Impact of Neoliberalism on UK Housing Policy

Running head: HOUSING POLICY
Housing Policy
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Author Note

1HOUSING POLICY
Topic – EXAMINE THE IMPACT OF NEOLIBERALISMSM ON
HOUSING POLICY IN THE UK SINCE THE 1980'S.
The Neo-Liberalism can be defined as an era of neoconservatism, pure capitalism, neo-
classicism in the history of Britain. The term is used for a set of principles. In the year 1776, sir
Adam Smith coined the idea of a liberal economy in the book "The Wealth of Nations". It is also
seen as the 19th-century variation when the British rulers, along with other imperialist rulers,
utilized their ideology for justifying the colonialism and expansion (Adams and Saks 2018). By
the early 1930s, the workers revolted, and the classical –liberalism got replaced by the new
termed ‘Keynsianism’. It implied that the state has a dominant role to play in almost every corner
of the development. The neo-liberalism was an ideology that existed as a paradigm along with
other factors in the development economics since the year 1940. In simple words, the
Neoliberalismm emerged in the scenario, when all the countries were walking towards
development, rather global growth (Alvesson and Spicer 2019). It generated out of the
realization that the state is unable to deliver something significant and improve the lives of the
poor. The state intervention resulted in a negative impact, which was highlighted by the neo-
liberalism activists such as Bela Balassa, Ian Little and Deepak Lal in their writings. Through the
early part of the 1980s, the political opinions correlated with the shift in the political views
across the nations and the established institutions such as IMF and World Bank (Boothman,
Craig and Sommerville 2018).
In the year 1980, the underlying philosophy of the neo-liberalism proposed a
restructuring of the relationship between the market and the state. As per the agenda, the country
was given the role to play of facilitator rather than the controller. The state was bound to pave

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the way for the markets to deliver the necessary. At this stage, the sectoral policy reforms and
the economic reforms were considered to be the pre-requisites to conduct smooth operations. At
the same time, there were several measures too, which were advocated. The steps were the
exchange rates, the elimination of the price distortions, liberalization of the government controls,
market open for the foreign capitals, the competition by removing the protective tariffs along
with the import quotas. The agenda had a significant impact on housing. By the later part of the
1970s, it became apparent that the housing provision models were idealized as a result of the
failure of the direct intervention policies. Hence, the supporters of neo-liberalism argued that
excessive regulations of land decreased the investment quality available and also decreased the
affordability rates have led to the subsidies (Jacobs and Manzi 2017). The affordability of the
ordinary people was dominated under public housing schemes. It was suggested that the private
markets should take the functions of distributing the housing stock and the excessive land usage
regulations along with the rent controls should also be eliminated for enabling the housing
markets to operate effectively. As per the neo-liberalism ideology, the subsidies were
unaccountable, monopolistic to the users and provided proper services with least investment.
In the United Kingdom, the price of the homes have doubled over the past ten years, and
since the year 1924, the housing building is at the lowest level. In Britain, it has been estimated
that by the year 2022, there will be a shortage of almost one million homes. Britain is a nation
where 70 % of the adult citizens are habituated to own their own homes, the lack of homes at
affordable prices is frustrating the salary earners. Britain has experienced the housing shortage
at the end of the world war 2nd, and the deficit is leaving the citizens in desperation and
inconvenience (Alvesson and Spicer 2019). The government has been blamed with having slow
planning, which is making the lives of the community people disadvantageous and difficult. It is