Financial deregulation and UK housing finance: Government‐building society relations and the building societies act, 1986

Abstract

Abstract UK building societies are the major source of loans for house purchase and major financial institutions in their own right. Financial deregulation has, however, had major implications for house purchase finance in the UK and for building societies in particular. In an increasingly competitive environment, there was mounting pressure to widen the scope of building society activities. This resulted in the Building Societies Act, 1986. This significantly expanded building society powers and introduced a new regulatory framework. This article gives an account of the background to the new legislation and its content, focusing in particular on government‐building society relations. These, it is argued, went beyond simple pressure group activity or lobbying by the societies’ trade association, the Building Societies Association. Government‐building society relations over this period are best seen as a form of informal, ‘corporatist interest intermediation’, a model which focuses attention on the recipro...