Progress | Centre-left Labour politics

Let’s start building council houses

David Cameron’s latest back-to-the-1980s gimmick is to give a big bribe to council home renters to buy their property. As with his backfired stunt last week to depict fuel tanker drivers as the new Scargillites against whom the nation should unite, or the over-the-top rhetoric in the Falklands, Cameron is trying to paint himself as a son of Thatcher copying many of her flagship policies.

Scargill and Galtieri were serious foes of Mrs Thatcher. The tanker drivers with a banal industrial relations dispute are not in the same league and the jerry can gaffe shows how history repeats itself first as tragedy then as farce (though the sad business of a woman following government advice being badly burnt is not funny.) Despite bombastic noise from Buenos Aires, the Argentinians are utterly incapable of mounting a military attack and everyone knows it. Cameron, Hague and other ministers makes themselves look like puffed up Latin American populist nationalists with their pompous bellicosity.

A more confident, Macmillanesque government would have just calmed everything down, dismissing as ‘little local difficulties’ the current problems. Now Cameron is hoping to repeat an election winning policy of Mrs Thatcher with the announcement that council house tenants will be given £75,000 to help buy their council homes.

This will worsen not ease the current housing shortage. The National Association of House Builders reports that last year the level of new homes being built in Britain fell to its lowest level since 1923 when Britain’s population was half what it is today. Last year just 121,000 new homes were built. This is half the number of incomers that arrive in Britain from Ireland, the rest of Europe, the US, Canada and Australia to work here. Britain’s population is growing and the birth rate is increasing. France will overtake Germany’s population by 2050 and the demographics of western Europe are changing.

Cameron’s new push to sell council homes comes on the back of Labour’s sale of nearly 500,000 council properties between 1997 and 2009. At the same time, Labour built just 24 new council homes in Yorkshire and the Humber. Housing corporations and private housebuilders built 2 million homes under Labour but this is far fewer than the 300,000 a year Harold Macmillan was building as housing minister in the 1950s.

The end of council house building for rent has destroyed the hopes of local communities to keep living in the networks of family and work that sustained them. One does not have to be a paid-up blue Labourite to recognise the force of Maurice Glasman’s argument that roots in a local community, a home that was affordable and new homes that would be available to next generations was a powerful element of social stability for the white working class.

Sadly Labour conceded to the Treasury and Thatcherite neo-liberal view that low-cost social housing built locally for rent was bad for Britain. Councils were not allowed to use the massive receipts they built up from council house sales to build new homes for rent after 1997. Many council tenants under Labour bought their homes, moved out and started renting them back to the council for asylum seekers, social cases and the homeless. This further disintegrated the social fabric as by definition many of the incomers how housed in privatised council homes had not been able to make any contribution by way of tax or national insurance before becoming recipients of British benefits.

Cameron’s new policy will worsen this problem and further divide communities in the poorer estates of Britain. It will be pointless for councils to build new homes for rent if they know that Cameron will make them sell them to tenants after a short period.

Selling council homes sends out a further signal that only home ownership, not rental matters. Yet first-time buyers have to wait to an average age of 43 to become home-owners. Mortgage restrictions imposed in 2008 after the housing bubble burst make ownership harder. Localist planning delivers power to Nimbys who reject any new housing.

Yet less than 90 per cent of Britain is built upon. The IPPR says that 750,000 new homes need to be built by 2025 to meet existing housing needs and many think that is an underestimate. The National Institute of House Builders reckons that each new home being built creates three new jobs and if we want to relaunch the UK economy on the basis of employing local workers then nothing beats house-building.

Sadly there is no effective home building lobby in Britain. Each element of what might constitute one stays in its silo pleading its own narrow cause but not creating a real movement for a dynamic new housing policy based as much on rent as on ownership. Today’s Tories have inherited the hate of municipal housing from the 1980s Thatcher generation. Can they change their mind? Can Labour admit that the sale of council homes now makes easing the housing shortage worse not better? New thinking is needed not a re-run of the 1980s.


Denis MacShane is MP for Rotherham and a former Europe minister. Follow him on and @denismacshane


Photo: R~P~M

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Denis MacShane MP

is a former Europe minister. His biography of François Mitterrand was published in 1982, and in 1985 he wrote a Fabian pamphlet, French Lessons for Labour


  • Of course Labour’s adherence to the Thatcherite view of council housing was devasting for people wishing to remain in the communities where they grew up instead of being forced out by second-home owners from the capital. But the problem is not that there isn’t a homebuilding lobby, but that it cares only for minimum quality and maximum profit out of housing. Barratt’s, Redrow and the like are never slow to press councils to allow them to build over the countryside, but when it comes to having a housing plan that creates real communities based around people, with retail, services and public transport, the big players are nowhere to be seen, leaving us with mile upon mile of identikit estates.

  • Oh how ironic! Dennis is now endorsing the central domestic platform of George Galloway’s Respect!

    Has this anything to do with losing Bradford West?

  • As an aid to reinvigorating the economy, the policy is akin to Cameron’s credit card comment, when he told people to restrict economic activity in a recession.
    Council-house buyers are even older than the average 1st time buyer (or they won’t get much discount) and they are generally on a higher income than average, especially per capita ( to stereotype: they buy when the kids are no longer dependant). Some of them would have contemplated buying on the open market . Getting them to stay put and exercise RTB doesn’t just take the house out of the future rental pool, it stops them buying one of the many thousands of part completed homes under construction. As a result the construction sector stays in the doldrums. And the homelss pool gets larger. Double whammy.
    There is an argument under “homes for all” for not resricting council estates to McShane’s list (asylum seekers, social cases and the homeless). This is neither the time nor place to use RTB discounts to do it. But then I was among the authors of the longest suicide note in history in 1983.

  • So very very true and I live in an area in which we have miles and miles of these boxes they now call homes.

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