Development FinanceNews

Pilot launched to speed up building blocked by infrastructure delays

A new government backed pilot scheme has been launched to unblock infrastructure hold ups that are delaying the building of new homes in the UK.

It has been set up by the Housing and Finance Institute, who recently published a major report which highlighted how failing water companies are severely infringing the ability of private developers to build more homes.

The pilot scheme is being carried out in the South East of England and will seek to identify, assess and then unblock infrastructure problems in order to speed up house building.

The scheme will pay particular attention to housing developments that have been delayed due to a lack of water, sewage, electricity, gas or road connectivity. If successful, the plan is to roll the scheme out across the UK later in 2017.

Natalie Elphicke, chief executive of the Housing and Finance Institute, said that a lack of local infrastructure on new housing sites is drastically slowing down the rate of new homes coming onto the market.

She said: “When we speak to housing developers, they often say it is water, electricity, gas, broadband and roads which are impeding their ability to build more homes faster. Water and sewage connectivity is a particular problem, with some water companies completely failing to deliver what housing developers require.

“This has been slowing down the rate of housing completions right across the country. Our hope is that this new pilot scheme, which brings together key players from the private and public sectors, will provide us with a blueprint for fixing these issues and facilitating accelerated housing growth.”

The scheme will run until May 2017, with its initial report due by the end of January and its findings being reported to housing and planning minister Gavin Barwell and Stephen Hammond, chairman of the All Party Parliamentary Group on Infrastructure.

He said: “I welcome this new pilot scheme and its focus on identifying ways of working together to overcome infrastructure barriers, and I look forward to seeing the initial report on its findings.”

A water company can currently take between six months and a year to connect a property and still meet their regulatory target. This is despite the fact that the water company will benefit from the revenues of the new connections for many years.

Research in the HFI’s summer report, Let’s Build More Homes Faster, revealed the scale of the failure currently being seen around the UK. Of the water connection performance, only Dee Valley, which operates in Wales and Cheshire, secured 100% of connections.

The company that has failed its performance targets most dramatically was Affinity Water which covers areas in the South East as well as in London. In quarter one of 2015 it failed its performance target by nearly 60% and its average performance over the first three quarters of 2015 saw its performance fall by nearly 40%.

Significantly poor performances were recorded for Thames Water, Southern Water and South Staffordshire, all of which saw 20% to 25% failure rates in at least one quarter of 2015.

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