Thirty years of giant strides that left many behind

Published on Sunday 27 December 2009 20:42

'WE WILL give to every council tenant the right to purchase his own home at a substantial discount on the market price," declared Margaret Thatcher shortly after she had swept to victory at the 1979 general election. "This will be a giant stride towards making a reality of Anthony Eden's dream of a property-owning democracy."

That "giant stride" celebrates its 30th anniversary in Scotland this week (the then Scottish Secretary, George Younger, launched the policy in January 1980) but it is a dream that still divides the Scottish political sphere. For Tories it still ranks among their proudest achievements; for the SNP Government it was destructive and ought to be reined back.

The idea of selling council houses to their tenants had a good provenance. Although Mrs Thatcher attributed the dream of a "property-owning democracy" to Anthony Eden, it was in fact Noel Skelton, the long-forgotten Unionist MP for Perth and a much-neglected Conservative philosopher, who first articulated it back in 1923.

Eden took up the mantle, and by the 1970s it had almost entered the political mainstream. Edward Heath's government pursued limited sales of council housing stock, while Bernard – now Lord – Donoughue, Labour's senior policy adviser, attempted to persuade Jim Callaghan's administration that it was an idea worth advancing.

Instead it became the first substantial application of Thatcherism in Scotland, although it was not initially as popular north of the Border as it was in England. By May 1980 only 1,500 tenants in Scotland had bought their own homes. Given that 53 per cent of all household tenants in Scotland were in the public sector (against 28 per cent in England), this was not an impressive figure.

Opposition from Scotland's predominantly Labour-controlled local authorities helped explain some of the disparity. Indeed, the Labour MP Norman Buchan branded the Tenants' Rights (Scotland) Bill a "dangerous and nasty piece of legislation".

But by attacking the likely side-effects of wider property ownership, rather than its ideological thrust, Labour left itself vulnerable to Tory counterattacks that they were denying their own supporters the perfectly legitimate opportunity of owning a home, an aspiration many natural Labour supporters undoubtedly held.

In this sense Mrs Thatcher was a good Marxist, engaging in subtle class warfare of divide and rule to hive off aspirational socialists. This worked to varying degrees. In the Livingston New Town, for example, the Tories enjoyed their biggest increase in votes at the 1983 election, probably because its council stock was attractive. More widely, however, many Scots purchased their council house and carried on voting Labour.

By 1983 Mrs Thatcher was clearly frustrated at the lack of progress. "Since 1979 some 50,000 council tenants in Scotland have taken advantage of our legislation to become the owners of their homes," she told the Scottish Tory faithful. "That's good, but it's not good enough. For so far only one in 20 council tenants have taken advantage of the offer. South of the Border, it's about one in nine. So go out and spread the good word."

In 1982 she had introduced 90-per-cent home improvement grants in a further bid to woo owner-occupiers. Not surprisingly these proved popular, and although homeowners in Glasgow constituted less than 1 per cent of the UK total, they managed to claim more than 8 per cent of the available grants. Only after 1986, however, did Scottish sales take off, when terms governing the purchase of council flats (rather than houses) were improved.

Accompanying the expansion of the property-owning democracy was a sizeable reduction in government cash available for public-sector house-building in Scotland. In 1979-80 the Housing Support Grant amounted to 765 million; by 1983-84 it fell to around 450m, pushing rents up and the number of new local authority houses down.

Meanwhile, grants to the private sector for house-building and improvements increased by 364 per cent between 1979 and 1983 to 114.6m. With much of local councils' best-quality housing stock sold off and little new being built, Shelter Scotland found that those on waiting lists grew from 144,000 in 1981 to 156,000 in 1982, with rural areas most affected.

Nevertheless, the policy made Labour uncomfortable. When the journalist Kenneth Roy challenged the party's future leader, John Smith, to admit that many Scots had done rather well out of Thatcher's policy, he replied: "I don't fully understand this … If people in my constituency choose to buy their council house, they don't on the whole change their vote as a result." Smith's analysis neatly sidestepped the question of whether or not he agreed with what many of his constituents were doing.

Other opposition politicians were more even-handed. To the SNP MP Donald Stewart, it "was an intelligent idea, had it not been followed by a freezing of monies for the building of new homes". This pithily summed up the retrospective view of the Right to Buy in Scotland. While the principle of property ownership in Scotland came to be embraced by everyone except those on the hard left, the related erosion of Scotland's public-sector housing stock did not.

Like much of Thatcherism, however reluctant many were to acknowledge it, the Right to Buy did change attitudes. For Mrs Thatcher, as Simon Jenkins has written, "home-ownership embodied all the vigorous Tory virtues: secure savings, family values, household goods, a lifetime of hard work rewarded". And for many council tenants with little or no family history of home ownership it enabled them to break free from local-authority landlords.

For those able to exercise the Right to Buy in Scotland (and despite the discounts, many still could not), research found that it altered their whole attitude to – and expectations of – home ownership, increasing their sense of freedom, their ability to undertake home improvements, and giving them a liberating sense of financial stability. The lack of council new-builds, however, undeniably created problems later.

That is something the Scottish Government has tried to rectify, to a modest degree, while amending the legislation in a manner never attempted by Labour. Yet the orthodoxy has changed: in 1980 Mrs Thatcher was attacked for seeking to create a property-owning democracy; in 2010 few would question that as a legitimate political aim.