The whole of this surplus profit is devoted to building new houses and to buying and developing more land, so that Bournville automatically increases in size year by year. At the present time it is growing at the rate of about 50 houses, or say, 250 persons, per annum, and the rate of increase will, of course, be progressive.

In considering the above figures it must be remembered that the Bournville Trust in 1900 had the whole estate handed over to it by Mr Cadbury as an absolute gift. No capital charges had therefore to be met. I am informed by Mr L. P. Appleton, the building manager, however, that, with regard to the houses erected by the Trust itself, they all show a net return of 4 per cent. on the capital, after providing for ground rent, rates and taxes, repairs, management and all out-goings.[49]

The respective parts played by land and capital in such a scheme should be carefully noted. If a municipality acquired land at £100 per acre, and laid out roads and sewers at a cost of £400 per acre, and erected upon each acre ten houses costing £280 each, the total outlay per acre would be £3,300, and per house £330. How little a considerable variation in the cost of land affects the result will be realized from the following table:

It is not commonly realized by many of those who write on the housing question that building land is a manufactured article, and that when raw land is secured housing is as far off as ever unless capital can be secured to develop it. It would rarely be necessary for a municipality to pay more than £200 per acre, but whether it paid £20 or £200 the cost of making roads, sewers, etc., and of erecting the houses would remain the same. To house all our people on the scale of ten families to the acre as at Bournville would absorb only 900,000 acres of land, which could be acquired for quite a moderate sum of money at a small remove from crowded centres, but the cost of manufacturing the land and of manufacturing the houses would be great.

Given the provision of healthy houses by a municipality, would they be appreciated by those for whom they were intended? Here the experience of Bournville is conclusive. The village has never a house untenanted and the new houses are eagerly sought after long before they are completed. There is a constant stream of applications, and this in spite of the fact that Birmingham is distant four miles. Many of the men cycle to and from their work in the big city. They do not come to Bournville for charity rents. They have to pay about the same rentals as in Birmingham. The difference lies in the substitution of a healthy and lovely home for a gloomy and uncomfortable tenement.

There is nothing in the Bournville scheme which cannot be effectively carried out by any municipality. Under the housing acts local authorities possess the power to acquire land for present or future building operations, the power to raise loans, and the power to build. The explanation of their sluggishness in putting the acts into effect is to be found in the fact we have already noted, viz. that the housing question is chiefly a capital question. This was slightly recognized by the Housing of the Working Classes Act of 1903 which extended the period allowed by the 1890 Act for the repayment of loans from 60 years to 80 years.

The vital importance of good housing makes it necessary to do something to put capital cheaply at the disposal of local authorities for the purpose. The housing question is a national one, and demands the use of national capital. Again we touch the matter of ways and means and again we see the advantage of considering social problems in relation to the income and accumulated wealth of the country. Year by year, as we have seen, an enormous amount of capital is wasted. British workmen, denied proper housing, are paid something less than the value of their product, while the margin is largely wasted in luxury at home or even sent out of the country to establish water works in Argentina, supply the sinews of war to Japan, or employ Chinese Coolies in South African mines. The time has come when the nation must consider the nature of its resources, and study its own development. We must see to it that the demand for houses, the primary demand of a civilized man, is answered, not by the speculative builder, but by the nation itself.

The proposal here made is a simple one. It is that National Housing Loans should be raised and the proceeds placed in the hands of a permanent Housing Board or Commission which should be empowered to guide, assist and if necessary stimulate local authorities to rehouse their poor. The Housing Board should have power to lend money to local authorities, for the execution of approved schemes, for a period of 100 years at a nominal rate of interest, say 1½ or 2 per cent., the loss to be made up out of the proceeds of Imperial taxation. To deal effectively with the question, a yearly loan of at least £20,000,000 would be needed for some years. Borrowing this at 3 per cent. and lending it out at 2 per cent. would create a charge of only £200,000 for each £20,000,000. If then we authorized an annual issue of £20,000,000 for ten years—in all £200,000,000, the total annual charge through loss of interest would be but £2,000,000. Such a loan, about two-thirds of the cost of the late South African war, would not only rehouse one-tenth of our people, but place local authorities in possession of assets yielding a fine revenue,[50] which on the Bournville plan, could be used for the progressive extension of housing schemes. With access to capital for housing at 2 per cent., and 100 years in which to repay it, local authorities would be eager to claim their share of the national housing provision. The loan would only be granted on the approval of plans for the extension of the town boundaries, for transit facilities, and of plans of the houses, gardens and recreation grounds for which the loan was desired.

Failing action by the local authority, the Housing Board would make a compulsory housing scheme[51] upon representation by the persons lacking accommodation.

A drastic housing policy is needed as much in rural as in urban districts. Want of housing accommodation is helping to thin our country population, and the Housing Acts have been simply ignored in the past by Rural Sanitary Authorities. On this head the Housing Bill of 1909 makes salutary provisions giving county councils power to act in default of rural district councils, and also giving power to the Local Government Board to order schemes to be carried out within a reasonable time.

We have to do something more for the agricultural labourer than house him, however, and here we touch another question intimately bound up with national development—the land in its primary aspect as the basis of agriculture and the source of food and material. This brings us to the consideration of the empty country.