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Circular 39.


Ministry of Health,

Whitehall, S.W.I

November 21st, 1919.

Sir,—1. I am directed by the Minister of Health to state that he has had under consideration various proposals for accelerating the provision of houses. Although much good work has been done, especially in the preliminary stages of housing schemes, it is imperative that measures should be taken by which many more houses can be erected with the utmost dispatch.

Dr. Addison will shortly address a further communication to the local authorities describing certain supplementary measures which have been decided upon; in the meantime he desires to draw special attention to the arrangements described below, which have been concluded with representatives of the building trade.

A.-Agreed Price Contract.

2. The Minister has been in negotiation with the Building Resettlement Committee of the Joint Industrial Council of Building Trades with regard to a recommendation made by the Committee and adopted by the Council in favour of an arrangement by which a fair price should be fixed for the erection of houses.

A copy (marked A) of an agreement which has now been reached is enclosed; and Dr. Addison wishes the matter to be taken into consideration at once by the Council of every large town with a view to the adoption of an arrangement on the lines laid down if the local conditions are favourable to this course. The arrangement may also be adopted with advantage in smaller areas where it is practicable to secure the co-operation of. a considerable number of building contractors of standing in a wide district.

3. The principal feature of the agreement is that representatives of the Local Authority, the local Federated Builders and the Housing Commissioner meet together and arrive, where possible, at an agreed price at which houses are to be erected; and that then the number of houses to be built under the arrangement is distributed by the local association of the Federation to builders in proportion to their


The great advantage of this arrangement is that it affords means of immediately securing that the largest possible number of local builders, and of workmen employed by them, become engaged in the erection of houses.

4. Dr. Addison wishes to impress upon your Council that in any agreement made in accordance with the new arrangement it should

always be provided that a definite number of houses shall be erected within a specified time, and that the Local Authority should be satisfied that the work can be done within that time by the builders among whom it is distributed.

One of the principal objects of the new arrangement will not be secured unless this part of the scheme is fulfilled, namely, that the local builders agree to erect within the shortest time the largest number of houses which they can reasonably be expected to undertake. Hitherto, partly because of the uncertainty as to prices and tenders, the Local Authority have been inclined to let out contracts only for small numbers of houses, but it is imperative that they should arrange for the erection forthwith of the maximum number which can be built. The houses can be, of course, of as many different types as is considered desirable.

Nothing in the agreement prevents the Local Authority from arranging for the erection of houses of special forms of construction such as concrete, steel framing, and other forms approved by the Ministry, and Dr. Addison suggests that your Council should also consider immediately the possibility of taking steps in this direction.

5. The Industrial Council have arranged to inform builders of this new scheme, and Dr. Addison requests that your Council will immediately get into communication with the local association of the Building Trade Federation.

He will be glad to arrange for a representative of the Ministry to be present at any meeting which is arranged between representatives of the Local Authority and the Federated Builders.

B.-Purchase of Working-class Houses under Section 12 (3) of the Act of 1919.

6. Under Section 12 (3) of the Act of 1919 local authorities are empowered to contract for the purchase by, or to lease to them, of houses suitable for the working classes whether built at the date of the contract or intended to be built thereafter. The object of this provision is to enable local authorities to take advantage of cases in which house builders have in their possession land which is already partially developed. This is one among other supplementary measures which local authorities cannot afford to neglect in the present emergency. Dr. Addison has recently had conferences on this subject with representatives of house builders, and an agreement has been reached of which a copy (marked "B") is enclosed. When operations under Section 12 (3) of the Act are undertaken this agreement should be made use of.

The arrangement is, briefly, that the builder holding partially developed land, shall enter into an undertaking with the Local Authority for the erection of houses to be bought, with the land, by the Local Authority.

The terms of purchase, the lay-out and house plans will be subject to the approval of the Ministry. To secure the utmost despatch, it

is suggested that the best course will be that the arrangements in each case be settled at a conference between the builder, representatives of the Local Authority (say, the Chairman of the Housing Committee and the principal technical official) and the Housing Commissioner or other representative of the Ministry. Particulars of the detailed proposals should be circulated to the various parties a week before the conference, so that they may be fully prepared with their considered comments, and that, wherever possible, the matter may be finally settled at the conference.

In order to bring the matter to the notice of local house builders, it will be well in the larger towns to call a special conference for this purpose.

7. Lay-out. Much of the land being already wholly or partly developed it will be inexpedient always to insist on a maximum of twelve houses to the acre, and the erection of a larger number will, in such cases, be considered, but not more than twenty houses to the acre should be arranged unless there are very special circumstances.

8. Types of Houses.-It will be open to the builder to adopt plans prepared by the local authority, or to submit complete plans of his own or to undertake to erect houses of a type similar to those which he has already built.

