13
The defeat of James Callaghan in the 1979 UK general election is correctly considered to mark the end of an era in post-war British political arrangements. Even the date itself looms like a tombstone over subsequent events. Many of the important democratic and bureaucratic structures that had existed up until that point – some, like the GLC and its predecessor body the LCC, for the best part of a century – were either scaled back or abolished in the years that followed. In many areas state funding gradually retreated back to levels last seen in the inter-war period. And the standard rate of taxation was cut, by governments of both political persuasions, finally reaching the levels suggested by Enoch Powell in his 1968 “budget”, under Gordon Brown in 2008. Decade by decade the UK slowly but surely distanced itself from how other major western, socio-democratic, European economies conducted their affairs.
Public housing, and the central role the government had in providing this was an early casualty. The first year of the Thatcher administration saw the new government take statutory powers that allowed it to regulate local authority spending and borrowing. By November 1980, these powers had been strengthened further via the setting of strict limits on local authority capital expenditure. This produced a rapid (and permanent) reduction in the number of homes built by councils. In 1978, 114,000 council houses had been completed. By 1982, the figure was below 50,000; by 1991 below 10,000; and by 1999 it was statistically insignificant. The days of UK local authorities building large, ambitious new housing projects where homes could be rented at a reasonably low and affordable price were over.(1)
Visually and emotionally, though, the most enduring and immediate legacy of the early Thatcher years was the speedy recasting of Heath’s rules about the sale of council homes to their tenants. Implemented in August 1980 this created a “Right to Buy” (RTB) which no local authority could gainsay. Unlike Heath’s earlier version it discounted the value of the properties sold and placed the capital receipts firmly beyond the control of the council that was selling them.
Making RTB a statutory requirement had been planned prior to 1979 as a popular electoral tactic, but according to Michael Heseltine today, the intention (certainly from himself) was to release 75% of the capital receipts raised from the sales back to the local authorities to fund the construction of replacement housing. Nothing like this ever happened, and the arrangements he thought he had made with the Treasury never came to fruition. Instead, post-1983 RTB receipts were increasingly switched to fund tax cuts, something that he now cites as his greatest regret from his years in office.(2)
But even allowing for Heseltine’s decent and socially scrupulous attempts to make the revised RTB rules work, one had to ask why the policy was needed at all. In 1981, the average RTB valuation (the value the property was assessed at, prior to the discount being applied) was £19,557. Assuming it was a house, and was sold with the then maximum discount of 50%, this produced a sales price of £9,778.50p.
At that time there were many areas, even in London, where an existing, non-council home could be bought for that amount, which was well within the means of many council tenants. All of which calls into question why the people buying their council homes didn’t just buy their own home somewhere else, possibly with some financial assistance from the government. Or, for that matter, if the government really wanted to attract people of limited means to home ownership, why it simply didn’t introduce a low-cost home ownership programme targeted at such households.(3)
One of the saddest aspects of the RTB as implemented after 1980 was the number of people who purchased “non-standard” properties: houses and flats built from large concrete panels, prefabs and so on. None of these was “mortgageable” by most building societies and banks because they were regarded (correctly in most cases) as temporary housing that was only ever expected to have a limited lifespan. Nevertheless, many were purchased and the tenants concerned often used their savings to do so. In the years that followed they found that they couldn’t sell them on and, if they were a leaseholder, that they were obliged to pay for major repairs as and when these were carried out by the local council.
Whatever one thinks about such matters, it does appear clear today that in the eyes of its keenest advocates (Heseltine excepted) the real purpose of the RTB policy was to dramatically reduce the scale of council housing and even, eventually, to get to the point where it could be abolished.(4) Politically of course, RTB was a huge success and as every commentator notes it was one of the defining characteristics of the Thatcher era. At a very basic level – having a place that you owned, getting to a point where you didn’t have to pay either rent or a mortgage, having the freedom to sell and move on, if you wished – it chimed with the aspirations of the Chartists’ National Land Company over a century and a half earlier, or even with Jesse Collings’s “three acres and a cow”. It was a dream of liberty.(5)
Returning to the Department of Environment in 1979, much of Heseltine’s energies – the revised Right to Buy notwithstanding – were taken up with proposals for dealing with the continued decline of London’s docks.(6) He did that by the relatively straightforward approach of establishing the London Docklands Development Corporation (LDDC), a body that operated in exactly the same way as those set up by Attlee, Macmillan and Wilson to build the new towns after 1945. It took over the ownership of the docks that still functioned and exercised planning, compulsory purchase and land acquisition powers across eight square miles. Repeating the approach taken by the GLC, and the Heath government in the late 1960s and early 1970s in regenerating the St Katharine’s Docks, it worked extensively with private house-builders, construction companies and major employers on quickly redeveloping the area, parts of which had by then been derelict for between 15 and 20 years.
Much of the housing built under the auspices of the LDDC, at least in its earlier stages, was conventional, low-rise and very typical “English vernacular” in style, as anyone visiting parts of the former Surrey Docks or Beckton today can see. The abundance of ornamental trees, shrubs, planted areas, grass verges and footpaths are much more like Milton Keynes than London. The homes provided here were almost entirely for private sale, with much of it designated as economically priced (and sized) “starter homes”.
Partly this was down to the house-builders: this was what they built, more or less, wherever they built it. But, part of it was also down to anti- high-rise views that had taken hold since Ronan Point, and which were reinforced by much of the thinking on housing throughout the 1980s. During the final throes of Callaghan’s government, a White Paper, Policy for the Inner Cities, established a budget for dealing with specific areas where targeted investment was required. Most of this money became available from 1979, and was retained by the incoming Conservative administration.(7)
This funding extended beyond bricks-and-mortar initiatives into community consultation and area-based studies led by organisations like the Priority Estates Project which duly began studying various post-war estates and lobbying for changes in how they were managed and maintained. Along with this, and mining some of the same ground explored in the 1950s by Young and Willmott in Debden, came the academic, Alice Coleman, whose 1985 book Utopia on Trial quickly became a seminal text.
