Harold Wilson - First Term As Prime Minister (1964–70) - Domestic Affairs - Housing

Housing

Housing was a major policy area under the First Wilson Government. During Wilson's time in office from 1964 to 1970, more new houses were built than in the last six years of the previous Conservative government. The proportion of council housing rose from 42% to 50% of the total, while the number of council homes built increased steadily, from 119,000 in 1964 to 133,000 in 1965 and to 142,000 in 1966. Allowing for demolitions, 1.3 million new homes were built between 1965 and 1970, To encourage home ownership, the government introduced the Option Mortgage Scheme (1968), which made low-income housebuyers eligible for subsidies (equivalent to tax relief on mortgage interest payments). This scheme had the effect of reducing housing costs for buyers on low incomes. The government also accepted most of the recommendations of the 1961 Parker Morris Report for significantly improved standards of space and amenities new local authority dwellings.

Significant emphasis was also placed on town planning, with new conservation areas introduced and a new generation of new towns built, notably Milton Keynes – this trend itself a continuation of efforts initiated in the latter years of the preceding Conservative administration. The New Towns Acts of 1965 and 1968 together gave the government the authority (through its ministries) to designate any area of land as a site for a New Town. The government also combined its push for the construction of more new housing with encouragement and subsidisation of the renovation of old houses (as an alternative to their destruction and replacement). The Housing Improvement Act of 1969, for example, made it easier to turn old houses into new homes by encouraging rehabilitation and modernisation through increased grants to property owners. The legislation also introduced special grants for installing amenities in houses in multi-occupation and government grants towards environmental improvement up to an expenditure of £100 per dwelling, while approved works of repair and replacement became eligible for grant aid for the first time ever. Altogether, between 1965 and 1970, over 2 million homes had been constructed (almost half of which were council properties), more than in any other five-year period since 1918.

The Protection from Eviction Act (1964) outlawed the eviction of tenants without a court order, and according to Colin Crouch and Martin Wolf, did much “to stem the rising tide of homelessness,” especially in London. The Rent Act (1965) extended security of tenure, introduced registration of rents, and protection from eviction for private tenants. This legislation was attributed to fall in number of homeless families taken into welfare accommodation each year in the LCC area, from 2,000 in 1962-64 to 1,300 in 1965 and 1,500 in 1966. The Leasehold Reform Act (1967) was passed in order to enable holders of long leases to purchase the freehold of their homes. This legislation provided about one million leaseholders with the right to purchase the freehold of their homes. Controls were introduced over increases in the rents of council accommodation, a new Rent Act (introduced in 1965) froze the rent for most unfurnished accommodation in the private sector while providing tenants with greater security of tenure and protection against harassment, and a system was introduced whereby independent arbitrators had the power to fix fair rents. In addition, the First Wilson Government also encouraged the introduction of discretionary local authority rent rebates to assist with housing costs.

Generous new subsides were introduced by the government to encourage authorities to construct many more houses and to build them to Parker Morris standards. In 1967, the government issued a circular which urged authorities to adopt and publicise rent rebate schemes. As a result of this circular, the number of authorities adopting such schemes rose from 40% before the circular to 53% by March 1968. About 70% of tenants were covered, though not necessarily in receipt of rebates:

“... 495 authorities operated rent rebate schemes, and the £9.5 million total rebate went to over a quarter of a million tenants, representing nearly 12 per cent of the total housing stock. The average rebate, 13s 9d, amounted to one third of the average rent.”

Legislation was introduced which regulated tenancies for properties with a rateable value of up to £200 per year (£400 in London), which meant that tenants were not only to be protected from intimidation, but that evictions would now require court orders. It also restructured the housing subsidy system such that the borrowing charges of local authorities of individual local authorities would be pegged to 4% interest. The 1966 Rating Act introduced the rating of empty properties and provided for the payment of rates in instalments. The Local Government Act introduced that same year introduced a “domestic” element in the new Rate Support Grant, by providing relief to domestic ratepayers on a rising scale, so that as local expenditure rose, government grant was geared to outpace it. As noted by one historian,

“The amount of grant in the domestic element would be calculated as sufficient to subsidise domestic ratepayers to the extent of a fivepenny rate in the first year, tenpence in the second, and so on."

The 1965 Housing (Slum Clearance Compensation) Act continued a provision for home owners of unfit dwellings purchased between 1939 and 1955 to be compensated at market values. The Building Control Act of 1966 introduced building licensing to give priority to housing construction. Under the Supplementary Benefit Act of 1966, an owner occupier on benefits was entitled to an allowance for repairs, insurance, rates, and “reasonable” interest charges on a mortgage. A Land Commission was also established to purchase land for building and therefore prevent profiteering in land values, although it only had limited success. The aim of the Land Commission was to purchase land for public goods such as housing or shopping redevelopment (compulsorily, if the need arose), and investigated the planning needs of a particular area in conjunction with the Ministry of Housing and some planning authorities to see if any land in any particular area would be needed for such developmental schemes. Although the Land Commission purchased substantial quantities of land, it did not become the dominant influence in the land market that the government had hoped for.

The Housing Subsidies Act (1967) fixed interest rates at 4% for councils borrowing to build homes. It also provided financial assistance to local authorities for conversions and improvements, while also reforming the standard of fitness for human habitation. The 1967 Act increased subsides on new houses to such an extent that it became the largest individual source of subsidy after a previous housing subsidy act of 1946. For a period, as part of the prices and incomes standstill introduced by the government, local authorities were not permitted to raise rents. Thereafter, a limit was set on the extent of increases that were permitted.

A Town and Country Planning Act introduced in 1968 provided more local autonomy in town planning. This piece of legislation aimed for greater flexibility and speed in the planning of land use, and made public participation a statutory requirement in the preparation of development plans. The Act also introduced a new system of process planning under which the spatial distribution of social and economic trends superseded physical standards as the principal concern of planners. According to Maureen Rhoden, this effectively meant that the development control system operated by local authorities ‘policed’ new housing demand. This allowed for new development on infill sites or on the edge of larger towns and villages, “but preventing development in the open countryside and in designated areas such as green belts and Areas of Outstanding Natural Beauty.” In addition, opportunities for public participation in the planning process were also increased by the Act, partly in response to opposition to some features of urban housing and planning policies. By September 1970, general improvement areas covering 23,254 dwellings had been declared, with work having been completed on 683 dwellings. In addition, the Labour government went further than previous administrations in aiming to safeguard the housing programme from wider economic problems.