Spreading the word

Submission to the Barker Review by the House Builders Federation: The will to succeed, Constructing policies to meet housing need, August 2003

Over 53 pages the HBF stressed that the planning system, not construction methods, was the biggest barrier to producing more homes.

Even if the whole industry changed to new construction methods overnight and speeded up completion levels, planning constraints would continue to restrict the total number of finished projects, it argued.

It added that MMC would not reduce the price of housing. If it cut building costs, firms could either increase profits or put savings into its land bids to gain a competitive advantage.

The HBF also warned against rushing into untried methods: “Homes have a very long life. It may be many years before faults are found and they can be very expensive to remedy.” And it raised concerns about the difficulty of securing mortgage finance for untried technology.

Increased planning permissions would ensure a sustained increase in house building and lead to the industry investing in the necessary recruitment, training and new technologies.

"We agree with the argument outlined in the Barker Report that housebuilding in England needs to be expanded by a higher rate than 55,000 dwellings a year. The most important single constraint on the industry’s output is the operation of the planning system, which needs to be speeded up. In addition, as outlined in the report, sustainable communities do require a balance of house types, tenures, occupations and income groups, and planning policies need to respond to the desire for diversity and choice and avoid prescriptive one-size-fits-all solutions."

Chris Crook, subsidiary managing director of Countryside Properties

Manufacturing Excellence, January 2004

Manufacturing Excellence was published by the Housing Forum’s modern methods of construction group. It focused on the adoption of off-site manufacturing and concluded that more and more housing organisations were “ready and willing to respond to the real challenges” of OSM.

The forum’s research suggested that suppliers were operating at around 70% maximum plant output but that although there was scope to expand, this was limited by market demand and existing production capacity.

However, the report warned of the danger in expecting the market to develop too quickly and recommended that developers and manufacturers take time to develop closer links and identify suitable projects.

In conclusion, the report found that OSM could relieve some of the traditional skills shortages in construction but needed its own pool of suitably trained labour. It called for action to encourage careers in this area.

Planning authorities and consumers should also be informed of the merits of OSM but until certification of systems becomes the norm for manufacturers, lenders will continue to have concerns over the security of their investment.

" The report showed that there was some progress in using modern methods of construction more widely, but barriers within the construction industry remain. I think modern methods offer the potential for better construction and are a useful approach to rationalising the delivery process. This certainly warrants more research. But in itself, MMC won’t automatically give you a good design. That still requires a good design team and long-term investment and commitment from the client – just like any other construction method."

Eleanor Warwick, head of research at Cabe

The barker review of housing supply, March 2004

The aim of economist Kate Barker’s 158-page report was to set policy recommendations to address “the lack of supply and responsiveness” in housing in the UK. Barker called for an additional 70,000 houses each year in England to cope with problems of affordability and homelessness.

Embracing innovation was, according to the review, vital to boosting supply. It indicated that the higher costs of MMC had restricted incentives to change building techniques, but added that improved build quality was one advantage of switching to modern methods. Barker called on the House Builders Federation and National House Building Council to develop a strategy to address barriers to modern methods of construction.

Because a shortage of specifically skilled labour might be a barrier to take-up of MMC, the report urged the Construction Industry Training Board, ConstructionSkills and the House Builders Federation to develop a strategy to increase the take-up of apprenticeships. For example, were housebuilders investing enough in their own workforce training, as well as addressing the skills needed for MMCs?

However, Barker was optimistic that the economic rationale for MMC would be clear and more would adopt the approach in time.

"Governmental review documents have served a primary purpose in centrally galvanising the house building industry into consistent action in recent years. Quality of build and customer care issues have received renewed focus and given all companies, large and small, a framework to work within. On the report’s emphasis on workforce issues, the challenge is to encourage new blood into the industry and give enough training for overseas workers."

Greg Locke, chief executive of David Wilson Homes

Department of Trade and Industry, construction sector unit annual report 2004/5, June 2005

The DTI document heralded off-site construction as being “poised to make significant contributions” to the built environment, adding that there was also
interest in innovation from the retail and commercial sectors.

As 2004 had been the first full year of operation of Constructing Excellence, the DTI said the forum was helping to reduce confusion about where firms should go if they want to understand and take part in the industry improvement agenda. Constructing Excellence’s position in the industry as a “hub” for innovative best practice was, said the DTI, developing well. The department also hoped that Buildoffsite, which aimed to promote the uptake of off-site techniques, would become “the focal point of the construction industry and its clients for off-site manufacturing”.

" A useful reference source that provides a concise review of the main government initiatives. Innovation and modern methods of construction continue to be restricted to the fringe of the industry, largely limited to small, directly government funded programmes. There is little evidence within the report of enthusiasm for modern methods of construction from the private companies within the sector. If the industry is to realise the benefits of MMC it must become more common place."

John Hughes, deputy director of project construction at Genesis Housing Group

National Audit Office report: Using modern methods of construction to build homes more quickly and efficiently, November 2005

The aim of the NAO study was to identify good practice and encourage improvement. It noted that building processes were not changing enough to get the best out of MMC.

One of the key findings of the 2005 study was that MMC should make it possible to build up to four times as many homes as established techniques, while using the same amount of on-site labour. Construction time, it added, could be more than halved with building performance promised to be at least as good.
However, the NAO found that costs, although comparable to traditional methods, tended to be higher on average. Because of the potential of risks in the early stages of the development process, good risk management was vital.

In summary, the report found that the search for best value was not simply about the lowest cost: “It is vital to maintain and enhance quality, including those aspects of quality that affect durability, lifetime running costs and overall performance in areas such as environmental sustainability.”

" While most of the issues raised have been previously aired, it’s backed up by thorough analysis – essential when decisions on whether or not to adopt MMC are so often based on very sketchy information. The major wins that can be taken from the report are the publication of hard data on cost, programme and programme benefits, the focus on project process maps needed to obtain the full benefits from MMC and the very pragmatic section on risk which emphasises MMC’s very different risk profile."

Simon Rawlinson, partner at Davis Langdon