A new report from the Common Wealth think tank has ignited a fresh debate about the long-term impact of Margaret Thatcher’s Right to Buy scheme. The report claims that the policy, which allowed council tenants to purchase their homes at a significant discount, has cost UK taxpayers almost £200 billion and is a major contributor to the country’s ongoing housing crisis.

Key Points from the Report:

• A “Massive Giveaway”: The think tank’s report describes the Right to Buy scheme as one of the “largest giveaways in UK history.” Since 1980, approximately 1.9 million council homes have been sold in England at an average discount of 44% of their market value.
• Cost to the Taxpayer: Common Wealth estimates that the £200 billion figure represents the “opportunity cost” of these sales—the wealth that local authorities could have retained if the homes had been sold at full market value or kept as social housing.
• Fueling the Housing Crisis: The report argues that the policy has created a vast shortage of social housing. It notes that a significant number of former council homes are now in the private rental sector, often at higher rents, with many tenants relying on housing benefits. This, in turn, has led to increased costs for councils and a decline in their ability to build new social housing.
• Turbocharging Inequality: By transferring public wealth into private hands, the report suggests the scheme has also “turbocharged inequality.” While it allowed some working-class families to build wealth through homeownership, it did little to benefit those at the bottom of the wealth distribution.

Looking Ahead: Potential Reforms

The findings of this report come at a time when the government is already considering reforms to the Right to Buy scheme. While not looking to abolish it, changes are being considered to make the scheme more sustainable and help councils replace the homes they sell. Potential reforms include increasing the minimum tenancy period required to be eligible for a discount and allowing councils to keep more of the money from sales to fund new builds.