Studying the vandalism and crime that was so widely reported about public housing by the early 1980s, she argued that much of this was caused by design features within the estates and blocks themselves – windy hidden corners, anonymous stairwells, poor lighting and so on. Her solution was to build fewer such estates and more houses, the kind of give-people-what-they-want approach that Osborn had voiced throughout the 1940s and 1950s. Coming from a person with her credentials, though, this constituted something of an official imprimatur for the anti-high-rise/high-density view.(8)
Another factor in determining what the early stages of the LDDC’s programme looked like was that Heseltine and the new government wanted to make an immediate impact in these areas. The money designated pre-1979 by Peter Shore for spending on the “Urban Programme” in the former docklands was welcome but would never have been enough to transform the area quickly, and nor could anything at all have been done with any great speed without the existence of a Development Corporation. Hence the appropriation of these powers and their use in at least the early stages of large-scale, tried-and-tested, private-housing designs. And within some of the former docklands this worked quite well and was popular.
The problem arose with the scale of the task the LDDC had taken on. The various development corporations that Heseltine set up in the early 1980s would eventually be allocated £3.5bn, but more than half of this ended up being spent in London. Nor was it just a case of counting how much cash the government was providing. In 1982, a Docklands Enterprise Zone was set up, within which anyone developing anything could claim 100% of their construction costs against tax and enjoy an exemption from paying business rates for 10 years on any non-residential building they erected. The indirect subsidies were, therefore, enormous.(9)
Nowhere would this approach be more evident than at Canary Wharf, a demolished 81-acre site in the centre of the abandoned West India Docks. Here, from 1988, an immense (by UK standards) complex of high-rise offices, steel-clad and over 800-feet high, was built. The developer was Paul Reichmann who demanded, and got, an undertaking that the Jubilee Line would be extended to serve his scheme before he started building.(10) The end result looked uncannily similar to his 1983 scheme at Brookfield Place, New York and was much disliked by both Margaret Thatcher and Prince Charles but for most people working in housing, town planning, property and architecture its completion represented a release from nearly two decades of having anything above 5-6 floors frowned on and regarded as problematic. High-rise was back, initially as offices, but quickly, and increasingly thereafter, as housing.
By the time Canary Wharf was being feted (or damned) as the embodiment of everything the LDDC represented, Heseltine had given way at the Department of the Environment to Nicholas Ridley, whose period in office brought about a sharp downsizing of the UK’s commitment to social housing and local government. The regional government structures established by Heath were abolished in 1986, along with the GLC, and by the end of the decade Ridley had also overseen the winding up of 9 separate new town development corporations, far more than any of his predecessors or successors.
The disappearance of these bodies said a great deal about UK governance in the 1980s and 1990s. Why did they go? After all, the speed at which the new towns built their housing (almost all of which was popular and stood the test of time), their provision of high levels of employment, shopping, social welfare and educational facilities, mostly provided rapidly and to a standard not previously seen by ordinary people, and the integrated way that these were delivered, were clearly much to be admired. One argument for their demise, though, was their democracy deficit: no one voted for their membership, or had that much control over their decisions even allowing for the working relationships they gradually achieved with some of the local authorities in their areas. Significantly, some County Councils actively disliked them, and had always done so, as can be seen by the fracas over Stevenage in 1947.
It had been the intention that a development corporation would be abolished whenever it was felt that it had reached the targets set for its area. Indeed, three (Crawley and Hemel Hempstead in 1962; Hatfield, 1966) went early. For rather different reasons, the government pulled out of the four in Northern Ireland (Antrim, Ballymena, Craigavon and Derry) in 1973. When a development corporation ended, its housing was usually transferred to the local authority and its assets reverted to the ownership of the New Towns Commission, for onward disposal if required. But this had been on the understanding that the housing would remain intact, and even continue to be increased, by the local authority concerned, and the integrated planning of the area would continue, with high levels of government funding.
After 1979 what occurred was an abrupt ending of development corporations, in some cases before they had reached their targets, and much of the housing was quickly sold via the revised RTB regulations soon after its transfer to the appropriate local authority. Nor, by the early 1980s, did the host local authorities retain the spending powers that their predecessor development corporations had enjoyed.(11) This was a state of affairs that would have appalled Osborn and Morrison. But would it have annoyed Howard? After all, Howard wanted nothing to do with state funding and envisaged, whatever the intricacies of his ownership model, an almost entirely private sector-led execution of his theories. His ideal, of low-density housing, built on greenfield sites for private sale by private companies, chimed very neatly with what occurred during the Thatcher-era, even if in design terms it failed to match his exquisite vision.(12)
The demise of the new towns took place alongside other significant changes introduced by Ridley. Firstly, to speed purchases on their way, he increased the RTB discount for council house sales to 70%. Then, from 1988, he reduced funding for housing associations – by that point the only organisations building social housing in appreciable numbers – by ending the 100% grant funding they could claim against their schemes. Instead, they were obliged to seek “mixed funding” by borrowing privately or using their reserves when developing, with the state portion cut, on average, to around 67%.
