The End of the Right to Buy in Scotland

by Ken Gibb

All my working life it has been hard to avoid the Right to Buy, such has been its dominance in housing policy, ideological debate and electoral politics since 1980. This morning the Scottish Deputy First Minister confirmed that legislation in Scotland will outlaw it in 2014 but not without a three year final opportunity for tenants to exercise the Right before the avenue is closed off forever. It will be a little strange when it has gone – but as many have said, it is a policy that is well past its political sell-by date.

This is the third significant Scottish reform to sales policy in a little over ten years. First, we had the modernised Right to Buy, which widened the Right, created high pressure market areas where suspension of the RTB was possible, but it also greatly reduced discounts to new tenants (but kept the much larger discounts for existing tenants who still operated under the original provisions). Then, second, the SNP abolished the RTB for new build housing to encourage councils to build again.

Third, and after a consultation period, is the decision today to end it altogether, albeit in a slightly odd delayed and somewhat counterproductive way (there is bound to be an artificial unhelpful bubble in sales). Scotland was also distinctive from England through most of the post 1980 period because of the greater willingness of different kinds of Scottish government to allow councils to re-use their capital receipts (which they did extensively to improve their stock without recourse to rent increases).

Nonetheless, nearly 500,000 homes were sold in Scotland and the DFM believes that, as a result of the abolition, as much as an extra 15,000 homes will stay in the sector over the next decade (I would like to see the assumptions behind that calculation). If true, that is important in a context of a Government trying to add 6,000 units of social and affordable supply each year in the face of a huge waiting list of the order of something like four hundred thousand households.

While there are not many in the housing professions who will mourn its passing, at a more basic political level it was a powerful redistributive and empowering mechanism – it was just that it did this in an arbitrary and untargeted way doing little for those at the bottom end.  And, at least initially, it was also a weapon deployed on councils by a hostile central government.

The big picture issues of course were cumulative and incremental – the slow residualisation of the sector, the growth of re-sales increasingly into private renting and the sense of inevitable decline for many social landlords. Politically, you might have thought at one time this was an untouchable policy such was its primacy.  In a context where opposition has become so consensual on Scotland in recent years it has been vaguely bizarre to see the Conservative party continue to champion and even seek to re-start it as an important part of their brand.

In many respects, this journey to wind up the RTB in Scotland has been a triumph of devolution, built around a Scottish consensus (not counting the Tories).  This has also succeeded against the backdrop of a stalled housing market – and in some ways is reminiscent of that other successful gradualist policy achievement – the abolition of MIRAS.