SELECTIVE EMPLOYMENT TAX AND DOMESTIC HELPERS (Hansard, 22 June 1966)

§ LORD MOYNE
My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.

§ LORD SHEPHERD
My Lords, it would not he practicable, within the framework of the simple scheme to be introduced this year, to exempt any employers of domestic assistance from payment of the selective employment tax. However, the Government recognise that the tax may cause hardship in certain circumstances. The House will no doubt be aware of the conditions in Clause 6 of the Selective Employment Payments Bill which is now before the other place. This clause requires the Minister of Social Security, subject to certain conditions, 293 to refund the tax paid in respect of a person giving such assistance in a household where there is an old, infirm, incapacitated or sick person; or where there is a child or children under 16 and where there is only one parent, or person acting as a parent, in the house and that parent or person is working more than eight hours a week, not counting the domestic work of the household. Your Lordships will therefore see that, under the provisions of this clause, a household in which there is a mother as sole parent with children under 16 she would qualify for a refund of tax paid in respect of a single domestic helper when the mother herself was employed for more than eight hours a week in work other than the domestic work of the household.

§ LORD MOYNE
My Lords, my Question was really concerned with the case for instance of a couple where the husband and the wife are both employed. The wife, who may be a doctor or a school teacher, has perhaps one baby. She has had training and has years of learning behind her, and it is in the national interest that she should go on working—I am sorry to be stating something rather than asking a question, but it is the background to my question. Would the noble Lord not give further consideration to this matter, in view of the fact that only where one person is working does the relief which he mentioned, at present in the Bill as drafted, apply?

§ LORD SHEPHERD
My Lords, on the first point the noble Lord has made, of course the Government wish to ensure that, so far as possible, married women should go back into industry or into the various essential services of local government such as school teaching. However, we do not feel at the present stage that the imposition of this tax is likely to be detrimental to this desire, since that type of person clearly would be working more than eight hours a week and, of course, in conjunction with the husband's earnings there would be a fairly substantial income. We have no reason to believe that this would stop the present flow of married women into industry and local government. In regard to the second observation, I should not like to answer immediately, but I will give the noble 294 Lord the assurance that I will look into it, and if I can give him any information I so will.

§ BARONESS SUMMERSKILL
My Lords, may I take up my noble friend on one point? If two women share one lady worker during the week, it is the woman who employs her on the Monday morning—and I presume she would have to employ her for two days—who would have to pay the tax.

§ LORD SHEPHERD
My Lords, the tax of course will require to be paid only if the domestic help is working more than eight hours in the week. In the case of two employers of one employee, presumably they would share out the selected employment tax on the basis of what they now do in contributing towards the insurance stamps for the domestic worker.

§ BARONESSS SUMMERSKILL
My Lords, I am sorry to hurt my noble friend's feelings, but he obviously does not know much about women and domestic work. The point is, if I may remind him, that perhaps two housewives living on different sides of a large suburb in London employ the same woman but they have never met each other. The second one who employs her, perhaps on Wednesday and Thursday, will consider herself extremely fortunate that the law does not compel her to pay, but the employers are complete strangers to each other.

§ LORD SHEPHERD
My Lords, I would not claim that I know a great deal about domestic work, but certainly I am beginning to know a good deal more about women the more I come in contact with the noble Baroness. I appreciate there is some difficulty where there are two employers who may not know each other, but I think I referred to the general circumstance which is going on all the time. There is the obligation to pay for the stamp. I think that in most cases it is the employee who arranges with her two employers how they shall share the cost of the stamp.

LORD TAYLOR
My Lords, with great respect to my noble friend, the situation is that in law the first employer of the week has to pay the whole of the cost of the stamp, as I know to my cost—

§ BARONESS SUMMERSKILL
Hear, hear!

LORD TAYLOR
I imagine the position in the case of this tax may well be the same. Certainly none of the other employers of my domestic assistant pay towards the cost of the stamp.

§ LORD SHEPHERD\
My Lords, I am quite prepared to bow to the greater experience of the noble Lord, Lord Taylor. What may be the law and what may be the fact may be two different things. It may well be that the first employer should in fact pay for the stamp, but my experience, limited thought it be, is that usually the cost is shared.

§ LORD NEWTON
My Lords, will the noble Lord realise that both his noble friends are on a very good point? Although I would not go so far as the noble Baroness and suggest that he does not know anything about women, nevertheless may I ask him to realise that endorse what the noble Baroness, Lady Summerskill, said? Will he also realise that this is going to be a much more serious problem in future, because in the past the level of payment for the stamp has not made it worth while for the employer to take the trouble to discover the identity of the remaining employers, but this is now different? Will he invite his right honourable friend the Chancellor of the Exchequer to think about this?

§ LORD SHEPHERD
My Lords, when one is on a difficult point it is perhaps the best thing to say that one will take note of the point and convey it to one's right honourable friend, and this I will certainly do. But as has been said on a number of occasions, this is an important measure. This is a simple scheme in the very first instance, and I believe that the Chancellor is on record as saying that all matters arising from this scheme will be considered, and no doubt certain refinements will appear in the next Finance Bill.

§ BARONESS HORSBRUGH
My Lords, as the noble Lord has said that he does not himself know much about domestic service, can he assure us that a member of the Government does?

§ LORD SHEPHERD
Yes, my Lords.

§ LORD WADE
My Lords, was I to understand the noble Lord, Lord Shepherd, in reply to the first question, to refer to the measure now being introduced in another place as "a simple scheme"?

§ LORD SHEPHERD
My Lords, it is the judgment of the Government that it is simple, but there are some who try to make it more difficult than it really is.

§ LORD AUCKLAND
My Lords, will the noble Lord recognise that there are many mothers of young children who are magistrates? Will he urge on his right honourable friend the importance of this public duty, particularly in view of the present crime rate as it is and the great burden of work which magistrates have to undertake?

§ LORD SHEPHERD
Yes, my Lords, I will certainly look at it, but this has already been considered. At this stage I cannot go any further than I have already this afternoon. We shall be watching the scheme during the next few months prior to the introduction of the next Finance Bill, and if any refinements should be introduced this will be done.