In some cases where a housing association had significant reserves (as did some of the older trusts) there was a case for restricting funding. Cutting grant levels had nothing to do with this, though, as the regulatory body (the Housing Corporation) had always had the power to refuse funding to any housing association that had unusually high reserves. What Ridley established by doing this was the principle of gradually cutting funding for social housing, and easing its providers back to an era in which the state had less involvement in such enterprises, much as the Conservative governments of the 1920s had tried (unsuccessfully) to roll back the gains made by Addison and Wheatley. His crowning achievement, though, was the passing of legislation that allowed local authorities to transfer their council housing to another landlord, typically a housing association, or indeed, for the Secretary of State to dictate that such a course of action was desirable. As it happens, the latter option quickly proved unworkable after a series of raucous residents’ meetings, in 1987-1988, including one at the former LCC Boundary Estate. Ridley quickly retreated to a compromise position: there had to be a ballot where tenants could accept or reject a transfer proposal. With this agreed, and with local authorities finding their social housing diminishing via the Right to Buy, as well as being in a position where they could no longer build new homes, large-scale stock transfers began, the first occurring in Chiltern District Council in December 1988.(13)
These were huge changes and reversed, in less than a decade, the consensus on funding and management arrangements for public housing that had been built up, step by step, in the UK between the 1880s and the 1960s. It was a truly radical programme and chimed neatly with Enoch Powell’s comments on housing in 1955 as well as his 1968 projected budget for a model Conservative government. When finally implemented it took place against a backdrop of spending and borrowing limits being imposed on local authorities, rising unemployment and cuts in the standard rate of income tax: to 29% in 1986, 27% a year later and finally to 25% by 1988, a level last levied in 1938.(14)
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After 1990, the rate of change was less frenetic and the climate gentler. John Major replaced Margaret Thatcher as Prime Minister and Heseltine returned as Secretary of State for the Environment, moving upwards a couple of years later to the position of Deputy Prime Minister. Within the Department of the Environment the housing portfolio was assigned to Sir George Young, who remained in post until 1994, as the new government pursued various inner-city regeneration schemes.
The most significant of these was City Challenge, regarded by Heseltine today as his finest accomplishment. Launched in 1991-1992, it was a programme targeted at local authorities that clearly exhibited signs of considerable blight, disadvantage and need. These authorities were invited to bid for government funding, made available for a period of five years, to improve a specific area – such as a town centre – where these problems were concentrated. They were required to involve residents, businesses and voluntary bodies in drawing up the proposals that they put to the government, and in particular needed to show how much inward (or “matching”) investment from private sources their schemes would generate. Bids were judged on whether they met accepted local needs, their general outputs (homes built, jobs created, adults trained, and so on) and, most importantly, the “gearing” between the money the government supplied and how much additional investment came from the private and voluntary sectors. The greater the leverage, the more likely the government was to approve the bid. Funding was administered by a discrete local body, separate from the local council (although it included some locally elected members) which included representatives from businesses, other government agencies (the police, the NHS), voluntary groups and the wider public as well as the officials responsible for running the scheme. Thus were the criticisms aimed at earlier regeneration bodies, such as the new town corporations, and the LDDC, answered.
City Challenge provided a democratic balance that had previously been lacking within such bodies, with no one group of representatives able to outvote any of the others and the government retaining the power to suspend or deny funding if the agreed plans were amended without its approval. What Major, Heseltine and Young were doing here was carrying on – within the constraints set by their own party – the government-directed policies of the 1940s, 1950s and 1960s in a way that provided for greater accountability, resident involvement, and, given each programme only lasted for 5 years, maximum impact.
City Challenge was not a housing programme, but the provision of new homes played a considerable part within it. In particular, the demolition of selected 1960s estates, usually built from large concrete panels or similar materials, was a common factor to successful bids. They were replaced with new mixed-tenure developments, often built to a comparable or higher density, the physical implementation of which highlighted one of the problems created by the post-1980 Right to Buy sales: leasehold properties had to be “bought back” slowly and expensively (and often with the threat of compulsory purchase) before any redevelopment could commence. The need to do this greatly increased the price of estate redevelopments and slowed down such programmes hugely, in some cases causing further blight as they did so.(15)
None of these redevelopments was carried out by local councils acting on their own and almost no new council housing was provided by them. By 1992, council house-building was insignificant as a source of new homes and remains very low today despite some local authorities venturing back, very expensively, into new build.
Major, Heseltine and Young knew this and, acting within the antipathy to council housing within their own party, opted instead to provide new social housing via housing associations. They boosted spending accordingly and 26,500 new housing association homes were being built annually by 1992, with the number climbing, very slowly, to around 35,000 per annum today. Within the limits it set, City Challenge was a success, and a model that might have been usefully continued by the politicians who came after John Major.
By 1994, Heseltine was planning Thames Gateway as a follow-up. Hugely ambitious, the aim was to build a million new homes on abandoned industrial land in the Thames estuary, in a programme that was intended, Heseltine stated in 2020, to “recreate the urban initiatives that had run from 1979 to 1983”, though its lineage clearly stretched back in many ways to Heath’s plans for south Essex in the early 1970s. Alas, Thames Gateway moved very slowly, and as events would transpire, failed to emerge from its chrysalis. The government’s well documented problems with a minority of its own MPs about Europe restricted the amount of time available for complex projects. Added to which, by 1995, Heseltine was increasingly taken up with his duties as Deputy Prime Minister and Sir George Young no longer Minister for Housing. Momentum was being lost and John Major’s period as Prime Minister and leader of a heavily divided party came to an end a couple of years later. The end of an 18-year spell of Conservative control was much celebrated in many quarters at the time. Political judgements are typically arrived at via a heavy dose of rough justice, but even allowing for this, it was unfair to rope in the relatively centrist government of Major and Heseltine with the longer, earlier and somewhat more caustic Thatcher period. Judging the legacy left by such a lengthy period of one-party government, though, one cannot help but concentrate on the assumptions that had underpinned the direction of travel.
