Oireachtas Joint and Select Committees

Tuesday, 9 May 2023

Joint Oireachtas Committee on Housing, Planning and Local Government

Modern Construction Methods: Discussion (Resumed)

Mr. Sean Downey:

If the industry is currently well capable of producing 30% of the units, there is no reason that the 30% could not follow the trajectory of the total number of units and that the market share could not grow significantly.

A major issue is the funding model, which was outlined by Deputy Ó Broin and Senator Cummins. We also need to be careful in that just because we are at the committee hearing discussing the seriousness of the housing situation, that does not mean a company that is going to invest in a factory will follow through on its plan. It may respond to a housing crisis now but if health or education become much better engineered and much more prepared to ask for an MMC off-site solution, that will become a much more attractive market. If the UK housing sector becomes much more attractive, it will follow that. It does not necessarily mean anything that we are lining everything up here and demanding certain things. That is where certainty of procurement and certainty of stating what the framework looks like come in. We had a teaser in that regard last year with the Office of Public Works, OPW, and the Ukrainian proposal. If ten companies are capable of scaling and answering that ask at the moment, whether it is a 2D or 3D volumetric offer, they need to be told the volume of units and that while they are currently capable of producing 900 units in a timber frame factory in Dundalk, they should examine a business plan to scale to 3,000 units over a five-year cycle and that five or six other providers will be examined with the same timeline. There is no reason the industry would not respond but those risks exist if, for some reason, the State changes its mind halfway through and there are different Department guidelines again, floor area requirements are changed or building regulations change again in two or three years. Those producers may decide that, given the risk for them and their product, they would be better off focusing on the expansion of hospital beds or second level education buildings.

The main issue is for those deciding policy to make their minds up and be clear that it will be a framework for five years. They need to fix it and not change their minds. That certainty will allow the industry to gear up to answer that ask. They need to be clear that they understand what makes them tick and what supports they need. Senator Cummins was correct; the advanced manufacturing principle could work successfully to bring new providers to the market, nurturing them and helping them to grow their offering. We have probably covered everything we believe off-site manufacturing companies require. For the committee, on the policy side, and as those who will have the capital budgets to spend, they must make their minds up, fix it and send the signal to the market that this is exactly what will be procured over the next five years. It is important they do not change their minds.

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