KATE BARKER’S final report on the supply of houses in this country, commissioned by Gordon Brown and due in the spring, comes not a moment too soon. With continuing divorce and the average age of first-time buyers moving from the late twenties rising to the early thirties, Britain seems faced with many years of house-price inflation — whatever the prospects of a slowdown in the market in 2004.

Of course, more than weak supply lies at the root of the high cost of new houses, old houses and — by far the biggest component of the building trade — the refurbishment of old houses. Money has not favoured equities until relatively recently, so investing in homes, and in particular the buy-to-let market, has had a lot going for it.

Nevertheless, the state of housing supply tells us a lot about the lack of innovation in the building trade. We are building 130,000 new homes a year. In the 1960s, the annual total exceeded 400,000.

Government housing ministers themselves berate builders for not moving into mass production. But this is so much rhetoric. A close look at the Office of the Deputy Prime Minister’s White Paper, Sustainable Communities: Building for the Future, published in February, reveals that very little of the £22 billion housing “programme” announced then is actually devoted to building new homes. About £4 billion is to be spent on affordable housing, and £1 billion on the key- worker housing beloved of the London Mayor, Ken Livingstone; but the rest is being spent mainly on refurbishing old public housing stock, demolition and land clearance and, significantly, a Regional Development Agency bureaucracy of funds administrators, a layer of Arms Length Management Organisations (ALMOs), and various social engineering schemes.

Social engineering, indeed, seems to be the main purpose of government housing policy, along with saving the planet, and measuring everything that moves on a construction site. It is a bizarre system of priorities, and very different from what the Japanese are up to. Toyota’s factory at Kasugai alone mass-produced 3,500 large, spacious, homes in 2002, and it is only one of three run by the group’s construction arm. By contrast, the Sustainable Communities initiative plans just 16,000 new homes a year, of which perhaps 4,000 will be prefabricated.

Michael Caine was right to hate the prefab in which he spent his childhood in the post-war years. But 50 years on, new technology makes prefabs a completely different proposition. Looking at the customised componentry in Japan and in the world motor industry, there seems little to worry about. The issue with UK housing supply is not so much technical, nor even economic, as political.

In thrall to nimbyish green pressure groups, the Government believes that Britain’s green and pleasant land is being overrun by suburbanising working-class families. According to its chief adviser, Lord Rogers, building brownfield cities such as Birmingham up to London housing densities is preferable to allowing a town such as Milton Keynes to expand. But why? Towns bigger than 10,000 people account for 80 per cent of Britain’s population, but just 7 per cent of its land mass. As Kate Barker hinted, the planning system is a nonsense. In the naturalistic perspective dominating thinking about UK construction, this country needs more and more regulation to protect itself from property developers who hoard precious land and environmental police to ensure all new buildings are interrogated over their relatively miniscule carbon emissions.

There is, though, an alternative. We should denationalise the right to develop land and encourage mass production. We can also develop the fast-track Local Authority National Type Approvals Confederation. Lantac already controls the safety of buildings in England and Wales: why not let it extend its Type Approvals to whole buildings? No more endless public inquiries.

The price of land and of houses would come down. Foreign investors interested in British locations would find them a lot easier to build on.

London’s key workers could buy prefabricated, customised, swing-more-than-a-cat macroflats of their own, instead of being forced into tied government microflats.

Is that too much to ask, or must we continue the current inflationary policy of make-do-and-mend?

James Woudhuysen is professor of innovation at De Montfort University, Leicester. He is co-author, with Ian Abley, of Why Is Construction So Backward? (Wiley, £29.99)

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