ANGELA RAYNER’S suggestion that Thatcher’s “right to buy” policy will be discontinued for new council housing stock will prompt howls of outrage from the billionaire press.
The consultation Labour plans will face intensive lobbying. The shift in housing subsidies since right to buy was brought in — away from funding for the construction of social housing, and towards discounts, help-to-buy loans and housing benefits to line the pockets of private landlords — has inflated house prices.
That’s bad news for most people — houses in Britain are at their costliest relative to average wages for over 100 years. But it’s good news for landlords and banks, and for the handful of big house-building companies that dominate construction.
All these forces will seek to undermine efforts to resolve Britain’s housing crisis. But in reality Rayner’s policy does not go far enough.
Right to buy has been a disaster, resulting in the sale of more than two million council houses. Heavily discounted sale prices, which councils have not normally even been able to keep (the decision to allow them to keep the whole revenue from such sales was a positive of Labour’s Budget last week), have prevented councils from replacing the lost stock.
Though the justification for the sell-offs was once what Thatcher admirers termed a “property-owning democracy” in which the majority would own their own homes, over 40 per cent of former council houses are now rented out privately — at vastly higher rents than when they were socially owned, and with far less security for their tenants.
Since the early 2000s, the proportion of British households that are owner-occupiers has actually fallen, as prices soar beyond the means of working-class people, and because an ever-larger private rented sector charges rents so high that fewer people can realistically save for a deposit.
Hence today’s housing crisis. One study this year calculated the country is short of 2.5 million homes, and should aim at building 550,000 a year until 2031, nearly double the 300,000 a year target set by Labour.
We have a homelessness crisis too.
Councils have a statutory duty to accommodate the homeless, but their lack of housing stock thanks to right to buy forces them to meet this through the private rented sector or, worse, temporary accommodation such as hotels or bed and breakfasts.
The number of households “housed” in this way has climbed an astonishing 72 per cent in the last three years alone — now amounting to 117,000 households nationally, including over 150,000 children.
The social cost is huge, both in the disruption and stresses imposed on these families and in the knock-on effects of councils paying through the nose to house them, which include cuts in other areas of spending (councils have axed hundreds of libraries, swimming pools and youth centres over the last decade, and even so one in four faces bankruptcy).
Tackling this crisis requires bolder action than Labour is yet contemplating. Right to buy should not just be ended for new builds: it needs to be abolished altogether, a step already taken in Scotland and Wales.
Labour’s 300,000 new builds a year target should be raised, and because house-building companies openly admit their business model rests on maintaining scarcity, councils need funds to build council houses directly.
Land-banking and property speculation should be actively discouraged through punitive taxation of unused land and empty buildings, as advocated in the Communist Party’s Charter for Housing, while rent controls should be used to stop private landlords ripping off tenants, local government and (through heightened housing benefit) the public as a whole.
Any such programme will face stiff opposition from vested interests: it will only be secured by grassroots pressure. This makes the case, again, for a united front of unions and community activist groups that can campaign coherently for a political alternative.
