[Increase in Local Authority Rents, England and Wales…]

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Increase in Local Authority Rents, England and Wales. Notes: (a) Assuming an average rent increase of 10% increase in prices from April 1981 to 1982. (b) Assuming an average rent increase of £2.50, the govern.

piers with a mortgage have higher than the rate of inflaIndex of retail prices rent increases that are much The effects: 1. The supply of housing.

By reducing housing payments, subsidies have boosted demand yet supply has in general failed to keep pace. The resulting excess demand has led to higher prices in the private and longer queues in the public sector.

Since the War, private sector house prices have risen at neany youva anathy donhle the 111k rate of inflation. Only 3 portion of this is accounted for by improved standards. In stimulating demand, especially in the privare sector. some of the "benefit" of tax concessions has WE'LL NEVER GET AIRBORNE IF THEY PUT EYERYTMING INTO THAT ONE shifted through higher l prices from new buye existing owners and to owners.

No money for poorly housed The system of subsidies has also encouraged underoccupation and a waste of limited housing space, especially in the owner-occupied sector.

Problems have also been created because of the nature of the accounting arrangements for public expenditure on housing whereby current and capital spending compete on equal terms under . increasingly tight cash limits.

In consequence, the share of total public spending on housing devoted to investment has fallen from 70% in 1975/6 to 48% in 1981/2. In effect, public spending has increasingly been used (at least until 1981/2) 10 moderate the housing costs of those ..who are already relatively well "housed instead of improving the housing opportunities of the poorly housed.

Effects 2: Public provision.

That the financial scales are weighed heavily in favour yuse to ind19 August

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