Anarchy 83/Tenants take over

Tenants take over

a new strategy for council tenants

COLIN WARD

Ours is a society in which, in every field, one group of people makes decisions, exercises control, limits choices, while the great majority have to accept these decisions, submit to this control and act within the limits of these externally imposed choices. It happens in work and leisure, politics, and education, and nowhere is it more evident than in the field of housing. This article is concerned with one particular aspect of the housing situation. It presents the arguments for a tenant take-over, for the transfer of control of municipal housing from the local authorities to tenants’ associations. Although more than a quarter of the population of this country live in municipally owned houses and flats, there is not a single estate controlled by its tenants, apart from a handful of co-operative housing societies. At the moment an argument is going on between the two major political parties over the issue of the sale of council houses to tenants. From the point of view of increasing people’s control of their own environment this is a sham battle, because it affects only a tiny minority of tenants. At the moment too, in consequence of the changes in the structure of local government in London, the Greater London Council is planning a phased transfer of a large proportion of its housing stock to the London Boroughs. It plans to transfer about 70,000 houses and flats in 1969. Discussion of the control of housing is in the air, and no time is more propitious than the present for raising the genuinely radical demand for tenant control and tenant responsibility.

The facts and opinions presented here are intended as ammunition for such a demand.

THE MODES OF HOUSE TENURE

The ways in which householders hold their houses in Britain are limited. They are in fact more limited than in any other European country except Greece, Ireland, Portugal and Roumania. The three modes of tenure in this country are owner-occupation, council tenancy and tenancy from a private landlord. The sole exception to this is, of course, ownership by a housing association, and this includes the only examples we have of co-operative housing. Statistically it is insignificant. The proportions between these three tenure groups have changed, and are changing, rapidly. For Great Britain as a whole the percentages in 1947 were

owner-occupied	public authority rented	privately rented
26%	13%	61%

By 1965 they had become

44.5%

28.5%

25%

The figures differ according to whether a dwelling or a household is being counted and according to the definitions used, and they are also different for various parts of Britain. For example, the figures for England only in 1964, counting households, were

46%

26%

28%

while another estimate, in terms of dwellings, gives

46%

33%

21%

The proportions of council-owned dwellings varies greatly. “The Newcastle Corporation controls two out of every five of the city’s houses. In Greenock, on the West Coast of Scotland, half the population live in council houses.” The London Borough of Kensington has 5% council tenants, while Dagenham has 67%.

The general trend is clear, and, since it concerns a commodity so basic, durable and socially important as housing, it is one of the dramatic social changes of this century. Private renting, which before the First World War accounted for over 90% of households, is declining rapidly for reasons which are well known. Just as rapidly owner-occupation and renting from local authorities is increasing. The proportionate increase of these two tenure groups depends of course, on government policy, as well as on opportunity and increasing affluence. The post-war Labour government, through building licensing and a quota system, put the emphasis on building by local authorities. The Conservative governments of the 1950s and early 1960s changed the emphasis: “Under the Labour government only one new house in six was built for sale to a private buyer: under the Tory government two out of every three were built for sale.” The policy of the present government is that by 1970 the proportions of council houses built for rent and private houses built for sale should be equal. It is pledged to stimulate and facilitate both forms of tenure. Virtually no new house building by private enterprise since the war has been for private letting. This is why privately rented property is usually anonymous with old, run-down property. The bulk of Britain’s slum housing is in the privately rented sector.

Thus “the range of choice open to the family in Britain seeking a modern house is more limited than is the case almost anywhere else in Europe”.

HOUSING ASSOCIATIONS

The alternative to owner-occupation or council tenancy is to be found in the housing society movement, which has been called “Housing’s Third Arm”. If it is a third arm, it has so far been a regrettaby feeble one, for housing associations of all kinds had by 1962 provided only 1.3% of post-war housing. Between them they control 0.7% of the total housing stock. But since the only examples of tenant co-operative housing fall into this category, it is worth examining more closely.

When building societies first came into existence as organs of working-class mutual aid at the end of the 18th century, they were remarkably like the self-build housing societies of today, and very unlike the money-lending-pus-savings-bank organisations which are the modern building societies. They consisted of groups of people who saved to buy land to house themselves, and when the first house was completed, borrowed money on its security to build another, until all the members of the society were housed, at which point the society disbanded. In a sense they resembled the method of financing house purchase used by some groups of immigrants in this country today:

Particularly among Indians and Pakistanis, housing finance pools are found with a substantial membership—perhaps as many as 900—which meet periodically once a fortnight or once a month, and make calls of, say £10 on each member. Those who draw upon the fund thus created are subject thereafter to periodic calls until the whole amount drawn by them has been liquidated. Drawings under this system are substantial and may cover the whole purchase cost. Occasionally, West Indians operate on similar but less ambitious lines. … Their pooling arrangements usually only provide for the initial deposits necessary for house purchase, thus enabling them to “get off the ground”.

The building societies changed their character in the nineteenth century to become more permanent societies, separating the people who wished to save from those who wished to build. A new kind of society was founded in 1830, the Labourers’ Friendly Society for Improving the Conditions of the Labouring Classes. The early efforts of poor people to improve their own housing conditions failed to expand for lack of capital. Investors then, as now, found easier ways to get rich than by financing working-class housing. This is where the Victorian philanthropists moved in, satisfied with a “modest return” on their capital.

