The Slums and the Housing Subsidy
FROM to-day, the subsidy given by the Government to encourage the building of small houses will be seduced in England and Wales. In Scotland, where the 3eficiency of houses still remains serious, the present scale of subsidy is to remain in force for at least another two years. The reduction south of the Tweed comes at an opportune time, for already there have been completed in Great Britain since the Ministry of Health was formed in 1919, over 970,000 houses. Of these 615,000 were built without any State assistance at all. In Scotland, however, the total completed in State-aided housing schemes is less than 50,000.
Political opponents of the Government, and some badly informed housing enthusiasts, have exaggerated the probable effects of the reductions that come into force to-day. The only difference between the amount that was allowed up to yesterday, and the amount that is now offered by the Government to individual builders or local authorities carrying out housing schemes, is the comparatively small sum of £2 a year at the most. It is obvious that such a reduction cannot press so hard upon municipalities or upon speculative builders as to prevent them building, so long as the demand continues. But the reduction, for it must be remembered that the subsidy is continued for 20 years under the Chamberlain Act of 1923 and for 40 years under the Wheatley Act of 1924, will save the Exchequer £40 on every Chamberlain house and £60 on every Wheatley house.
The extent of our obligations for houses already built is not generally recognized. The coal subsidy that was so severely criticized was slight as compared with our commitments for housing. The annual payments for houses built under the Addison scheme alone in England and Wales amount to over £7,000,000 and the payments will continue until about 1985. The capital value of the Exchequer subsidy on the 176,000 Addison houses is difficult to estimate, for it depends upon the rate of future interest on loans, the rents that can be obtained, and the produce of the penny rate, that differs in various localities. It is, however, estimated on good authority that the capitalized value is at least £107,000,000. In addition there is the capital value of over £80,000,000 for Chamberlain and Wheatley houses.
If the Wheatley scheme were carried out to the full extent of the programme put forward in 1924 for the completion of approximately 2,500,000 houses within the next 15 years, and the full Exchequer contribution were paid in all cases, we should find ourselves, our children and grandchildren, at the end of 1980, having paid over one thousand million pounds for subsidies to one industry alone. Wisely, however, Mr. Wheatley included in his Act a provision which allowed the contribution for houses built after September 80th, 1927, to be reduced, if the cost of building and other conditions warranted a reduc- tion. Under this clause Mr. Neville Chamberlain has acted, but he has not abandoned the subsidy altogether, fearing that precipitate action might dislocate the house- building programme. He is proceeding by very easy stages. But already this policy has been justified by the results, for the cost of building has been coming down. A non-parlour house that at the end of 1920 was costing at the maximum £888, was being built last July under contracts let by local authorities for £418. It is probable that during the last two months there has been some increase in prices, for plasterers, recognizing that local authorities wished to complete houses by September 30th in order to obtain the old rate of subsidy, took advantage of the nation's need to demand in many cases 2d. an hour extra. Under the circumstances their demands had to be met, and this temporary rise may affect the average price. It is, however, encouraging to note that in the last year there has been a fall of £37 in the cost of a house without a parlour.
All the indications, moreover, for the future are a still further decrease in the cost of building in the next few months. Mr. Chamberlain has taken a common-sense and businesslike step in making this first reduction.
In any case there is good reason to hope that next year it may be possible to build houses that will let for 4s. 6d. a week. Already in Halifax and in certain parts of South Wales, small houses have been built and let at 5s. a week. Unfortunately it must be confessed that, in the main, the housing schemes on which so much effort and money have been expended have failed to meet the needs of the poorest class in the community. In many cases they are occupied by tenants who belong to the lower middle class with incomes of £5 or more a week, whereas the urgent need to-day, if our slum areas are to be cleared, is for the houses that can be rented by unskilled artisans earning about £3 a week. We have already called attention to the existence of insanitary areas that fester even under the shadow of the House of Commons. But no local authority can make any considerable progress in clearing slums unless alternative accommodation is available in which to place the dishoused tenants.
In recent years over £3,000,000 has been spent on the acquisition of slum property and for re-housing. To-day many far-seeing local authorities are quietly preparing in their offices schemes for the further clearance of insanitary areas, and are anxiously awaiting the Government's promised Bill to assist them to do this. The solution, however, depends partly on providing cheaper houses and partly on more power being given for the planning of built-up areas, which is another and even more complex problem. To-day's reduction of the subsidy, however, marks an advance towards the opening of a national campaign for clearing slums, B. S. TOWNROE.
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