examining the impact of government spending on social housing construction
TRANSCRIPT
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 1 of 96
London South Bank University
Faculty of Engineering, Science and Built Environment
Department of Built Environment
Examining the Impact of Government Spending on Social Housing Construction in London
2012
Jorg Holter
MSc Quantity Surveying
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 2 of 96
Examining the Impact of Government Spending on Social Housing Construction in London
Submitted by Jorg Holter
For the MSc Quantity Surveying
Unit Co-ordinator: Shamil Naoum
London July, 2012
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 3 of 96
Declaration This dissertation may be made available for consultation within South Bank University and may be photocopied or lent to other libraries for the purposes of the consultation. Jorg Holter July 2012 I declare that this dissertation is my own unaided work except where specifically referenced to the work of others. Jorg Holter July 2012
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 4 of 96
Acknowledgements
I would like to express my special thanks to everyone who has supported me in the
completion of this study. Special thanks also to my project supervisor Professor Dr.
Herbert Robinson, Dr. Mahtab Farshchi and Korinne Louison who have been very
supportive throughout my course and this dissertation.
My sincere thanks to the BCIS especially Joe Martin, Andrew Thompson, Alan Carter,
Cosmas Kamasho and Lindsay Pullen for all the support through the duration of this
course as well as the anonymous professionals, who shared their expertise in the
interviews and have been so kind with their time and knowledge.
Dedicated to my mother Katharina Hölter and in loving memory to my dad, Franz-Josef
Hölter.
July 2012
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 5 of 96
Abstract
The recent economic crisis has placed added pressure on an already struggling
social housing sector. While housing supply has been falling, demand has been
increasing throughout the UK and specifically in London where the number of
households continues to grow. While seeking to meet targets, the coalition government
has made significant policy changes to prevent waste and reduce bureaucracy in the
social housing sector.
This thesis used a mixed method approach (including literature review,
interviews, and statistical analyses) to examine how changes in government policy have
affected social housing delivery. The thesis investigated the delivery structure,
spending, efficiency, costs, and the construction programme. Also the thesis looked at
the extent to which alternative methods of construction are used in the social housing
industry and how it compares to traditional methods in terms of cost, quality of design,
and efficiency.
Overall the content analysis of themes revealed little impact of the new delivery
structure on efficiency. Some positives about reduced government spending regarded
the emergence of the LAs as a prominent agency in social housing delivery. Among the
negatives were increased uncertainty and decreased risk taking. Some of the new
government measures were argued to carry up the cost of social housing. The biggest
point of worry is the overall impact of the governmental austerity measures of reducing
the number of housing schemes by at least a half. Results of the study did not support
arguments in favour of the use of MMC to improve design quality, costs or efficiency in
these times. Recommendations and limitations of the study were also discussed.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 6 of 96
TABLE OF CONTENTS PAGE Title Page 2 Declaration 3 Acknowledgements 4 Abstract 5 Chapter 1: Context and Rationale 1.1 Introduction 12 1.2 Key Issues 13 1.2.1 The Delivery Chain 14 1.2.2 Funding 15 1.2.3 Housing Design 15 1.2.4 Modern Method of Construction (MMC) 16 1.3 Aim and Objectives – Research Questions 17 1.4 Structure of the thesis 17 Chapter 2: Literature Review 2.1 Introduction 20 2.2 Definition of Social Housing 20 2.3 Government Housing Policy and Social Housing 1945 – 2008 20 2.4 Recent Issues in UK Social Housing 2008 – present 26 2.4.1 Physical condition of existing stock and Housing Gap 26 2.5 Social Housing Delivery Structure 27 2.5.1 Present Housing Delivery Structure 29 2.6 Government Spending to present 30 2.7 Concluding Remarks 32 Chapter 3: Design Standards and Cost of Social Housing 3.1 Introduction 34 3.2 Space, Dwelling Types and Design Standards over the years 35 3.2.1 Code for Sustainable Homes 39 3.2.2 External Environment 40 3.3 Affordable Housing Trends in London 41 3.3.1 Dwelling Mix 41 3.3.2 Density 41 3.3.3 Brownfield vs. Greenbelt 43 3.4 Costs of Schemes 45 3.5 Impact of Modern Method of Construction (MMC) 47 3.5.1 Volumetric Construction 48 3.5.2 Panellized Construction 48 3.5.3 Off Site Manufactured 49 3.6 Design Quality and Costs 49 3.6 Concluding Remarks 49
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 7 of 96
Chapter 4: Methodology (Findings from the Case Study Interviews) PAGE 4.1 Introduction 51 4.2 Research Design and Approach 51 4.3 Research Method chosen 52 4.3.1 Literature Review 52 4.3.2 Case Study Interview 53 4.3.3 Structured Interview 53 4.3.4 Semi-Structured Interview 53 4.3.5 Unstructured Interview 53 4.4 Respondents 53 4.4.1 Housing Association 54 4.4.2 Developer 55 4.4.3 Quantity Surveyor 55 4.5 Data Analysis 56 Chapter 5: Findings from Case Study Interviews 5.1 Introduction 58 5.2 Housing Association 58 5.2.1 Delivery Structure 59 5.2.2 Government Spending and Cost 60 5.2.3 Design and Cost 61 5.2.4 Modern Method of Construction 62 5.3 Developer 63 5.3.1 Delivery Structure 63 5.3.2 Government Spending and Cost 64 5.3.3 Design and Cost 65 5.3.4 Modern Method of Construction 66 5.4 Quantity Surveyor 67 5.4.1 Delivery Structure 67 5.4.2 Government Spending and Cost 67 5.4.3 Design and Cost 67 5.4.4 Modern Method of Construction 68 Chapter 6: Analysis and Discussion 6.1 Introduction 69 6.2 Deliver Structure 69 6.3 Government Spending 74 6.4 Factors influencing costs 74 6.5 The Project Duration 75 6.6 Modern Method of Construction (MMC) 76 6.7 Concluding Remarks 77 Chapter 7: Conclusion 7.1 Introduction 78 7.2 Key Findings 78 7.2.1 Objective 78 7.2.2 Objective 79 7.2.3 Objective 79 7.3 Conclusions 80
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 8 of 96
Chapter 7: Conclusion (continued) Page 7.4 Industry Recommendations 80 7.5 Limitations of the Research 81 7.6 Further Study Recommendations 81
REFERENCES AND BIBLIOGRAPHY 82 APPENDICES 96
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 9 of 96
LIST OF TABLES PAGE Table 1: Household Projections. 22
Source: Department for Communities and Local Government, 2010.
Table 2: Comparison of GIA and its changes since 1949. 37
Source: CABE, 2010a. Mapping space standards for the home.
Table 3: Dwelling Space Standards. 39
Source: London Development Agency, 2011. Design for London.
Table:4: Baseline Construction Cost. 45
Source: CLA; 2010.
Table 5: Summary of extra-over costs of building to each level of the Code 46
in each of the dwelling types and for a range of development scenarios.
Source: CLA, 2010.
LIST OF FIGURES
Figure 1: Right to Buy and Preserved Right to Buy sales 1980/81 to 2010/11 24
Source: CLG, Reinvigorating Right to Buy and One for One.
Replacement Impact Assessment, 2012.
Figure 2: Number of Social Housing Dwellings in the UK 1981 – 2007 25
Source: Beever and Struthers, 2011. Annual Review of Social
Housing.
Figure 3: Flow of funding for affordable housing. 28
Source: National Audit Office, 2005a.
Figure 4: Housing completions in 2010; lowest peacetime level since 1923. 30
Source: Hill, R., Comes and Community Agencies, 2011.
Figure 5: The ‘deepest’ recession since the Second World War. 31
Source: Allen, G., Recesssion and Revovery, 2010.
Figure.6: Household Size Projections. 34
Source: GLA (2006) Household Size 1991 – 2026.
Figure 7: Growth in Population. 42
Source: The Mayor’s London Plan, 2011a.
Figure 8: Brownfield land developed for residential use by region. 43
Source: Wong and Schulze Bäing, 2010.
Figure 9: London Plan key diagram. 44
Source: The Mayor’s London Plan, 2011b.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 10 of 96
LIST OF FIGURES (continued)
Figure 10: Delivery Chain Social Housing, 2012. 70
Source: Trower and Hamlins, 2009.
Figure 11: BIS/TPISH Tender Price Index of Social Housebuilding; New Build. 72
Source: BCIS online; Average Prices; 2012.
Figure 12: Average Construction Duration in weeks. 73
Source: BCIS Online, Duration calculator, 2012.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 11 of 96
“Examining the Impact of Government Spending on Social Housing Construction”
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 12 of 96
Chapter 1 – Context and Rationale
1.1 Introduction
This thesis aims to explore the impact of government spending on the housing
delivery chain and the social housing construction industry. The topic is examined
under the backdrop of the 2008/2009 recession which was caused by the credit crunch.
Falling house prices and a collapse of confidence in the finance sector resulted in lower
confidence among the ‘real’ economy.
In 2010, David Cameron, leader of the newly elected coalition government of the
UK, along with his deputy, Nick Clegg, revised the 2010/2011 budget of the previous
government. This ‘emergency budget’ outlined how the new coalition planned to raise
and spend money over the coming years. Listed among its most important aims were
the prevention of waste and the reduction of bureaucracy in order to save money.
Shortly after the announcement of the emergency budget, numerous articles
were published that predicted dire circumstances for the social housing industry. The
article “Housebuilders to be hit by affordable housing slump” in the journal
Building.co.uk (2010) predicted that government spending cuts would result in a decline
of 65% in the number of social homes built - the lowest annual total since 1991 .
The realities of the current economic crisis – company closures, unemployment
and higher prices particularly in the housing sector have resulted in an increased
demand for affordable housing. In the first quarter 2012 an estimated 1.8 million
households were on the waiting list for social housing (Barclays, 2012). According to
the statistics from the Department for Communities and Local Government (CLG) report
“Housing Statistical Release” (2009a) household projections are estimated to reach an
extra 35.000 households per year between 2006 and 2026. Others project an annual
increase of 223,000 households by 2026 (Holmans and Whitehead, 2011) increasing
demand even further. It is therefore important to explore the impact of the recent
government austerity measures on the provision of much needed social housing.
The truth is that the current government is facing a housing supply crisis.
Indeed, Bramley (2007) predicted that housing supply will become one of the key
challenges in the future even though policies and procedures were in place. Bramley
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 13 of 96
argued that the current land use planning system could be one reason for the
problem of inadequate and unresponsive housing supply in the UK.
The Barker Review (2004) studied problems associated with housing supply.
The conclusion was that the rise in housing prices was directly related to a
supply/demand imbalance, resulting from a rise in households, particularly the number
of one person households. Moreover, the review reported a drop in new build social
homes from 42,700 per year in 1994-95 to about 21,000 in 2002-03. According to
Barclays (2012), between October 2010 and March 2011, the number of social housing
starts was 35,735 – an improvement over the 2002-2003 period; however there was a
sharp decline to 454 in the following six months (Barclays, 2012). In 2007 the
government set the target of 3 million new build houses by 2020 (Shelter, 2007). In light
of this erratic and generally declining pace of construction in the sector, the
government’s vision will not likely be met (2020 Group, 2009).
The continuing shortage of affordable private and social housing resulted from
years of scarcity, low investment and the reduction in housing stock through the “Right
to Buy” option (Niemitz, 2012). The consequences of this situation are economically
devastating. In addition to the financial pressure resulting from high housing costs,
there will be serious constraints on labour mobility, especially if households cannot
secure housing where there are employment opportunities. It is important that housing
levels continue to rise or we are likely to see increasing levels of homelessness in the
coming years.
1.2 Key Issues
To understand the impact of current government spending on social housing
construction, this thesis examined key issues such as the nature of the housing delivery
chain, availability of funding and its affect on the delivery structure, type of housing that
can be built under the current economic climate in terms of land use, number and sizes
of units, unit cost and the impact of modern method of construction (MMC) on social
housing production.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 14 of 96
1.2.1 The Delivery Chain
In the UK market, when compared to other countries, housing can be very
expensive and out of the reach of many. Barclays (2012) asserted that the demand for
social housing is increasing as a result of a lack of newly built homes and a shortage of
affordable homes. Where budget cuts have been made, the government faces the huge
challenge of meeting the increasing demand for social housing with less available
financial resources.
This has resulted in key changes in the funding, administration and structuring
of social housing (Barclays, 2012) with a specific focus on the complex delivery chain
that guides the flow of funding towards new housing. Traditionally, the delivery chain
has started with the Office the Deputy Prime Minister (ODPM; now called Communities
and Local Government), which directs funding to Housing Corporations (HC) and then
to Housing Associations (HA) and other bodies that apply for grant and subsidies in
order to provide new housing. This funding procedure is thoroughly described in the
National Audit Office (NAO) (2005a) report: “Building more affordable homes: Improving
the delivery of affordable housing in areas of high demand”.
Lamentably, the effectiveness of the housing delivery chain has been limited by
problems related to inefficiencies and bureaucracy because of the number of agencies
that usually have been involved. By making key changes to the delivery chain, such as
reducing the number of participating agencies and giving more financial responsibility to
Housing Associations (i.e. shifting from grant funding to revenue funding), the
government has attempted to increase efficiency and reduce costs (Parker R.,
PricewaterhouseCoopers, 2008).
This thesis will explore the recent changes that have been made to the delivery
chain and the extent to which these changes have met the objectives of the current
social housing policy.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 15 of 96
1.2.2 Funding
Is there a need to change or to identify new forms of funding strategy in
affordable housing? The government has given the new national Homes and
Communities Agency (HCA) a leading role in social housing delivery. In terms of
funding, the HCA’s budget for the affordable homes programme has been reduced
substantially, from £8.4 billion in the 2008-2011 period to £4.68 billion in the 2011 –
2015 period (Jones Lang Lasalle, 2011b). Still the HCA anticipates that the revised
budget can still provide 170,000 new homes (Jones Lang Lasalle, 2011b). To
supplement governmental based funding, there has also been a drive to switch from
capital based to revenue based funding and move to a smaller number of larger
registered providers or RPs (Barclay’s, 2012, Jones Lang Lasalle, 2011b).
1.2.3 Housing Design
Over the years, government spending cuts have impacted housing design in
many ways such as in the size, design and quality of dwellings. Several views have
been offered relating to housing design, but the consensus seems to be that housing
quality has been neglected over the past 50 years.
During the post- 2nd World War ‘Homes for Heroes’ initiative, the highest
standards in housing were achieved. The 1944 ‘Housing Manual’ set out strict housing
and estate design guidelines in terms of site layout, density, and dwelling type. Focus
was also given to gross internal area space standards which increased from 800 – 900
sq. ft. in 1944 to 900 – 950 sq. ft. in 1949 (GLA, 2006).
In the 1960s the Parker Morris Committee report ‘Homes for Today and
Tomorrrow’ prescribed standards that are considered adequate in today’s housing
design (GLA, 2006). The report argued for improved space standards and adjustments
to the internal organization of the home based on how residents actually made use of
their homes. Unfortunately the Parker Morris space standards, in the absence of good
site planning and good quality construction, were not sufficient to ensure better quality
of design.
In the 1980s, the Parker Morris standards were neglected due to cuts in funding.
As housing grants decreased, design quality deteriorated even further. In the 1990s the
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 16 of 96
drop in Housing Association quality standards were highlighted in certain reports
as being 5% below Parker Morris standards (Mathieson, 2010).
Later on, a consideration of issues related to persons with disabilities, social and
public health and the environment would revive the drive towards better quality homes;
but in light of the recession and the pressure on the government to reduce spending in
this area, would design standards once again be sacrificed?
1.2.4 Modern Method of Construction (MMC)
In an attempt to increase the supply of housing, MMC was put forward as a
possible solution. The housing supply/production literature also recognises the
importance of MMC. A report by the National Audit Office (NAO, 2005b) describes
MMC, which involves the making of panels and/or modules in specialized factories,
which are then assembled at the construction site as an innovative, efficient and cost
effective approach. However MMC faces scepticism related to a less than auspicious
history, higher immediate capital costs before start on site and economies of scale
(POST, 2003), general concerns about prefabrication and standardisation in housing
(Edge et al, 2002) and lack of flexibility of design changes during the production stage
(Pan, W. et al, 2005).
The NAO report also suggests that for MMC to meet government targets there
must be very stringent accreditation criteria to ensure the durability of such housing as
well as improved staff training to ensure high quality in construction. Kempton (2009)
discusses that the goal for social housing is 3 million new homes by 2020 and one of
the expectations is that the application of MMC will make this goal attainable. Kempton
(2009) however suggests that there are problems with this idea. One of them refers to
the complications associated with using innovative and non traditional “housing
formats’, such as suspicion on the demand side and a lack of capacity on the supply
side.
