It is often said that there is no such thing as a new idea and it is with something of a weary sigh that we have listened to Brandon Lewis, Housing and Planning Minister, returning to the subject of offsite construction and suggesting it could be the magic bullet that eliminates the shortage of new homes.
It is good news to hear that housing is a priority for the Conservative government and excellent to see that politicians of all major parties recognise the need to build more new homes. However, when a minister starts to suggest that he is in a position to dictate how the housebuilding companies who can deliver that ambition should carry out their business, then I worry.
Advocates of offsite construction frequently make comparisons between the automotive industry and housebuilding, suggesting that increasing automation, factory production and standardisation will inevitably produce the results we are looking for.
This is an interesting comparison because the track record of governments is hardly positive in the automotive sector. Government intervention in the UK car industry of the 1970s preceded a collapse and the decimation of the sector in this country.
Fortunately car production is back in the UK - but it has recovered because conditions were created to attract foreign investment from the likes of Nissan, Toyota, Honda and more recently Tata with Jaguar Land Rover and BMW with Mini. So you would think that attempts to mimic the recovery in automotive manufacturing would focus on the more successful intervention: creating conditions that make the UK an attractive option for investment from the world’s largest building product manufacturers such as Holcim, Heidelberg and St-Gobain.
Instead of which we find an increasingly outspoken Mr Lewis suggesting that the sector will miss all of its targets unless it embraces offsite construction and making some generalised judgements on the efficacy of this method which could be considered to be highly misleading.
No-one is likely to deny that we need more housebuilding in this country – but I would contend that the government’s role is to create the conditions to allow volume building and leave it to the builders to decide the business model that will enable them to deliver.
Given my role as MD of an aircrete block manufacturer, I am scarcely a disinterested commentator, but I have also been working in the construction sector for many years in different roles and have listened to the debate about offsite construction many times.
My main concern right now is that too great a focus from Government on encouraging offsite construction will deter product manufacturers from investing in the production capacity that we need. Having been through a really severe housebuilding recession, the manufacturers that are still supplying the sector are those that have the flexibility to reduce production, mothball plants and survive ready for the market to pick up.
We are now at the stage where existing plants are working hard to fulfil demand. Additional facilities are available – requiring investment to bring them back on stream. The last thing we want to do is suggest to the multi-national companies who own those facilities that the UK government is likely to coerce the housebuilding sector to use particular build methods that would jeopardise the market for their products.
And even if the government does chose to go down that path I don’t believe it will find a huge enthusiasm to invest in offsite construction. Many players invested heavily in the last housebuilding boom only to have to close facilities in the downturn.
Companies including four of the top ten housebuilders vertically integrated into offsite manufacturing in either steel or timber but have since closed their factories or sold them on to other businesses that subsequently shut the doors. Only two of the top 30 housebuilders still have their own offsite businesses.
And product manufacturers too got involved with the experiment. Tata Steel set up its Corus Living Solutions modular building plant and then had to make 180 people redundant when it closed in 2010 along with many independent offsite timber frame businesses.
Even my company, H+H, went down this path in 2002 by opening a plant to manufacture storey high wall elements and floor panels for use in modular construction. That factory has since been converted to produce aircrete blocks.
Not only is there anxiety over commitment to the principle of offsite manufacture, there is also nervousness surrounding the performance of schemes that embraced the concept.
For example, when John Prescott was advocating a rapid move to offsite, seven “Millennium Villages” were built with the aim of highlighting new building techniques. One of these, Oxley Woods estate in Milton Keynes, used flat-packed houses of insulated steel panels overlaid with cedar cladding. Designed by Richard Rogers, the development won many plaudits for the forward-thinking design of the houses. The 122-home estate is currently the subject of a £5million legal claim against Rogers’ firm brought by the developer over water penetration.
These concerns have surely contributed to the decline in the use of pre-fabrication techniques for building homes. NHBC figures suggest that the market share for new timber frame homes in England is now down to just 7%.
My own view is that the government should focus on encouraging demand for new houses and removing any barriers that prevent commercial organisations capitalising on that demand. The previous government moved significantly in that direction with its Help to Buy initiative stimulating the private sector housebuilding sector and legislation to simplify planning helping to speed up the availability of land for development.
Once companies can be confident of a sustained demand then you can be sure they will find the most efficient way to grow their market. My message to our politicians is simple: if you want more homes, then encourage companies to invest. Either you commit the taxpayer to funding a growth in social housing or create the conditions for private developers to thrive. Ensure there can be a reasonable expectation that there is a long-term commitment to the policy and experimentation and innovation will follow, but don’t try to force the direction in which this moves.