Firstly, for many on the political right it was taken as axiomatic that, within housing, construction and planning, the private sector had been hampered by an excess of regulation and red tape. It was held that, if this were altered, a revival in private house-building would inevitably follow which would meet natural demand. In fact, post-1945, the private sector had enjoyed its most successful years when the state played a major role in planning the economy: it built 221,000 homes in 1964 (when Keith Joseph was Minister for Housing) and 226,000 in 1968 (under Anthony Greenwood). After 1979, the private sector only once came near this (in 1988 when it completed 207,000 homes) and frequently built at only half this level. To put it another way, in the period between 1964 and 1980 (a greatly maligned era) house-building had averaged 318,000 completions annually. Between 1981 and 1990, it slipped to 184,000 per annum, slightly higher than the inter-war period, and, by the 1990s, it was averaging only 138,000 a year, a return to pre-1914 levels.(16) Obviously, the figures wobbled about a bit, depending on overall economic circumstances, but after the mid-1980s the UK failed to build enough homes for its population. The truth was the private sector couldn’t pick up the slack of the state. It had never done so. Nor could it reverse the policies set by the state, particularly when cutting income tax remained a central policy: the standard rate declining to 24% in 1996 and 23% by 1997. And, even though spending on housing association new build increased, by 1995 overall spending on public sector housing in the UK had halved in real terms, compared with 1980. Despite Heseltine’s initiatives, the numbers of new homes being built declined sharply.(17)
Secondly, in the absence of new towns and new housing estates, what the private sector provided from the 1980s onwards were a lot of low-density suburban schemes, often sprawling on the edge of existing towns. In appearance these were a seamless continuum of “English vernacular”, consisting of low-rise, often semi-detached houses and small, discreet blocks of flats. They usually came with a lot of surrounding landscaping (the maintenance of which was paid for via a service charge levied on local residents) and the properties themselves were smaller than those built previously thanks to the abolition of the Parker Morris standards in 1980.
Some might consider that the apogee of this style arrived in 1987, on the outskirts of Dorchester. Here, on land owned by the Duchy of Cornwall, Prince Charles began building Poundbury. Promoted as a carefully designed, self-contained, community-orientated town, even though it was, strictly speaking, a suburb of a long-established urban area, a great deal more thought went into this than other private sector-led projects of the time. Driehaus Prize-winner Léon Krier was hired to design the scheme, construction of which finally started in 1993.(18) Built in a variety of styles – Queen Anne, Georgian, imitation mid-nineteenth century cottage but most definitely not modern and never brutal – it covers less than a square mile and will eventually house around 6,000 people. Reminding one of a larger and more ambitious Portmeirion, it isn’t unique and there are other places like it, particularly Seaside, Florida, used in 1997 as the setting for The Truman Show. Together these are referred to as the “New Urbanism”, and are popular with some people. If they demonstrated anything, it was that their aesthetic is valued even if they aren’t really much like old towns. It is interesting to note that, in the current debate about the beauty and appearance of new homes, these characteristics count for more than affordability. Ultimately, though with a proposed density of about 12,000-12,500 people per square mile (about 19 per acre, equating to an average of 4-5 homes per acre, a figure beneath those contemplated by Frederic Osborn), one thing is certain. Given the challenges faced through population growth, migration, food production and climate change, Poundbury and its cousins cannot and should not be the future of housing provision in the UK or anywhere else.(19)
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The election of a Labour government in 1997 was felt at the time to represent the beginning of a new era. It was expected, in housing, planning and regeneration circles, that the best of the Heseltine-Major initiatives would be continued, expanded and buttressed by substantial additional funding, with the state well to the fore in directing activities. Fresh programmes were anticipated too, dealing with all the difficulties caused by the post-1979 deindustrialisation of the economy. In fact, what emerged was far from being a change of direction. Rather like Heath in 1970, Blair created a super ministry, the Department of Environment, Transport and Regions, with John Prescott installed as Secretary of State, and, like Heseltine, doubling as Deputy Prime Minister. Rebranded the Department of Transport, Local Government and Regions in 2001, by 2005 it had been split up, with the housing section represented by the Secretary of State for Communities and Local Government. Housing itself remained a junior position, overseen by nine separate ministers during the thirteen years Labour were in office. The implication appeared to be that building homes was just one of many things with which local councils had an involvement, and wasn’t a specific priority. There was a slight shift from 2007 when Blair’s successor, Gordon Brown, allowed the Minister of State for Housing and Planning to attend cabinet meetings. But it remained a low-level portfolio.
Underscoring this lack of change, whilst certain government functions including housing were eventually devolved (after endorsement by referenda) to Scotland and Wales, the establishment of the Greater London Authority in 2000 was not accompanied by any attempt to resurrect the role of the GLC in this area. New Labour was not interested in fleets of Morrison-style estates, built to house the needy.(20) Indeed, the early Blair years saw the winding up of the London Docklands Development Corporation (1998) and the demise of the Commission for New Towns, which were formally abolished after paying back £80m to the Treasury in 1999 in respect of various outstanding loans. The option of rebooting either of these – to, say, build new towns or implement the stalled Thames Gateway project – was not taken. What emerged instead was New Deal for Communities. This dropped the competitive bidding between local authorities that had marked City Challenge in favour of inviting local authorities where deprivation was judged to exist to submit proposals for their area, the funding of which would then be negotiated with them. New Deal for Communities was not time-limited to five years either: a much longer period was allowed with the possibility of an exit strategy from the scheme that left in place some type of community investment organisation for the funding of ongoing projects well into the future.
By 1999, there were 39 NDC areas in operation between Bristol and Newcastle, with 10 of these in London. Some were focused on housing estates, but the majority were centred on neighbourhoods within local authorities.(21) Compared with City Challenge, the visual impact of the spending was less obvious as much of it went instead on training initiatives, childcare, literacy schemes or improving policing. Things which in other countries would be dealt with, as a matter of course, by far more adequately resourced local government, and, in fact, had been delivered by local government in the UK when it had the means to do so. For reasons that were never clear, neither Blair nor Brown were keen on re-establishing the type of regional government units that Heath had favoured. Nor were they interested in raising taxes – locally or nationally – back to the level where services of this type could be provided on a continual basis, somewhat more comprehensively.
Also observable during the Blair-Brown years was a tendency by the UK to simply copy US policy. Initiatives such as Underserved Markets, the Hope VI programme and Business Improvement Districts were all trialled in the UK. None of them achieved a great deal.(22) These attempts to pick a winner from across the Atlantic neglected to take into account the astonishing de-urbanisation of US cities (such as Detroit), a process that had been greatly accelerated by an extraordinary scale of private sector-led house-building, suburbanisation and car dependency.(23) To many this was an elementary consideration, and the UK’s persistence in implementing schemes that were devised in another country with markedly different characteristics was one of the odd features of the 1997-2010 Labour governments. It was, though, intellectually consistent with Howard’s adoption, a century earlier, of a US model for his original garden city proposal.