This thesis explores the benefits and limitations of using MMC as a cost
effective innovation to increase housing supply in this time of economic decline.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 17 of 96
1.3 Aim and Objectives – Research Questions
This thesis is concerned with issues in social housing that are related to the
government’s attempts to secure the economy, particularly the impact it will have on
housing supply as well as the delivery structure of social housing. Specifically, the
research focuses on the following questions:
1) How has the structure for the delivery of social housing changed?
2) Have there been adjustments in the number of the participant agencies and their
roles?
3) Have the changes in the delivery structure achieved its intended goals of
increasing efficiency and reducing costs?
4) How does the government’s new policy affect spending in social housing
construction?
5) What are the key factors that influenced costs in social housing?
6) How does reduced governmental spending affect the construction programme
(project portfolio) of RPs in terms of number, types and sizes of schemes,
available land whether brownfield / greenbelt, mix between rehabilitation and
new development and density (high or low)?
7) What is the level of use of MMC and what has been its impact in social housing
construction?
1.4 Structure of the thesis
This thesis will explore the impact of government spending on social housing
construction in seven chapters.
Chapter 1 presents the rationale of the research and states the aims and
objectives of the study, along with the research strategy that was employed to answer
the research questions.
Chapter 2 is a literature review which gives a brief history of social housing in
the UK from the post 2nd World War period to present. It explores how the devastation
of the 2nd World War, returning forces, increased migration into the UK, and later,
increase in the number of households impacted the demand for social housing. It also
describes how changes in government policy and economic fortunes affected the
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 18 of 96
availability and supply of affordable housing. The chapter will investigate the
housing delivery structure as it existed previously and also in its current form as well as
describe how the economic crisis has affected government spending on social housing.
The chapter ends with a brief discussion of the current state of affairs in the UK and
makes projections for the following 15 year period based on the literature.
Chapter 3 explores how the types, standards and costs of social housing have
changed over the years. Particular emphasis will be placed on the extent to which the
current spending changes highlighted in the government policy document have or can
impact these factors. The chapter discusses specific areas of design and quality
standards such as size, space and adherence to sustainable codes and also available
land for development, density and modern method of construction. The chapter will also
demonstrate the trends of cost per m² of traditional and modern method schemes of
affordable housing in the recent years.
Chapter 4 is the research methodology and will describe the data collection
approach of this study. The study used a largely qualitative approach, which sourced
both primary and secondary data to answer the questions of this study. This data was
obtained from governmental policy documents, published statistical data, journal
articles and structured interviews with persons within Housing Associations, Developer
and Quantity Surveyor firms.
Sixteen firms were approached to participate in the study. Of those approached,
8 responded and 6 of the response transcripts were chosen for analysis. Quantitative
data was also accessed from the Building Cost Information Service (BCIS) online
service which provides up to date cost sector information. The goal of the interviews,
review of documents and analysis of quantitative data was to determine the impact of
government policy on the delivery structure, cost of different methods of social housing
construction and efficiency of delivery of social housing.
Chapter 5 represents the findings from the case study interviews. The selected
interviews were organized according to one of the following groupings: Housing
Association, Developer and Quantity Surveyor. Within each grouping, the interview
responses were collated and summarized, with each interview question as a separate
heading.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 19 of 96
Chapter 6 provides the analysis and discussion of the findings. The primary
data analysis that was used for this study was content analysis. The process of content
analysis involved the synthesis of data to identify themes related to the research
questions that are the subject of this thesis. Once the themes were identified, they were
used to answer the research questions in order to meet the aims and objectives of this
study. The findings of the interviews were compared to the results of the literature
review and quantitative data analysis.
Chapter 7 summarizes the findings of the research relative to its initial aims and
objectives. It presents recommendations based on the data and industry opinions as
well as suggestions for future studies. Limitations are also discussed.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 20 of 96
Chapter 2 – Literature Review
2.1 Introduction
Over the years, demand and supply in UK social housing has been impacted by
social, political and economic factors. Increased demand is attributed to sharp post war
population growth, changes in household structure (Fitzpatrick and Stephens, 2008),
lowered household income and higher prices in the private housing sector which has
resulted from increased challenges to the UK economy. On the supply side, changes in
government have been accompanied by changes in policy which are influenced both by
political ideology as well as economic realities. The following sections will explore in
detail, post 2nd World War, the impact of these factors on the demand for and the
provision of affordable housing in the UK.
2.2 Definition of Social Housing
‘Social housing is housing that is let at low rents and on a secure basis to people in
housing need. It is generally provided by councils and not-for-profit organisations such
as housing associations’ (Shelter, 2011a). Social housing includes social rented
housing that is provided to households who are unable to fund housing within the
private sector (CLG, 2006a). Social housing and affordable housing has been used in
the literature to mean the same thing. The two terms will be used interchangeably in
this thesis.
2.3 Government Housing Policy and Social Housing 1945 - 2007
Prior to the end of the Second World War, with a large number of its citizens
engaged in military service, Britain was suffering from a shortage of resources including
labour and construction materials (Taylor, 2009). As a result there was little or no
con8struction of houses during that time. The ravages of the war had also taken its toll
on the British infrastructure and so the lack of production and destruction of buildings
resulted in a severe housing shortage. In addition to the housing shortage, the UK
experienced a period of sharp population growth after the war that increased the
demand for social housing.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 21 of 96
With the return of the troops and other army personnel after the Second World War,
the Labour government saw that there was an urgent need for housing and so
reimplemented its post war 1929 social housing programme called ‘Home for Heroes’.
Moreover, by 1946, the population of post war Britain had increased by over one million
and local authorities had taken on a leading role in the provision of council housing,
meeting the needs of 10% of all households (Glendenning and Muthesias, 1994).
The labour shortage by this time had also stimulated a period of migration into the
UK. In 1949, the Royal Commission on Population began a massive campaign
designed to attract immigrants of ‘good stock’ to work on rebuilding Britain, and soon
thereafter, Britain witnessed an influx of migrants largely from Eastern Europe, Ireland,
and Italy. Recruitment of labour was later extended to India, Pakistan, Africa and the
Caribbean, which resulted in substantial migration from those parts of the world
between the 1950s and 1960s (Brown, 1995).
Stringent immigration laws implemented in the 1970s by the British government
resulted in a slowing down of migration into Britain in that decade, (Bam-Hutchison,
n.d). Contrary to the general opinion, of all the social factors, migration had placed the
lowest demand on social housing as reports show that even the majority of post war
immigrants found rental housing on urban estates and largely from private landlords
(Ponzo, 2010).
By the mid-1950s, the government had embarked on a program of slum clearance
which involved the relocation of lower-income inner city populations (Malpass and
Murie, 1999). This program continued into the 60s and 70s and was accompanied by
an expansion of new social housing, which lamentably was of poor design and
construction. It was around this time that public funds were channelled to housing
associations. Malpass and Murie (1999) remarked that this new approach established a
‘modern framework for their operation’ as well as a ‘basis for later growth’.
At this time the focus was on housing those who could least afford to purchase or
rent market housing. Between 1955 and 1970, 400,000 new Local Authority flats were
built in urban areas (Shapely, 2008). The population of the urban estates mostly
consisted of poor immigrant communities. By 1965, there were a total of almost 4
million social housing units, 2.9 million of which had been built after the 2nd World War
(Greenhalgh and Moss, 2009). Unfortunately the demand for new housing exceeded
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 22 of 96
the government’s capacity to build. This was perhaps due to the continued
reduction in private renting, particularly after the introduction of much stricter rent
controls in the Labour Government’s 1965 Rent Act (Greenhalgh and Moss, 2009).
By the late 1970s to 1980s, population growth resulting from repatriation of military
forces and migration to the UK had slowed and became less of an influence on
government policy. It must be said that in recent times, Britain has seen a resurgence of
immigration particularly from members of the European Union, but the truth is that
today, migration into the UK cannot be pointed to as the largest contributor to
increasing demand for social housing. Indeed, immigrants currently make up
approximately 1% of applicants for social housing (Rutter and Latorre, 2009)
Distinct from population growth, household growth has increased the demand for
social housing in the UK. After the Second World War, there was a sharp increase in
new households, arising from younger marriages and increased family dissolution.
Such changes have led to a shortfall of two million dwellings (BMA, 2003).
Since then the trend of household growth has continued to increase sharply due to
further changes in household structure (aging population and the increase in the
number of single parent households or single person households). Expectations are
that by 2033, the number of households will increase at an annual rate of 232,000
(CLG, 2010). Table 1 shows household growth projections for the period 2008 to 2033.
This has put further pressure on the government to provide new homes.
Table 1: Household Projections.
Source: Department for Communities and Local Government, 2009b.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 23 of 96
In the 1970s, a notable change was the growth of housing associations. With house
supply slumped to its lowest since 1950, the government recognized that local
authorities were not capable of coping with the current demand. New legislation had
opened the way for housing associations to secure capital grants to fund provision of
rental housing in the UK. A new subsidy system, “The Housing Action Grant” (HAG)
was announced in the Housing Act 1974. By 1979, social housing increased from 12%
of total housing stock in 1945 to 32% (Malpass and Murie, 1999).
In spite of the substantial growth of the housing association, at the end of the 1970s
it accounted for only a small share of the total number of social homes. However, since
then, their role has increased rapidly and substantially as well as their expertise, and as
such, by the 1980s the housing associations were taking on more responsibility for
large local estates. This reflected a change in government policy as is evidenced by the
‘innovative’ 1980 Housing Act, which authorized housing associations to offer shared
ownership deals (Council of Mortgage Lenders; Homes and Communities Agency;
National Housing Federation, 2011).
Another ‘innovative policy of the 1980s and 1990s was the ‘Right to Buy’ program.
Established by the Margaret Thatcher ‘right wing’ conservative government, this new
strategy resulted in an increase in owner-occupied housing from 56 percent in 1981 to
67 percent in 1996 (Malpass and Murie, 1999). The outcome was that by 2001, 1.9
million units, three tenths of local authority housing, were lost to Right to Buy (Malpass
and Murie, 1999). Furthermore, three-quarters of the income generated from the sale
of council housing to residents was allocated towards repayment of debt on council
housing (Durden, 2001), thereby leaving limited funds for replacement housing. Any
remaining funds were used to maintain the existing stock rather than invested in new
developments (Forrest and Murie, 1988).
The CLG (2011d) document, Reinvigorating Right to Buy and One for One
Replacement described the ‘Right to Buy’ programme as a ‘great success’ in many
suburban areas and smaller towns where resident ownership of homes converted entire
council estates to part of the regular housing stock. Unfortunately the same was not
true for the urban, flatted developments, where original owners have leased their
property to local councils, Housing Associations and Housing Benefit applicants that
now have to deal with huge bills to repair buildings that have exceeded their life cycle
(Greenhalgh and Moss, 2009). Figure 1 presents a summary of the number of
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 24 of 96
affordable homes that were sold within the ‘Right to Buy’ initiative during the period
1980 to 2011.
Figure 1: Right to Buy and Preserved Right to Buy sales 1980/81 to 2010/11
Source: CLG, Reinvigorating Right to Buy and One for One Replacement Impact Assessment, 2012,
For many reasons, it can be argued that the ‘Right to Buy’ programme was a
mistake, particularly as it severely depleted the already meagre housing stock and
placed a heavier burden on the government to provide newly constructed social
housing. Subsidies that would have otherwise been given to housing associations for
construction of new homes had been transferred to support households through
housing benefits. What resulted was a decrease in new social homes from an average
of 100,000 per year in the 1970s and 30,000 per year in the mid-1980s to an
astounding zero by 1993 when the conservative government of John Major was elected
to office. (Golland,1998; Balchin, 1996). It may have been more prudent to reduce rent
on properties in a savings plan that would allow tenants to eventually purchase private
housing, therefore freeing up the existing stock for new tenants.
In 1990, the John Major conservative led government met the largest housing slump
since the 1950s in addition to a major recession. The then government was faced with
balancing the Thatcher ‘Right to Buy’ policies with policies to promote modernization in
the sector (Fée, 2009), thus paving the way for the centrist government of Tony Blair,
whose policy on social housing was continue to promote home ownership, but also to
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 25 of 96
improve the quality of the current stock through the urban regeneration program
(Fée, 2009). When Gordon Brown entered office in June 2007, his intentions were to
stimulate new affordable house building by pledging £2.1 billion towards the
construction of 20,000 new homes (Story, 2009).
David Cameron replaced Gordon Brown in May 2010, at a time when the UK was
suffering the effects of the global recession and it was clear that government spending
must be curtailed to avoid a collapse of the UK economy. Cameron’s housing policy of
necessity focused on increasing efficiency and supply while cutting costs and will be
discussed later in this chapter.
As of today, it can be argued that the changes in governments saw policies that
resulted in a reduction in affordable housing. Figure 2 shows a falling trend of built
affordable housing stock from 6.6 million dwellings in 1981 falling to 4.8 million at end
2007. The graph is meant to demonstrate the extent to which social housing declined
since the ‘Right to Buy’ policy was introduced. In light of these facts, it is not surprising
that a large portion of the rental housing owned by the local authorities is in an
unsatisfactory condition due to age, poor design and construction (Stone, 2003).
Figure 2: Number of Social Housing Dwellings in the UK 1981 - 2007
Source: Beever and Struthers, 2011; Annual Review of Social Housing.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 26 of 96
2.4 Recent issues in UK Social Housing – 2008 to present.
A major event occurred in 2008 which placed a heavier burden on the UK economy.
The US credit crunch of 2008, followed by the recent Eurozone crisis has resulted in a
struggling UK economy with GDP contraction in the 4th quarter of 2011 and the first
quarter of 2012 (Barclays, 2012). The bottom line has been continued company
closure, further job cuts and depressed household incomes which have increased the
waiting list for social housing. The literature points to growing challenges for the
government as it tries to provide affordable housing for its residents. These challenges
can be summarized under the following headings:
Physical Condition of existing stock and the Housing Gap
Housing Delivery Chain
Government Funding and
Innovation.
2.4.1 Physical condition of existing stock and Housing Gap
The late 1980s to 1990s witnessed the government introduced ‘regeneration
programmes’ to improve the physical condition of council housing (Malpass and Murie,
1999). The renovation initiative has persisted today in the form of combined renovation
and demolition/replacement activities. While there is a concern about the maintenance
of existing stock, there is an additional focus on the quality and sustainability of new
built housing. It has been argued that housing association units are being designed and
built with 25 year life cycle to keep costs down during this period (Stone, 2003)
These programmes have been progressing slowly. In 2000, the backlog of repairs
and improvements amounted to £ 19billion (CLG, 2000) In 2011, 23,000 new homes
would have to be constructed to remove the backlog. This would likely incur costs of up
to £1.6 billion (Barker, 2004).
The Barker Review (2004) reported the number of 42,700 social houses built in the
UK in 1994-95 falling to approximately 21,000 in 2002-03. Along with the decline in
production was an increase in expenditure of £600 million over the period 2001-02 to
2003-04. The surprising decline in production in spite of increased funding was
attributed to rising land prices and the rehabilitation program.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 27 of 96
2.5 Social Housing Delivery Structure
Currently, the situation in the housing market is a challenging one. The UK
government was forced to revise the housing delivery structure to make it more
compatible with the current economic conditions, and to meet the increasing demands
for housing.
This increasing demand for housing was a concern for the government which had
established a target of 240,000 additional homes by 2016 (CLA, 2007). Unfortunately
the financial crisis in 2008 placed a formidable obstacle in the way of the government’s
housing supply agenda. The mortgage market almost collapsed and in response to it
the banks tightened up the lending criteria (FSA, 2011) that made home ownership
almost unattainable for many. As houses became unaffordable, the social housing
supply decreased further. The National Housing and Planning Advice Unit (NHPAU),
which was created after the Barker’s Review 2004, advised that the recession had
increased demand for social housing up to 290,500 new homes per year until 2031 to
meet its demand (NHPAU, 2009).
This worrying situation prompted the Office of the Deputy Prime Minister (ODPM) to
set the following Public Service Agreement target:
“Achieve a better balance between housing availability and the demand for
housing, including improving affordability, in all English regions while protecting
valuable countryside around our towns, cities and in the green belt and the
sustainability of towns and cities” (NAO, 2005a).
