John Skivington, group director of LHC, takes a look at the government’s use of pre-manufactured value calculations for MMC projects
You will have read a lot about modern methods of construction (MMC). You may have even investigated where you can incorporate it into your plans. But if you haven’t introduced it to any of your projects yet, now’s the time, thanks to a significant development in Government policy.
As part of the Affordable Homes Programme, Homes England is currently seeking applications for strategic partnerships for the delivery of up to 130,000 homes. One of the requirements for successful bids is that 25% of projects must be delivered using MMC.
Elsewhere, the government is also in the process of launching an MMC task force, with £10m seed funding and a remit to accelerate the use of MMC, while Homes England is running a research project to test the performance of different types of MMC over the long term. MHCLG has also recently closed a consultation on the New Homes Bonus, that proposes to apply a premium for MMC.
Government use of PMV calculations
All of this points to a big push for developers and housing providers to be using modular, panelised and other MMC solutions, as the economic, social and environmental benefits become more widely realised.
However, the most interesting development has been the government’s use of pre-manufactured value (PMV) calculations as part of the Affordable Homes Programme. This is a weighted calculation that rewards the proportion of a home that has been constructed offsite, measured as a percentage of the total.
Under the programme, a building will only pass the MMC test if it has a PMV of 55% or more.
The government’s adoption of PMV for the programme is interesting. It gives a clear framework for measuring progress, and I suspect we will start to see its usage across more policy development in the future, perhaps akin to the way we see energy efficiency goals defined using EPC bandings.
It’s therefore vital that housing providers start to get to grips with MMC and PMV now.
PMV is not hard to achieve
At LHC we know from experience that a PMV of 55% is not hard to achieve. As mentioned, use of MMC is already growing across the country, and through our Offsite Construction of New Homes (NH2) and Offsite Project Integrator (OPI1) frameworks we’ve already been helping housing providers to deliver projects that would achieve up to 80% and more.
The key is to start with structural systems, such as timber frame, steel frame, SIPS and panellised systems, or full-blown volumetric ‘pods’, and build up from there with a range of offsite-manufactured components. These solutions provide by far the highest PMV (take a look here to find out more about the different categories of MMC) and our NH2 framework gives access to suppliers that are experts in all of these options. The suppliers are also SMEs, helping to meet another of the Affordable Homes Programme requirements.