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Real progress in innovation

As the Innovative Housing Programme goes into its fourth year, Gayna Jones reflects on schemes approved and lessons learned.

In February 2017 the cabinet secretary for communities and children announced a new grant stream: the Innovative Housing Programme (IHP). The initial programme was £20 million over two years but this was later increased to £90 million over three years with a target of 1,000 homes as part of the Welsh Government’s 20,000 homes target. I was pleased and pleasantly surprised when Welsh Government announced a fourth year of IHP funding of £15 million capital grant, £10 million capital loan and innovative revenue funding.

Each round has seen some adjustment of aims. This year the focus was on delivering Modern Methods of Construction (MMC). Schemes needed to demonstrate the development of MMC solutions that also advance the delivery of place-making and design quality beyond the usual expected standard of good quality design and in the context of national place-led planning policy and legislation.

As usual all proposals were considered via the Design Commission for Wales, which feeds back to both the teams and the Welsh Government on design quality, place-making innovation, energy performance potential and risk. An independent panel assessed the final bids. The panel met via MS Teams in October 2020 to consider the 26 schemes submitted for funding. Each scheme was assessed on the degree of innovation and its potential future impact. The panel was encouraged by the quality of the bids received given the shorter application window this year and the constraints that local authorities and registered social landlords have been working under during this period.

Eight applications were recommended for approval, with an additional reserve scheme. The remaining schemes were rejected on the basis that they did not fit with the aims and criteria set out in the IHP technical specification and guidance. For example, they did not demonstrate a sufficient level of innovation or potential future impact to the housing sector, they did not represent value for money, or were seeking to ‘bolt on’ technology or swap out traditional for MMC solutions with little thought about the process and challenges.

Developing new models of housing, ways of building or delivering projects carries an inherent risk. As expected, these were reflected in the costs of the schemes submitted. However, the eight capital schemes were asking for less grant support to deliver more homes compared to previous years.

High quality design and good placemaking were key measures for Welsh Government. The Design Commission for Wales (DCFW), established by the Welsh Government to promote good design for the built environment, contributed to the process over the four years and as the chair of DCFW I chaired the IHP assessment panel. Good design and placemaking were key elements of the criteria and all schemes were required to undergo a Design Review Service to help assess the design quality and innovation of the proposals.

Lessons learned


Some of the issues that arose through the design review process over the four years which were consistent barriers to good design related to:

·       Pre-application discussion with local planning authorities coming too late

·       Responses from local authorities such as outdated parking provision requirements from highways departments dominance and the prescription of adoptable over- engineered streets; failure to use Manual for Streets

·       Lack of thorough site and context analysis which should inform and add value to the design process and sound placemaking. Failure to design for good orientation and layout; north facing living spaces

·       Lack of access to high quality, reliable environmental strategy and performance advice

·       Lack of clear overall energy performance targets being set so as to allow a range of responses/means to meet them

·       Local skills shortage in understanding and delivery capacity for good sustainable design and construction

·       Proper use and installation of renewable technologies – over and above passive fabric first approaches. Use of terminology such as ‘passivhaus principles’ which is largely meaningless

  • A deep-seated view that consumers/tenants/buyers want ‘traditional’ house-types which limits the possibilities of outcomes appropriate to the needs of life in the 21st century. The trend observed is one of perverse incentives toward pastiche and the disguise of forms of innovation, including materials and construction methods, to meet an unsubstantiated desire for something ‘traditional’.

In addition to the lessons learnt through the design review process, the first official research report of year 1 by Sheffield Hallam University was published in September.

There is clearly some overlap (and some divergences) between the two

Planning process

  • Early dialogue with both with local authority planning teams and with residents is important
  • Local planning authorities may need additional learning to be ready for applications for more unconventional forms of development.
  • Constructing buildings with traditional appearances may reduce concerns amongst local residents and planners (but can result in pastiche see design concerns above).

Construction challenges

  • IHP funding gave developers confidence and financial ‘safety nets’ to adopt more innovative approaches than they otherwise would have.
  • Many developers experienced difficulties with supply chains for specialist materials and identifying construction partners and contractors with appropriate experience. However, 11 of the 18 IHP Year 1 schemes appointed locally based construction partners.

Workforce challenges

  • Many of the workforce problems aren’t specific to the IHP. They relate to the need for the design and construction industries to upskill rapidly – a longstanding concern in the industry
  • The size and value of the IHP schemes plus the innovation limited interest from construction partners and contractors
  • Apprenticeships and partnerships with local colleges provided specialist labour for some schemes and also supported local employment aims.

Comparisons with traditional

  • Higher costs.
  • Concerns with level of defects, but feedback is that there are lower defect levels
  • Struggled to be specific about waste levels but generally reported reduced waste
  • Intensive resident engagement and support in the post occupancy period
  • Low energy designs did not always result in the SAP rating necessary to achieve an EPC A rating.

Progress against outcomes

  • In many cases it was too early to provide feedback
  • Delays were related to appointing suitable contractors, navigating planning challenges, and sourcing materials
  • MMC considered a faster approach than traditional methods
  • Participation in IHP Year 1 shifted attitudes towards innovative approaches amongst both developers and construction partners.


The independent assessment panel was encouraged by the quality of the successful schemes and could see some real progress in innovation over the four-year period. However, there were still some poor schemes amongst those rejected. There is clearly a variable standard amongst Welsh RSLs in developing innovation. Some RSLs have really embraced both innovation and MMC, as evidenced by repeated success in accessing grant over the four years. Year Four IHP grants should lead to increasing use of Welsh timber and supply chains which support green recovery and low carbon economy.

It seems unlikely that, given the current state of public finances, there will be future grant funding of this nature. The challenge now is to ‘normalise’ innovation throughout the whole SHG process.

Gayna Jones is chair of the Design Commission for Wales

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