To achieve its target, the 2004 government had developed a complicated
delivery chain to manage the flow of funding for social housing. Figure 3 demonstrates
how the funding emanated from the ODPM, and was directed to the Government
Offices for the Regions, then to the Regional Housing Boards and Regional Planning
Bodies, followed by the local authorities, housing associations, and property developers
respectively (NAO, 2005a).
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 28 of 96
Figure 3: Flow of funding for affordable housing.
Source: National Audit Office, 2005
In Figure 3, the diagram of the original housing delivery chain features the ODPM,
the Housing Corporations (National and Regional), the Developers and the Housing
Associations as the central bodies in the delivery structure. Additional agencies such as
the Regional Government Offices, Regional Housing Boards and Planning Bodies and
Local Authorities, can be said to form extensions from the main chain (NAO, 2005a).
In an attempt to improve efficiency, the present government has made revisions to
the housing delivery structure. The following section will explore the evolution of the
delivery chain in recent years with a particular focus on the current structure. The
section will discuss what the literature reports to be the potential benefits and limitations
of the chain in its current form as the government attempts to meet its objective of
speeding up the delivery of housing and reducing the costs involved.
In 2005, a joint study by the Audit Commission and National Audit Office
investigated ways by which the availability of affordable housing in high demand areas
could be increased. The report concluded that there needed to be more efficiency on
the national, regional and local levels, in order to reduce the time of delivery and cost of
housing units (NAO, 2005a). The study proposed strategies including removal of
blockages, simplification of processes and clarification of roles of participating bodies
within the chain to speed up delivery of social housing. Also, to reduce costs, the study
suggested rationalising the delivery chain by removing duplications and sharing
services (NAO, 2005a).
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 29 of 96
In its traditional form, the ODPM provides funding to the Housing Corporations
which then award grants and subsidies to the Housing Associations and Developers for
the provision of new housing. But in the traditional chain of delivery, the flow of funding
goes through a convoluted channel through other bodies. For example the Government
Offices were charged with the responsibility of linking with and ensuring that the other
organizations were aware of national policy. The Regional Housing Boards liaised with
the Regional Planning Boards to set priorities for housing and to advise the government
where funding should be channelled. The role of Local Authorities was to approve the
schemes for new housing developments and prepare needs assessments and
development frameworks. The Regional Assemblies were responsible for the Regional
Spatial Strategies (RSS), (NAO, 2005a)
Few can argue that the complexity of this structure resulted in the waste of finance
and other resources and had also increased ambiguity at regional and local levels
about roles and relationships. In order to achieve efficiency, major changes had to be
made. In 2010, an important change in policy was introduced, which allocated more
decision making power to regional bodies, thereby removing the Local Authority Social
Housing Grant and changing the planning system. Moreover, the criteria for funding
Housing Associations were revisited and the funding cycle was adjusted from one to
two years (NAO, 2005a).
According to the report by the Comptroller and Auditor General (NAO, 2005a), the
changes had a positive impact by giving ‘more certainty to housing associations’ as well
as ‘encouraging developers to plan better and to invest in capacity for the future’. The
report stated that the new initiatives reduced complexity in funding by being more
selective in the awarding of grants, thereby reducing spending by 9%.
2.5.1 Present Housing Delivery Structure
As recently as November 2011, the Localism Act, in which changes to the housing
delivery structure were announced, was proclaimed in parliament. The highlight was the
transferring of decision making power for planning and housing away from the ODPM to
the councils and neighbourhoods. Other changes included the removal of the
requirement for councils to have a Home Information Pack (HIP), reform of the Housing
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 30 of 96
Revenue Account System (HRAS), and abolishment of the Tenant Services
Authority (TSA). The TSA was replaced by the Home and Community Agency (HCA). In
London in particular, the responsibilities of the HCA in housing investment were
transferred to the Greater London Authority (GLA) (HCA, 2012a). Furthermore, with
regard to planning the following changes were also made: abolishment of the Regional
Assemblies; greater new housing and regeneration powers to the GLA and abolishment
of the London Development Agency (LDA). Greater powers are now afforded to locally
elected representatives such as the Mayor of London, who can carry on investment and
economic development activities that were previously the responsibility of the HCA and
LDA.
2.6 Government Spending 2009 to present
The financial crisis of 2008 had a major impact on housing supply. Successive
governments have tried to stimulate house construction with additional, short-term
spending as well as with programmes to improve efficiency within the sector over the
long term. In 2007 planned housing supply was to meet a goal of 240,000 new homes
every year by 2016 to match annual population growth. Hill (2001) reported that
118,000 homes were completed in England in 2009, while in 2010, only 102,750 – the
lowest levels during peace time since the early 1900s.
Figure 4: Housing completions in 2010; lowest peacetime level since 1923.
Source: Hill, R., Homes and Community Agencies, 2011
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 31 of 96
But numbers of completions alone do not give a full picture of net additions to the
national stock. Losses through war, slum clearances or demolitions for redevelopment,
conversions and changes of use should also be taken into account.
Recognizing the poor state of affairs in housing, the 2009 budget of the Gordon
Brown government provided £200 million to kick-start house-building – the overall aim
being to deliver 10,000 new homes in England over 2 years. An additional £300 million
were allocated for the purpose of re-starting stalled housing developments, while a
further £100 million were assigned to authorities for building new social housing at
higher energy standards.
Shortly after coming into power in May 2010, the Conservative party and Liberal
Democrat coalition, led by David Cameron and Nick Clegg respectively was faced with
a financial crisis. Two months later, the newly appointed Chancellor Osborne presented
the coalition’s ‘Emergency Budget, which was said to be based on the values of
‘responsibility, freedom and fairness’ (NHF, 2010).
The budget presented a five-year plan to bring the UK economy out of a record
deficit which was described as the ‘longest and deepest’ recession since 2nd world war
(Allan, 2010) (see Figure 5).
Figure 5: The ‘deepest’ recession since the Second World War.
Source: Allen, G., Recesssion and Revovery, 2010.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 32 of 96
To reduce the UK’s unprecedented peacetime deficit of around £180bn (Jones Lang
LaSalle, 2011a) the coalition government announced wide ranging and predominantly
revenue focused efficiency measures to curtail its spending. The stated goal was to
achieve initial savings in the amount of £6.2 billion. Details of the proposed measures
were presented both in the Emergency Budget of June 2010 and later in its
comprehensive Spending Review of October 2010 (HM Treasury, 2010). Particulars of
government cuts on housing related support are listed as follows:
In February 2011, the CLG and HCA published a document, the 2011-15 National
Affordable Homes Programme (NAHP) Framework. This framework was
comprehensively summarized by McGuinness (2011), who described the policy as
primarily focussed on reducing capital subsidy for affordable housing in favour of the
Housing Benefit. A key feature of this new framework was the adjustment of social
housing rents from 50% to 80% of market rent. This adjustment would benefit providers
who signed the NAHP agreement with the HCA, and would apply both to the provision
of new Affordable Rent units as well social rent units to be rehabilitated to Affordable
Rent (McGuinness, 2011). To apply for funding under the NAHP, providers must be
either Investment Partners or meet Specialist Provision qualification (HCA, 2011).
Investment Partners would have met the NAHP requirements of technical readiness,
financial capacity, and good standing, while those providers qualifying under the
Specialist Provision route would have to demonstrate that they provide housing in any
one of the following areas: rural housing settlements, housing for black and minority
ethnicities, supported housing, environmental innovation, and housing meeting at CSH
Code level of at least 5 (HCA, 2011).
2.7 Concluding Remarks This chapter provided an overview of social housing supply in the UK from the post
2nd World War period to present. The chapter demonstrated how the provision of
affordable housing which reached its zenith 1945, gradually declined over the years as
a result of government policy and economic challenges.
At present, the current economic crisis has put further pressure on the government
as it aspires to meet its housing targets. To achieve its social housing goals, recent
policy changes focused on reducing funding while making significant adjustments to the
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 33 of 96
housing delivery chain. These adjustments were made as recently as December
2011, and it still remains to seen what is the overall impact on efficiency of housing
delivery.
Even with cuts in spending, government has made adjustments in administrative
policy, suggesting that government still hopes to meet its stated goals of 3 million
homes by 2020. Is this realistic or will the reduction of capital grants result in changes in
quality of housing (dwelling type, density, land use, space standards)? The following
chapter will explore this issue in more thorough detail.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 34 of 96
Chapter 3 – Standards, Design and Cost of Social Housing
3.1 Introduction
While the second chapter of this thesis focused on the broader context, namely
governmental policies related to the administration and funding of affordable housing in
the UK; this chapter will explore the types, standards and costs of affordable housing
from the narrower London context. The rationale for the approach of this chapter is
warranted in light of London’s social, economic, political and cultural uniqueness
(Fenton at al, 2008). With regard to demand, Greater London has the most need for
social housing compared to Greater Manchester and the West Midlands city. Fenton at
al (2008) estimated that there are three times as many households in Greater London
compared to the aforementioned cities. Moreover, he indicated that London is the most
important destination for both domestic and international migration.
Household composition is different in London as well. While it is true that like the
rest of the UK, London has seen an increase in the number of single person
households, the average household size in London exceeds that of the rest of England.
Figure 6 presents the household size projections for London compare to the rest of
England.
Figure.6: Household Size Projections.
Source: GLA (2006) Household Size 1991 – 2026.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 35 of 96
It follows that the extent to which the supply of housing will meet demand in London
will be assessed not only by the number of available units, but the types of dwellings
(i.e. number of rooms) that are built.
Strikingly, as of 2006, affordable housing construction in London was trending
towards an 80% production of flats, with a reduction in the number of 3 and 4 bedroom
units and an overall increase in 1 and 2 bedroom accommodation (GLA, 2006). The
outcome has been a greater percentage of 2 bedroom flats, certainly not in line with the
housing needs of the London population. This decrease in room number has been
accompanied by a decrease in floor space in spite of an increase in the space
benchmarks over the years (GLA, 2006). In spite of all this, housing is in general more
expensive in London compared to other regions (Fenton, 2008).
London’s uniqueness in social housing is also reflected in the design, distribution of
tenure and cost of social housing. With regard to tenure mix, renting in 2008 was more
common in London than in other districts. At that time, 5 of the top 10 boroughs
estimated to have the highest portion of council housing in their housing stock were
London boroughs (Fenton, 2008).
This chapter will explore the types, standards and cost of social housing in London.
Attention will be paid to dwelling types, density, brownfield and modern method of
construction (MMC).
3.2 Space, Dwelling Type and Design Standards over the years
Social housing for returning army personnel in the post second world war
‘Homes for Heroes’ initiative achieved a high standard of housing that can be credited
to the Government commissioned Dudley Report of 1944. This report provided a
thorough assessment of housing standards that would inform guidelines for post war
housing construction. These housing standards were outlined in the Housing Manual of
1944 which provided benchmarks for housing design, including site layout, estate
density, house types, room and flat size, efficiency in building, new methods and
materials, heat and insulation (CABE, 2010a).
Amendments via the 1949 Housing Manual Standards resulted in an even higher
quality of housing. Largely located in Greenfield areas, the design was generally semi-
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 36 of 96
detached dwellings with indoor heating and plumbing (Malpass and Murie, 1999).
Dwelling type standards advocated for the provision of a wide variety of houses and
flats ranging from 1 bedroom, 27.9 m² flats for single persons to 7 person, 4-bedroom
maisonettes of 102 to 109 m² floor space (GLA, 2006).
Such strict attention to high quality housing continued into the late 1950s until a
change in government policy resulted in a deterioration of social housing (Malpass and
Murie, 1999). At that time, projects were noted for low quality of design and
construction. This deterioration of standards can be attributed to a change in policy that
focused on the relocation of lower-income inner-city populations. The slum clearance
programme was accompanied by a reduction of investment in social housing
construction resulting in an unfortunate deterioration in the design and construction of
newly built homes (Stone, 2003).
Why did social housing suffer from such a lowering in standards in the 20 year
period in spite of previous efforts to improve housing quality? Perhaps it can be argued
that since the guidelines in public sector housing were related specifically to space, it
left the door open to substandard design and workmanship. The Housing Evidence
Summary Report (2010) supports this argument in part. The report argued that strict
space standards do not translate into good design.
The 1961 Parker Morris report ‘Homes for Today and Tomorrow’ emphasized
the need for space standards in housing. These standards were derived from a survey
of how people actually used their homes and respective rooms. Also included in the
report was the addition of a storage space requirement. The Parker Morris guidelines
were different from previous standards in that it paid particular attention to the internal
arrangement of the home in response to the changing needs of residents (RIBA, 2011).
The Parker Morris report was revised and improved upon in 1963 and published
in the Ministry of Housing and Local Government’s Design Bulletin 6 (RIBA,2008).
Included in these guidelines were space and furniture requirements for family and
personal activities as well as space required for moving furniture around. The Parker
Morris standards eventually became mandatory for all new council housing in 1969.
(Croydon Council, 2008). Table 2 provides a comparison of floor areas standards and
its changes since the introduction of the Parker Morris 1961 standards.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 37 of 96
Table 2: Comparison of GIA and its changes since 1949.
Source: CABE, 2010b. Mapping space standards for the home.
Unfortunately, the excellent standards prescribed were not evidenced in the
housing of the 1960s. In the era of slum clearance, the mode of housing tended to be
multi-storied, industrialized, Radburn layouts which tended to be of poor design. It was
clear that space standards were necessary but not sufficient for ensuring good quality
design but it was also important to have good site planning and good quality in
construction (CABE, 2004)
Adherence to standards set out in the Parker Morris report was also determined
by the extent to which the state had the resources to fund the construction of such high
quality homes. Indeed, the recession of the 1980s saw the decline of housing
construction and a disregard for Parker Morris standards (The Design of Homes, 2009).
Housing Corporations which by this time had become the main provider of social
housing, in 1983, had compiled a new standards document entitled the Design and
Contract Criteria, which largely borrowed from the Parker Morris standards . Still,
because the priority was cost saving measures in house building; as the housing grant
decreased, so did the adherence to housing standard guidelines (Mathieson, 2010).
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 38 of 96
By the early 1990s, 68% of dwellings built by Housing Associations fell short of
benchmarks in storage and circulation space and were also poorly constructed
(Mathieson, 2010). The Scheme Development Standards (SDS) were published in 1993
as an attempt by the Housing Corporation to stem the lowering of standards in social
housing. The SDS was useful in that it provided guidelines regarding the minimum that
was expected in housing that was funded through the social housing grant (GLA, 2006).
Special attention was paid to meeting the needs of persons with disabilities according to
the requirements of the 1995 Disability Act and those of older citizens. In 1996, housing
design standards introduced the concept of urban design as a way local authorities can
influence the quality of construction of affordable homes (Mathieson, 2010).
In 2000, the Blair/Brown government introduced the Decent Homes Standard as
a measure to upgrade the quality of existing housing stock (Davidson et. al. 2009). The
standards pronounced the following guidelines for homes: “it must meet the current
statutory minimum standard for housing; it must be in a reasonable state of repair; it
must have reasonably modern facilities and services; and it must provide a reasonable
degree of thermal comfort” (CLG, 2006a).
By 2010, the programme was declared a success with 92% of the 2.1 million
social homes that were deemed to be in an unsatisfactory condition (HCA, 2011)
achieving the decent standard. In light of the positive results, the Spending Review of
2010 revealed that the programme would be further funded in the amount of £2.1
billion, with £1.6 billion allocated to council homes and £0.5 billion going to housing
associations (CLG, 2011). The goal was to fund the upgrade of 123,000 of the 410,000
homes assessed to be below the ‘decent home’ standard by 2014-2015.
That year, the London Design Guide (LDA, 2011) was launched which
presented the new design standard for London Homes. The expressed goal as
indicated in the guide was to improve the quality of London homes while maintaining
the unique character and appeal of London residential areas. The Guide covers
different aspects of design and quality. Standards were established to ensure, among
other things, that the design of the building fits in with the environmental context and
character of the area, complies with open space strategies, provides suitable place for
play where it is required, and ensures open spaces are accessible and properly placed.
According to the guidelines, the density of residential units should be in line with the
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 39 of 96
London Plan and should provide proper access to transportation and services.
Also, developments must have the appropriate mix of dwelling sizes and tenures. Other
standards regarding entrance to and circulation within buildings, parking and storage,
waste and recycling and post and deliveries are clearly highlighted in the document.
Key are the space benchmarks that are painstakingly outlined in the Guide. Table 3
presents the minimum space standards for varying dwelling types.
Table 3: Dwelling Space Standards.
Source: London Development Agency, 2011. Design for London.
