May 26 2013 Latest news:
By shaun lowthorpe Business editor
Wednesday, October 31, 2012
The boss of Norfolk-based facilities management and contract services provider Norse Commercial services said it is set to grow by nearly 50pc after securing more than £1.5bn of business on its books.
Peter Hawes, managing director of Norse Commercial Services, said the firm, a wholly-owned subsidiary of Norfolk County Council had benefited from public sector cuts as councils and public bodies look to save work by outsourcing and opted for Norse instead of private-sector firms.
The company, which was recently ranked in 15th place in the EDP Top 100, provides a range of council services across the country from emptying bins to school dinners, as well as running care homes in Norfolk.
It now employs more than 10,000 people, with more than 6,000 of those employed in Norfolk and Suffolk and it could reach 15,000 if the same levels of growth are maintained.
Recent long-standing contract renewals, including 10-year plus agreements with Suffolk Coastal District Council and Waveney District Council which are worth around £300m between them, have taken Norse’s annual turnover to more than £135m a year.
Last year Norse, which pays a dividend to County Hall of between £3m and £5m a year, also secured a £39m contract to carry out housing repair work for Norwich City Council and it has also won contracts in Ipswich, Felixstowe, Northampton, Wellingborough, Barnsley, Enfield and Devon.
However as it continues to grow, there are mutterings within the business community about whether it could attract the interest of a potential private sector buyer, while some have also raised issues about whether it has an unfair advantage in winning public sector work.
But Mr Hawes said that its public partnership model meant that it was not a suitable case for a sell-off. “The government is encouraging local authorities to work together to reduce their costs and we are fully following that agenda,” he said. “It’s pretty difficult to sell us off because a lot of the work we undertake is through public partnerships, which is a model created specifically for allowing us to work with other public bodies. This fits nicely with the shared services agenda of reducing unit costs through shared volumes.
“Councils are cutting back and do not directly want to undertake this work themselves and are quite happy to outsource without going to the private sector or keeping it in-house.
“We are able to have an offer which provides the best of both worlds. We know that whenever we start up a new partnership, we save 10-15pc by introducing commercial criteria.
“Our forward order book, the total value of revenue over the life of our current contracts and partnerships, shows just how strong and successful Norse is,” he added “The group as a whole employs more than 10,000 people and we envisage that could be up to 15,000 in two years time if we continue growing at this rate.
“These latest announcements, following on from long-term partnership agreements in Norfolk, make Norse not only one of the largest employers in the region, but also one of the most secure for the coming decade,” he said.
Norfolk turkey giant Bernard Matthews is in talks to sell a stake in the business.