Finally, in 2000, after it had been in abeyance for a couple of years, Thames Gateway was formally launched. It was deemed necessary that this required not one, but two separate development corporations: London Thames Gateway Development Corporation and Thurrock Thames Gateway Development Corporation. Both had the same powers exercised by their predecessor bodies, but neither had either the funds or the borrowing facilities available to implement its projects within a reasonable timescale. More to the point, the membership of both differed considerably from that of the earlier corporations and Heseltine’s City Challenge bodies. Instead of a balance between different interests (business, community, political and voluntary) both contained a great many councillors representing the various local authorities they covered, proportionally far more than had been the case previously. Because of this, and because too of an overly cautious approach to consultation, getting agreement over a credible business plan proved difficult, and, incredibly, no overall masterplan for the Thames Gateway area ever appeared.(24) When interviewed in 2020, Aman Dalvi (Chief Executive of London Thames Gateway, 2002-2010) compared his experience unfavourably to his prior dealings with City Challenge bodies, noting “Heseltine’s plans did work – but only as long as he was in power”. He also observed that funding was minuscule compared to amounts available when he had worked at the Housing Corporation in the early 1990s, and also much more difficult to access: “it was like trying to extract teeth without anaesthetic”.
This was New Labour’s attempt at a major initiative and, compared with the new towns of the 1940s, 1950s, 1960s and 1970s, and compared even with City Challenge in the 1990s, it failed utterly. In 2010, both development corporations came to the end of their intended life.(25) Neither was retained. Whatever they still had left to do, most of which would have happened anyway, was delegated to the local authorities across their areas to continue with in a piecemeal fashion. Much of the land holdings that had been assigned to them went to the Greater London Authority, and a good portion of this in and around Stratford was developed for use as the 2012 Olympic Park. Heseltine today is very clear about what went wrong, stating when interviewed that the Labour government generally had insufficient commitment to its development corporations and that Blair in particular made no serious effort at making them work.
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The Conservatives returned to power in 2010, initially leading a coalition government, later with an outright majority. Eric Pickles held the position of Secretary of State for Communities and Local Government between 2010 and 2015 and remains at the time of writing the last figure in UK politics to have held a portfolio overseeing housing and planning for a significant number of years. Like his predecessor Prescott he did not affect the UK’s direction of travel which remained focussed on a private sector house-building model with a preference for low-density suburban options.
Gordon Brown’s practice of having the junior housing minister attend cabinet meetings was discontinued, and in a further sign that the new administration had very specific ideas about what type of homes the government ought to be providing, the new Chancellor of the Exchequer abolished funding for “social rent”, the type of rented housing local authorities (and housing associations) had been building since their inception. What would be provided in its place was low-cost home ownership and “sub-market” rent, the latter, in an echo of what the various nineteenth century industrial dwellings companies provided, typically set at 80 per cent of market rents, so that in areas of high demand (such as London) they were always significantly higher, and therefore less affordable, than equivalent social rents.
Looking further afield, and continuing with its cost-cutting approach, by 2011 the new government had wound up all the New Deal for Community schemes established by Blair and Brown in 1998-1999. In place of these came, eventually, a package of proposals from Heseltine, now in the House of Lords and operating as an “urban regeneration Czar”. Known as “Plan H” these were intended to stimulate economic growth outside London, with an emphasis on decentralising control from Whitehall. Significant funds for this were announced in 2013, but little transpired as Cameron and his successors were hamstrung by the need to spend most of their time dealing with Brexit and its ongoing consequences.
Heseltine also tried to reboot the Thames Gateway initiative, persuading Chancellor of the Exchequer George Osborne it was unfinished business, which indeed it was. In this he was partially successful, as Osborne announced in March 2014 “a brand-new garden city” at Ebbsfleet, Kent.(26) To achieve this, he established the Ebbsfleet Development Corporation, under government control, with funding of £300m. There was no question of this being spent, as had been the case with the new towns, on local authority-style housing. Instead, the role of the Ebbsfleet Development Corporation was to coordinate development by various private house-builders (a minority of whom might be “Registered Providers”, as housing associations were now called) and to act as the planning authority within its designated area. Up to 15,000 new homes would be built, and comparisons were made with the Stockholm suburb of Hammarby, an exemplary high-density scheme with many built-in environmental features.