These standards are said to allow for flexibility of arrangement within the living
space and ease of circulation. Specific care is taken to report on space guidelines for
different living areas, such as kitchen, living and dining areas, bedrooms, bathrooms
and toilets, storage, study areas, wheelchair user areas, and private open spaces.
3.2.1 Code for Sustainable Homes (CSH)
Recently design standards in social housing have focused on environmental
performance under 9 categories: energy and CO2 emissions, water, materials, surface
water run-off, waste, pollution, health and wellbeing, management and ecology (CLG,
2006b). Points are assigned to each category and the extent to which it will allow
homes to be assigned a Code Level ranging on an ascending scale from 1 to 6. The
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 40 of 96
minimum standard for affordable housing is a Code Level 3. The goal is that by
2016, all new homes will be zero-carbon or Code Level 6 (CLG, 2009).
3.2.2 External environment
There are several standards under which the external environment of housing
schemes can be assessed. The Building for Life (BIL) standard is a national standard
that is awarded to housing schemes that reflect excellence in design and place making
under the four categories: Character, Roads, Parking and Pedestrianisation, Design
and Construction and Environment and Community (Building for Life, 2011). Overall
there are 20 criteria that reflect how well the new homes integrate with their
surroundings. The public sector as adopted these standards as a method of
assessment as it relates to the award of affordable housing grants. The standards
specify the minimum number out of 20 points that will meet award criteria (Building for
Life, 2011).
Another standard, the Lifetime Homes standard was developed by the Joseph
Rowntree Foundation and applies to all new housing schemes within London through
the London Plan Policy. These standards comprise 16 criteria including access to the
home as well movement indoors and between floors. Developments must achieve all 16
criteria to achieve the Lifetime Homes Standard (Lifetime Homes, 2010).
There is also Secured by Design, which is a police initiative to prevent crime via
the right site layout and design. Elements of safety such as secure windows, doors and
locks must be determined in collaboration between the developer and either a police
Crime Prevention Design Adviser (CPDA) or an Architectural Liaison Officer (ALO).
While these standards have been included in the Code for Sustainable Homes, they are
not compulsory; however for public sector funding purposes, these standards are
mandatory (ACPO Secured by Design, 2010).
The question of whether or not these standards have been met is a different issue,
one that has been studied extensively. In 2004, London housing standards achieved a
very low ranking, with only 18% of homes achieving a grading of ‘good or better’ (RIBA,
2009). Another study by Croydon Council (2008) audited 100 affordable housing
schemes. The findings from the research rated 61 of the 100 schemes as being of
average quality, 17 of good or very good quality, and 21 of poor quality. The results
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 41 of 96
reflected that standards in building were generally mediocre. While there seemed to
be a positive trend towards urban design principles such as appropriate use of scale
and creation of active frontages, problems around a lack of specific design solutions
continue to be repeated. Room sizes that met the prescribed standards in the 1970s
diminished considerably in dimensions by the 1990s and onwards (Croydon Council,
2008).
In a study commissioned by the GLA the researchers explored space standards and
dwelling mix (GLA, 2006). The qualitative survey reflected findings based on anecdotal
reports that indicated that room sizes were decreasing. The problem maintaining quality
in design and construction over the years can be attributed to ‘higher land costs and
constrained land capacity’ (Mathieson, 2010). It is anticipated that within the broader
UK context, increasing cost cutting measures will put even greater pressures on quality
overall.
3.3 Affordable Housing Trends in London
3.3.1 Dwelling Mix
The trends on dwelling mix in London were obtained from the ODPM Housing Statistics
of 2011 (GLA, 2006). With regard to new build units, there appears to be a prevalence
of two-bedroom accommodation with a decline in 3 and 4 bedroom units. Additionally,
affordable housing construction has produced an inordinately large number of flats as
opposed to houses. The portion of three bedroom flats built is 10% compared to 5% in
2005. One bedroom flats have increased from 20% to 25%, while 2 bedroom units are
at 60% (GLA, 2006).
Considering the fact that London household sizes exceed values nationally, it
seems a contradiction that dwelling types are diminishing in number of rooms. The
mismatch between needs of the population and the housing that has been provided
over the past 10 years increases the risk of overcrowding.
3.3.2 Density
London’s population has been growing steadily since 1988 and continues to grow
(see Figure 7). In 2011, London’s population was estimated to be 8 million, an increase
of 10% over the last 10 years (Bentham, 2011). With limited space available and an
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 42 of 96
increasing population, it is not surprising that housing developments are of densities
larger than the national average (Mathieson, 2010). On average, housing densities in
London have increased from 85 dph in the 1990s to over 130 dph in 2010 (Mathieson,
2010).
Figure 7: Growth in Population.
Source: The Mayor’s London Plan, 2011a.
The key to building higher density developments in London, according to the Draft
Replacement London Plan (DRLP, 2009), is to ‘optimise and not simply maximize’
housing output. In a study commissioned by the London Housing Federation, ‘Capital
Gains: Making high density housing work in London’ (Cope, 2002), the author looked at
successful high density (81-455 dwellings per hectare) housing developments in
London, seven of which were managed by housing associations and one which was
managed by a local authority. They wanted to answer what factors made these high
density estates successful.
Among these factors were the following:
Spare Bedroom or bed space
Good management and maintenance
Sustainable and well integrated and inclusive communities.
Good design
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 43 of 96
The authors lamented that developers were allocating minimum space to affordable
housing, and emphasized the need for more family housing and an adherence to
minimum space standards in new build developments.
3.3.3 Brownfield vs. Greenbelt
In the late 1990s, government introduced a policy that was aimed at reducing
urban sprawl and Greenfield development. The goal was produce a denser form of
development (Wong and Schulze Bäing, 2010). This policy advocated for the
development of housing developments on brownfield sites.
Brownfield refers to land that has been previously developed ‘which is or was
occupied by a permanent structure including the cartilage of the developed land and
any associated fixed surface infrastructure’ (CLG, 2006c). Another definition for
brownfield land is ‘land that is or was occupied by a permanent structure which has
become vacant, underused or derelict, and has the potential for redevelopment’
(Shelter, 2011b). A brownfield site is contrasted with a Greenfield site which is land that
has never been developed. Greenfield sites can exist either within or outside of built-up
areas.
A national target had been established to build all new housing on brownfield
land by 2008 and for the most part, the goal has been met. There are estimated to be
over 66,000 hectares of brownfield sites in England, with approximately 22,000
hectares in London (Gray, 2012). Compared with the rest of England, brownfield land
use for residential development has been high. Figure 8 shows brownfield land
developed for residential use by region.
Figure 8: Brownfield land developed for residential use by region.
Source: Wong and Schulze Bäing, 2010.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 44 of 96
The name Greenbelt refers to defined areas of land that exist around a city or town.
Greenbelt land was defined as early as the 1930s and was included in the development
plan during the 1940s Homes for Heroes initiative. Today greenbelts cover 1.6 million
hectares or about 13% of England. As of March 2011, approximately 560,000 hectares
are located in London (CLG, 2011c). The distribution of greenbelt sites in London is
presented in Figure 9.
Figure 9: London Plan key diagram.
Source: The Mayor’s London Plan, 2011b.
Restrictions on the development of greenbelts are very strict owing to the fact the
greenbelts are for the purpose of protecting open space. However there are exception
sites for social housing as demonstrated by the Planning Policy Guidance Note (CLG,
2006c). There has been an argument for using greenbelt sites for social housing in light
of the shortage of land available for development in London. Figure 9 shows how
development projects tend to be concentrated within the existing London boundary,
while the greenbelt areas remain untouched.
Housing in London is more expensive than any other part of England. Granted,
the gaps in rents between affordable and private sector housing can be as much as
£100 in the inner city, but compared to the rest of England, affordable housing is highly
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 45 of 96
priced. The reason for the high rents relate to the high land values in London as
well as the costs involved in construction.
3.4 Costs of Schemes
Housing in London is more expensive than any other part of England. Granted, the
gaps in rents between affordable and private sector housing can be as much as £100 in
the inner city, but compared to the rest of England, affordable housing is highly priced.
The reason for the high rents relate to the high land values in London as well as the
costs involved in construction.
Table 4 presents the construction costs for different types of dwellings. To meet the
prescribed CSH Code Level 3 for affordable housing, extra over costs are incurred
which further carry up market rent and therefore affordable rent values. Table 5
presents a summary of extra-over costs for meeting each Code Level for different types
of housing.
Table:4: Baseline Construction Cost.
Source: CLA; 2010.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 46 of 96
Table 5: Summary of extra-over costs of building to each level of the Code in each of the dwelling types
and for a range of development scenarios.
Source: CLA, 2010.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 47 of 96
3.5 Impact of MMC
Modern Method of Construction or MMC is a term that has been used in the
housing industry to describe a technique in construction that combines offsite
construction with onsite technologies (ODPM, 2003). MMC is a term used to describe a
range of processes, management techniques and constructions methods (Kempton et
al, 2009). This thesis will focus on three of the construction methods involved, for which
the Housing Corporation developed a construction classification system as follows:
Off site manufactured Volumetric
Off site manufactured Panellized
Off site manufactured Hybrid
Off site manufactured Subassemblies and Components
Non off site manufactured modern methods of construction.
In 2002, a Housing Corporation initiative was introduced to kick-start the use of
MMC in the construction of affordable housing as a means of maximizing the
government’s potential in increasing the social housing stock. This fund, the Challenge
Fund, provided £300 million to meet the objectives of providing social housing in areas
of high demand in London, promoting the use of MMC in construction, and producing
the housing more time and cost efficiently than traditional methods (HC, 2005). The
following sections will provide an overview of modern methods of construction that have
been used in the affordable housing sector, its advantages and disadvantages and the
costs associated with its use in recent times.
The use of MMC is not new. This technique of construction was used during the
Homes for Heroes Program of the 1940s and also during the slum clearance
programme of the 1960s (POST, 2003). An example is the Ronan Point Housing
Scheme, which was built in 1968 to relocate East London residents. Tragically, a gas
explosion caused an entire corner of the 22 storey building to collapse (Ross, 2002).
Other such disasters on MMC housing schemes resulted in widespread scepticism
regarding its use (Bura Report, 2005). However advancements and refinements in
MMC, in addition to recent shortages in skilled tradespersons in the field (eg. brick
layers, carpenters, plumbers, and electricians) have made MMC a more attractive
prospect in recent times (Johnson, 2010), particularly since most of the skilful
processes occur offsite. Moreover, MMC has been seen as providing excellent potential
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 48 of 96
for the regeneration sector to improve the delivery of large projects in terms of
efficiency and cost (Bura Report, 2005). The following MMC techniques are used in
affordable housing schemes in London.
3.5.1 Volumetric construction
Volumetric construction refers to the production of 3 dimensional units off-site in
a factory setting. Materials used consist of light gauge steel frame, timber frame,
concrete and composites. In residential construction, this method is particularly useful in
the production of highly serviced areas such as bathrooms and kitchens. This form of
MMC has been used in UK house building since the 1970s (Bates, 2010). The benefits
associated with volumetric construction are low labour costs related to reduce on site
labour requirements and lessened on site construction time (NHBC Foundation, 2005).
Compared to traditional house building techniques, volumetric construction has been
known to reduce onsite construction time by as much as 50-60% (NAO, 2005b).
An important point of concern regards the occurrence of errors in design. As
volumetric units are generally mass produced, any defects are likely to be repeated for
each module and may not be detected until the units are lived in. Rectifying such errors
are therefore likely to incur huge costs (POST, 2003).
3.5.2 Panellised construction
This system is very popular in London affordable housing construction, and
refers to the production of walls, floors, roofs that envelope a building (Davis Langdon
and Everest, 2004). The panellised systems use materials very similar to those used in
volumetric construction. Among the construction materials, mentioned above, timber-
frame is most commonly used as it meets environmental standards (Westframe, 2011).
Additionally, there has been an increase in the use of structural insulated panels (SIPs).
The Davis Langdon report (2006) describes SIPs as ‘rigid insulation boards bonded
between plywood or orientated strand boards’ that are ‘load-bearing, durable and
adaptable’.
Unlike volumetric systems, panellized systems are not mass produced,
therefore allowing more flexibility in design specifications according to client needs
(Buildingtalk, 2010). Timber frame are considered to be superior to traditional methods
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 49 of 96
because it provides excellent insulation and lightweight construction within a
shorter time. Unfortunately, the panellized system is said to incur a 5% added capital
cost on that of traditional timber frame construction, however such costs are usually off-
set during the shortened onsite construction phase (Davis Langdon and Everest, 2004).
3.5.3 Off Site manufactured – Hybrid Construction
This type of construction is a combination of the Volumetric and Panellized
techniques. In this case, highly serviced areas (pods) are constructed by volumetric
techniques, while the remainder of the home is constructed using the panellized
system. Hybrid construction enjoys the benefits of both volumetric and panellized
systems, however, since these different units are generally produced by different
manufacturers, there is a risk of problems of design coherence especially if the units
are made of different materials (NHBC Foundation, 2006; POST, 2003).
3.6 Design Quality and Cost
So far, studies have not demonstrated a clear relationship between design quality
and the use of MMC. An evaluation of the design quality in the schemes funded by the
Challenge Fund revealed that none were considered to be of outstanding design
quality. Moreover, results have indicated that there has been no cost saving to date with
the use of MMC. In fact some schemes have been shown to cost more than traditionally
built projects (POST, 2003; Windapo and Balogun, 2009). To date, there is not enough
data regarding the more complex MMC schemes in terms of costs. It is believed that
accurate cost information will be useful to decision making early in the process but
currently such information is usually confidential (POST, 2003).
3.7 Concluding Remarks
This chapter focused on design standards, types of social housing developments,
and cost of social housing with a particular focus on London which is a unique to other
cities in the UK. The chapter showed that to date, social housing has failed to meet the
various design standards and tend to be of either poor or mediocre quality. It is believed
that economic challenges tend to determine the extent to which standards are met.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 50 of 96
The chapter also showed that in light of London’s large and ever increasing
population and lack of available land, there has been a push to increase the density of
developments as well as use brownfield sites to establish urban developments.
Greenbelt sites, generally seen as protected recreational areas, have also been
proposed for use in order to meet the high demand for housing, but such arguments are
controversial.
One recent initiative has been the use of MMC. The 2001 Challenge Fund allocated
substantial sums to money as an incentive for developers to use off-site manufacturing
in the provision of social housing. Traditionally met with scepticism, MMC has become
more attractive as a cost and time saving approach. However studies to date have not
supported this assertion, as MMC schemes have not been shown to reduce cost. There
has also been no demonstrated improvement in design quality through the use of MMC.
The lack of data on the costs of MMC and the utility of MMC in providing housing in a
time efficient manner is a major problem for the field. This study hopes to add to the
currently deficient literature.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 51 of 96
Chapter 4 – Methodology (Findings from the case studies interviews)
4.1 Introduction
This chapter will describe the methods used to achieve the aims and objectives of
this study. As has been summarized in Chapter 1, the general focus of this research
was to understand how government spending impacted social housing in London.
Specifically the research questions were as follows:
How has the structure for the delivery of social housing changed?
Have there been adjustments in the number of the participant agencies and their
roles?
Have the changes in the delivery structure achieved its intended goals of
increasing efficiency and reducing costs?
How does the government’s new policy affect spending in social housing
construction?
What are the key factors that influenced costs in social housing?
How does reduced governmental spending affect the construction programme
(project portfolio) of RPs in terms of number, types and sizes of schemes,
available land whether brownfield or greenbelt, mix between rehabilitation/new
development and density (high or low)?
What is the level of use of MMC and what has been its impact in social housing
construction?
To accomplish these objectives, this study employed the exploratory type of
research which features a review of literature, and additional data gathering approaches
including case studies interview and quantitative data analysis.
4.2 Research Design and Approach
This study employed a range of data collection strategies, including the
qualitative approach which featured the use of interviews to gather data; as well as the
gathering of quantitative data by perusing databases. It is important to provide a
rationale for the use of both methods.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 52 of 96
The formal and objective methods involved in quantitative data collection, allows
the author to answer research questions by collecting numerical data that can be
analysed statistically (Creswell, 2009). For this thesis, the author used descriptive
statistics to examine the trend of cost per m² and duration of completion for common
building types (estate housing and flats) over a period of 15 years.
The use of qualitative data collection facilitated the gathering of individual
interpretations and impressions of the present situation through the use of interviews.
After collecting the interview data, analyses focused on identifying themes, categories,
and patterns within the narratives.
