“Right To Buy was one of the main causes of the housing crisis. As a result of its continuation in England there are now less than 1.6 million council homes left.”
Martin Wicks, Secretary of the Labour Campaign for Council Housing, calls for Labour to support public housing by ending the sell off.
From discussion with senior figures we know that the Labour Party leadership is hesitant about committing to ending Right to Buy (RTB) because they expect the Tories to denounce them as being “opposed to aspiration”. RTB was never about aspiration. It was a means of the Tories weaning away electoral support from Labour on council estates. It was designed to mobilise self-interest; what used to be called getting-on, or keeping up with the Joneses.
It is not difficult to challenge the argument on “aspiration”. Whilst RTB is a gift to the person buying (they are getting the property on the cheap) it has dire social consequences for others because it means one less home for the growing numbers on the waiting list. It also means a loss of rental stream to councils, leaving them with less income to pay for work on their depleted housing stock.
An estimated 40% of homes sold end up in the private rental sector. This drives up the cost of housing benefit because of the much higher private rents.
There is nothing superior about a home owner over a renter. Not wanting to own a home is not an expression of lack of aspiration. Being unable to afford one is not a sign of ‘failure’. The experience of the pandemic led millions of people to reconsider what is important in their lives. Personal acquisitions do not guarantee contentment. Owning a home is not a guarantee of ‘security’. As the current situation shows a mortgage can be an albatross around the neck. With interest rates above 5% more people will struggle, as they have to renew their fixed term mortgages.
Historically council housing can be said to have facilitated home ownership for those who wanted it. The reasonable rents enabled tenants to save up a deposit, buy a home on the market, and hand the keys back to the council for a new tenant off of the waiting list.
RTB was one of the main causes of the housing crisis. As a result of its continuation in England there are now less than 1.6 million council homes left. The acute shortage of council housing, in combination with house price inflation (the ratio of prices to earnings for both median and lower quartile new build homes is more than 10 times) has forced millions of people into the insecure, expensive and often poor quality private rented sector. There are 5 million households in England in the PRS.
In the last financial year more than 10,000 council homes were sold under RTB. Add around 2,000 demolished and councils have to build at least 12,000 just to stop the loss of homes. That number has not been built since 1990. Since the discount on sales was increased 107,000 homes have been sold and 26,000 demolished. Only 42,000 homes have been built or bought, to replace them.
In 2019 and 2021 Labour conference overwhelmingly passed resolutions which called for an end to RTB. At the 2021 conference Lucy Powell (then responsible for housing) said that ending RTB was the right thing to do and it was what the members wanted. At the 2022 conference, Lisa Nandy told a fringe meeting that the policy was under review. The Labour Campaign for Council Housing therefore produced a statement (see below) calling on Labour to commit to ending RTB. We want to get across the message to the leadership that ending RTB is a necessary precondition for tackling the housing crisis and it is what the membership want.
Some people say that the problem is not selling homes but failing to replace them. Just recently Lisa Nandy said on TV that she agreed with Michael Gove that RTB was “sustainable” if homes sold were replaced “like for like”. She further said that Labour supports “the principle” of RTB. This stands in contradiction to the decisions of the 2019 and 2021 Labour conferences. Moreover, there is no chance of “like for like” replacement. Councils generally do not even keep half of the receipts from sales. Even if councils were able to keep all the receipts for RTB, the fact is that the cost of building new homes is far higher than selling existing homes. The difference between the receipt and the cost of replacement would come from the housing revenue account; that is from existing tenants’ rent.
RTB has been ended both in Scotland and Wales. It is a cost-free policy. It will mean that, for the first time since its introduction, new homes built will increase the stock numbers and open up the prospect of reducing the number of households on the waiting lists. Combined with funding for new build programmes it will liberate the rising generation from the PRS.
What can you do to help?
Sign the statement yourself. Get your branch and/or CLP to support it. If you are a councillor get your Labour council group to support it. Ask your trade union organisation to sign it.
Statement: Labour should commit to ending Right to Buy
“We the undersigned agree with Lisa Nandy that “the idea of a home for life handed on in common ownership to future generations is an idea worth fighting for.” That requires the ending of the disastrous Right to Buy policy. In Scotland and Wales it has already been ended.
In England there are now less than 1.6 million council homes left. Even if councils were able to keep all receipts for sales they would have to build more than 12,000 council homes a year just to replace homes sold and demolished. That many haven’t been built since 1990.
RTB not only means the loss of homes but councils losing rental stream, leaving them with less money for the maintenance and renewal of their existing stock.
Many homes sold under RTB end up in the private rented sector; an estimated 40%. This drives up the housing benefit bill because of the much higher private rents.
Labour conferences in 2019 and 2021 voted overwhelmingly for RTB to be ended. It was incorporated in the 2019 manifesto. At the 2021 conference Lucy Powell said that it is the right thing to do and that is what the members want.
Ending RTB will stop the loss of homes and ensure that for the first time since it was introduced all new council house building will increase the stock and enable the waiting lists to begin to fall. It is also without cost and will stop the loss of rental income to councils.
We therefore call on Labour to commit to ending RTB when in government.”
- Martin Wicks, Secretary of the Labour Campaign for Council Housing (LCCH). To sign the statement email the campaign here.
- You can follow the LCCH on Facebook and twitter.
- This article originally appeared in Labour Briefing (Co-operative) magazine and is reproduced with permission. Subscribe by sending a £20 cheque with your address to ‘Labour Briefing Co-op, PO Box 78639, London N16 1LA.
