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conditions therein. Under the Act any financial loss on the scheme as well as losses
on schemes undertaken by metropolitan borough councils, so far as they exceed
the produce of a penny rate, are borne by the National Exchequer. Owing to financial
stringency, the house-building programme was considerably curtailed by the Minister,
and eventually the number of houses to be built by the Council, apart from
dwellings for rehousing in connection with clearance schemes, was reduced from
29,000 to 8,814. Of these, 7,433 had been completed by the end of 1923.
Although the Government did not continue to undertake the unlimited liability
previously involved, it soon became convinced that some form of State assistance was
necessary. Not long after the curtailment of the Council's scheme there was a general
fall in wages and cost of materials, the combined effect being to reduce building
prices within more reasonable limits. This was naturally followed by a revival of
house building by private enterprise, but the houses were almost entirely intended
for sale and were destined in the main for middle class occupation. The Government
therefore decided to assist local authorities to build houses, and at the same time
to encourage the provision of small houses by private enterprise by the contribution
of a fixed sum per house.
The State's liability was thus limited, any loss beyond the amount of its contribution
being borne by the local authority. In fixing the State's contribution
it was intended that the loss upon a scheme undertaken by a local authority should,
as far as possible, be borne equally by the State and the local authority, but the loss
seems to have been under-estimated and in most cases the larger share falls upon
the local authorities.
The Government's proposals were embodied in the Housing, etc., Act, 1923.
Primarily the Act aims at encouraging the building of houses by private enterprise, and
before municipal effort can qualify for the State grant the Minister of Health must be
satisfied that the needs of the district can more appropriately be met by the local
authority itself. The State contribution is a sum of £6 a house for 20 years payable
annually to the local authority. Such houses must be completed before 1st October,
1925, but this period may be extended to 1st June, 1926. The local authority,
for the purpose of encouraging the provision of houses by private enterprise, may grant
assistance by either lump sum payments or annual grants, supplementing the State
contribution to such extent as it may deem desirable with the approval of the
Minister.
The object of the Act is to assist in the construction of houses mostly in demand
for occupation by the working classes, and, except in special cases to be determined
by the Minister, houses must be either (a) a two-storied house with a minimum of
620 and a maximum of 950 superficial feet, or (6) a structurally separate and selfcontained
flat or a one-storied house with a minimum of 550 and a maximum of
880 superficial feet. Each house or flat must be provided with a fixed bath.
The Council, on 31st July, 1923, approved a scheme for the administration of the
subsidy provisions of the Act. Under this scheme a purchaser of an approved new
house for his own occupation (including any person employing a builder to erect a house
in which he intends to reside), provided that he satisfies the Council, after due consideration
of his financial resources, as to the need for a grant, is eligible to receive
from the Council a grant equivalent to £6 a year for 20 years, or a lump sum of £75,
subject to the Council's approval of the price to be paid.
The present situation calls for the production of houses which may be rented for
occupation, and the Council has decided to make money grants as follows in respect
of approved houses and flats erected and maintained for letting for residential purposes
at inclusive weekly rents fixed by comparison with the rents of existing houses in
the same neighbourhood :—
(a) For a house with not more than two bedrooms, with or without a parlour,
a grant of £9 a year for 20 years.
(b) For a house with more than two bedrooms, a grant of £8 a year for 20
years.