Creswell (2009) described the combining of elements of quantitative and
qualitative research in one study as the Concurrent Mixed Method approach. This
mixed model approach is considered to be appropriate for the purposes of this
research. Combining both qualitative and quantitative methods of exploration will allow
the researcher to synthesize the findings of different data formats that were collected for
the same purpose (Tashakkori and Teddlie, 2003). This approach is considered to
provide greater depth and breadth than can be achieved by using one approach alone
(Creswell, 2009). It also allows the researcher to use one form of data to validate the
findings of the other (Creswell & Plano Clark, 2007).
4.3 Research Methods Chosen
The following sections will describe the data collection methods that were
employed in this study: the literature review, the case study interview and the
quantitative data collection.
4.3.1 Literature Review
In order to answer the research questions, information was provided by the
following sources:
Academic Journals
Governmental Publications
Organizational Publications
Textbooks
Trade Journals, Newspapers and Magazines
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 53 of 96
4.3.2 Case Study Interview
Case Study Interviews were used for the purpose of collecting narrative data.
Three main types of interviews were available to the researcher:
4.3.3 Structured Interview
For the structured interview, a researcher utilizes a rigid list of questions which
are not deviated from. The purpose of the structured interview is to reduce the
complexity of the data by having fewer categories or variables to analyse.
4.3.4 Semi-structured Interview
This type of interview also employs the use of a script, however the interviewee
has the freedom to divert from the main line of questions for clarification or to increase
the depth of information.
4.3.5 Unstructured Interview
This approach obtains information in a largely open format. Questions are not
predetermined and the direction of the interview is led by the interviewee, and depends
on what is revealed by prior questions. Such an approach has the advantage of
broadening the potential volume of data that can be obtained; however such richness of
data can be burdensome as there can be an infinite number of variables or categories
for analysis.
The chosen interview format for this study was the semi-structured interview
which was considered to provide richness of data without complicating the analysis.
See Appendix A for a list of questions.
4.4 Respondents
To answer these questions quantity surveyors, housing associations and
developers were interviewed. They were asked to describe their roles in the delivery
chain and assess their understanding of how the delivery chain worked before recent
reforms and how they worked after. They were also asked to give their
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 54 of 96
recommendations to increase efficiency and to achieve value for money in terms of
adherence to design and space standards. Regarding the policy aspects involved in
housing provision, the views of housing association managers and developers were
sought.
Prior to data collection, informal meetings were scheduled with one individual in the
field, a quantity surveyor, whose name is withheld. The purpose of the meetings was to
identify key areas of concern that could form the basis of the research questions that
were asked and also to refine and finalize the list of interview questions.
Subsequent to the informal meeting and finalization of structured interview, 16
individuals were contacted and 8 agreed to complete the interview in written format.
They all agreed to participate in follow up interviews if the need arose. Via email, the
interviewee was provided with a summary of the research project along with a copy of
the structured interview questionnaire.
Lack of information resulting from difficulty recruiting participants was a major
limitation of this study. Of the 16 intended participants, only 8 volunteered and made
themselves available to be interviewed.
Special care was taken to reassure the interviewees that their responses will be
kept confidential. As such their names and key information about their places of
employment or company affiliations will not be revealed in this document.
4.4.1 Housing Association
Of the 3 housing association approached, one admitted a lack of knowledge related
to the delivery chain, spending and MMC.
HA1 holds a MSc. degree in Quantity Surveying. He has had 5 years’ experience
working with LAs and 10 years’ experience as a senior consultant – among his most
recent experiences has been working with the GLA/HCA. His work as been primarily
concerning the viability of building new homes, and he has completed many projects.
HA2 has 25 years of experience as a Social Housing/Development professional and
has worked with LAs, HAs, and in the private sector. For 17 years, he was the
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 55 of 96
Development Director for a major HA; building over 100 homes per year. He spent
18 months running a consultancy which helped landowners and developers resolve
affordable housing issues successfully in S106 agreements. Currently, he is part of a
consultancy, which in its first year, was involved with acting for approximately 30
landowners and developers on about 4000 affordable homes.
4.4.2 Developer
D1 holds a MSc. in Land Management. He is currently a Regional Development
Director for London. His responsibility is provision of 2000 homes, most of which are
affordable homes. He has had experience in a variety of roles in regeneration, land
acquisition and project delivery. His current challenges involve meeting GLA housing
targets by March 2015, finding land sites that are deliverable with consents, competition
for sites with other HAs and managing the fallout of changes in government housing
policy.
D2 has 25 years’ experience working with HAs prior to which he worked with
LAs. He is currently the CEO of a housing association, which is a landlord, developer,
support and care provider and investor in communities. Projects have included delivery
of 1000 homes per year, generally consisting of 30 to 100 unit mixed tenure sites. He
has also been involved in some Section 106 projects. Additionally, he has been
involved in regeneration projects, specifically the demolition and replacing of council
estates.
D3 holds a BSc. in Building Surveying. He is a Chartered Building Surveyor. He
is currently a Senior Development Manager and is responsible for managing new build
housing projects. The company is a Not for Profit business and builds for social
purposes and its core activity is being landlord to 56,000 homes throughout England.
4.4.3 Quantity Surveyor
Of the two quantity surveyors approached, only one of the two completed the
questionnaire satisfactory. QS1 holds a BSc. (Hons), MRICS and CIHM and is a
Chartered Quantity Surveyor experienced in both the private and public housing sector.
He served as an environmental consultant to HAs and developers working in both
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 56 of 96
markets. He also runs a private consultancy with 20-30 employees. Projects include
one-off housing, mixed tenure housing schemes, and larger mixed use
residential/commercial schemes.
4.5 Data Analysis
For the purposes of analysis of data, this study used the content analysis approach.
There is no one definition of content analysis. Stemler (2001) describes content
analysis as the ‘systematic, replicable technique for compressing many words of text
into fewer content categories based on explicit rules of coding’. Holsti (1969) defines
content analysis as any ‘technique for making inferences objectively and systematically
identifying the specific characteristics of the messages’. These two definitions represent
varying conceptualizations of this analytical approach. Indeed, content analysis can
range from rigid, strict and replicable processes to impressionable, intuitive and
interpretive analyses (Rosengren, 1981).
A particularly rigid approach is the summative approach which involves searching
the text or transcript for the occurrence of a prior determined word, term, or phrase, and
then summing the frequency at which the words appear. Once these words are
identified, the context within which the words appear is ascertained. The summative
approach is considered to be non-reactive and non-obtrusive (Babbie, 1992) and
perhaps the least subjective of content analyses.
Other approaches can involve a method of ‘coding’ which specifies clear and
replicable rules by which categories can be identified within the content of the data
(Weber, 1990). Depending on the theoretical background of the study, the categories
would have been already determined and therefore interviews and data collection
methods would be designed with particular categories in mind. This structured type of
approach, otherwise known as Directed Content Analysis, is guided by the findings of
prior research and provide evidence that can support pre-existing theories. The obvious
difficulty with such design is the potential for researcher bias, whereby the researcher
may be inclined to find data or evidence that supports the theory (Hsieh & Shannon,
2010). Also there is a risk that interview questions would provide certain cues that may
influence the participant to respond in a way that would support the theory.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 57 of 96
Such risk for bias is less likely in studies that use Conventional Content Analyses;
these studies are more open-ended and designed for the purpose of describing a
phenomenon. Such studies lack a priori categories or codes. Codes are derived from
the actual data, after the interview process is completed (Hsieh & Shannon, 2010). The
interview process consists of largely open ended questions. The semi structured
interview guides but does not constrict it. Follow-up questions are based on the
information that has been gathered during the interview process.
For the present study, conventional content analysis was used as there is limited
theory from which to derive codes or categories. The written responses were
summarized into categories or groups of words with similar meanings and then
presented in the findings. The main concern with conventional content analysis is that
the process of coding is not scientific enough and subject to the interpretation of the
researcher thus jeopardizing reliability and validity.
With specific regard to this research study, and as with all qualitative studies, this
thesis risks being criticised for being subjective or biased in favour of this researcher’s
opinion. Also, because of the small sample size, another feature that is associated with
qualitative research, problems of generalizability are likely to crop up. The results of this
study may or not be applicable to any other setting because of the uniqueness of the
London situation. However, it is argued that there are ways to protect against problems
of bias and lack of generalizability. One of these strategies regards the actual research
questions.
For this research it was important to carefully and clearly specify the research
questions and the participants that were selected for research. Peer reviews and
debriefing with the participants in the study to check for agreement and accuracy was
another effective way of ensuring that the categories that have been identified fit the
data or that the researcher did not miss key categories (Hsieh & Shannon, 2010).
Another important approach was to supplement and/or cross check the findings of
the qualitative analyses with results from the literature review and analysis of
quantitative data.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 58 of 96
Chapter 5 – (Findings from the case study interviews)
5.1 Introduction
Of the 16 questionnaires that were emailed to the various selected participants, only
8 responses were returned. Of the 8, responses from 2 Housing Associations, 3
Developers, and 1 Quantity Surveyor were completed fully and considered to be
suitable for analysis. Of the abandoned questionnaires, one was not completed enough
to contribute to the analysis and one of the respondents indicated that he either could
not understand the questions or did not know enough to respond.
Full responses have been supplied in Appendix B. For the purpose of data analysis,
results of each question have been collated under one of the following headings:
View of the Delivery Structure,
Funding and Design, and
Spending and Design.
Later in Chapter 6, the findings will be discussed under theme headings with a goal
of meeting the aims and objectives of this study, which is to answer the research
questions that have been listed in Chapter 1 and Chapter 4.
Connections will be established between the reviewed literature and the data findings,
as well as comparisons will be made with the results of quantitative data analyses that
were also undertaken in this study.
5.2 Housing Association
The representatives of two HAs, HA1 and HA2 provided information for analysis
under this heading.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 59 of 96
5.2.1 View of Delivery Structure
Has the role of the housing association in the delivery structure changed since
the government’s recent social housing policy reforms and how?
The general response was that the role of HAs was changing. HA1 noted that
where the HA was traditionally the main provider, it is no longer at the forefront of
delivery. Additionally, the result is confusion within the HAs about their new role. With
the withdrawal of higher grants, the HAs are faced with the dilemma of making a profit
versus building for charitable purposes. Moreover, he suggested that with a lower
grant, HAs are forced to pursue risky ventures to generate income, with little potential
for positive outcome. HA1 also anticipated that the role of HAs will lessen, and with the
decreased presence of the HAs, the LAs are poised to be at the forefront of social
housing provision.
According to HA2, the removal of higher grants has negatively impacted social
housing delivery. From the perspective of financing, increased gearing has placed
restrictions on HAs therefore reducing housing supply.
Has the recent changes in the delivery structure resulted in greater efficiency and
how?
To this question, both respondents disagreed with the notion that changes in the
delivery structure resulted in greater efficiency. HA1 admitted that the transfer of
housing provision responsibility from HAs to LAs was a good move in that HAs were
dependent on higher grants and S106 which limited the HAs especially in current
economic conditions. Conversely, LAs had the advantage of ‘free land and a large
borrowing capacity’. Still, he conceded that the emergence of LAs as the main housing
providers, will see a transfer of skills from the HAs to the LAs, perpetuating old
practices.
For HA2, it is not the delivery chain that is responsible for efficiency, it is
demand. He asserts strongly that less demand results in greater efficiency – a point that
he expands upon in later questions.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 60 of 96
5.2.2 Government Spending and Cost
With regard to meeting housing needs, can you tell me which funding and
delivery models can potentially be the most cost-effective?
HA1 expressed confidence in the LAs based on the fact that they had access to
free land and low cost financing; however, a point of main concern regarded the skills
gap which he suggested might result in poor decision making, or even no decision
making. Still, with the right conditions, LAs as main developers of new build housing
were likely to keep rents low and provide housing for those most in need.
HA2 advocated for a return to the grant free S106, which he insisted would
lower government spending. He compared S106 to the current Design and Build (D&B)
project delivery system. According to HA2, S106 costs are expected to be lower than
D&B costs.
Government spending reviews have constrained public funding for housing.
What is your suggestion to make best use of the current public funding to bring
additional resources for housing?
With more constraints on public funding for social housing, the responses
focused on removing competition among RSLs and problems associated with debt
covenants. HA1 pressed for greater care to be taken when analyzing bids and
allocation grant funding. HA1 suggested also that more grants should be issued to
RSLs that can best contribute from their own resources. Also he asserted that reduction
of land prices can be effective at bringing additional resources for housing. He observed
it was the competition among RSLs as they place bids for land that carried up land
prices. So by reducing competition, new housing costs would be reduced. He also
recommended a return to the old TCI system to reduce costs.
HA2 insisted that there was no need to bring additional resources for housing,
and that in fact, the resources were there for housing. What was absent was the desire
to take risks, largely due to bank covenants.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 61 of 96
5.2.3 Design and Cost
What is your response to the suggestion that government should spend less on
building and improving social housing and more supporting the delivery
structure chain?
HA1’s response to the question seemed to suggest that government could
support the delivery chain by bringing more land to the market.
HA2 agreed that supporting the delivery chain can be effective if done
purposefully. HAs must be encouraged to ‘step up capacity’. Additionally, banks must
remove harsh limitations to HAs seeking equity funding or disposing of properties. He
also suggested that further support can be offered through giving long term certainty to
the rent regime (Affordable Rent Level at RPI +0.5%) and by reviewing how HA stock is
valued (EUV-SH is outdated). Other changes in the area of financing as suggested
including balance sheet reviews to increase asset value.
In your experience, how has the reduced governmental spending affected the
company’s developments portfolio?
Number of current and projected schemes?
HA1 anticipated that reduced public spending would not have an immediate
impact on developments portfolios as most current schemes are funded from the 2008-
2011 programme. However his expectations are that, projected schemes are likely to
collapse as there are no plans beyond 2015. HA2 shared this opinion as he suggested
that most HAs have reduced their program size and operating area.
Duration of Construction Projects?
Both respondents (HA1 and HA2) did not view reduced spending to have an
effect on the duration of construction projects.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 62 of 96
Ratio of rehabilitation projects to new developments in social housing?
HA1 anticipated that there will be less rehabilitation projects. Regeneration
projects do not generate extra income and therefore rely on grant funding, making this
approach less viable in these times. HA2 agreed that new build projects are the
predominant schemes at this time. He added that less HA demand has resulted in an
increase in the percentage of S106 projects.
Density and space standards?
According to HA2, there is little interest in developing social housing above a
CSH Level 3 and no potential impact on space standards. The reason for this is clear
as reduced funding makes it a very difficult prospect to adhere to increasing standards.
HA1 was even stronger in his opinion, criticizing the implementing such high design
standards at a time when funding is at a low. The benchmarks are for larger rooms,
which will increase market rents which will inevitably have an impact on the social
housing rents. So increasing standards is having the impact of reducing viability.
Available land for developments (brownfield or greenbelt)?
Only HA1 responded to this question. He suggested that land availability will be
restricted as landowners will wait for the market to heat up before they dispose of their
land.
5.2.4 Modern Method of Construction (MMC)
To improve design and construction quality, a set target of 25% of funding for
social housing developments must be allocated to modern methods of
construction (MMC). What type of MMC technology has been in use, and what
has been its impact in terms of cost, quality and time on social housing
developments in your company?
Having completed a few MMC projects, HA1 argued against the use of MMC.
The suggestions that use of MMC can result in greater time and cost efficiency were not
realized on the projects that HA1 was involved in. He also expressed concern that
these projects will have a shorter life cycle than traditional build projects. HA2 reported
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 63 of 96
a greater experience with MMC schemes, using SIPS, Panelized systems and
volumetric systems. In his experience, these projects were completed at a higher cost,
and were only used for CSH compliance. Both HA1 and HA2 suggested that the 25%
has been removed.
5.3 Developer Three Developers, D1, D2, and D3 provided information for analysis under this
heading.
5.3.1 View of Delivery Structure
Has the role of the developer in the delivery structure changed since the
government’s recent social housing policy reforms and how?
D1 remarked that from his perspective, his role which is both client and
developer – contracting with builders to provide homes, and remaining as property
owner and landlord after completion has not changed since government policy reforms.
D2 remarked that there have been changes. He remarked that Developers have to be
more independent as there are less Section 106 agreements. D3, whose role has been
to take projects from land exchange stage to project closure, remarked that government
policy has become more complicated. The reaction at D3’s company has been vertical
expansion of the team by splitting it into New Business and Delivery.
Has the recent changes in the delivery structure resulted in greater efficiency and
how?
