Supplementary memorandum by the Council
for Mortgage Lenders (CML) (AH 37(b))
LENDERS AND
MODERN METHODS
OF CONSTRUCTION
(MMC)
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.
ENGLISH PARTNERSHIPS
(EP) AND THE
CML
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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