The House of Lords Built Environment Committee has highlighted the need for transparency in the Government’s MMC initiatives in a new report
The findings of the report published today by the House of Lords Built Environment Committee followed an inquiry into the future of MMC initiatives after the collapse and closure of several Category 1 MMC companies during 2022 and 2023.
The report underscores contradictory evidence on construction costs, lack of data on MMC usage, and the dormant MMC Taskforce, urging the Government to provide clear justifications and explanations for a more effective and accountable approach.
According to findings, Category 1 (modular) MMC has not been backed by a coherent strategy and set of measurable objectives. However, with the right approach, it could still play an important role in the building of much-needed housing.
There are still barriers to the adoption of MMC in the construction industry
There is evidence of real barriers to MMC, such as risk aversion from warranty providers, insurance companies, and insufficient clarity for building regulations.
However, the Government appears to have made a limited effort to understand and address these challenges.
There is a lack of Government understanding surrounding the needs of the MMC sector
According to the House of Lords Built Environment Committee, the Government needs to acquire a better understanding of how the MMC sector works and the help that it needs.
From there, achievable goals and a coherent strategy can be set.
The Government will struggle to meet housing targets without the help of the MMC sector
Lord Moylan, chair of the Built Environment Committee, said: “Modern methods of construction are successfully used to construct homes abroad and build high-rise and non-residential buildings in the UK, but this success has thus far eluded the building of MMC homes in meaningful numbers.
“In the context of an ageing skilled workforce and the need for greater building sustainability, MMC has shown some promise. We heard evidence that the Government couldn’t achieve its housebuilding targets without a sizeable contribution from the MMC sector.
“Our inquiry found that the Government has not set out clear objectives for the funding it provided the MMC sector. Homes England has not given any clear metrics as to how success is to be measured and over what timescale.
“The Government needs to change tack. Simply throwing money at the sector hasn’t worked. If it wants to encourage MMC it must acquire a much deeper understanding of how it works, develop a clear strategy, and demonstrate leadership.”
What other findings did the report show?
The committee encountered conflicting testimony on whether homes constructed using MMC are more or less expensive than traditionally built homes. Given the substantial public investment involved, it is imperative for the Government to ensure cost-effectiveness.
The mandate to utilise MMC in the Affordable Homes Programme (AHP) spurred some housing associations to adopt MMC in their projects. However, this incentive fell short of generating robust pipelines for Category 1 MMC businesses, primarily due to the perceived high costs associated with MMC.
A lack of comprehensive MMC data was found
The challenge of assessing the Government’s progress lies in the absence of comprehensive data on MMC usage. Urgently, the Government should release data on the proportion of supported completions employing MMC in the Affordable Homes Programme.
Despite being allocated £10m, the Government’s MMC Taskforce, responsible for advancing work on data and standards, has not convened. The Government must clarify the rationale for abandoning this initiative and transparently detail the utilisation or reallocation of the promised funding.
To encourage greater adoption of MMC, particularly in Categories 1 and 2, the implementation of higher energy efficiency requirements is suggested.
The Government is urged to show a heightened interest in successful examples of modular construction overseas, potentially offering valuable insights for advancing the MMC sector domestically.
