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Oxbridge College riches

An ill-informed article in The Guardian draws attention to the “riches” held by Oxbridge colleges – £21 billion, according the report, “Guardian study reveals how wealth of nearly 70 colleges is held in estates, endowments and artworks“. The mischief and disinformation is the aggregation of estates, buildings and artworks under the title of “assets”. The buildings, being hundreds of years old and scheduled ancient monuments, are more of a liability than an asset. The artworks and other historic artifacts, whilst they might fetch vast sums at auction, are also liabilities which are costly to conserve and insure, and generate no streams of revenue. That leaves the estates. The colleges occupy valuable city-centre sites, but since they could not be redeveloped for commericial or residential use and are encumbered by historic buildings, their value is also trivial.

It is a pity that the authors of the study missed the main point. The wealthiest of the colleges have valuable land holdings. St John’s College, which tops the Oxford list, owns most of north Oxford. This was originally poor quality grazing land, but was developed for housing in the 1870s, when Oxford dons were allowed to marry. The properties were sold on 99 year leases, probably at a modest price. However, this is now prime residential real estate. Other colleges have been steadily buying up land in the city centres for centuries and are also holders of what has become, but was not originally, valuable real estate yielding solid rental income. You would never guess this from the Guardian’s article.

Now the mischief is this. Any economics tutor who drew attention to the economics theories developed by Henry George would quickly get a tap on the shoulder from his bursar, telling him to lay off the subject. In fact, they would probably never have been appointed if their views were known. Thirty years ago, there was a junior Oxford fellow who was quite keen on promoting LVT and often used to tout the idea. Gradually, he said less and less, and now he is an Oxford professor he says nothing at all on the subject. So the chances of anyone going to Oxford and coming out with a sound knowledge of the role of land in the economy are minimal. Since this includes most of those who become senior members of the government, whichever party is in power, it means that their toolbox is bereft of effective policies.

Postscript A subsequent Guardian article has drawn attention to the Oxbridge college landholdings. That’s more like it. The article was not open for comments.