Some people opposed this. Architect Richard Rogers, who had advised the Blair-Brown government in the late 1990s, commented “They shouldn’t be building down there. East London still has masses of brownfield land, so why are we building 15 miles out? This is not a sustainable option” whilst Councillor Derek Hunnisett (Dartford, Conservative) noted “We are looking for a higher quality than the normal and what we are getting is the norm – standard off-the-peg stuff”. Both points of view were (and are) fair: Ebbsfleet is a conventional house-builder scheme, slotted in on vacant land near Ebbsfleet International railway station. Covering approximately 2,100 acres, its average density of 7-8 homes per acre was well within the parameters Frederic Osborn had recommended from the 1930s through to the 1970s. What the critics didn’t address, though, was why something they would have been happier with hadn’t happened during the Blair-Brown years. And indeed, why a clutch of development corporations, specifically to build new towns, hadn’t been launched by John Prescott and instructed to develop schemes in line with Rogers’s recommendations in his 1999 report Towards an Urban Renaissance. Ebbsfleet continues to emerge and has survived the dramatic post-2015 political changes in the UK. Currently, its non-housing targets include the construction of London Resort, a massive theme park consisting of water features, theatres, live music venues, cinemas, restaurants and hotels, as well as a training academy for the entertainment and hospitality sector, a new country park and a large science and education facility. In 2021, the Johnson government designated this as vital national infrastructure, allowing the developers to bypass local planning authorities. Some of the attractions on the site will be licensed by Hollywood-based Paramount Pictures and marketed by them as a rival to Disneyland.(27)
Unlike Ebbsfleet both George Osborne and Heseltine failed to survive the 2016 transition from Cameron to May. The vicissitudes of that government are well known, but within housing May and her Chancellor of the Exchequer Philip Hammond did at least reintroduce funding for social rent, assisting greatly the provision of slightly more affordable housing for those renting from Registered Providers.(28) Further signs of change occurred in 2019 when Boris Johnson reinstated the attendance of the housing minister at cabinet, and again in 2021 with the rebranding of the Secretary of State for Communities and Local Government as the Secretary of State for Levelling-Up, Housing and Communities. The new incumbent, Michael Gove (the sixth in as many years) becomes the first holder of the housing brief to attend full cabinet, and exercise voting rights, in 52 years.(29)
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Any account of the political and economic travails affecting housing in recent decades needs to comment on house price inflation, a phenomenon closely intertwined with rocketing increases in the value of land over the same period. Most people who own, have owned or would wish to own property have some experience of this. The scale of the problem, though, is only partially understood and many do not realise that in historical terms this is actually quite a recent phenomenon.
In his 1981 autobiography A Better Class of Person, playwright and actor John Osborne comments about how, in what was then the recent past, he heard an actor at a party state that he had bought a house in Finlay Street, London SW6 (where Osborne lived in the 1930s) for £15,000, a figure Osborne found amazing. The implication was that the transaction happened at some point in the mid-1970s, when £15,000 was approximately 3.5-3.75 times “average” annual earnings. For Osborne, who would have had memories of such properties being sold pre-war for maybe £200-£300, this was incredible. Today (2021) the website www.rightmove.co.uk proudly advises that “Properties in Finlay Street had an overall average price of £2,136,667 over the last year… Overall, sold prices in Finlay Street over the last year were similar to the previous year and 10% down on the 2014 peak of £2,366,238”. All of which means that if you want to buy in Finlay Street now, the purchase price would be about 69 times average annual earnings. In the same book, Osborne also remarks that in the mid-1930s his grandmother lived in a semi-detached mock-Tudor house in Stoneleigh, near Epsom, Surrey. He states “At this time, houses in places like Stoneleigh cost something in the region of £300 to £600 to buy, but many were rented”.(30) In other words, circa 1935, you could buy a 3-bed semi, at the lower end of this scale, for twice average annual earnings. This earnings to property ratio held good until at least the beginning of the 1970s, when it was still possible to buy a new, or newish, home in an outer London suburb like Chessington, for about £3,000.
What caused this startling divergence of prices from earnings was the political desire to expand personal borrowing. Credit of any type – mortgages, hire purchase, bank loans – had traditionally been heavily regulated, and even frowned on, within the UK economy. In the last 40-50 years, though, it has become increasingly available and for much of the time, by historical standards, scarcely regulated at all. The OECD report today that UK household debt (the 11th highest in the world) is 142% of net disposable income.(31) According to the IMF, it is the equivalent to 87% of Gross Domestic Product. The IMF also note that, using this reckoning, it rose from 30% in 1980 to a peak of 94% by 2010. The International Institute of Finance paints an even starker picture, noting that the UK has comfortably the worst levels of household debt in the “mature markets”, at 84% of GDP against only 58% within the Euro area and a level that exceeds even the US. (The UK also boasts the highest levels of financial services debt).(32)
All of which suggests that the “official” way of managing the UK economy, whatever some third parties might claim, is a kind of bust-boom model based on easy credit. Anyone who has lived through the last 40 or so years will have experienced a bust (1979), followed by a boom (1982), another bust (1988), a long boom (1993), a grim bust (2007) and, as far as house prices and personal debt are concerned, another boom (2013). How great the next bust might be, and how long it will last, is a matter of conjecture. The rapid rise in private house prices and land values that has occurred throughout this period escalated at some speed after the 1992 opening of the Land Registry to public enquiries, after which the appearance of all this data on the internet, by the late 1990s, led to a boom in land trading.(33)
As the first quarter of the twenty-first century draws to a close, the UK’s house-builders have reverted to an almost pre-1914 model, or if not quite that, something John Osborne would have recognised during his childhood. They sell most of their product, but an increasing amount is now being rented out, via buy-to-let landlords. Within England, private home owners now account for 60% of all households, with the private rented sector at 21%. In another echo of the pre-1914 era, the latter category is now bigger than the number of housing association and local authority tenants combined at 11% and 8% respectively. Social housing rents have also reverted, with their emphasis on sub-market renting, to levels that would have been familiar to those running the Victorian and Edwardian “dwelling companies”.
Despite all these changes the commercial house-builders have continued with their traditional model: they build mainly in the suburbs or on “greenfield” sites, and they build mainly low-rise, low-density schemes of a type that are popular with the public. Sometimes they build in inner-urban or town centre areas too, and when they do, they build high-density blocks, some of which are architecturally quite striking. They have always done this, and they are very good at it. But they will never, by themselves, meet housing demand. (They never have). Aman Dalvi commented, about his experience in Thames Gateway, which counted in a lot of already existing private housing schemes as part of its “outputs” “The house builders just did what they had always done. They were not particularly interested unless they felt they couldn’t sell their homes, at which point they would ask for infrastructure improvements”. For him, and indeed for many people hoping something dramatic might still emerge in Thames Gateway, the problem was that the government treated the house-builders as the main driving force rather than the Development Corporation itself, or indeed any of the larger housing associations. Philosophically, within much of the UK’s political class, the expectation is still that the private sector should lead any programme, providing whatever social housing is deemed necessary via legal agreements with local authorities and the registered providers that operate in their area. For most people, in most places, this remains the face of house-building in the UK today.