The developers seemed to all agree that efficiency has not increased. According
to D2, efficiency hasn’t changed. What has changed is land prices in London, which
have increased. D3 urged a wait and see approach. He explained that it was too early
to tell. At this time, internal and external bureaucracy may be impacting negatively on
efficiency.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 64 of 96
5.3.2 Government Spending and Cost
With regard to meeting housing needs, can you tell me which funding and
delivery models can potentially be the most cost-effective?
All the developers suggested that increased capital funding and subsidy was the
most cost-effective model to meet housing needs. D1 said that affordable housing
provision required capital subsidy. Currently, the Affordable Homes Programme (AHP)
is about reducing capital subsidy. This results in higher rents which are subsidized via
the Housing Benefit. According to D2, this approach may be useful if the goal is simply
to provide immediate shelter through zero grant schemes of high density and poor
standards. However if the focus is on families and building communities over the long
term, then it is important to ensure good design and provision of public space and
reasonable rent levels. For this to occur, capital funding is needed. From the
perspective of D3, new homes should go where it is most needed.
Government spending reviews have constrained public funding for housing.
What is your suggestion to make best use of the current public funding to bring
additional resources for housing?
The main theme here was government funding. D1 lamented the lack of government
investment in affordable housing. Rather, the focus has been on funding the market
rented sector. The problem with this approach is a lack of congruence with the current
cultural framework in London which is a preference for home ownership. The
disadvantage of this approach has been the high house price resulting from
supply/demand imbalance. If the supply would increase, house prices will become more
affordable. D2 insisted on the need for capital funding or subsidy through government
land, or incentives such as cheap loans, or underwriting sales risks. D3 suggested that
more private/social housing developments should be allowed in areas that are set aside
for social housing under the planning policy.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 65 of 96
5.3.3 Design and Cost
What is your response to the suggestion that government should spend less on
building and improving social housing and more supporting the delivery
structure chain?
To this question D1 indicated that either approach could have a positive impact
on increasing housing supply, however, he remarked that investing in housing directly
gives the funding agency more control in ensuring that it is provided where it is most
needed. He referred to regeneration projects that have suffered over recent times and
reductions in funding. He insisted on rehabilitation projects that deliver much needed
housing to established communities. D2 asserted the need to build homes and to
cease speculating. D3 described supporting the delivery structure chain as a way of
supporting private developers who are generally more profit motivated. Therefore it is a
bad idea especially if the goal is provide social housing where it is needed.
In your experience, how has the reduced governmental spending affected the
company’s developments portfolio?
Number of current and projected schemes?
D1 projected a decrease of about 60%. D2 has noted a reduction of about 50%
of their programs in addition to moving some of the projects to the open market to
create cross subsidy. D3 had not experienced a reduction in schemes, he reported on
reductions for other RSLs.
Duration of Construction Projects?
Two of the three respondents did not indicate a change in the duration of
projects. D1 suggested however, that projects have tended to be smaller and more
fragmented.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 66 of 96
Ratio of rehabilitation projects to new developments in social housing?
D1 reported that there have been some infill refurbishment projects on existing
sites, while D2 suggested that rehabilitation projects stopped years ago. D3 did not
agree that there has been an impact.
Density and space standards?
Two out of three developers responded that there has been no impact of
government spending on density and space standards. D1 suggests that density and
space standards have increased due to funding conditions.
Available land for developments (brownfield or greenbelt)?
All three developers agreed that land availability has not been affected by
reduced government spending.
5.3.4 Modern Method of Construction (MMC)
To improve design and construction quality, a set target of 25% of funding for
social housing developments must be allocated to modern methods of
construction (MMC). What type of MMC technology has been in use, and what
has been its impact in terms of cost, quality and time on social housing
developments in your company?
Two of the three developers were able to answer this question, as D1 admitted
to a lack of experience with MMC projects. D2 admitted that MMC may be useful at
increasing speed and reducing defects, but it does not improve design and construction
quality. He stated that care must be taken to use reliable products as heavy costs can
be incurred in maintenance and repair if these products were found to be flawed. D3
reported using timber frame and other continental type systems in construction. To
date, he has not seen benefits in cost or quality.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 67 of 96
5.4 Quantity Surveyor
QS1 provided information for analysis under this heading.
5.4.1 View of Delivery Structure
Has the role of the housing association in the delivery structure changed since
the government’s recent social housing policy reforms and how?
QS1 suggested that the Quantity Surveyor’s role continues to evolve as policies
change. In the current climate, the Quantity Surveyor’s role is expected to change from
basic cost planning to evaluations of alternative forms of construction and renewable
systems including life cycle costing. The Quantity Surveyor will need to develop a
greater knowledge of government funding, private funding and sustainability funding
and also to be aware of the benefits in cost of alternative methods of construction.
Has the recent changes in the delivery structure resulted in greater efficiency and
how?
QS1 did not agree that the changes in the delivery structure have resulted in
greater efficiency.
5.4.2 Government Spending and Cost
QS1 did not respond to this question.
5.4.3 Design and Cost
In your experience, how has the reduced governmental spending affected the
company’s developments portfolio?
Number of current and projected schemes?
QS1 reported a reduction in schemes overall.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 68 of 96
Duration of Construction Projects?
QS1 did not respond to this question.
Ratio of rehabilitation projects to new developments in social housing?
QS1 did not respond to this question
Density and space standards?
QS1 suggested that while a reduction in funding was expected to result in a
lowering of standards, space standards have improved largely due to the GLA and
London Housing Design Guide, Lifetime Homes Compliance and CSH Level 4
requirements. Additionally, adherence to guidelines are necessary for funding therefore
developers have no option but to follow these guidelines.
Available land for developments (brownfield or greenbelt)?
There was no response to this question from QS1.
5.4.4 Modern Method of Construction (MMC)
To improve design and construction quality, a set target of 25% of funding for
social housing developments must be allocated to modern methods of
construction (MMC). What type of MMC technology has been in use, and what
has been its impact in terms of cost, quality and time on social housing
developments in your company.
QS1 admitted to limited experience with MMC however he stressed that the
method is seen as risky both in cost and marketability.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 69 of 96
Chapter 6 – Analysis and Discussion
6.1 Introduction
The focus of this chapter is to answer the research questions that were listed in
Chapters 1 and 4. Using each question as a heading, the themes that emerged out of
the interview responses will be discussed. Also where applicable, the results of the
interview will be compared with the findings of published data within the literature
reviews of Chapter 2 and 3, as well as, the results of quantitative analysis of raw data.
6.2 Delivery Structure
Research Question 1: How has the structure for the delivery of social housing
changed?
Information for this question was obtained from reports, articles and government
policy documents and was summarized in Chapter 2.
Based on the exploration of the literature, key changes have been made to the
delivery chain that was first introduced in 2004. Figure 4 showed how initially, funding
was directed from the ODPM, to Government Regional Offices, to the Regional Housing
Boards and Planning Bodies, then to the LAs which then disbursed funding to HAs and
Developers respectively.
Instrumental to the 2011 changes to the delivery chain was the introduction of the
Localism Act, which transferred decision making power from the ODPM to the councils.
In London specifically, the Mayor of London takes a prominent role. Additionally, there
were reforms to the HRAs and the introduction of the HCA. The HCA is the body that is
responsible for funding and analysing bids of the pool of contractors and developers
(See Figure 10).
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 70 of 96
Figure 10: Delivery Chain Social Housing, 2012
Source: Trower and Hamlins, 2009
The interviews did not provide further clarity in this area. Perhaps, what these
results suggest is that although the delivery chain has been simplified, the roles within
the delivery chain remain complex, and the members of the delivery chain continue to
be unsure about how the chain is supposed to work.
Research Question 2: Have there been adjustments in the number of agencies
and their roles?
Figure 5 in Chapter 2 illustrates the new delivery structure of November 2011. The
chart demonstrated a clear reduction of participating agencies. This reduction in
number is accompanied by increasing responsibilities for individual agencies
particularly the HCAs and HAs in affordable housing delivery; however the interview
responses reveal another aspect to the picture that is not obvious by simply studying
the policy document.
Analysis of interviews revealed the following themes:
Emergence of LAs as main affordable housing providers
Increased uncertainty about roles
Delivery chain changes did not occur in a vacuum, but were accompanied by
changes in the allocation of funds. The outcome to these funding changes is the HAs
are no longer at the forefront of affordable housing delivery. The LAs in fact have
assumed the lead role in this area because of its lack of dependence on higher grants.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 71 of 96
The decrease in capital funding has placed the HAs in a position of uncertainty
about their roles. Previously buoyed by governmental subsidies, the HAs are now in the
unusual position of having to seek other sources of revenue, changing its role to a
competitive and profit seeking entity. Lamentably, the HAs are constrained by debt
covenants, and thus, risk taking is not such an attractive option. The situation has
become more complex and complicated. Developers have to become more
independent and Quantity Surveyors are expected to broaden their roles from basic
cost planning and expanding their knowledge of funding opportunities that are available.
Research Question 3: Have the changes in the delivery structure achieved its
intended goals of increasing efficiency and reducing costs?
To answer this particular research question, interview responses were analyzed and
compared with the results of statistical analyses of raw data. The results are provided
below.
Based on the responses, the following themes were identified:
No changes in efficiency
Increased bureaucracy
Perpetuation of established practices
All respondents agreed that the changes in the delivery structure have not resulted
in increased efficiency in affordable housing delivery, at least not as yet. One
interviewee even urged a wait and see approach as increased internal and external
bureaucracy has held up progress.
This makes intuitive sense especially as the structural changes are in its early
stages and the delivery chain is transitioning from one format to another. Indeed there
are many adjustments to be made. One interviewee spoke of the movement of staff
from the HAs to the LAs. This transitioning period would likely impact negatively on
efficiency. For example, he spoke of the skills gap that now exists which either results in
poor decision making or no decision making. Therefore it is left to be seen whether the
structural changes will eventually result in better efficiency.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 72 of 96
The question is whether the perceptions are supported by actual data. To determine
whether the changes have seen reduction in cost and increased efficiency summary
and analyses of raw data were carried out.
First, the researcher attempted to calculate average building costs for the period
1997 to 2012 using raw data that were gathered from the BCIS online database.
Unfortunately, data from the period 2009 to 2012 was found to be unreliable and could
not be included in the analysis.
As a 2nd option, the researcher compiled a graphical summary of Tender Price
Indices (TPI) from the period 1997 to 2010. The TPI measures the fluctuation of
accepted tender prices for housing contracts for single to four storey dwelling units in
the social housing sector. The TPI was selected as a suitable means of estimating
costs in social housing construction. TPI is generally related to demand which impacts
house-building costs. Figure 11 presents the Tender Price Index for Social Housing
(TPISH) indices for the period 1997 to 2010. The results demonstrate a steady increase
TPISH between 1997 and 2008, followed by a steady drop that continues to 2010.
Figure11: BIS/TPISH Tender Price Index of Social Housebuilding; New Build.
Source: BCIS online; Average Prices; 2012.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 73 of 96
It has been suggested that the lowering TPISH can be linked to lowering demand.
The drop in TPISH coincides with the recession of 2008. As with any recession, the air
of pessimism dulls much economic activity. This along with the reduction of government
funding, increased gearing and restrictions set by lending agencies have lessened the
drive towards taking on risky projects, resulting in less business for the developers, and
therefore a lowering of costs. Indeed the construction orders in the social housing
sector have decreased. Additionally, contractor’s input costs, labour rates, and material
site prices fell in 2011.
Second analyses were done to investigate the impact of delivery structure policy
changes on efficiency. Efficiency in this case is operationalized in terms of completion
time for projects. Based on the statistical analyses, completion time does not appear to
be lowered since November 2011 (See Figure 12).
Figure 12: Average Construction Duration in weeks.
Source: BCIS Online, Duration calculator, 2012.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 74 of 96
6.3 Governments Spending
Research Question 4: How does government’s new policy affect spending on
social housing construction?
Themes identified in the analysis of responses under this heading included:
Removal of capital grants
Lower risk taking
Section 106
Based on the literature, the UK deficit forced the coalition government to curtail
spending to achieve savings. This policy resulted in substantial cuts amounting to
approximately £6 billion. Included in the policy change was the reduction in the capital
grant. Therefore the Housing Association is now to force to seek its own income via rent
subsidized by the housing benefit.
The removal of the capital grant showed up as a main theme in the interviews. The
positive benefit was the emergence of LAs as a major player in the delivery of
affordable housing. The LAs have access to free land and low cost financing and
therefore this move was a positive step.
The same is not true for HAs, and this is where the problem seems to lie from the
perspective of the respondents. The removal of capital funding has led to increased
gearing which has placed major restrictions on the HAs which have been spending less
on affordable housing construction in spite of the fact that the agencies have sufficient
resources – ‘balance sheet strength, surpluses, and access to funds from equity
investors’.
6.4 Factors influencing costs
Research Question 5: What are the key factors that influenced cost of social
housing?
Based on the findings of the literature review and interviews, the factors believed to
influence the cost of affordable housing in London are:
Increasing design standards/CSH
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 75 of 96
Increasing land prices
Removal of S106
The past years have seen an increase in space and design standards. The London
Design Guide sets out benchmarks that all new housing must achieve. Moreover, the
CSH provides guidelines under 9 categories of environmental performance. As of now,
affordable housing must meet the minimum standard which is Code Level 3; however
the goal for 2016 is Code Level 6 or zero carbon for all new homes.
Meeting the standards is a key requirement for funding. Table 5 in Chapter 3
demonstrated the extra over costs for achieving each code level. The fact is that the
cost meeting code level 3 can range from £2000 for a medium to large urban 2
bedrooms dwelling to £3,020 for a 3 bedroom semi-detached dwelling. In light of this
fact, the government was criticized for insisting on higher design standards while cutting
grants.
With regard to land values, Chapter 3 showed that land values in London are higher
than in the rest of England. One of the interviewee argued that the existence of
competition between RSLs is driving up land prices, resulting in increased cost for new
housing. He insisted that removal of competition and reintroduction of the TCI would be
effective at reducing costs. Another suggestion regarded bringing back S106 which was
perceived to lower costs and purchase prices compared to Design and Build.
6.5 The Project Duration
Research Question 6: How does reduced governmental spending affect the
construction programme (project portfolio) of RPs in terms of number, types and
sizes of schemes; available land; mix between rehabilitation and new
development; and high and low density.
It appears that government cuts have had an impact on some areas of the
construction programmes and not on others. Chapter 2 showed that the numbers of
schemes have diminished substantially. Ramesh (2012) reported a decrease of 66,540
new build homes between 2007 and 2011, a reduction of approximately 40%. If the
interviewees were correct, this data supports the perceptions which pointed to a
reduction of between 50% and 60%.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 76 of 96
Additionally, the spending cuts have made regeneration projects a non-viable
option for RPs. So much so, that in January 2012, the Mayor pledged to invest £177
million in capital grants to revitalize this sector that has been struggling since the
downturn. In total, 18 boroughs and 23 schemes were earmarked to receive this much
needed subsidy (GLA, 2012).
The literature and interviews tend to agree that governmental spending has not
impacted density and land availability.
6.6 Modern Method of Construction (MMC)
Research Question 7: What is the level of use of MMC and what has been its
impact on social housing?
In spite of what the literature and policy documents suggest, the interviewees
generally denied knowledge of or disputed the Challenge Fund requirement that 25% of
new build homes must be built using the MMC approach. One respondent suggested
that instead, the use of MMC was for the purpose of meeting CSH requirements.
Based on the interview responses, the following themes were identified around the
impact of MMC on social housing:
Lack of knowledge of MMC
No positive impact on design quality
No positive impact on efficiency
No positive impact on costs.
Some respondents admitted to a lack of knowledge about or experience with MMC.
A few interviewees reported extensive experience with this technique in affordable
housing. Still, all respondents agreed that MMC has not reduced costs and in some
cases have increased building costs. This seems to match the findings of the few
studies in the area ((POST, 2003; Windapo and Balogun, 2009)).
In terms of design, the respondents expressed scepticism. One predicted that MMC
buildings may not outlast traditional construction types. On the positive side, MMC was
reported to help speed of completion and reduce defects; however, care was suggested
in choosing products as errors might result in exorbitant maintenance costs.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 77 of 96
Additionally, continued distrust over the use of MMC in construction has been
detrimental to its marketability. Limited raw data is available on MMC.
6.7 Concluding Remarks
In order to meet the aims and objectives of this thesis, interview responses were
analysed using content analysis. The results were presented under the headings of the
research questions that were listen in Chapters 1 and 4, and compared with the findings
of the literature review and quantitative data analyses.
The findings showed that the delivery chain for social housing was substantially
reduced in terms of number but not complexity, resulting in a lack of clarity about the
changing roles. This may have had a negative impact on efficiency.
