Select Committee on Office of the Deputy Prime Minister: Housing, Planning, Local Government and the Regions Written Evidence

Supplementary memorandum by the Council for Mortgage Lenders (CML) (AH 37(b))


  Margaret Ford made a number of comments about the Council of Mortgage Lenders (CML) in relation to Modern Methods of Construction (MMC) when giving evidence to the ODPM Committee on 16 January. I am writing to set the record straight and also to clarify the actual position of the Housing Corporation (HC) in relation to the BRE certification standard for innovative housing, LPS 2020.


  The statement made by Margaret Ford that EP "tear their hair out" over the attitude of the CML and its members to MMC is inexplicable.

  In fact, as far as we are aware, the limited contacts between the CML and EP on this issue have been cordial and constructive. There have certainly been no expressions of frustration on either side. In spring 2004, I was invited by the Board of EP to give them a presentation on MMC and I was pleased to oblige. Margaret Ford herself chaired the meeting and the CML presentation was received positively by Board members present. On the initiative of the CML at least two other constructive meetings with EP officials took place to discuss MMC, and these revealed a fair measure of common ground in terms of a desire to secure high standards and a determination not to repeat the well-documented mistakes of the prefabricated and system—built housing programmes of the past.

  As I believe my presentation makes very clear, lenders are not opposed to any particular form of construction and have in fact provided significant finance for MMC new-build projects. The concerns of the CML and its members focus on the need to ensure that properties are capable of standing security for a mortgage of up to 35 years. This means that high standards of durability, repairability, and adaptability are essential, together with low whole life costs and the ability to attract buildings insurance on normal terms.

  I am most surprised that Margaret Ford and EP apparently find such commonsense requirements, which would be supported by most consumers, frustrating. I would have hoped that a positive concern with providing high quality homes for the future could be shared by all the key stakeholders in the sector.

LPS 2020

  LPS 2020 is a certification standard for innovative housing initiated by the Building Research Establishment (BRE) and supported by the CML, the Association of British Insurers (ABI) and other stakeholders. We have supported it over the past two years because of a positive desire to promote high standards for MMC. LPS 2020 will help to overcome the problems of unquantifiable risks that are inseparable from innovation and will promote confidence in MMC amongst all the key stakeholders. LPS 2020 is currently in its calibration phase and will be launched as a full standard in spring 2006.

  I am certainly not offering criticism of Peter Dixon for not being aware of every initiative that his organisation is involved with. Nevertheless, the HC (in the shape of Clive Clowes a senior HC official) has been involved with the development of LPS 2020 since work commenced some two years ago. The HC have been supportive of the new standard (as have ODPM) and we are pleased that this project has benefited from HC input.

  The CML support for LPS 2020 is another example of the way in which lenders have worked positively to provide a viable platform for innovation in housing. This support deserves more recognition in some quarters than it has apparently received.

Andrew Heywood

Deputy Head of Policy

27 January 2006

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