The big­gest pri­vati­sa­tion of the 1980s

The Week - - Briefing -

Right-to-buy was orig­i­nally a Labour pol­icy, but it was adopted – ini­tially re­luc­tantly – by Mar­garet Thatcher. It was the big­gest pri­vati­sa­tion of the era by far, worth around £40bn in its first 25 years. It gave mil­lions of fam­i­lies a large as­set for the first time, at dis­counts of up to 50%, and was an elec­toral mas­ter­stroke. “No sin­gle piece of leg­is­la­tion has en­abled the trans­fer of so much cap­i­tal wealth from the state to the peo­ple,” said Michael He­sel­tine, the min­is­ter re­spon­si­ble – whose stated wish was to re­verse the “dom­i­nance of the state over the life of the in­di­vid­ual”. How­ever, the pol­icy also sucked a large part of the UK’S post­war in­vest­ment in hous­ing out of the pub­lic sec­tor for­ever. Coun­cils were given only half the pro­ceeds, and had to use the money to pay debts be­fore they could build re­place­ment hous­ing. Pub­lic fi­nances have lost out twice over, since many of those who would have had pub­lic hous­ing are now housed in ex­pen­sive pri­vate rental prop­er­ties at the state’s ex­pense, via hous­ing ben­e­fit – the sec­ond-largest sin­gle item of pub­lic spend­ing af­ter pen­sions.

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