THE COTTAGE PROBLEM. T HE second part of Lord. Lansdowne's speech
on Unionist policy as regards the land dealt, and dealt with singular knowledge and ability and in the best possible tone and temper, with what we believe is the most important of all the rural problems—the problem of providing cottages in the country at a rent which the agricultural labourer and the country labourers generally can pay without undue sacrifice. In the last resort the problem is one of cheap construction. The rural labourer cannot afford to pay more than 2s. 6d. a week for a cottage. If he pays more his wages are reduced in a great many cases to a level hardly endurable. But at present it is generally considered impossible in this country to produce a cottage which can be let at 2s. 6d. a week without serious loss to the person who builds, even if no account is taken of the land which the cottage and its garden occupy. Landlords think themselves lucky if they can build a pair of cottages for £400, and, as a rule, another £50 has to be added to each cottage for fencing, making the approach, and securing a water supply, either by laying pipes to some existing water system or by digging a well. But if a landlord has to sell out stock paying 4 per cent., which he would have to do now in order to build a cottage at £250, he must, if he is not to lose on the transaction, get back at least £11 a year in rent even if the tenant pays the rates, for provision must be made for insurance, repairs and other small outgoings. This means, in effect, that he cannot let his cottage under 4s. 6d. a week if he is not to be out of pocket. But ordinary squire land- lords, whatever Mr. Lloyd George may say, do not in the greater part of England think it possible to ask 4s. 6d. a week for cottages. In many cases they only ask ls. or ls. 6d. a week, and we may put 2s. 6d. as the maximum asked by the Landlord class from ordinary :abourers. What is the result ? Landlords feel that they cannot build cottages without a loss of, say, £5 a year per cottage on the transaction, and they do not therefore build unless they are obliged. That is to say, they only feel compelled to build sufficient cottages to provide the labour without which their farms could not be let. No doubt a great many also build a certain number for philanthropic reasons, but that is another matter. We are now speaking of the business side of the transaction. The result is that in almost all rural districts in England, and in a very special degree in the south of England, there is a dearth of cottages. Very few new cottages are built to be let at 2s. 6d. a week or under, and when old cottages become uninhabitable, as they are constantly becoming, they are very often not rebuilt. No doubt a certain number of small speculators build cottages as investments, but these cottages, one may safely say, are never let at 2s. 6d. a week or anything like it. They are much oftener let, at any rate in the South of England, at sums from 5s. to 6s. a week, or in some parts of Surrey as high as 7s. a week.
Here is the problem. How is it to be solved ? Some people seem to think that it can be solved by the imposi- tion of a minimum wage for rural workers. If nobody earned less than £1 a week everybody would have enough money, it is argued, to pay a sufficient rent to encourage people freely to build houses, even under present conditions. The hope is illusory. We all desire that the wages of agricultural labourers and of other rural labourers should rise, but for the State to interfere in this way could only cause a terrible catastrophe to rural industries. Such interference would do exactly the opposite of what it was intended to do. It must end in the gravest injury to the economic interests of the country labourers. It would most certainly lower the demand for labour in the country. But no man's wages were ever increased in the end by lowering the demand for his labour, for labour is the thing which he has to sell. The next suggestion is that the State, or rather the local authorities, should build cottages and let them at an uneconomic rent— not at a rate which will pay the interest on the money expended by the local authorities and so secure them from a loss, but at a much cheaper rate. The difference between the actual annual cost of the cottages and the rent to be paid by the labourers would be made up from the rates. That way madness lies. At present, if they only knew it, a great part of the bad condition of the agricultural labourers is due to the pressure on them of the rates—of the most stupid, nay iniquitous, system of taxation ever devised for the depression of a great industry. The greater the burdens piled upon the rates, the more certain the poverty of the labourer. It is no use to reduce rent with one hand and to pile up rates upon the cottages with the other, and at the same time increase the rates levied on the man who employs the labourer, for that makes him unable to offer better wages.
The only sound and hopeful way of getting a better supply of cottages at rents the labourers can pay without an undue deduction from their earnings is to cheapen con- struction, to discover, if possible, some means by which a cottage can be erected at a price between £100 and £150, and thus can be let without economic loss at 2s. 6d., or at the most, 3s. a week. Cheap construction is the essential thing. Even those who do not agree that the fixing of a minimum wage would do more harm than good, or who think that there is some solution to be found in the building of cottages by the State or the local authority direct, must still admit that cheap construction would be an advantage. Even if we could secure the rural labourer a rise of five shillings a week in wages all round, it would still be a. great advantage to him to have a cheap rather than a dear cottage. To put it at the lowest, dear con- struction means economic waste, and economic waste is the greatest injury that can be done to the material interests of mankind. Can cheaper construction be secured ? We have no panacea to offer, no miraculous suggestion to make, but we do believe that with care, and if sufficient ingenuity is brought to bear upon the problem, cheaper construction can be secured. At present landlords, as a rule, spend too much upon their cottages, doing so often out of a mistaken sense of duty and because they do not realize that a second-rate cottage, though not as good as a first-rate cottage, is a great deal better than no cottage at all. They feel ashamed not to build what they consider a perfect cottage. No cottage at all is the result. In cheap construction one of the most important factors, perhaps the most important factor, is cheap money. The money out of which the cottage is built has got to come from somewhere. Whether a man uses his own money or borrows it, it means taking the amount of money required away from where it was earning its wage as capital. To put it in another way, a man, if he does not borrow from somebody else, must borrow from himself. Now it makes all the difference to the rent at which a cottage can be let whether a man borrows at 3 or 41 per cent. The additional 1 per cent. means, roughly, an extra 5d. a week in rent, a very serious sum to the agricultural labourer. Next to cheap money in importance we may mention freedom of construction. The builder should not be hampered by all sorts of by-laws and restrictions in regard to the material he is to use or the ways in which he is to use it. The more the builder's hand is tied the dearer the cottage will be. We admit that it is necessary to have some sanitary regulations, but, speaking generally, the less the better if we are to secure cheap housing. The simplest by-laws are the best.
