Is the PM's direct commissioning plan sound?

The Prime Minister will announce today a landmark scheme of direct commissioning of affordable homes. The idea appears to be that the government will secure planning approvals for houses on publicly owned land, and then directly commission builders to build.  That sounds like a really good idea and goes some way to address some of the risks of planning approvals I have previously discussed. However, the idea goes further and suggests that the government will ring-fence the competitions to build the houses to small building firms in the hope of undermining the market dominance of the eight biggest building companies.

Before anyone seeks to replicate this strategy, perhaps it would be worth getting a legal opinion on whether or not such distortion/exclusion of part of the market is legal and doesn't contravene the EU Rules, or better, perhaps the government could share their legal advice on how others can follow their lead without falling foul of the law.