The "right to buy" introduced by Margaret Thatcher has left thousands of families trapped in ghetto estates, the former Conservative leader Iain Duncan Smith has warned.
He said Mrs Thatcher's government failed to foresee the social consequences of the flagship reform, which allowed council tenants to buy their homes, and failed to bring in important social reforms. He said the totemic Conservative policy of the 1980s left the worst estates dominated by "the most broken families".
He told the think-tank magazine Fabian Review: "Nobody really thought about what happens if you allow only the most broken families to exist on housing estates. You create a sort of ghetto in which the children who grow up there repeat what they see around them."
He added: "While I'm not going to point the finger and say the changes made in the 1980s were wrong, we didn't have any real sense of where this might go and what needed to happen. Big social reforms should have taken place then, and they never did.
"We forgot that, while the economy was moving on, a society itself was not really ready for this. Swathes of the population got left behind in the process. The gap between the bottom socio-economic group and the rest started to grow, and it's grown ever since. Under Labour it's grown almost faster in some senses."
Mr Duncan Smith, whose Centre for Social Justice think-tank has played a central role in developing David Cameron's social policy, has condemned the degeneration of many areas into sink estates.
He said Ken Clarke, the shadow Business Secretary, was "wrong" to oppose tax breaks for married couples, and praised the former Labour chancellor Denis Healey for carrying out important policy reforms after calling in the International Monetary Fund in the late 1970s.