The housing society movement since then has never lost this “charitable” emphasis, and in this respect is in marked contrast to the co-operative housing associations of several other countries. Mr. Lewis Waddilove contrasts the situation here with that in Sweden, where the movement

depended strongly on the initiative of tenants it did not, as in the United Kingdom, become the instrument of liberal employers and philanthropists making provision for what were referred to as the “working classes”. The tenants’s unions of Sweden discovered that the best way of preventing the making of undue profits from a housing shortage and to raise housing standards was to build and administer their own hoes. As an example, in 1923, the tenants’ union of Stockholm became The Tenants’ Savings and Building Society and in the following year similar movements in other towns came together to form a National Association of Housing Societies known throughout Sweden by the initials HSB. … A second national body for housing associations has been formed by the trade unions in Sweden concerned with the building industry. HSB remains the largest national body and its very name measures out the difference between the Swedish and the British housing association movement. In Sweden the movement’s inspiration and drive come from the tenants; they save for the purpose of raising their own housing standards.

In Britain the initiative in the movement has come from philanthropists and others concerned to raise the housing standards of the “working class”. Save in the “self-build” societies, the initiative rests with the occupants of the houses who are simply the tenants of the association.

He describes how the HSB has built up not only resources of expert advice in building, planning and finance, “but has become a centre of research, the results of which can immediately be applied in its own large-scale activities. This means that the tiniest housing co-operative in a remote township” has access to the best of advice, architectural and technical, with the result that “the standard of design, workmanship and finish are well in advance of comparable dwellings in this country. … So competent is the research, technical and even manufacturing organisation of HSB that municipalities have been glad to avail themselves of it. Many local authorities’ housing schemes are in fact planned and executed by HSB; in some areas municipal houses are built and managed by a ‘municipal company’ on the directorate of which the local authority and HSB are represented”.

In Britain, at least until the initiation in 1966 of the Co-ownership Development Society, the nearest thing we have had to HSB has been the National Federation of Housing Societies, which gets a meagre government grant, and to which are affiliated 1,530 societies providing general family housing, old people’s housing, industrial housing (sponsored by industrial firms for their employees) as well as self-build, “cost-rent” and tenant co-operative schemes. Housing societies were long ago granted the same treatment as local authorities so far as facilities for long-term loans and qualification for subsidies are concerned.

All the political parties express their support for the housing society idea, and it was amid general approval that the Housing Act of 1961 (in Section 7) made available £25 million for direct government loans at the then current rate of interest, to be administered through the National Federation to housing societies building new dwellings to be kept available for cost-rent letting, without subsidy. The Minister described his £25 million as a “pump-priming” operation, meaning that he wanted to encourage private capital to go the same way. This of course was the same pious hope that was expressed by the philanthropists a hundred years ago, and it met with the same lack of success.

Then in 1964, the government set up the Housing Corporation with Admiral Sir Caspar John as its head, and offices in Park Lane, with power to dispense another £100 million in loans to housing societies for both cost-rent and co-ownership schemes.

The results of both these attempts to stimulate the growth of housing societies has been disappointing.

The Corporation’s last report showed that by the end of September 1966, 150 cost-rent projects, involving 6,932 dwellings and costing about £26.7 millions, had been approved together with a further 42 co-ownership schemes, had been registered with the corporation. Commencing on the implications of the report, which declared that a large potential market exists for co-ownership housing, Sir Caspar John admitted that co-ownership housing had developed slowly, adding hopefully that “things have speeded up tremendously in the past six months”.

I have referred to the rate of expansion of the housing society movement as disappointing, but perhaps the surprising thing is that it expanded at all, as so many legal and fiscal obstacles stood in its way. In the first place the original cost-rent scheme could only benefit people with an income (five years ago) above about £1,500 a year, while such people, because of the system of taxation and tax allowances would have found freehold house purchase a better proposition. Secondly, and partly because of the difficulty of finding a legal framework—even after 100 years of the Co-operative Movement—for the concept of co-ownership, the whole system was so complex that only groups containing someone with specialist knowledge were likely even to understand the scheme. The Milner Holland Report criticised the absurdity of the situation: “It seems to us that if non-profit housing associations are to make an effective contribution to the most urgent needs—and it is widely accepted that they should—then the rationalisation of the fiscal and legal provisions governing their activity is urgently needed; at present these seem to have the effect of discouraging the very associations which are equipped to give effective help in the area where it is most needed.” And elsewhere the Report declared that “We have been unable to find any justification for the unfavourable tax treatment of housing associations and we conclude that unless the tax burden is lifted, the contribution to the supply of rented accommodation by housing associations will be seriously hampered.”

Several steps have been taken recently which, in theory, should improve the situation&mash;the Housing Subsidies Bill, the option mortgages scheme, the prospect of assistance from the Land Commission and of more flexible cash borrowing arrangements, but none of these in practice has so far affected the prospect for housing societies.

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“It is curious that left-wing councils, whose members can hardly be unaware of the advantages of co-operative systems, still maintain a rigidly paternalistic attitude to housing management.”

architectural review, November 1967

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references and sources

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