But there are alternatives. This is clearly evident in east London where astonishing population increases have occurred in the last 40 years – 71% in Newham and 129% in Tower Hamlets – as the redevelopment of the area that was started by the London Docklands Development Corporation continues to rumble on.(34) At Canary Wharf, Reichmann’s pioneering offices are now circled by 18 residential towers, all of them between 350 and 700 feet high, looking like the offspring of an adjoining matriarch. Much of what they contain will consist of uber-expensive apartments, and some will be purchased by overseas buyers. But the scale is impressive. The same approach has given birth to other clusters of large towers elsewhere: in Croydon, North Acton and Stratford.(35) These and a few others like them are the only equivalent the UK has to the great towering cities of Asia. There are other plans elsewhere too. The Peabody Trust aim to complete Thamesmead, whilst on the opposite side of the Thames an abundance of new neighbourhoods, blocks and “quarters” continues to march across Newham. The juxtaposition of so many carefully designed and elegant buildings together with the attention now given to providing transport links and environmental sustainability makes one hope that a new form of architecture has arrived and taken root in the UK. One that can meet the demands of the future without worsening the condition of our world still further.
Notes
1. There has been a small resurgence in council house-building in recent years – about 8,500 are included in the 2021-2026 Greater London Assembly programme – but it is nothing like the level formerly seen.
2. A point made by him when interviewed for this book.
3. For more on this see Beckett Promised You a Miracle: Why 1980-1982 Made Modern Britain p226. The author recollects being advised in Hackney in the mid-1980s that the average purchase price of ex-local authority maisonettes in Fellows Court E2 was around £6,000.
4. It is worth noting in this respect the comments of Enoch Powell in 1962 “The council house system today is morally and socially damaging. I think we ought to do something about this nuisance”. Quoted in Beckett p220 and elsewhere.
5. It seems ironic, given Margaret Thatcher’s close identification with the RTB, that the famous picture of her celebrating the sale of a council house to its new owner dates from 1978 – before she was PM. See The Guardian 6 April 2014 at https://www.theguardian.com/society/2014/apr/06/margaret-thatcher-britains-obsession-property-right-to-buy Disputes continue about whether the Labour Party ought to have had its own RTB policy pre-1979. Rarely discussed is whether any other countries do this, and if they do, how the policy is managed.
6. The majority of which had shut by 1979: East India Docks (1967), St Katharine’s Dock (1968, sold to the GLC), London Docks (1969, sold to the London Borough of Tower Hamlets) and the Surrey Docks (1971). The West India Docks and the Royal Docks both closed in 1981.
7. See Hansard 8 November 1977 where the Secretary of State for the Environment, Peter Shore, comments “In my previous statement of 6th April I announced the Government’s decision to increase the Urban Programme, to assist the inner cities in grant-aided expenditure, from the existing level of £30 million to £125 million in 1979. Five partnership areas were then announced—in Liverpool, Birmingham, Manchester/ Salford and, in London, Lambeth and Docklands—and on 24th October I made provisional allocations to them of £50 million a year for a three-year period from the starting date. I also told the House on 6th April that we would be giving further consideration to the case put by other authorities for assistance with their urban problems”. One of the subsequent criticisms of City Challenge funding in 1992 was that it amounted to less – in terms of government money – per annum than the Urban Programme scheme it replaced. However, this does not take into account matching non-government funding that it attracted.
8. Coleman, who carried out a Land Use Survey of the UK in the 1960s, didn’t really consider in detail the impact on housing management of the Housing (Homeless Persons) Act 1977 and its higher volume of statutorily homeless households, the accelerated right to buy and how that impacted (visually, in particular) on people’s attitude to their surroundings, spending cuts, the tripling of unemployment in the early 1980s and so on. Or even minor technical changes: there were no spray cans in the 1940s and 1950s, and therefore much less graffiti. One wonders why the Barbican Estate, which exhibits many of the problems she identifies, works so well.
9. See The Guardian 7 March 1999.
10. At the point Reichmann agreed to participate in Canary Wharf his net worth was cited as being $10 billion, making him one of the richest individuals in the world. By 1992, however, he had run out of cash and his business collapsed. See his obituary at https://www.nytimes.com/2013/10/26/business/paul-reichmann-who-helped-develop-the-world-financial-center-dies-at-83 html This notes “Mr. Reichmann took enormous business risks. He bet that each new development project could exceed the size of the previous one and still attract enough tenants to produce a windfall” A colleague, Andrew Sarlos, likened him to “a gambler, like being a heroin addict — he cannot stop,” whilst in an article in Institutional Investor in 2000 Reichmann himself was quoted as stating “You don’t get the returns if you don’t take the risk”. An interesting remark given his refusal to start Canary Wharf without the Jubilee Line.
11. Also lost was the collective memory and associated database within the new towns as they gradually disappeared. At its peak Milton Keynes Development Corporation employed 1200 people.
12. The winding up dates of those not already mentioned were as follows: Corby, Harlow, Stevenage (1980), Bracknell (1982), Northampton, Redditch, Skelmersdale (1985), Basildon, Central Lancashire (1986), Aycliffe, Cwmbran, Peterborough, Peterlee, Washington (1988), Runcorn, Warrington (1989), Telford (1991), Milton Keynes (1992), Glenrothes (1995), Cumbernauld, Irvine, East Kilbride (1996) and Livingston (1997). The hugely popular film Gregory’s Girl was shot at Cumbernauld in 1980, whilst it was still being developed.
13. As a result of this, by 2008, 1.5m council homes had been transferred and a third of local authorities had completely eliminated their involvement with social housing. Ironically, such transfers slowed down RTB sales (incoming tenants post-transfer were not able to exercise this right) and also increased the building of new social housing on transferred ancillary land. Whether Ridley envisaged this is not clear.
