Cllr Peter Cuthbertson is a member of Westminster City Council
A lot of left-wingers did not expect the spectacular Conservative victory on 7th May. But many remain hopeful that they can stop some of the best manifesto policies that we were elected to introduce.
The expansion of the Right to Buy has received perhaps the most criticism. It is easy to see why. Socialist ideology aside, the policy has welcome echoes of Thatcher’s success in winning so many tenants’ votes when she privatised council housing. Already, most Labour leadership contenders are being noticeably quiet on the issue and leaving the attacks to the media and establishment luvvies. It’s as if Kendall, Burnham and Cooper realise that standing in the way of up to 1.3 million families owning their own homes isn’t a great way to prove they understand aspiration.
But it is worth responding to the other critics of the policy, who at the moment seem to be despairing on every other page of the Guardian, Independent and New Statesman. These critics seem to have dusted off every stale argument from the 1980s, but they are just as wrong now.
First is the idea that those who buy their homes under this policy are the only ones to benefit. While we should never underestimate the benefits of expanding home ownership, it is also worth setting out clearly that the benefits of the policy go far beyond the buyers themselves. They are the chief beneficiaries, of course, and even if they were the only ones to benefit, it would be a poor reason to oppose helping so many more people own their own homes.
But there is no surer law of economics than that which says any expansion in the supply of homes to buy helps all potential buyers.
Everyone agrees about the difficulty people on remotely normal incomes have owning their own homes – especially in the most prosperous parts of the country. All economically literate analysis also agrees that this problem is one of supply of homes available to buy.
The new Right to Buy does not entirely eliminate the supply problem. But it will help ameliorate this overriding problem in the housing market. More private sector homes is inherently good for affordable houses and affordable rents.
Second is the vague notion, never clearly stated, that our policy will somehow destroy housing association properties. If a tenant buys a housing association property, that hardly deserves to be treated as if the house is obliterated! Instead, they simply stop paying rent to the housing association. On top of this, this policy actually provides for the replacement of housing association stock that is sold to its tenants.
But most fundamentally flawed is the largely unargued premise that people on low incomes in private sector housing are in a worse position, and therefore a growing private sector share of housing is a bad thing. This is what people really seem to mean when they write as if a house is destroyed when it moves to the private sector.
It is true that our policy, if successful, will mean a slowly growing share of private sector housing. With every sale the number of homes owned by members of the public will go up by 1, while the number of housing association properties stays the same (because each sold home is replaced).
So groups like Shelter aren’t mistaken to identify a slowly growing share for private sector housing as a consequence of government policy. Where they go wrong is in thinking that this is a bad thing. The move of millions of properties from the ownership of town halls to the ownership of their tenants was one of the greatest achievements of any post-war government, and it is entirely right to continue this in the 21st Century.
The alternative – constraining a growing share of private sector housing – is a sure way to deny opportunity, and to keep the poor poor.
Housing Associations have great reputations and do a lot of good. Everyone loves non-profits, and they do work hard for their tenants and deserve an A for effort. But the figures speak for themselves. All manner of life outcomes are better for private sector tenants and owner occupiers.
Some cynics like to blame social housing tenants themselves for this, rather than the conditions and culture on so many housing estates. They say that if the same people came to own their own home or rented in the private sector, their life outcomes would be the same. But the figures just don’t back up this cynicism.
Even when one controls entirely for the attributes of their parents, people who grow up in private sector housing are half as likely to be unemployed at the age of 30.
A study by the London School of Economics found that children in otherwise identical family circumstances were half as likely to leave school with no qualifications if they grew up in private sector housing.
The Joseph Rowntree Foundation – far from a right of centre organisation – controlled for parents’ education, occupation, income, the characteristics of their schools and all manner of other relevant factors and found the same pattern. Those who had always lived in private sector housing were healthier and less likely to smoke, were better qualified and less likely to be out of work.
Sincere efforts to help people on low incomes means reflecting these realities in housing policy. All the evidence is that a growing private sector share of housing is good for people on low incomes. All the better that our policy helps everyone else by increasing the overall supply of houses to buy.
Above all, home ownership is a legitimate aspiration, and we should be proud that this government is doing so much to expand it.