Housing minister Lee Rowley has pledged to undertake “detailed work” with modular builders over the coming weeks following a string of setbacks for the sector.
He told Built Environment Committee chair Lord Moylan that he aims to provide “a full update” on policy regarding modern methods of construction (MMC) in “late spring”.
The committee warned in January that it had “limited confidence” that the government had a coherent strategy for the activity, once hailed as the future for the industry but recently facing a number of major challenges.
Moylan said at the time that ministers “must acquire a much deeper understanding of how it works” and “develop a clear strategy” for supporting the disruptive sector.
Now Rowley has provided an initial response on behalf of the Department for Levelling Up, Housing and Communities, essentially asking for more time to come up with a plan.
“As you and the committee are aware, the MMC sector has had a number of successes,” he wrote. “At the same time, and as we discussed, it is also the case that the sector is facing challenges.
“There are clear questions which now need to be reviewed, and answered in detail, about where the sector currently is, where it is going and what role the state will play in the future.”
Rowley said there were “clearly broader discussions to have about what can, and what should, be done in the future given the changes the sector has experienced in recent months”.
He added: “Given the recent announcements of further industry exits, I would like to give further detailed consideration to the development of MMC policy and how best this department can support the sector. Inevitably, that will take some time.”
It emerged this week that modular housebuilder TopHat had stopped work creating a 60,000 square metre manufacturing site in the South Midlands due to “market conditions”.
Meanwhile Beattie Passive, which created the UK’s first Passivhaus-certified build system, halted work at its 10,800 square metre factory after parent company Beattie Passive Group Ltd and four related companies filed notices of intention to appoint an administrator.
Laing O’Rourke said in January it was considering cutting 60 jobs at its offsite factory in a bid to reduce operating costs.
Several offsite specialists have collapsed in recent years including Ilke Homes, House by Urban Splash, Mid Group, Eco Modular Buildings and Caledonian Modular. L&G also wound down its offsite business after years of heavy losses.
Moylan said in his response to Rowley’s latest letter: “Since we wrote to you there have been further industry exits. This includes the announcement that one organisation which provided us with written evidence has filed a notice of intention to appoint administrators.
“Given the importance of this matter, and the need for the government to develop a deeper understanding of the sector before setting out a clear policy position, we understand your suggestion of additional time to prepare a full response.”
The committee chair urged the minister to respond “ahead of the Whitsun Recess” that begins on 23 May.