14. On this see Thatcher’s Progress: From Social Democracy to Market Liberalism Through an English New Town Guy Ortolano 2019 which argues how extensive the changes implemented by Thatcher were. Home ownership had never been suppressed pre-1979, even in the new towns. At Milton Keynes in 1979 41% of the development corporation programme were houses for sale. What did get suppressed was housing for rent, which had sunk to nil by 1990.
15. A good example of this being the redevelopment of the Aylesbury Estate in Southwark.
16. See English Housing Survey 2015 at www.designingbuildings.co.uk
17. The Greater London Assembly Planning for London’s Growth (2002) has council completions at 20,000-25,000 annually until 1978. Below 10,000 by 1982, they were no longer significant by 1987. Housing association completions were collected as part of private housing until 1975 after which they were shown as being around 1,500-2,500 annually, rising to 5,000 by 1993. The private sector built around 8,000-9,000 annually year on year, decade on decade. During the high point of the LDDC (roughly 1987-1995) the private sector increased to 11,000-14,000. Once funding for council housing ended, insufficient homes were built in London.
18. Krier, from Luxembourg, originally worked at Sir James Stirling’s modernist practice. The first sign of his revolt against this came in 1977 when he devised an unimplemented scheme for Blundell Corner in Hull which envisaged a neo-classical redevelopment of the area. Prior to being appointed to masterplan Poundbury he published Albert Speer: Architect 1932-1942 which attempts to reappraise Speer’s legacy.
19. The favourite architect of the Prince of Wales appears to be Quinlan Terry, who designed a castle for the Barclay brothers in the Channel Islands, and was appointed, by the Qatar Investment Authority, to redesign the Chelsea Barracks scheme after criticism from HRH. Terry’s son is an architect too and has worked on Poundbury.
20. The GLA got a regulatory role, though. In 2011 it reintroduced Parker Morris-type space standards, following on from similar action in 2008 by English Partnerships, a government agency that held a great deal of former new town and development corporation land.
21. One of these covered the Aylesbury Estate in Southwark. A 10-year plan, it didn’t start until 2009. New Deal for Communities boards had a far higher ratio of local community representatives than City Challenge, often up to as many as half the membership.
22. For a critique of this pro-US approach see Regeneration and Renewal 4 November 2005 Lost in Translation by Ben Walker and 1 December 2006 Hope Springs Eternal by Joey Gardiner. At the time Regeneration and Renewal magazine was one of a stable of publications run by the Haymarket Press, Michael Heseltine’s company. In January 2002 the author attended a dining club in Hackney (Socialist Piecrust) where the keynote speaker was Lord Falconer, at that point Minister for Housing, Planning and Regeneration. Falconer had flown into London that day from Los Angeles, where he had been on a fact-finding visit to study urban renewal.
23. On the scale of collapse within US cities see the article Requiem for a Dream in The Telegraph Magazine 5 July 2008. The key work on this topic remains Jane Jacobs’s 1961 book The Life and Death of American Cities. Jacobs cites Greenwich Village (population 23,000; density 79,000 per square mile) as an ideal example of a neighbourhood.
24. Conversation with Aman Dalvi 19 August 2020. The London Borough of Bexley stopped construction of a new bridge between North Woolwich and Thamesmead, which had originally featured in the Abercrombie Plan. In previous development corporations an individual local authority would never have been able to block a major scheme.
25. Mention should be made of the increasing housing role afforded to the Mayor of London from 2000, and in particular the introduction by them of viability assessments that seek to increase affordable housing provision within large private sector schemes. This is welcome, but as with the building of new council homes in limited numbers, is no substitute for the spending and planning powers that were once enjoyed at regional government level.
26. In fact, Ebbsfleet had been identified as a major redevelopment site as far back as 1996, this being one of the reasons for opening Ebbsfleet International Station in the area in 2007.
27. The Cameron government also set up the Old Oak and Park Royal Development Corporation to oversee the development of redundant railway land and adjoining industrial estates in west London. This too is unlike an NDC, although in this case day-to-day management is devolved to the Mayor of London.
28. In this context it may be relevant that Hammond had previously been a director of the Castlemead Group, a medium- sized developer. See https://www.castlemead-ltd.co.uk/residential/
29. Since 1997 there have been 11 cabinet ministers with overall responsibility for housing and 18 junior ministers. In terms of a modest change for the better we should note that the GLA Housing Budget 2020-2021 increases grant per unit for social rent from £70,000 to £160,000-£180,000 per unit. (Very approximately a grant rate of 54% ie, less than that available between 1988 and 2002). Outside London, Homes for England pay about £60,000.
30. See John Osborne: A Better Class of Person 1981 p17 and p39.
31. See https://data.oecd.org/hha/household-debt.htm
32. See https://www.iif.com/Portals/0/Files/content/Global%20Debt%20Monitor_January2020_vf.pdf It is worth commenting that throughout the UK’s period as a major oil production nation there was, effectively, bipartisan agreement on not establishing a Sovereign Wealth Fund. Instead of being used to plan industrial expansion and significant regeneration, oil revenues were largely used to subsidise tax cuts.
33. Pre-1992 enquiries to the Land Registry about land ownership could only be made via a solicitor. Post-1992, there were a vast number made by members of the public seeking information about plots of land in their area, or even the precise particulars of their own homes.
34. A victim of which was the Smithsons’ Robin Hood Gardens which was demolished after only 45 years due to repair costs of £77,000 per unit. Which is not that much, actually, for a bespoke high-profile development. The truth was that land in that location was simply too valuable, and the mythologies, about how dreadful the council housing of the 1960s and 1970s had been, too powerful to resist. It is being replaced by 1500 new homes (costing £200,000 each) of which 561 are for rent, 189 for shared ownership and 750 for private sale. The area has been rebranded “Blackwall Reach”. On population growth, most UK cities outside London have increased too, but at a much lower rate: Newcastle is only 16% over the same period.
35. Croydon started early down this road: Seifert, clearly a man before his time, developed two major high-rise office schemes there in 1970. One of these, in Addiscombe Road, survives and has been converted into residential use.