Wire mesh lath - the right solution?

Joined
18 Feb 2015
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United Kingdom
I'm having a 2 bed victorian mid terrace (circa 1880) renovated.

The builders have opened up the walls to install radiator pipework and electrics and a lot of the interior plaster is coming away in HUGE chunks on both internal and external walls. According to them whoever did the last refurb (80's we guess) didn't prime the walls properly and did a terrible job of plastering. This is the back wall of house in guest bedroom as an example:

http://bpkersey.com/images/wall.jpg

They've suggested patching up the worse areas using wire mesh and a new render / plaster. Is this the right solution?

Or should they be taking everything back to brick / studwork and putting up new plasterboard?

They've quoted me £200 per room parts and labour which i believe is getting the wall repaired to a point they can plaster + decorate.
 
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