Following the publication of the ‘Offsite Manufacture for Construction: Building For Change’ report by the House of Lords Science and Technology Select Committee, Darren Richards, Managing Director of key contributors Cogent Consulting, discusses the findings.
What this report acknowledges is that offsite construction techniques are now recognised as some of the most important solutions to many problems facing the UK construction industry today – particularly in the housing sector. Evidence from the report reveals that the construction industry and its labour model is at a critical crossroads. Whilst the diagnosis points to a deep-seated market failure, there are certain industry trends and wider societal changes happening now that represent both unprecedented risk and opportunity for the industry and its clients.
As the team at Cogent knows only too well from our work in the industry – if the opportunities are not harnessed in a planned and structured manner, the risks may become overwhelming. In my opinion, one of the report’s most important recommendations, is that the Government should encourage the use of offsite manufactured solutions through policy measures as part of the wider procurement strategy across the ‘big five’ spending portfolios – infrastructure, education, healthcare, prisons and housing. There is an opportunity here for the UK to extend our position at the forefront of offsite manufacturing globally in these sectors. Such a policy would further strengthen the confidence in the offsite supply-chain and encourage greater R&D/innovation investment.
Concerns that the UK lags significantly behind other countries in the low-rise residential offsite sector is a real issue, particularly as some low-rise offsite specialists have recently gone out of business after a relatively short time in the market, which brings me onto another crucial element of the report – pipeline/demand certainty – probably the most significant issue for all elements of the offsite supply-chain.
The report recommends that the Government provides a steady pipeline of projects for the construction sector so that companies can plan and make the capital investments or create the strategic supply-chains necessary for embracing offsite manufacture.
We welcome the Government’s commitment to the National Infrastructure and Construction Pipeline in the Construction Sector Deal, but it is important that the Government adheres to the pipeline to provide certainty to the sector. The ‘presumption in favour of offsite’ – if properly executed – will help to achieve this, but it is also important that public sector procurement bodies take heed of the important recommendations around a ‘reporting/auditing’ framework to require an explanation as to why offsite technology may not have been used. This looks like a recommendation for the use of the carrot and the stick – either way it will take strong government leadership to enforce.
The key issues of standardisation, capital investment in semi-automation and the cost premium often associated with low volume offsite manufacturing are part of the same equation and have a direct correlation. That is, with more standardisation there is a higher likelihood of a production process being repeatable and therefore automated, with automation comes investment in machinery which increases efficiency and productivity levels and ultimately provides cost reductions. Crucial to unlock the benefits of automation is asset financing. As an industry we need to lobby the Government to find better ways of asset financing to encourage a greater uptake of automated processes, which will increase advanced and lean manufacturing procedures. The automotive and aerospace industries have been exploiting this model for decades and it is time that the offsite manufacturing sector had the confidence to do this too.
To continue reading this article, visit: Offsite Magazine Issue 12
