Agenda item

To receive a report that had been to the Homes Policy Development Group.

The Committee had before it a report * from the Head of Housing & Health providing it with the strategic and policy context supporting the delivery of modular (modern methods of construction, MMC) social housing in Mid Devon.

The following was highlighted within the report:

·         The report had been considered at Homes Policy Development Group on 3 June 2025.

·         The report provided strategic and policy context supporting the delivery of modular, modern methods of construction, (MMC), Social Housing in mid Devon. It provided further information in respect of value for money relative benchmarking with traditional and other types of schemes. It also set out the wider context in terms of the benefits of the programme with regard to regeneration, zero carbon, added or social value and sustainment of the Council’s tenancies.

·         Benchmarking was very difficult for construction projects; no two schemes were the same.

·         This fair benchmarking exercise included external information supported by independent and authoritative sources such as Homes England, Other information came from publicly available sources, for example planning documents.

·         Typically the Council’s Zed Pod schemes were around 6 units in size, vying for brown field sites. Therefore, the wider schemes that had been used to benchmark had been selected to be as similar as possible in that context with regard to scale and the type of location.

·         When it came to external grant requirements, external grant funding requirements with Homes England and the wider Ministry of Housing were very robust and independent.

·         Section 5 of the report (Benchmarking) was a summary of one of the annexes which set out the data in more detail. The report tried to be as transparent as possible, and showed gross costs for the schemes as well as net costs after introductions for grants that had been awarded, for example, under the full homes programme. It was the cost to the Council that mattered, so the net cost was the most valid benchmark.

·         The reduced cost to the Council  was achieved by bringing forward the types of schemes the Council did, at the specification they were producing in relation to the Zed Pod modular schemes or similar, that way the Council were able to draw down that extra grant funding to bring down the net cost to the Council.

·         Table 1 within the report showed how the schemes benchmarked in relative terms; almost all of the schemes were either in the top five or top seven of those two comparators.

·         With regard to the Kingsland scheme in Bristol, whichever figure that was used in terms of metres squared for development, that scheme still fell within the bottom end of value for money in the table.

Consideration was given to:

·         Homes England did not release the benchmarking data they used. The qualitative feedback from Homes England had been that the schemes this Council put forward were at the higher end of the value for money assessment.

·         Some of the funding that the Council were very successful in securing was tailored towards specifically problematic sites, like the Brown Field Land Release Fund. That was there because the Government knew that those sites were viability challenged, they knew that they were problem sites and they knew that unless they intervened in them to support and give funding then, they would not come forwards because the viability did not work.

·         The value for money element had three aspects: the cost net; the value to add to Mid Devon and the value add to UK Plc. Developing the building industry locally was one of the big benefits. Decreased carbon emissions, nationally improved household insulation, national adherence to building regulations.

·         When MMCs, were discussed it would be useful to mention the category: complete build, partial build etc.

·         Concerns with regard to the overheating of modular properties. The Council had only had one poor experience in the schemes that had been brought forward so far. Two factors had been identified; one there was an issue between two different people in the house adjusting the temperature, one person wanting it very high the other person wanting it a bit lower, the Council had also identified a potential fault with one item, which meant the heating was on a little bit too much and engineers were due to visit to remedy the fault

·         A lot of the concern went back to one report in respect of one of the early Bristol schemes that Zed Pods put together and it was down to misinformation, in that one particular tenant misunderstood how the heating should be used. There was a lesson there for Bristol Council and for Zed Pods around how Council’s on board new tenants, because the heating systems were a little different. As a result of that, a completely new tenant pack had been designed.

·         Had any mid Devon building companies been approached to tender for the construction of those types of buildings? Unfortunately, at the moment with the approved procurement frameworks that the Council had to access for those type of projects, none of the companies on those frameworks were local companies. However, the Council had received approaches from a couple of companies which were starting up locally and were showing an interest in modular or forms of MMC building whereby the Council had supported them and, the Council had guided them in terms of how the procurement process worked, the quality control mechanisms that had to be in place to be awarded on a framework. Alternatively the Council would encourage working with some of the broader national manufacturers to see a manufacturing base in the southwest if that was possible.

RECOMMENDED to the Cabinet that:

a)    The report be NOTED.

b)    Cabinet continues to adopt an HRA development programme with a focus on delivering MMC, modular net-zero social housing where possible and viable as part of the Council’s future Housing Strategy.

(Proposed by the Chair)

Note: (i) * Report previously circulated.

(ii) Cllr Broom was unable to vote to as he had left the meeting room during the discussion of the item.