On November 16, 1946, soon after World War II, the cabinet instituted the modern Japanese orthography as part of a general orthographic reform.
The h-row was historically pronounced as fa, fi, fu, fe, fo (and even further back, pa, pi, pu, pe, po).
Japanese f (IPA: [ɸ]) is close to a voiceless w, and so was easily changed to w in the middle of a word; the w was then dropped except for わ wa.
The vowel + (f)u changes do not apply between elements of compound words, for example, the name てらうち was Terauchi not Terōchi, as it is Tera (temple) + uchi (inside, home).
For example, the educator Ishikawa Kuraji wrote his innovatively space-separated and softly hyphenated hiragana text with わ instead of は and え instead of へ, although he still kept を.