CMA considering Gove鈥檚 call for recommendations to improve 鈥渆ffectiveness鈥� of sector

The Competition & Markets Authority could launch a study of the housebuilding sector in January following a formal request from Michael Gove yesterday.

The watchdog鈥檚 interim chief executive Sarah Cardell, in a letter replying to the housing secretary, said the body has been working on proposals to look at the industry, including a one-year study, and could put it before its board next month.

Gove has repeatedly called for the CMA to study the sector, last March accusing .

CMA

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The CMA said it will decide in January whether to look into the housebuilding sector after a request to do so by Michael Gove

He wrote to Cardell last month to say it is 鈥渃ritical that we have a housebuilding sector that operates effectively to deliver the homes that people need鈥�.

He added: 鈥淭he last housebuilding market study took place 14 years ago and since then, there have been significant changes in both the market and the challenges facing the country as a whole 鈥� such as net zero, changes to the structure of the market following the financial crisis and changing demographic trends.鈥�

He said the government would welcome policy recommendations from the CMA 鈥渢o make sure the housing market is operating effectively鈥�.

The housing secretary also wrote to the CMA in May saying that he was interested in the barriers facing SMEs who want to enter the market or expand 鈥渋ncluding the role that the land market and planning system play in these dynamics, and whether the market structure is holding back innovation.鈥�

Gove鈥檚 call for CMA intervention follows his comments last year that the housebuilding industry operates 鈥渆ssentially鈥� as a 鈥渃artel鈥�, a comment that prompted

Cardell said the government鈥檚 openness to recommendations regarding the housebuilding industry will be 鈥渁n important factor鈥� in the board鈥檚 consideration of proposals for a market study.

She added: 鈥淥ne of the requirements for delivering the homes people need is a thriving, competitive housebuilding sector.

鈥淲ith this in mind, CMA staff have been developing proposals for work in this area, including a possible market study for the board鈥檚 consideration in January.

鈥淎s we discussed, a market study would be a substantial piece of work, and it is crucial that careful consideration is given to its scope, to ensure suitable focus and efficiency.鈥�

 

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