Property, Family and the Irish Welfare State, by Michelle Norris, Palgrave Macmillan, 304 pp, €93.59, ISBN: 978-3319445663
In this book, Michelle Norris proposes a novel hypothesis: that property played a key role in the Irish welfare system for much of the period from the late nineteenth century until the economic crash in 2008. She provides an impressive range of data and evidence to support her claim. Property redistribution was indeed the focus of government policy for most of this period. Prior to independence in 1922, the UK government had made considerable efforts to facilitate the transfer of land to Irish tenant farmers and social housing to landless farm labourers. The evidence presented shows that land reform became a core “social policy” in rural Ireland, with particular reference to the permanent smallholder class. This in turn enabled rural social housing tenants to secure the right to buy their dwellings – a right much later extended to the urban population.
The book is divided into five periods: Establishment, 1870-1921; Construction, 1922-1947; Saturation, 1948-1968; Retrenchment, 1969-1989 and Marketisation, 1990-2007. The chapter on the establishment period provides a detailed chronology of the various land acts relating to landlords and tenants and acts designed to improve the housing conditions of rural labourers and artisans. By 1909 a total of 270,000 tenants had bought their farms with government support. The Congested Districts Board, established in 1891, also played an important role until 1923 in land distribution and in alleviating “congestion” and poverty in the poor west and southwest of the country. During this early period local authorities had built 44,000 homes, the vast majority in rural areas. The principal reason for land and housing policy was the mobilising ability and influence of the tenant farmer lobby – an influence they were to retain for much of the twentieth century.
The emphasis on property as an element of welfare was to continue during the “construction” period from 1922 to the late 1940s. The Land Commission, established in 1923 as a successor to the Congested Districts Board, was given a key role in acquiring land from large landlords and redistributing it to smallholders, who became liable for “annuity payments” over an extended period. At the same time the new Irish government established a “Million Pound Scheme” to construct housing – the vast majority being sold off rather than rented. This preoccupation with home ownership, encouraged by tax incentives and grants, was to persist in the years ahead.
While not normally regarded as a “social policy”, home ownership, Norris argues convincingly, was largely a “socialised tenure” financed by direct and indirect subsidies and local authority mortgages. This was, in her view, a “welfare service” and a key element in the property-based welfare state.
This approach was strengthened further by the sell-off of social housing at considerable discounts and whether this provided much benefit to the least well-off is open to question. However, there is little doubt that the mainstream welfare system received much less attention during this period. The “saturation” period of the 1950s and 1960s saw support for home ownership continue unabated and it was extended to the urban middle class population via subsidies and grants and to the working class through tenant purchase. However, other elements of Ireland’s social welfare system, including the health service, expanded more modestly in comparison with their growth in the UK and other western European countries.
Norris examines the dramatic reduction in subsidies for home ownership, the demise of the Land Commission, the reduction in borrowing facilities for social housing and the economic downturn of the 1980s. However, the sale of council housing to sitting tenants continued with increased generosity. During the period 1969 to 1989 alone over 103,000 homes were sold to tenants at significant discounts, while only 114,000 were provided by local authorities, many purchased at market value. The infamous £5,000 surrender grant introduced in 1984 was a misguided policy which resulted in the exit of the relatively well-off and those with leadership qualities and the increased concentration of disadvantaged households in urban estates.
In contrast to earlier periods, the period from 1990 saw a significant shift in the role of the state in relation to housing provision. In the place of previous state-led initiatives, the provision of homes for sale or rent was to become almost exclusively market-driven. If individuals or families had the “ability to pay” – a key requirement in the market – they could purchase or rent homes. Without resources, however, they could do without. The key players in this market approach were the commercial banks, building societies and property developers. “Light touch regulation” by government and the Central Bank left them to their own devices, but they were encouraged by tax incentives. The result was a significant expansion of irresponsible lending by the banks and reckless borrowing by property developers and individuals. House prices escalated far out of line with other indicators; yet overpriced houses were purchased in their thousands. It could only end in tears – and it did.
A massive property crash occurred in 2008, resulting in a costly bailout for the banks, bankruptcy for property developers and negative equity for unfortunate home buyers. A long period of austerity followed, involving severe cuts to public services, increased unemployment and out-migration. This period is not covered in this book but it was the result of the “market-driven” and “light touch” approach in what Norris calls the “marketisation” period. We are left with a two-tier health system, where the people without resources must wait for an extended period for attention. Similarly, we have a continuing “housing crisis” and, despite genuine efforts of recent ministers with responsibility for housing, the current situation is no different than what many of us pointed to over ten years ago. The current housing problem represents serious “market failure” in that property developers and builders are failing to build sufficient homes despite a significant increase in demand and need. Furthermore, the private rented sector is most unlikely to provide the expected high proportion of social housing required. This points clearly to the need for a far more active role for government, local authorities and housing associations in providing for housing need.
In summary, this book offers a most useful addition to the literature. It provides a comprehensive analysis of the legislation dealing with land and housing over an extended period. It demonstrates clearly that successive governments before and after independence placed enormous emphasis on land and housing as an element of welfare. Obvious questions arise in relation to which groups gained most from this approach. However, governments had at least accepted their responsibilities in relation to the above two key requirements. The handover in recent years to financial institutions and other players with a heavy market orientation has served us badly.
Professor PJ Drudy is an economist based in Trinity College