Politicians have short memories. The moral outrage expressed by current Conservatives at the size of the nation’s Housing Benefits bill has been, unsurprisingly, targeted at an irresponsibly profligate Labour government but they forget that there is a history behind this that goes back to legislation that, in its time, did as much damage to the poor as today’s Bedroom Tax. Legislation that was passed by Edward Heath’s Conservative government in 1972. You may remember it. It was called the Housing Finance Act and it was sold to the public as a benign policy to house the homeless.
The Act placed a duty upon Local Councils to give priority to housing homeless families with children. It gave councils a nasty surprise because it demanded they find the resources for an immediate result and it appeared to sweep away the idea that homeless families, new to a council’s area, could simply be ignored. Instead of legislating for open access to council houses which would have stimulated the building of a larger stock, better able to respond to urgent need, councils were required to examine in detail, the meaning of a duty to house the homeless with immediate effect. There was no time to plan for and build more housing capacity and so this simply led to increases in the waiting lists. When it comes to making policies directed at the working class, it seems the Tories have always failed to think things through. But it gets worse…
Although councils had to find accommodation immediately for families with children, their legal duty only required that it be for a limited period which would allow time for “responsible families” to find their own accommodation. This period was determined to be 6 weeks. Inevitably the result was to revive the category of Bed and Breakfast accommodation for homeless families and the cost of this per day to councils quickly rose to double the weekly rent of a council house providing lots of scope for Tory rhetoric about how the “irresponsible families” who were unable to find a house in 6 short weeks were a drag on the economy.
In fact, what happened as a result of the 6 week rule was that many families once kicked out of their temporary shelter were forced to move back to the council areas they’d originally left in the hope of finding a home. What we’re seeing now with the Bedroom Tax forcing people out of high rent boroughs isn’t much different to what was happening back in 1972. It’s a tried and tested old Tory ruse to destabilise the poor working classes, ‘softening’ them up to accept jobs at any price and be grateful for the worst kind of housing.
The true intentions of the Act were revealed in an announcement in 1971, the year before its passage. Council rents would double, ostensibly to subsidise the housing of the homeless. However, in Tory circles it seems this rent rise was a cynical attempt to manipulate the housing market. They gleefully predicted a boom in private house building driven by an expected flight of council tenants from the high council rents into home ownership.
House prices rose rapidly, but council tenants didn’t miraculously become rich enough overnight to buy their own homes. They stayed put and more of them claimed Housing Benefit to cope with the rent increase. The hapless Tory market driven logic had failed again to appreciate the real circumstances of working folk, but their divisive moral rhetoric was on top form nonetheless…
Under the increased pressure of rising house prices council waiting lists inevitably grew and with this came a moral panic fueled by suspicions of queue jumping. An insidious new category of “scrounger” known as “the intentionally homeless” was created. These were people considered to be homeless as a result of their own actions. Just as today, people were incited to hate by the insidious Tory rhetoric. Once labelled intentionally homeless it sanctioned the official withdrawal of help from “offenders”. They do love their sanctions, these Tories, don’t they?
The reason for this doubling in council rents reveals another enduring Tory meme, one that Iain Duncan Smith is currently flogging to death.This is their notion of ‘fairness’. In the private rented sector at the time there were procedures for setting what was known as a ‘fair rent’ on a property which had to take account of current market conditions in order for landlords to be able to make a profit from renting their property.
Before the Housing Finance Act 1972 this didn’t apply to council housing. Local Authority rents were charged at the level of a balanced budget, which meant rental income balanced against loan charges and the costs of new building. The Act changed all that and they were now required to raise them to private sector levels. Mr Heath called this ‘an economic fair rent’.
So basically, under the pretence of looking after the homeless and bringing fairness into the system the Tories manipulated the housing market with the effect that their property and that of their supporters increased massively in value. House prices rose 12% in the year of their announcement to increase council rents, 36% the following year when the Act was passed and an amazing 51% the year after.
On the other hand, council waiting lists grew exponentially, homelessness increased and the Housing Benefits bill went through the roof. But hey, they could blame all this on the poor!
As with the Bedroom Tax today, one of the hardest hit areas in Britain was Merseyside. The 1970s were a time of soaring inflation rates – reaching a peak of 25% in 1978 and unemployment in Liverpool was high.
3,000 residents on the Tower Hill estate in Kirkby were enraged by the rent increases, especially since the homes they rented from the council were in a dire state of repair. They protested by organising a 14 month long rent strike and the documentary below, which was filmed in the October of 1972, is the story of that action. I was amazed at how relevant what was being said by those council tenants almost 41 years ago is to what is happening right now under a Tory government (effectively) which relies on the same old ideology. Who said the Tories have changed? Why ever should they? It wouldn’t be in their interests.