Thursday, 11 April 2013

MT and Social housing

I know Margret Thatcher is blamed for all our ills, but I cannot reconcile the idea that selling off social housing caused a housing shortage. OK selling one million houses would have meant another one million people owned their homes and other people wanting homes would be denied. However had those one million not bought their homes they would still be living in them. It doesn’t matter if the one million were renters or owners those houses would not have been available to anyone else.

The whole point of right to buy started off to sell houses to people who had paid for the house in which they lived,  in the rent they had paid; my parents bought the house that they had rented for over thirty years. People who bought under the ‘right to buy’ scheme would simply not have had the resources to go to an estate agent and buy a house, and so would have ended their lives as renters. Where the scheme got silly was when they started selling houses to people who had only been tenants for 2 years (they had barely paid enough rent to cover the stamp duty) and I think that didn’t start happening until after Maggie got the boot.

Love her or hate her Maggie is not responsible for all that we attribute to her. Lots of it yeah, but not all of it. We should cut the old dear some slack after all its Old Nick who has the problem now!


John said...

Hi Maffi,
If Right to Buy was such a good idea why was it never extended to the private sector? after all they "...had paid for the house in which they lived.." as well.

Also if it was such a good idea why were the houses sold at a discount. The houses were community assets, selling them cheaply was equivalent to giving the buyers free money. I wonder how many people would have brought if they had to pay the full price?

The reason why selling the houses has led to a shortfall in housing is two fold 1) whilst the local authority was receiving the rent it was paying off the debt and using the asset to borrow against to build more houses 2) once the property was sold there was no longer a rental stream or an asset to borrow against. The Government also prevented the authority from using the money to fund new housing. This was made worse when the selling price did not always cover the debt, so rent from the remaining properties was used to pay off money owed on sold properties and could not be used to fund new builds.

The Right to Buy Scheme was a great opportunity for individuals to benefit, but was a disaster for the wider community. As such it fitted perfectly with Thathers creed of individualism and 'no such thing as society'. It was also a perfect way of using public money (the discounts) to buy votes. A trick she used when selling off the utilities,and what a great policy that was. We still have electricity industry (EDF). Unfortunately it is French and the profits of aprox £1.6bn a year are now going into their economy rather than ours.

Regards John

Maffi said...

Certainly from my parents pov no one was denied access to housing. This is born our by the fact that they have lived in the same house for 63 years, whether they bought it or not, that house has never been available for any one else.

That the money generated by the R2B scheme was not allowed to be used for new housing was a serious flaw in the project, but should not on its own be used to poo poo the process.

The thinking behind the selling of houses to tenants, I think, is that if a man owns his own home then he will move heaven and earth to keep it and so becomes a more controllable worker, less likely to jeapodise his income by striking. This is the bad part of the R2B policy, the fact that the government sought to shackle people to a mortgage for the benefit of the capitalist.

John said...

Hi Maffi,

Your parents are clearly an exception. According to the Daily Mirror (5th March 2013) a third of RTB properties are now in the hands of private landlords. The houses are as you say still available, but the crucial difference is that instead of going to those most in need they are going to the highest bidder.

In my earlier post my final paragraph should have said "We still have [a nationalised] electricity industry (EDF)". Sorry about that, it didn't make much sense without the nationalised part.



Henhouse said...

Hi Maffi,
Can't fault you logic at all, and I will openly and proudly admit to being an unashamed fan of the great Lady.

However, being the pedant that I am I would like to point out that Council Houses were available for sale to tennants for many years before the Thatcher era.

The Thatcher government introduced the RIGHT TO BUY. Which as the name suggests gave tennants a right, enforceable by law.