Of course they are

Note, this article is a direct response to the previous one by Peter Neville.

Submitted by Reddebrek on August 16, 2018

MR NEVILLE’S OPINIONS SEEM TO ME INDISTINGUISHABLE FROM THOSE of the present government, whose Minister of Housing recently described Government policy as an attempt to move housing back into the free market (while recognising the need for aid to special groups). This does not seem to me a particularly anarchistic point of view. He isolates the fact that some tenants, who could afford to pay more, are subsidised. But why stop there? Quite apart from the general observation that the poor invariably subsidise the rich in our kind of society, millions of householders are “subsidised” in one way or another. In almost every country in Europe, governments have intervened in various ways to reduce the price of housing to the consumer. Rent control is one means, improvement grants are another, and income tax allowances on repayment of loans are a third. This last form of “subsidy” grows bigger if you are richer. Thus Prof. D. V. Donnison remarked at the RIBA Housing Conference that:

I worked out the other day that on the house I am buying, it cost me about £3,000 when I started to buy it about six years ago. Then I worked out what I was in effect being given by other taxpayers in reduction of tax on the purchase of this house. Over the years it came each year to £66 1s. 0d. The odd thing about this is that if my income was so low that I did not pay any income tax but just paid the other 60 per cent of taxes but not the 40 per cent of income tax that I would have had to pay, I would have to pay £66 1s. 0d. a year more to live in the same house.

It is, incidently, these anomalies of taxation which inhibit the growth of the Housing Society movement. A man earning enough to benefit from the official stimulus to housing societies, would find that a loan from a building society and the tax reliefs it would bring, would benefit him more. But it would hardly be an anarchist strategy to advocate the ending of tax reliefs.

Plainly the situation to which Mr. Neville draws our attention is inequitable, but so are most other aspects of housing. If, as anarchists, we have any point to make about them it is that of the limitations of reformism. Stanley Alderson, in his Penguin book on housing, sees the widespread opposition to the “means test” which differential renting of council housing implies, as being due to the paternalistic relationship of councils with their tenants:

The protests against a means test were not merely rationalisations of a reluctance to pay higher rents. Differential rent schemes were resented because they foisted on the local authorities the ultimate paternalistic responsibility of deciding how much pocket money their tenants should be allowed to keep. Local authorities deserve sympathy for their reluctance to exercise this responsibility. It is as imperative that they should be relieved of it as that council tenants who can afford to should pay economic rents. The council tenant who needs financial assistance should receive it through some other organ of the State, established to assist private tenants and owner-occupiers as well. He could then claim his assistance without loss of dignity, and he would always pay his full rent to his landlord.

It is on this question of paternalism that we can as anarchists, break into the argument, by pointing out once more, as was done in ANARCHY 23, the moral of the story from Norway, told by Lewis Waddilove in his PEP report on housing associations:

A pre-war municipal estate near Oslo was transferred over a period from the ownership of the local authority to the ownership of associations of the tenants themselves. It had been one of the most difficult problems to the local authority; its standards were low, it appearance unpleasant, and there was great resistance to increases in rents to a reasonable level. A series of meetings patiently arranged by the housing manager ultimately resulted in the acceptance by the tenants of membership in co-operatives which, on favourable terms, took over the ownership of the property from the local authority. Today it is transformed. The members have cared for their own property and by corporate action have ensured that others have done so in a way that they failed to do when it was in public ownership; they have charged themselves “fees for occupation” higher than the rents proposed by the municipality at which they protested so vigourously. This experience so impressed the authority that it decided in principle to transfer all its post-war estates similarly to the ownership of tenant co-operatives and to base its housing policy on this principle.

If we are going to agitate over municipal housing, it is this kind of change we should be agitating for. As ANARCHY 4 declared: “One quarter of the population of England and Wales live in the three-and-a-quarter million dwellings owned by local authorities. But is there one municipal housing estate in this country in which the tenants have any control over and any responsibility for the administration of their estate, their physical environment?”

One thing we should agitate against, I am sure, is the notion that if the householder’s income rises above a certain level, he should be obliged to move out of his municipal dwelling. We have plenty of evidence from the United States of the disastrous social effect of this kind of policy. Its personal effect is also bad, as you can see from the various hardluck stories in the press from places in this country where it is applied. It is an incentive to dishonesty in the tenant, and to the nastiest kind of petty dictatorship by the council.

We must also keep the whole question in perspective. It is an aspect of a world-wide difficulty—what the Coventry City Treasurer recently called “the discrepancy between the rent paying capacity of the less well off section of the population and the cost of providing the housing accommodation currently thought to be desirable.” I, as an anarchist, am a critic of the economic system in which this is true, but am I going to admit meanwhile, that my poorer neighbour’s children deserve to be worse-housed than mine? I know that buying a house costing more than £2,000 is beyond the means of a third of the population. I know that new housing for rent is only being built for the rich. I know that privately rented housing is the poorest, oldest and most inadequately equipped of all kinds of housing even assuming you can get it. Am I to say that municipal housing, the one large-scale public affirmation that people have a right to a roof over their head and a civilised standard of comfort under it, is unnecessary?

I know also that, on the average, tenants of the less recent municipal housing are paying more than an economic rent. In a paper read to this year’s conference of the Society of Housing Managers, Mr. A. L. Strachan supplied figures showing that the economic rent of local authority housing built between 1927 and 1936 was 9s. 6d. Similar houses built in 1949 had an economic rent of 26s. 6d., and in 1962 of 64s. 5d. The current rents of these houses were 21s. 4d., 31s. 2d. and 28s. 6d., respectively. “Thus pre-war houses had had their rents raised to compare with post-war economic rents, and even 1949 rents showed a surplus for the local authority after all charges had been met.” Most local authorities have a stock of pre-war and early post-war houses financed at low rates of interest, the present day rent of which is more than is necessary to meet the costs on these houses. Thus as their rents rise they yield an increasing “profit” to the local authority, which can be used to meet deficits on newer houses. This of course is not a permanent solution to the local authorities’ house finance problems, but it does draw attention to the effect of interest rates on the cost of housebuilding. The rate at which loans are made by the Public Works Loans Board is fixed by the Bank Rate, which was kept at (by present standards) a low level, until with the coming of the Conservative government to power in 1951, the manipulation of Bank Rate became an instrument of economic policy.

Twice this year we have been given figures to show that by far the heaviest costs in building, are not in construction but in servicing the loans. Norman Wates illustrated this at the International Construction Conference, and at the RIBA Conference, Mr. Womersley, the City Architect for Sheffield produced figures to show that the economic rent of a house was made up of 17 per cent for the cost of building, 3 per cent for the cost of land, 15 per cent on rates, 12 per cent on maintenance, and 53 percent on servicing the loans. The way to bring down the cost of housing is not, to reduce standards, which, (in spite of Mr. Neville) are already too low, but to make cheap money available for housing purposes. The government which has lent a private company £17½ million at 4½ per cent fixed interest, to build a new luxury liner, cannot bring itself to lend money for housing below 6 per cent.