Where a house already built is accepted as a type, plans will, no doubt, be readily available to assist the Local Authority in estimating the fair value of the house. Bills of quantities will not be required, but a general specification will be necessary.

The houses must be well built, and should not, as regards structural stability and sanitation, fall below the standard provided for in the model specification of the Ministry. Dr. Addison has been assured by the various associations of house builders that they will do all they can to fulfil this condition.


9. Supervision.-The Local Authority must exercise supervision over the building of the houses. They should see, however, that while the supervision is adequate, it is not vexatious. In particular, a reasonable amount of latitude must be allowed to the builder. should not be debarred from a reasonable variation from the plan or from using different materials in some cases where the standard of the house will clearly not be lowered. In this way the builder will be helped to erect the houses rapidly and also at lower cost.

10. Model Form of Contract for Sale.-To facilitate arrangements of the kind proposed, a model form of contract to suit these cases is being prepared and a copy will be sent to you shortly. Local authorities are advised to use this model form in all cases where it is applicable, with any adaptations that may be necessary.

It will be observed that it is suggested that a bonus be offered for the completion of houses before the stipulated time. It is provided that adjustments shall be made for changes in the rate of wages, but not for changes in the prices of materials; it would not be

practicable in contracts of this kind to check, without enormous expense, claims in respect of materials. To avoid disputes where alterations have to be made in the terms of a contract because of changes in rates of wages, a schedule is appended to the agreement with the associations of house builders and to the model contract which sets out, as agreed between the Ministry and representatives of the house builders, the proportion of different classes of labour in the total cost of a house.

A third feature in the model contract, which should be helpful to builders, is a "break clause," under which they are authorised "to break "the contract after the erection of the agreed number of houses; this will enable the builder to re-consider his terms if he should find, after proceeding some distance with the work, that he has quoted too low figures.

Dr. Addison will be glad if you will inform the Housing Commissioner for the Region, within fourteen days, what action has been taken or is contemplated by your Council in this matter; and also, if the area of your Local Authority has a population exceeding 50,000, the action taken or contemplated as regards the arrangements for Agreed Price Contracts.

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SPECIAL ARRANGEMENTS BETWEEN LOCAL AUTHORITIES AND BUILDERS' FEDERATIONS AS TO CONTRACTS. The Minister of Health, after conference with the Building Resettlement Committee, has expressed his willingness to agree to an arrangement on the following lines in any case in which the Local Authority are prepared to make such an arrangement (or in the event of the Ministry itself acting for or in the place of the Local Authority), and the Ministry consider that the local conditions are satisfactory.

1. The Local Authority and the local Association of the Building Trade Federation agree for a specified number of houses to be built by members of the local Association of the Federation, subject to agreement as to prices.

2. The lay-out, house plans, and specifications will be settled by the Local Authority, with the approval of the Housing Commissioner.

3. A Bill of Quantities will then be considered, and prices agreed upon, for each type of house at a conference at which the Federated

Builders, the Local Authority and the Housing Commissioner are represented.

4. The Local Authority will then decide, with the approval of the Housing Commissioner, how many houses of each type are to be erected under this arrangement; and the local Association of the Federation will arrange for the distribution of the work. The time within which the houses are to be provided is to be specified in the agreement. Each member who undertakes the erection of houses will make a separate contract with the Local Authority.

5. Contracts on the same terms may, in agreement with the local Association of the Federation and subject to the provisions of article 8, be given to unfederated builders in the locality or to builders outside the locality.

6. The Local Authority is not debarred, in any case they think fit, from obtaining competitive tenders or carrying out the work on any other basis; but competitive tenders shall not in any case be obtained as against an agreed price for an instalment of houses being built

under this scheme.

7. It is understood that the Federated Builders and their representatives will make a point of putting forward suggestions as to any modifications or alterations likely to secure despatch and economy in the erection of the houses.

8. Nothing in the present agreement is to be taken to debar a local authority from employing any contractor or contractors for the erection of houses to be built within the specified time over and above those which can be built within that time by the Federated Builders, or for houses of a different kind from those coming under the arrangement made with the local Association of the Federation.

November 21st, 1919.


D. 127.

[Enclosure B to Circular 39.

AGREEMENT AS TO ERECTION AND SALE OF HOUSES UNDER SECTION 12 (3) OF THE HOUSING ACT OF 1919. The following agreement has been made between the Minister of Health and representatives of associations of house builders :—

1. The builder should first submit to the Housing Committee of the Local Authority, and at the same time to the Housing Commissioner, a scheme accompanied by a plan of the land on which he proposes to build. This should be accompanied by a block planbeing a tracing from the Ordnance Map-defining the position of the site in relation to the surrounding streets and houses. The number of houses included in the scheme should be limited to what the builder might reasonably be expected to complete in twelve months.

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