Liberals have long believed that wide property ownership, serving as a bulwark against state tyranny, is essential to the preservation of liberty. However, our pluralism has ensured that we have historically been committed to a diversity of housing models, including social housing. With the need for our party to engage with, and empower, communities who often feel forgotten, and deprived of real power over their lives, Liberal Democrats must offer a clear, distinctive, and liberal approach to social housing. What should this look like?
In recent years, various local authorities have brought their housing stock under their direct control, replacing arms-length management organisations, and other local authorities, including my own, Gateshead Council, are planning to do likewise.
However, both of these models – the ‘partial privatisation’ offered by arms-length management organisations and the (local) statism of in-house control – suffer from the same weakness: they deny tenants meaningful control over the management of their homes. Just as ‘Tenant panels’ and ‘Focus groups’ are not a substitute for participatory democracy, the opportunity to lobby local Councillors, in the hope that they will come to aid of a tenant, ignores the need to decentralise and devolve power to the level at which it should be exercised: with the tenant. Both of the above models exemplify the stale and dull bureaucratic managerialism of much of local government and are premised on a paternalistic ethic that has little, if any, concern with empowering local residents to take ownership of their communities.
In contrast to these hierarchal and ‘top-down’ approaches, liberals should lead the call for an expansion in mutual housing. Unfortunately, while popular in other countries, such as Sweden, mutual housing is relatively scarce within the UK and, insofar as it does exist, has tended to be small in scale. There are, however, notable exceptions to this. For instance, in Rochdale – home of the Pioneers – the UK’s first tenant and employee co-owned mutual housing society operates and manages 13,000 properties.
Of course, as far back as J.S. Mill, liberals have advocated cooperatives, although often within in the context of the workplace and industry. However, as with workers’ cooperatives, mutuals and cooperative housing models combine political and economic democracy; at their best they are sites of democratic control and joint ownership. They promote community spirit, individual responsibility, a stakeholder ethos, and have produced above average resident satisfaction ratings and sound housing management performance.
While, as liberals, we must strive for a fairer distribution of wealth, we must also work to ensure that power is spread more widely within our society; concentrations of power are an enemy of liberty. Indeed, whereas the socialist has frequently emphasised the distribution of wealth to the neglect of power, it has been the liberal who has tended to stress the distribution of power; after all, a society in which one’s material needs are met, and yet one is reduced to the role of little more than a supplicant, is not a liberal one. In seeking to reform the management of social housing, liberals would do well to look to the mutual sector.
* Daniel Duggan is a Liberal Democrat Councillor in Gateshead



2 Comments
All good points you make, Daniel.
This a short briefing on Land Value Tax from a Mutual Media Cooperative in which they discuss housing cooperatives: https://www.mutualinterest.coop/2020/03/what-is-the-most-popular-tax-among-economists
“Housing cooperatives are housing units owned democratically as a cooperative by the tenants. There are two basic types of housing cooperatives, limited equity and market based. In a limited equity housing cooperative, the tenant is allowed to buy the apartment (and therefore a membership in the cooperative) for an affordable price, but in return, is only allowed to sell the apartment at an affordable price, typically only being allowed to charge for the improvements. In a market priced housing cooperative, the tenant buys and sells the apartment for a market price.
Limited equity housing cooperatives used to play a major role in Norway and Sweden. The labour movement used the model to provide affordable housing during a period of rapid urbanisation. However, beginning in the late1960s, the tenants grew increasingly hostile towards the model. They could see their neighbours who didn’t live in a housing cooperative sell their apartments for a price much higher than they could. As urbanisation had progressed, the value of the tenants apartments had grown, yet they had to sell the apartment for an affordable price. Getting rid of the limited equity model and allowing the tenants to sell their apartments for a market price was a key factor in shifting the tenants from the social democratic parties towards the right wing parties, starting the decline of the dominance that the social democratic parties had played in the countries elections.”
Limited equity housing cooperatives might usefully replace the current right-to-buy scheme for council housing ensuring that former council flats and houses remained affordable.
The more acceptable face of privatisation is when it’s motivated by using the market to offer people choice. Even this fails to stand up when people are offered a share of power, as you suggest Daniel. All recipients of services provided by government, both local and central, should have a real say in what is offered and how it is provided. I’d like to see our party extending its discussion of democracy from simply campaigning for an alternative voting method to campaigning on this kind of wider issue.
It’s good to get a more realistic view of the disadvantages of this empowerment Joe. Never trust the people too much? Maybe selling at the same percentage of market cost that they bought them for might have been a solution?