Introduction

In the long history of attempting to ensure housing affordability in Britain, the most constant theme has been that of supporting the provision of housing to be let at sub-market rents and allocated administratively. This has mainly been addressed by supply subsidies to local authorities and social sector organizations. There has been only very limited use of direct subsidies to other providers. In this chapter, we therefore concentrate on understanding the nature of these subsidies and how they have impacted on the supply of affordable housing and the rents charged for these properties. We also compare the development of our policy approaches to those in other countries, notably in Europe where in many cases there has been a long history of government involvement.

The policy objectives of social housing provision appear simple: to ensure that everyone is adequately housed, and that housing does not limit the capacity to obtain the other necessities of life, or to take advantage of life's opportunities. Social housing can help to achieve these goals by increasing the total available stock; allocating it to those in need; providing rent and/or income subsidies to those still unable to afford adequate accommodation; and by effective management and support, including enabling access to jobs, services and a safe and secure environment.

Economists tend to argue more in their own terms, that the provision of affordable housing can address issues of market failure in the supply of both new building and the existing stock; but that it may also take account of housing as a ‘merit’ good (where society values the good more than individuals); or most importantly that through administrative allocation it can help meet distributional objectives.

Many commentators in the past assumed that once minimum physical standards were achieved the task would be complete. The reality has proved to be very different as aspirations, standards and social objectives have expanded and the increased capacity to implement different forms of intervention has opened up other opportunities. Here we stress how these factors have modified the role of social housing over time.