Costs appear to have decreased since 2008, but this is not attributed to government
policy changes but to the recession, which has also seen a reduction in the number of
new build schemes and regeneration projects. Interviewees pressed for a return to the
capital grants and other incentives such as S106 to stimulate activity in the sector. They
also saw the increasing design and sustainability standards as carrying up building
costs and rents.
With regard to MMC, respondents agreed that there has been no obvious positive
impact on design quality, efficiency or costs.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 78 of 96
Chapter 7 – Conclusion and Recommendations
7.1 Introduction
The intent of this thesis was to achieve the following aim:
“To explore the impact of government spending on the housing delivery chain and the social housing industry.” This aim has been achieved by a thorough exploration of the literature, supported by the implementation of both qualitative and quantitative data collection approaches and analyses. 7.2 Key Findings
The author will summarize how the main aim of this thesis was met, by
demonstrating how each objective was achieved. The author will also summarize and
discuss the main findings und each heading.
7.2.1 Objective 1 – 3; to investigate how the delivery structure has changed.
This objective was met through an in-depth review of the literature in the area,
and by conducting both qualitative data collection and quantitative data collection.
Qualitative data was collected through the use of interviews that were delivered and
responded to via email. Qualitative data was accessed from the BCIS online database,
analysed and presented in a graphical format. The results of the literature review were
summarized in Chapters 2 and 3.
The results of the literature review revealed a reduction in the number of
participating agencies and a change in roles. There seems to be a resultant complexity
and lack of clarity by the members about their respective roles. Additionally, the results
demonstrate no real impact of the delivery structure in increasing efficiency. This may
be the result of the role transition which may not yet be complete. The skills gap is said
to be responsible for poor decision making or no decision making within agencies. One
interviewee urged a wait and see approach through the teething period as the impact of
the changes may be witnessed later. Based on the quantitative data, the changes in the
supply chain do not appear to have an impact on completion time of projects, however
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 79 of 96
the quantitative analyses revealed a lowering in TPISH, suggesting a lowering of
costs in the sector.
7.2.2 Objective 4 – 6; to investigate how the government’s new policy affected
spending, design, provision and cost in social housing construction.
To achieve this objective extensive perusal of the literature was done and
summarized in Chapter 3. Also interviews were administered and analysed. The results
show considerable cuts in spending with a reduction in capital subsidies forcing HAs to
seek out sources of revenue income, via rents and borrowing. This has placed
restrictions on HAs and as such the sector is seeing an emergence of LAs as the main
providers of social housing.
In spite of the curtailed spending, design and sustainability standards have
increased. Additionally, theses standards have become mandatory in order to qualify for
grants. Meeting benchmarks results in extra-over costs. The potential for rising costs
and rents also increase as a result of rising land prices that is said to be driven by
competition among RSLs.
In spite of these factors actual building costs seem to be decreasing as
estimated by the tender price index. This is attributed to the recession and not changes
in government policy. Pessimism, lowered demand and limitations by lending agencies
are believed to have affected costs. Curtailed spending has also seen a reduction in
number of schemes and regeneration projects. As a response the Mayor of London has
injected £177 million to spark rehabilitation projects within London.
7.2.3 Objective 7; To determine the level of use of MMC and its impact in social
housing construction?
This objective was met through the literature review and interviews. According to
the literature, the Challenge Fund set a target that 25% of new build social dwellings
should be by MMC. According to the interviewees this target has been abandoned, and
the use of MMC is mainly for the purpose of meeting CSH standards.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 80 of 96
Another finding was that MMC was not considered to be superior to traditional
methods in terms of design, cost, or efficiency. In fact, it was suggested that MMC was
the more costly of the two methods. These perceptions were supported in the literature.
7.3 Conclusions:
The changes in the delivery structure have not as yet resulted in better
efficiency of delivery of social housing.
Government has curtailed spending resulting in a reduction in social housing
provision and lowered costs related into lowered demand; however there
has been no resulting reduction in design standards.
MMC schemes do not seem to be meeting the target set by the Challenge
fund.
MMC does not seem to be more efficient that traditional methods.
MMC does not seem to have higher design standards than traditional
methods.
MMC does not seem to be less expensive than traditional methods.
There should be more incentives for research and development on this
particular method of construction to find innovative solutions for the industry.
7.4 Industry Recommendations
The author is of the opinion that efficiency of the supply chain can only improve with
increased clarity around the roles and purpose of the participating agencies. There
needs to be a clear signal to the stakeholders about how the government plans to
tackle the housing situation. A clear strategy is needed.
With regard to funding, most stakeholders agree that capital subsidy is preferable to
revenue subsidy in these times to stimulate the economy and to spark new build and
regeneration activity within the sector. Government land should be offered to RPs. Low
cost financing and underwriting sales risks can also be helpful.
If capital funding is unavailable then efforts by the government should be made to
encourage HAs to increase their capacity. HAs should be free to seek alternative types
of equity funding without penalty to remove the power the banks have over them.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 81 of 96
To reduce MMC costs, economies of scale should be applied. There should also be
more incentives for research and development on this particular method of construction
to find innovative solutions for the industry.
7.5 Limitations of the Research This section will summarize the main limitations of this study.
First, time was a main limitation as it was found to be insufficient to carry out the
depth of primary and secondary research that was necessary to meet the aims and
objectives of the study.
Also, the selection of methodology which was found to be adequate based on the
literature was found in reality to be hindered by limitations such as unavailability of
literature sources such as governmental or archival policy documents and statistics
related to MMC. Additionally, collecting qualitative data was challenging as the
response rate was very low. This may have been related to time constraints on the part
of the potential interviewees, or perhaps a lack of knowledge about, or interest in the
topic. Additionally, none of those who provided initial responses gave answers to follow
up questions that were put forward by the author.
7.6 Further Study Recommendations.
This study suffered limitations related to the collection of qualitative and quantitative
data. It is suggested that the aims and objectives of this thesis may have been better
met by a longitudinal study that can follow projects from beginning to completion, and
that can gauge how the perspectives of respondents may or may not change over time.
With regard to supporting data, case studies of social housing schemes (new-build
traditional and MMC) should be conducted to compare costs, efficiency, duration,
standard, and life cycle of developments.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 82 of 96
REFERENCES AND BIBLIOGRAPHY 2020 Group, 2009. The housing challenge, [pdf] Available at:
<http://england.shelter.org.uk/__data/assets/pdf_file/0008/173096/2020-launch-
document.pdf>.
ACPO Secured by Design, 2010. New Homes 2010, [pdf] Available at:
<http://www.securedbydesign.com/pdfs/SBD_New_Homes_2010.pdf> [Accessed 03
March 2012].
Allen, G., 2010. Recession and Recovery. [online] Available at:
<http://www.parliament.uk/documents/commons/lib/research/key_issues/Key%20Issue
s%20Recession%20and%20recovery.pdf>[Accessed 05 June 2012].
Babbie, E., 1992. The practice of social research. New York: Macmillan.
Balchin, Paul. 1996. “The United Kingdom.” In Paul Balchin, ed. Housing Policy in
Europe. London: Routledge, pp. 210-228.
Bam-Hutchison, J., n.d.. Race, Faith, and UK Policy: a brief history by, IPUP Research
Associate, [online] Available at:
<http://www.york.ac.uk/ipup/projects/raceandfaith/discussion/bam-hutchison.html>
[Accessed 20 February 2012].
Barclays Bank PLC, 2012. UK Social Housing Sector outlook Second quarter 2012
Report [pdf] Available at :
<http://www.business.barclays.co.uk/BBB/A/Content/Files/Social_Housing_Outlook_Q4
.pdf>.
Barker, K., 2004, Review of Housing Supply: Delivering Stability: Securing our Future
Housing Needs.[online] Available at:
<http://webarchive.nationalarchives.gov.uk/+/http://www.hm-
treasury.gov.uk/media/E/4/barker_review_execsum_91.pdf>[Accessed 05 August
2010].
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 83 of 96
Bates, B.N., Lawson, R.M. and Rogan, A.L., 2010. Value and Benefits Assessment of
Modular Construction, The Steel Construction Institute in partnership with Oxford
Brookes University Berkshire.
Beever and Struthers, 2011. Annual Review of Social Housing. [pdf] Available at: <http://www.esta-media.com/hosting/Beever-Struthers/Downloads/2011_Annual_Review.pdf>[Accessed 26 March 2012].
Bentham, M., 2011. Census 2011: London's population booms to EIGHT million,
London Evening Standards [online] Available at:
<http://www.standard.co.uk/news/london/census-2011-londons-population-booms-to-
eight-million-7946191.html> [Accessed 22 July 2012].
BMA, 2003, Housing and health: building for the future. London: British Medical
Association.
Bramley, G., 2007. The Sudden Rediscovery of Housing Supply as a Key Policy
Challenge, Housing Studies, 22, (2), pp. 221 – 241.
Brown, R., 1995. Racism and immigration in Britain, Issue 68 of International socialism
journal, [online] Available at: <http://pubs.socialistreviewindex.org.uk/isj68/brown.htm>
[Accessed 15 January 2012].
Building for Life, 2011. The 20 criteria, [online] Available at:
<http://webarchive.nationalarchives.gov.uk/20110107165544/http://www.buildingforlife.
org/criteria> [Accessed 10 January 2011].
Buildingtalk, 2010. I-SIP Building System for Social Housing Project, [online] Available
at: <http://www.buildingtalk.com/building-products-and-structures-/walls-/curtain-
walling-/i-sip-building-system-for-social-housing-project/374121.article> [Accessed 17
December 2011].
Bura Steering and Development Forum Report, 2005. Modern Method of Construction –
Evolution or Revolution, [pdf] Available at:
<http://www.buildicf.co.uk/pdfs/1%20mmc%20evolution%20or%20revolution%20%20pa
per.pdf> [Accessed 19 December 2011].
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 84 of 96
CABE, 2004. Housing Audit – Assessing the design audit quality of new homes,[pdf]
Available at:
<http://webarchive.nationalarchives.gov.uk/20110118095356/http:/www.cabe.org.uk/file
s/housing-audit-2004.pdf> [Accessed 21 November 2011].
CABE, 2010a. Housing standards: Evidence and Research, Space standards: the
benefits,[pdf] Available at:
<http://webarchive.nationalarchives.gov.uk/20110118095356/http:/www.cabe.org.uk/file
s/space-standards-the-benefits.pdf> [Accessed 20 November 2011].
CABE, 2010b. Mapping space standards for the home,[pdf] Available at:
<http://webarchive.nationalarchives.gov.uk/20110118095356/http:/www.cabe.org.uk/file
s/mapping-space-standards-for-the-home.pdf> [Accessed 20 November 2011].
CABE, 2011. Design and Modern Methods of Construction (summary), [pdf] Available
at:<http://webarchive.nationalarchives.gov.uk/20110118095356/http:/www.cabe.org.uk/f
iles/design-and-modern-methods-of-construction.pdf> [Accessed 20 January 2012].
Cope, H. F., 2002. Capital Gains: Making High Density Housing Work in London,
London: National Housing Federation.
Council of Mortgage Lenders; Homes and Communities Agency; National Housing
Federation, 2011 3rd ed., Shared ownership: Joint guidance for England, [online]
Available at:<http://www.homesandcommunities.co.uk/ourwork/best-practice-and-
guidance>[Accessed 20 February 2012].
Creswell, J., 2009. Research Design: Qualitative, Quantitative and Mixed Method
Approaches, Sage, London.
Creswell, J and Plano Clark, V.L., 2007. Designing and Conducting Mixed Methods
Research. Thousand Oaks, CA: Sage Publications.
Croydon Council, 2008, Scrutiny investigation - Room sizes in new housing
developments, [pdf] Available at:
<http://www.croydon.gov.uk/contents/documents/meetings/548639/868775/roomsizes.p
df>[Accessed 10 December 2011].
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 85 of 96
Davidson, E., Edwards, R., Morgan, J., Pawson, H. and Smith, R., 2009. The impacts of
housing stock transfers in urban Britain, Sheffield: Joseph Rowntree Foundation
Davis Langdon and Everest, 2004. Cost Model: Off-site Manufacture, [pdf] Available at:
< http://www.Building.co.uk/data/cost-model-off-site-manufacture/3042466.article>
[Accessed 15 December 2011].
Davis Langdon, 2006. Small Projects - Cost model Social housing, [pdf] Available
at:<http://www.davislangdon.com/upload/StaticFiles/EME%20Publications/CostModels/
SocialHousing_CM_11Aug06.pdf> [Accessed 15 December 2011].
Department for Communities and Local Government, 2000. Our Towns and Cities: The Future – Full Report. [pdf] Available at: <http://www.communities.gov.uk/documents/regeneration/pdf/154869.pdf> [Accessed 27 March 2012].
Department for Communities and Local Government, 2006a. A Decent Home: Definition
and Guidance for Implementation. [pdf] Available at:
<http://www.communities.gov.uk/documents/housing/pdf/138355.pdf > [Accessed 15
January 2012].
Department for Communities and Local Government, 2006b. Code for Sustainable
Homes, A step-change in sustainable home building practice, [online] Available at:
<http://www.planningportal.gov.uk/uploads/code_for_sust_homes.pdf> [Accessed 15
December 2011].
Department for Communities and Local Government, 2006c. Planning Policy Guidance
2: Green belts, [pdf] Available at:
<http://www.communities.gov.uk/documents/planningandbuilding/pdf/155499.pdf>
[Accessed 13 December 2011].
Department for Communities and Local Government, 2007. Homes for the future:
more affordable, more sustainable. [pdf] Available at:
<http://www.communities.gov.uk/documents/housing/pdf/439986.pdf > [Accessed 20
March 2012].
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 86 of 96
Department for Communities and Local Government, 2009. Sustainable New Homes –
The Road to Zero Carbon, [pdf] Available at:
<http://www.communities.gov.uk/documents/planningandbuilding/pdf/1415525.pdf>
[Accessed 05 January 2011].
Department for Communities and Local Government, 2009b. Housing Statistical
Release: Household Projections to 2031, England. [pdf] Available at:
<http://www.communities.gov.uk/documents/statistics/pdf/1172133.pdf>.
Department for Communities and Local Government, 2010. Housing Statistical
Release: Household Projections 2008 to 2033, England. [pdf] Available at:
<http://www.communities.gov.uk/documents/statistics/pdf/1780763.pdf>.
Department for Communities and Local Government and Homes and Communities
Agency, 2011. 2011-15 Affordable Homes Programme – Framework,[pdf] Available at:
<http://www.housingoptions.org.uk/general_information/gi_resources_docs/Affordable-
Homes-Framework.pdf> [Accessed 22 March 2012].
Department for Communities and Local Government, 2011. Decent Homes, [online]
Available at: <http://www.communities.gov.uk/housing/socialhousing/decenthomes/>
[Accessed 02 December 2011].
Department for Communities and Local Government, 2011c. Local Planning Authority
Green Belt Statistics: England 2010-11, [online] Available at:
<http://www.communities.gov.uk/documents/statistics/pdf/1888221.pdf> [Accessed 13
December 2011].
Department for Communities and Local Government, 2011d. Reinvigorating Right to
Buy and One for One Replacement Consultation. [pdf] Available at:
<http://www.communities.gov.uk/documents/housing/pdf/2053578.pdf > [Accessed 02
March 2012].
Department for Communities and Local Government, 2012. Reinvigorating Right to Buy
and One for One Replacement Impact Assessment. [pdf] Available at:
http://www.communities.gov.uk/documents/housing/pdf/2102753.pdf [Accessed 02
April 2012].
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 87 of 96
Durden, P., 2001.Housing Policy. In Stephen P. Savage and Rob Atkinson, eds. Public
Policy Under Blair. London: Palgrave, pp.139-153.
Edge, M., Craig, A., Laing, R., Abbott, L., Hargreaves, A., Scott, J. and Scott, S., 2002.
Overcoming Client and Market Resistance to Prefabrication and Standardisation in
Housing, Aberdeen: Robert Gordon University.
Fée, D., 2009. Acknowledging the limits of Thatcherism: Housing policies during the
Major years, [online] Available at:<http://osb.revues.org/808> [Accessed 12 March
2012].
Fenton, A., Clarke, A., Markkanen, S., Monk, S., and Whitehead, C., Understanding
Demographic, Spatial and Economic Impacts On Future Affordable Housing Demand,
Paper Six - Affordable Housing in London: Needs and Provision, Aspirations and
Realities, [pdf] Available at:
<http://www.cchpr.landecon.cam.ac.uk/Downloads/Paper%206%20-%20London.pdf>
[Accessed 21 November 2011].
