88.The lack of access to land is regularly cited as one of the main barriers to homebuilders—small and medium sized (SME) homebuilders in particular—increasing their delivery of new MMC homes. Homebuilder, WElink Homes UK said: “land owners are nervous of hosting new building methods so securing land can be very expensive”. The Centre for London suggest local authorities could help by identifying small sites for SME builders. The Government has announced several initiatives to help homebuilders access land, including the Accelerated Construction Programme, Small Sites Fund and Land Assembly Fund; the progress of those initiatives is discussed in this chapter.
89.In the 2017 Housing White Paper, the Government set out proposals for a new Accelerated Construction Programme, administered through the Homes and Communities Agency (now Homes England), to address the shortage of land for MMC builders by allowing easier access to surplus local authority land. In its written evidence the Ministry of Housing, Communities and Local Government explained:
The Accelerated Construction Programme will help ensure surplus central [government] and local authority land is built out more quickly, and sets conditions on focusing support for SME builders and off-site construction techniques.
90.The Accelerated Construction Programme has been asking for expressions of interest from local authorities since January 2017, however, Homes England has been slow to deliver any homes through the Programme. Our predecessor Committee’s Report: ‘Capacity in the homebuilding industry’ said the Accelerated Construction Programme should not be another stalled initiative and recommended the Homes and Communities Agency (now Homes England) provide regular updates on its progress to this Committee. The Government did not agree with this recommendation and said updates are published online but it would respond to specific requests from the Committee. Now our predecessor Committee’s concerns have been realised and to-date, zero homes have been delivered through the Programme. Work has recently begun on the first pilot sites and over the next 12 months work will start on 1,544 MMC homes across seven sites but this is more than two years after the initial call for expressions of interest.
91.The Accelerated Construction Programme also includes a £450 million grant programme for local authorities. Stephen Kinsella of Homes England explained how it works:
We issue grants to local authorities directly to unlock sites in their ownership. We are expecting to sign up to 200 grant agreements by March next year to unlock sites. These are typically brownfield sites, which require some help, so that means enabling works, demolition and remediation, to get them moving. As a consequence, when a local authority draws down the grant, they commit to delivering the site using MMC. This is a great opportunity for us to stimulate demand on local authority land using funding from Homes England.
92.Helping homebuilders to access land for development is key if we are to increase rates of homebuilding. Homes England should have utilised The Accelerated Construction Programme to boost MMC homebuilding, but it has become another stalled initiative. Construction is still at pilot stage and zero homes have been delivered so the expected benefits of the Programme are yet to be achieved. Homes England must speed up progress on its Accelerated Construction Programme. Current developments must keep to their deadlines and Homes England should prevent delays on future sites. We reiterate the recommendation made by our predecessor Committee that Homes England should provide the Committee with regular updates on progress across the full range of initiatives to bring additional land into use.
93.Homes England also stipulate the use of MMC in developments in the Single Land Programme. Stephen Kinsella told us:
The Single Land Programme is the agency’s owned land assets. We own land for circa 60,000 homes. It is land we have acquired in recent years from the private sector or from other Government Departments, or it is land that we have had from our legacy land holdings [ … ] on every single site we require a form of MMC. That is going quite well. Now we have 40 sites with an obligation to build a form of MMC in contract. Another 73 sites will get into contract in this next 12 months and, overall, that will deliver in the region of 15,000 homes, with an obligation to build according to one form of MMC or another.
Mandating for MMC use on land made available on these Government backed schemes will help to increase demand for MMC products but Jennie Daly from Taylor Wimpey warned against stipulating the introduction of a proportion of MMC use on land made available because it could be a burden to smaller builders:
Homes England is looking at introducing a proportion of MMC use as a sort of entry gateway to accessing its land. That may cause more constraint for a small builder that needs access to land in order to grow and expand, by introducing an additional burden rather than a boon. It is a balance as to how that incentive is used. It needs to be an incentive, rather than potentially yet another burden or an impact on their viability.
94.Several witnesses said that small and medium sized builders experience the most difficulties accessing land and as a consequence will need extra support if we are to increase diversity in the market. In its Strategic Plan 2018/19 - 2022/23 Homes England committed to supporting smaller builders to access land through the Small Sites Fund launched in September 2018:
Often, small sites require upfront financial support to unlock them for development. We will support this through the Small Sites Fund Where we own sites which are too large to be developed by smaller builders, we’ll look for opportunities to create smaller parcels which better suit their capacity.
When he launched the Small Sites Fund in September 2018, The Secretary of State for Housing, Communities and Local Government said “the £630 million Small Sites Fund will provide grant funding to speed up getting the right infrastructure in place to support home building on stalled small sites”. He also announced £1.3 billion for a new Land Assembly Fund to acquire land which requires work to get it ready for development, and undertake the necessary preliminary work to make it less risky for homebuilders to invest in.
95.We welcome the introduction of the Single Land Programme and hope it will increase uptake of MMC. We also welcome the Small Sites and Land Assembly Funds to help SME builders access land and therefore diversify the market, but these have not been designed to increase MMC homebuilding in particular. It is quite early to assess how effective the funds are at helping SME builders to access land, but the Government must ensure progress on these programmes is quicker than previous schemes. The Government should ensure the Small Sites Fund and Land Assembly Fund do not become additional stalled initiatives. It should provide the Committee with an update in September 2019 to show what progress has been made in the year since the launch of the Funds.
122 WElink ()
123 Centre for London ()
124 Department for Communities and Local Government, , February 2017, p48
125 Ministry of Housing, Communities and Local Government ()
126 Department for Communities and Local Government, , October 2017, p6
127 Correspondence with Homes England, relating to the , dated 12 April 2019
131 Homes England, October 2018, p24
132 “Ministry of Housing, Communities and Local Government press release:, 17 September 2018
133 “Ministry of Housing, Communities and Local Government press release:, 17 September 2018
Published: 3 July 2019