Call for pilot participants – helping councils work effectively with SME builders

A new pilot scheme to help councils work effectively with SME builders to provide housing in difficult to develop areas is being launched.

We are looking to support participating authorities with additional capacity to help deliver the pilot, together with standard procurement and contract templates. To register your interest click here.

The SME construction sector plays an important role in helping councils deliver much-needed homes. We have developed a new SME kickstart initiative to provide a fast-track route to getting SMEs working on building sites, whilst at the same time increasing the supply of social and affordable rented homes.

Most council areas have a cohort of SME builders and developers. It is important that those who were trading successfully pre-pandemic, can recommence construction as soon as current restrictions allow. Many councils could intervene to help make this happen, and we are looking to help them.

Councils often struggle with insufficient capacity and/or knowledge of how to engage directly with these small companies. An authority’s primary focus can often be on large-scale high-yielding sites, whilst these small construction businesses have an unrivalled ability to tease out fresh micro housing sites within their local areas. However, in order to do so at an increased pace when the market normalises, they will need the confidence of a back-to-back contract with their local council that reduces cash flow risk.

Under this initiative councils could enter into a contract to forward purchase newly-constructed homes for social and affordable rent off-plan for a fixed price. Provided the associated works contract has a value beneath the threshold for works that triggers the requirement for a full competitive tendering process under EU procurement law (£4,733,252), councils would need only adhere to the light-touch regime for below threshold procurements. This includes guidance and best practice re-use of SMEs in EU procurement rules, and otherwise to procure in line with their own relevant policies and Standing Orders.

Please click here to register an interest in the pilot.

To arrange a more detailed discussion about this initiative in more detail please contact Martin Walker, our Housing Programme Director, at martin.walker@localpartnerships.gov.uk or on 07879 443 410.