Mark Farmer tells MPs construction industry is unable to meet Govt housebuilding targets

The construction industry does not have the capacity to build the homes needed to address the housing crisis because of a lack of skills, the author of the Farmer Review has told a committee of MPs.

Mark Farmer, chief executive of the consultancy Cast, gave evidence yesterday to the Communities & Local Government (CLG) Select Committee on the capacity of the housebuilding industry.

In his hard-hitting report, published in October last year, Farmer took the construction industry to task over its labour model, examining some of the key issues the sector faces, from underinvestment in training and recruitment, to an ageing workforce.

The capacity of the construction sector and the current skills gap were the biggest challenges facing the homebuilding industry, he told the Select Committee.

Moreover, he had a stark warning for MPs: that unless serious inroads were made into improving skills and training, attracting new entrants in the workforce, and pioneering innovative technology in the construction sector, it would not be possible to achieve the Government’s current housing targets.

“in terms of skills and capacity, we are not attracting the amount of young people into construction industry needed to maintain the workforce,” Farmer said. “This, in combination with an already shrinking workforce, and the potential of Brexit-related reductions in labour will further reduce the capacity of the construction industry.”

Faced with having to build more homes with less workers, Farmer called on the Government to incentivise change and drive innovation saying that “we need to think long-term and apolitically about housing if we are going to get anywhere”.

When asked what Government could do to improve the capacity of the homebuilding sector, Farmer emphasised the importance of government supporting acyclical housing stock.

“Market enablement is a very important component of improving the capacity of the homebuilding industry,” he said. “Volume house builders dominate the current market, which is not a healthy situation to be in when it comes to market stability. Tenure diversity is therefore key for providing stability to the market and pushing innovative technology.”

When referring to the importance of tenure diversity, he said “I see the privately-backed Build to Rent sector as a crucial part of increasing supply as speed with fresh capital, as well as pioneering disruptive technology. For example, Essential Living’s Creekside Wharf development is using modular technology and is the first of its kind in the UK.”

Reiterating the recommendations of his recently published review into the construction sector, titled ‘Modernise or die: time to decide the industry’s future’, Farmer called for greater collaboration between industry and local authorities to provide stability to the market.

“The construction sector is very project led but we need integrated communication amongst all actors in order to provide the scale needed,” he said. “If local authorities talked to each other then there is a huge opportunity there. You don’t get innovation from a fragmented market.”

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