We must next ask, What can the State do to encourage and help cheap construction ? To cut a long story short, we believe that in the majority of cases cheap cottages can only come through encouraging landlords to build. Both by instinct and tradition they are the class most inclined to make sacrifices in order to secure the welfare of the rural labourer, and sacrifices there will no doubt have to be in order to get cheap cottages, even when the landlord is secured against heavy out-of-pocket losses. As a general rule the landlords are able and willing to provide the land for a cottage and a garden without charging for it. If a man is asked to cut, say one-sixth of an acre out of a field and to sell it as a site for a cottage, a price must be paid for it, and this must enter into the rent. If, however, the landlord himself builds, in nine cases out of ten he does not bring the price of the plot of land into the calculation. We would secure cheap money by making loans to landlords for the purpose of cottage building at the very lowest rate that the State can lend without actual loss, that is, at 31 per cent. To be specific, we desire that the State should lend to any landlord £150 per cottage—provided that the cottage, in respect of which the loan is made, has three bedrooms, has attached to it not less than one-eighth of an acre of garden, has a proper water supply, and that the rent charged to the occupier is not more than 2s. 6d. a week. To encourage landlords to enter upon these loans we would make the restrictions as to plans and materials to be employed as simple and as elastic as possible. Further, we would absolutely and entirely exempt any land upon which one of these loan cottages was erected, and also the garden attached to it, from the operation of the new land taxes, from the death duties, and indeed from all forms of taxation except the rates. As, however, it is never possible to say what may happen in the course of generations to a particular piece of land, we would not, as it were, sterilize for ever the cottage built under the system of £150 loans. If a landlord for any reason wished to make a new use of the land, we would allow him at any time to pay off the Government loan in full and resume complete liberty of action in regard to the cottage.
The loans for the cottages should run for sixty-five years, and there should be a Sinking Fund created by an extra payment of, say, 12s. 6d. a year beyond the 32 per cent.
interest. We believe that if an offer of this kind were made to the landlords, and they were able to feel that they were secure against any great out-of-pocket losses, and also secure against the predatory and harrassing exactions made under the new land taxes, they would on a very considerable scale avail themselves of the Government loans. We need hardly say that we do not suggest that the loans should be made solely to the squires. Any owner of land who would agree to the terms proposed and give the proper security should be allowed to use the Government loans. The same thing, of course, applies to co-operative and other societies formed for the purpose of cottage building.
The suggestions which we have just made differ very little in principle from those which were so admirably expressed by Lord Lansdowne in his recent speech. The only point, indeed, on which we venture to differ from Lord Lansdowne is his inclination to allow county councils, district councils, and other local authorities to borrow money with which to build cottages. We cannot go so far as this, for we feel convinced that the most extravagant and expensive builder in the world is the State, whether in the shape of the central government or of a local authority. We would not only not lend local authorities the money to build, but would actually prohibit them from burdening the rates by operations which we believe could never come under the head of cheap and therefore useful construction. State or municipal building is sure to mean economic waste. The only case in which we would allow the local authorities to build would be in order to provide houses for their own employees. By all means let the county council build such cottages as are required to house the police, the road men, or other permanent employees of the local authority, for in that case there is a proper restric- tion on the operations and the local authority is sure of a tenant who will pay his rent. When, however, a local authority speculates in bricks and mortar and builds in the vague and in order to let, one of two things is certain to happen. If it asks a rent which will repay its outlay, the rent in most cases will be high beyond endurance, and may very likely lead to the cottages remaining vacant. If, on the other hand, it asks a rent below cost price, it will be adding to the burden of the rates, and actually creating the very ills which it is trying to cure.
Let us, before we end, say once more that in cheap con- struction, in our opinion, is to be found the only true solu- tion of the housing problem, and that the best way for the State to help cheap construction is by using the landlords as an instrument—by giving them, in the way we have suggested, encouragement to build cheap cottages. But remember once more that we are not suggesting here any patent quick-cure remedy or panacea. There is a path upwards, but it is slow and arduous, and any attempt to take short cuts or to rush it will only end in failure.
Previous page