Financial Services Authority, 2011. CP11/31, Mortgage Market Review:Proposed
package of reforms. [pdf] Available at: <http://www.fsa.gov.uk/pubs/cp/cp11_31.pdf>
[Accessed 20 March 2012].
Fitzpatrick, S. and Stephens, M., 2008. The Future of Social Housing, Chapter 5, Social
Housing and Spatial Segregation. London: Shelter.
Forrest, R. and Murie, A. (1988) Selling the Welfare State: The Privatisation of Public
Housing; London: Routledge.
Glendenning, M. and Muthesius, S., 1994. Tower Block: Modern Public Housing in
England, Scotland, Wales, and Northern Ireland. New Haven: Yale University Press.
Golland, A., 1998. Systems of Housing Supply and Housing Production in Europe.
Aldershot: Ashgate.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 88 of 96
Gray, J., 2012. Brownfield Sites,[online] Available at:
<http://www.sustainablebuild.co.uk/BrownfieldSites.html> [Accessed 22 April 2012].
Greater London Authority, 2006. Housing Space Standards. [pdf] London: Greater
London Authority. Available at:
<http://www.london.gov.uk/archive/mayor/planning/docs/space-standards.pdf>.
Greater London Authority, 2009. Draft Replacement London Plan, Housing SPG EiP
Draft. [pdf] London: Greater London Authority. Available at: <
http://www.london.gov.uk/shaping-london/london-plan/docs/housing-spg-eip-draft.pdf>
[Accessed 19 February 2012].
Greater London Authority, 2012. Mayor investing £177 million to regenerate capital.
[online] London: Greater London Authority. Available at:
<http://www.london.gov.uk/media/press_releases_mayoral/mayor-investing-
%C2%A3177-million-regenerate-capital> [Accessed 23July 2012].
Greenhalgh, S. and Moss, J., 2009. Principles for Social Housing Reform. London:
Localis Research.) [online] Available at:
<http://www.localis.org.uk/images/articles/Localis%20Principles%20for%20Social%20H
ousing%20Reform%20WEB.pdf>[Accessed 26 January 2012].
Hill, R., Homes and Communities Agency, 2011. The HCA –New Affordable Rent
Model. [online] Available at:
<http://www.homesandcommunities.co.uk/sites/default/files/event/richard-hill-property-
week-19-may-2011.pdf>[Accessed 21 July 2012].
HM Treasury, 2010. Spending Review 2010, [pdf] Available at: <http://cdn.hm-
treasury.gov.uk/sr2010_completereport.pdf>[Accessed 25 November 2011].
Holmans, A. and Whitehead, Chr., 2011. Town & Country Planning Tomorrow Series
Paper 11: New and Novel Household Projections for England with a 2008 Base –
Summary and Review. [pdf] RAP Spiderweb: Oldham. Available at:
<http://www.cchpr.landecon.cam.ac.uk/Downloads/2011_holmans__whitehead_paper.pdf>.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 89 of 96
Holsti, O.R., 1969. Content Analysis for the Social Sciences and Humanities. Reading,
MA: Addison-Wesley.
Homes and Communities Agency, 2011. Existing stock, [online] Available
at:<http://www.homesandcommunities.co.uk/ourwork/existing-stock > [Accessed 30
November 2011].
Homes and Communities Agency, 2012a. Affordable Housing Capital Funding Guide
2012-13. [online] Available
at:<http://www.homesandcommunities.co.uk/cfg?page_id=&page=1>[Accessed 09
June 2012].
Housing Corporation, 2005. Capital Funding Guide, [online] Available at:
<http://www.docstoc.com/docs/92655350/CHALLENGE-FUND-Contents-CHALLENGE-
FUND-SCHEMES---1-POLICY-1> [Accessed 16 January 2012].
Hsieh, H. F. and Shannon, S.E., 2010. Three Approaches to Qualitative Content
Analysis. [pdf] Available at: <http://www.hu.liu.se/larc/utbildning-information/scientific-
methodology/course-literature-and-
links/1.253567/Qualitative20Content20Analysis_1.pdf> [Accessed 18 June 2012].
Johnson, D. 2010. Shortage of skilled workers a 'ticking time bomb', [pdf] Available at:
<http://www.dailymail.co.uk/money/article-1287640/Shortage-skilled-workers-ticking-
time-bomb.html> [Accessed 20 January 2012].
Jones Lang LaSalle, 2011a. On Point: Affordable Housing - a new dawn? [pdf]
Available at: <http://residential.joneslanglasalle.co.uk/knowledge-
centre/publications/affordable-housing-2011.aspx>[Accessed 23 November 2011].
Jones Lang LaSalle, 2011b. On Point: UK Residential Market Forecasts, [pdf] Available
at: <http://residential.joneslanglasalle.co.uk/research/residential-market-forecasts-
2011.aspx>.
Kempton, J. and Syms, P., 2009. Modern methods of construction: Implications for
housing asset management in the RSL sector, Structural Survey, Vol. 27 Iss: 1, pp.36 –
45.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 90 of 96
Kennett, S.T., 2010. Housebuilders to be hit by affordable housing slump,
Building.co.uk., [online] Available at: <http://www.building.co.uk/news/housebuilders-to-
be-hit-by-affordable-housing-slump/5001037.article> [Accessed 30 July 2010].
Lifetime Homes, 2010. 16 Design Criteria from 5 July 2010 (revised), [online] Available
at: <http://www.lifetimehomes.org.uk/pages/revised-design-criteria.html> [Accessed 02
March 2012].
London Development Agency, 2011. Design for London [pdf] Available at:
http://www.designforlondon.gov.uk/uploads/media/Interim_London_Housing_Design_G
uide.pdf> [Accessed 14 February 2012].
Malpass, P., and Murie. A., 1999. Housing Policy and Practice. Basingstoke: Palgrave.
Mathieson, D., 2010. Housing Design Standards Evidence Summary, [rtf] London:
Greater London Authority. Available at:
<http://www.london.gov.uk/shaping-london/london-plan/docs/housing-design-
standards-evidence-summary.rtf>.
McGuinness, P., 2011. GVA, Future of London: Policy in Focus, Funding Development
and Renewal: Housing delivery and estate renewal under the affordable rent model,
[online] Available at: <http://www.futureoflondon.org.uk/futureoflondon/wp-
content/uploads/2011/03/Affordable-Housing-Framework.pdf>[Accessed 02 April 2012].
Moore, P., 2012. UK’s Double dip further hits construction confidence – Tender Prices
continue to suffer. ECHarris Research., [online] Available at:
<http://www.echarris.com/pdf/8317_Market%20View%20Summer%202012_FINAL.pdf>
[Accessed 23July 2012].
National Audit Office, 2005a. Building more affordable homes: Improving the delivery of
affordable housing in areas of high demand. London: The Stationery Office. [pdf]
Available at:
<http://www.nao.org.uk/publications/0506/building_more_affordable_homes.aspx>
[Accessed 05 August 2010].
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 91 of 96
National Audit Office, 2005b. Using Modern Methods of Construction to Build Homes
More Quickly and Efficiently, London: National Audit Office.
National Housing and Planning Advice Unit, 2007. More homes for more people: advice
to Ministers on housing levels to be considered in regional plans. [pdf] Available at:
<http://www.communities.gov.uk/documents/507390/pdf/1299593.pdf >[Accessed 21
March 2012].
National Housing Federation, 2010. NAHP 2008-2011 funding decisions to Q4 2009-10.
[online] Available at
:<http://www.google.co.uk/url?sa=t&rct=j&q=&esrc=s&source=web&cd=4&ved=0CFMQ
FjAD&url=http%3A%2F%2Fwww.housing.org.uk%2Fpublications%2Ffind_a_publicatio
n%2Fdevelopment_and_regeneration%2Fidoc.ashx%3Fdocid%3D7253f9f2-d8cf-408d-
bc11-599f1891f8c0%26version%3D-1&ei=O4z4T4npL8q38gPOt-
X_Bg&usg=AFQjCNH1IuD-IKeIi1HSdgAIZD2wPWYkOg>[Accessed 10 June 2012].
NHBC Foundation, 2006. A Guide to Modern Methods of Construction, [pdf] Available
at:<http://www.nhbcfoundation.org/LinkClick.aspx?fileticket=kGLN0pdBF9Q%3D&tabid
=339&mid=774&language=en-GB> [Accessed 19 December 2011].
Niemitz, K., 2012. Abundance of land, shortage of housing, [pdf] Available at:
<http://www.iea.org.uk/sites/default/files/publications/files/Abundance%20of%20Land%
20Shortage%20of%20Housing.pdf>.
Office of the Deputy Prime Minister, 2003. Sustainable Communities: Building for the
Future, [pdf] Available at:
<http://www.communities.gov.uk/documents/communities/pdf/146289.pdf> [Accessed
16 December 2011].
Pan, W., Dainty, A. R. J., and Gibb, A. G. F., 2004. Encouraging Appropriate Use of
Offsite Production (OSP): Perspectives of Designers. In:, 2nd CIB SC International
Symposium, 30-31 Oct 2004, Beijing, China. The Hong Kong Polytechnic University,
pp. 125-136.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 92 of 96
Parker, R., 2008. Talking Points: Funding affordable housing - new options for housing
associations? [online] PWC. Available at:
<http://www.pwc.co.uk/en_UK/uk/assets/pdf/funding-affordable-housing.pdf> [Accessed
15 November 2011].
Ponzo, I., 2010. Immigrant integration policies and housing policies: The hidden links,
[online] Available at:
<http://westminster.academia.edu/OrnaRosenfeld/Papers/504096/SOCIAL_HOUSING_
POLICIES_AND_ETHNIC_MINORITIES_IN_THE_UK_> [Accessed 06 March 2012].
Ramesh, R., 2012. Government failing to get enough homes built, theguardian, [online]
Available at: <http://www.guardian.co.uk/society/2012/may/17/government-failing-
homes-built>[Accessed 23July 2012].
RIBA, 2008. Research Symposium 2008: Space at Home, [pdf] Available at:
<http://www.architecture.com/Files/RIBAProfessionalServices/ResearchAndDevelopme
nt/Symposium/2008/PatrickHammill.pdf>[Accessed 07 December 2011].
RIBA, 2009. Improving Housing Quality Unlocking the Market, [online] Available at:
<http://www.architecture.com/Files/RIBAHoldings/PolicyAndInternationalRelations/Polic
y/Housing/ImprovingHousingQuality.pdf> [Accessed 17 January 2012].
RIBA, 2011. The Case for Space: the size of England’s new homes, [pdf] Available at:
<http://www.architecture.com/Files/RIBAHoldings/PolicyAndInternationalRelations/Hom
eWise/CaseforSpace.pdf>[Accessed 05 December 2011].
Rosengren, K. E., 1981. Advances in Scandinavia content analysis: An introduction. In
K. E. Rosengren (Ed.), Advances in content analysis (pp. 9-19). Beverly Hills, CA:
Sage.
Ross, K,. 2002. Non-traditional housing in the UK: A brief review, London: Council of
Mortgage Lenders.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 93 of 96
Rutter, J. and Latorre, M., 2009. Social housing allocation and immigrant communities.
Mancester: EHRC RESEARCH REPORT SERIES, [online] Available at:
<http://www.equalityhumanrights.com/uploaded_files/4_social_housing_allocation_and
_immigrant_communities.pdf>[Accessed 19 February 2012].
Shapeley, P., 2008, Social housing and tenant participation, [online] Available at:
<http://www.historyandpolicy.org/papers/policy-paper-71.html> [Accessed 05 March
2012].
Shelter, 2007. Shelter’s response to the CLG Green Paper - Homes for the future: more
affordable, more sustainable, [pdf] Available at:
<http://england.shelter.org.uk/__data/assets/pdf_file/0020/60527/Response_to_Housin
g_Green_Paper_Homes_for_the_Future_Oct_2007.pdf>.
Shelter, 2011a. What is social housing? , [online] Available at:
<http://england.shelter.org.uk/campaigns/why_we_campaign/Improving_social_housing
/what_is_social_housing#0>.[Accessed 15 January 2012].
Shelter, 2011b. Protecting the environment, [online] Available at:
<http://england.shelter.org.uk/campaigns/why_we_campaign/building_more_homes/pro
tecting_the_environment> [Accessed 06 March 2012].
Stemler, S., 2001. An overview of content analysis. Practical Assessment, Research &
Evaluation,[online] Available at: <http://pareonline.net/getvn.asp?v=7&n=17> [Accessed
18 June 2012].
Stone, M. E., 2003. Social Housing in the UK and US: Evolution, Issues and Prospects. London: Centre for Urban and Community Research, Goldsmiths College. [online] Available at: <http://www.goldsmiths.ac.uk/cucr/pdf/Stonefinal.pdf> [Accessed 18 January 2012]. Story, C., 2009. Brown finds £2.1bn to build social housing, InsideHousing.co.uk., [online] Available at: <http://www.insidehousing.co.uk/brown-finds-%A321bn-to-build-social-housing/6505275.article> [Accessed 15 March 2012].
Taylor, S., 2009. Offsite Production in the UK Construction Industry, A Brief Overview.
Construction Engineering Specialist Team: HSE: London. pp. 4.
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 94 of 96
The Design of Homes, 2009. Space standards for new homes,[online] Available at:<
http://homesdesign.wordpress.com/2009/01/04/space-standards-for-new-homes/>
[Accessed 25 November 2011].
The Mayor’s London Plan, 2011a. Growth in Population, [online] Available at:
<http://www.london.gov.uk/shaping-london/london-plan/facts/index.jsp> [Accessed 13
April 2012].
The Mayor’s London Plan, 2011b. London Plan key diagram, [online] Available at:
<http://www.london.gov.uk/shaping-london/london-plan/facts/key.jsp> [Accessed 13
April 2012].
The Parliamentary Office of Science and Technology, 2003. Postnote: Modern Methods
of House Building, [pdf] Available at: <www.parliament.uk/briefing-papers/POST-PN-
209.pdf>.
Weber, R. P., 1990. Basic content analysis. Beverly Hills, CA: Sage.
Westframe, 2011. Introduction to Timber, [online] Available at:
<http://www.westframe.co.uk/p/h/About_Us/Introduction_to_Timber/243/> [Accessed 16
December 2011].
Windapo, A. O. and Balogun, A. A., 2009. Cobra 2009 - Study of the utilization of
modern methods and techniques of building construction in low cost housing provision
in Nigeria, [pdf] Available at
<http://www.rics.org/site/download_feed.aspx?fileID=5065&fileExtension=PDF>
[Accessed 20 January 2012].
Wong, C., and Schulze Bäing, A., 2010. Brownfield residential redevelopment in
England, What happens to the most deprived neighbourhoods?, [pdf] Available at:
<http://www.jrf.org.uk/sites/files/jrf/brownfield-residential-redevelopment-full.pdf>
[Accessed 05 March 2012].
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 95 of 96
APPENDICES
APPENDIX A - INTERVIEW QUESTIONNAIRE FOR Quantity Suveyor, Housing
Association and Developer
“Examining the Impact of Government Spending on Social Housing Construction”
1. Can you tell me about yourself?
2. What is your recent role and professional experience?
3. Can you tell me about your company (Sector, Turnover)?
4. What kind/types of projects have you worked on in the last 5 years?
5. What are your current challenges as a housing association in the market?
6. Can you tell me your role as a housing association in delivery structure chain?
7. Has the role of the housing association in the delivery structure changed since
the government’s recent social housing policy reforms and how?
8. Has the recent changes in the delivery structure resulted in greater efficiency
and how?
9. With regard to meeting housing needs, can you tell me which funding and
delivery models can potentially be the most cost-effective?
10. Government spending reviews have constrained public funding for housing.
What is your suggestion to make best use of the current public funding to bring
additional resources for housing?
11. What is your response to the suggestion that government should spend less on
building and improving social housing and more supporting the delivery structure
chain?
Impact of Government Spending on Social Housing Construction
Quantity Surveying, ESBE Page 96 of 96
12. In your experience, how has the reduced governmental spending affected the
company’s developments portfolio, i.e.:
Number of current and projected schemes,
Duration of construction projects.
Ratio of rehabilitation projects to new developments in social housing,
Density and space standards,
Available land for developments (brownfield or greenbelt)?
13. To improve design and construction quality, a set target of 25% of funding for
social housing developments must be allocated to modern methods of
construction (MMC). What type of MMC technology has been in use, and what
has been its impact in terms of cost, quality and time on social housing
developments in your company.
14. Any other comments about the impact of government spending on the delivery of
social housing that you would like to add?