Lords have an honest conversation about the role of SMEs in solving the housing crisis

Lord Bourne’s housing debate shows us how far politicians have come in discussing potential solutions to the housing crisis.

Although the debate focussed on modern methods of construction (MMC), passionate speakers made such informed contributions that the Government would do well to act on them.

These included considerations around the skills crisis, disability access, the diversification of the market, planning reform and more support for small and medium-sized (SME) builders.

The House Builders Association (HBA), the housebuilding division of the National Federation of Builders (NFB), understands the intricacies of housebuilding and planning and congratulates those decision-makers who have taken it upon themselves to understand how homes actually get built.

SME builders

The Earl of Lytton, a chartered surveyor, looked at why SME builders are being undervalued and highlighted the problems with the wider development process.

Baroness Walmsley, who used an SME builder for her Passivhaus project, explained the practical differences between her SME builder and volume builders she had spoken to in regard to testing and delivering thermal efficiency.

Lord Borwick brilliantly summed up the problems for SME builders and criticised an overly centralised planning system. He said “only the market possesses the information needed to address the housing crisis” and explained that the only solution involves relaxing planning rules and granting permission more quickly.

Lord Borwick quite poignantly pointed out that due to increasing planning costs and delays, 80% of SME builders have left the industry since 1999.

Discussing SMEs, other speakers criticised the operations of the largest housebuilders. It was clear policy-makers who have experience with SMEs understood why they have an integral role to play in solving the housing and skill crisis.

From training 4 in 5 construction apprentices to proportionately delivering more affordable homes and more quickly than volume developers, the reasons to support SMEs are overwhelming. It is satisfying to see politicians recognise that housebuilders are not all the same, and that the planning policies we implement should promote exemplary businesses.

Accessible and adaptable homes

Lord Borwick, Baroness Thomas and Lord Shinkwin also gave an insightful view on how we can deliver more new accessible and adaptable homes.

Baroness Thomas highlighted the experiences of disabled householders and how MMC must support them by, for instance, including walls that are strong enough for grab rails.

A review of part M – access to and use of buildings – is planned and will require industry collaboration, especially if we are to encourage more independent living and downsizing.

A more informed housing needs assessment could also help local authorities identify demand and implement changes in their local policies to deliver more appropriate homes.


Baroness Watkins, Lord Stunell and Baroness Warwick focussed on MMC, citing the need to adopt common standards across the industry so that homebuyers could use different manufacturers on one project.

Baroness Warwick, chair of the National Housing Federation (NHF), said that housing delivery was 50% faster and resulted in 90% less waste on housing association MMC projects she had seen.

All speakers discussing MMC were supportive of its potential benefits, but consensus remained about needing to get it right for consumers and the wider industry.

Traditional housebuilders will struggle to meet increasing demand, which stands at more than 300,000 homes every year, and MMC will consequently play a greater role in increasing the housing supply.

The planning process should not favour offsite over traditional housebuilding, but the Government should look to incentivise the broader use of MMC, otherwise we will end up stifling the wider industry from embracing modern construction methods.


When summing up the debate, Lord Bourne referred to the Mark Farmer report “Modernise or Die” as containing many solutions to the skills crisis.

With SMEs training 4 in 5 construction apprentices, employing within 15 miles of their head offices and sustaining the wider construction supply chain, it’s clear that Farmer’s recommendation of a ‘tripartite covenant’ between construction industry, clients and government is needed more than ever.

SMEs must be able to compete for work on a level playing field supported by fair procurement, a planning system encouraging good development, and regulations that advance, rather than impede, industry improvement.

A special mention should go to Lord Haselhurst, who tried to find solutions to the bitter political battle of housebuilding. He emphasised that, when promises on infrastructure upgrades are reneged on, local people’s hearts are hardened to development.

Transparency in section 106 and CIL contributions will highlight how much developers really contribute to communities but the Government should seek fresh ways to depoliticise planning as much as possible.

In conclusion, Lord Bourne’s debate was an insightful look into construction and housebuilding, highlighting the scale of the challenge for the Government and policy-makers alike.

With a long-overdue review into speeding up the planning process from beginning to end announced, it is clear that the Government is taking the housing crisis and planning reform more seriously.

Housebuilders remain a voice that the Government must engage for broad, honest debate but it is clear that the House of Lords is another place they can unquestionably come to for informed opinions and reasoned debate.