Pioneer housing success could save pounds 400m a year.

Byline: LARRY NEILD

A CONSTRUCTION consortium piloted on Merseyside has been so successful it is to be extended to other parts of the UK.

Deputy Prime Minister John Prescott's office believes social housing providers will save pounds 400m a year by introducing the scheme piloted by seven local housing associations and Knowsley Borough Council.

Fusion 21 has already won national acclaim for cutting construction costs and creating careers for unemployed people.

The joint procurement partnership was set up in 2002 by seven Merseyside-based housing associations -- Riverside Housing, Plus Housing Group, Maritime, KHT, Helena, SLH, Arena and Knowsley Metropolitan Borough Council -- to tackle rising construction costs, labour shortages and the poor image of the construction industry.

In just two years, it has developed a method which has saved members 30% on the cost of materials.

It has also provided construction skills training for almost 300 unemployed Merseysiders -- many of them now in permanent work with Fusion 21 contractors -- and attracted interest from the Government.

The scheme, based on the Fusion 21 model, is to be extended to 40 groups around the country following a presentation to Mr Prescott's office. Initially, it will be extended to London and Manchester.

The efficiency body Procurement for Housing told Mr Prescott's officials that social housing association can save up to pounds 400m by copying what Fusion 21 has done.

Fusion 21 chief executive Mike Brogan said: ``Our approach has been unique but we have proved that it works and can deliver a whole range of very real benefits to housing associations.

``One of the conditions of our original Housing Corporation funding was that we shared the good practice we developed. Aspart of this, we are now looking to open our doors to another seven or eight local registered social landlords so we can spread the benefits. ''

Expansion of Fusion 21 also means the partnership can play an even bigger role in helping raise standards in the construction industry.

It has already won national praise for leading the social housing sector in applying Egan principles designed to improve image and performance of the construction industry. Fusion 21 is planning to stage a seminar for potential new Merseyside members in October this year.