Competition drives down costs in Norfolk

Norfolk Council leader Cllr Daniel Cox explains how they have set up their own companies to compete to run Council services - and to pitch for business from other Councils.

By embracing Margaret Thatcher’s Compulsory Competitive Tendering legislation in the 1980s, Norfolk County Council helped pioneer the use of private enterprise to realise public ambitions.

While the vast majority of Local Authorities paid only lip service to the Conservative government’s desire to see privately-run companies provide a host of public services, Norfolk County Council embraced the CCT legislation, the benefits of which are now clear for all to see. Last year, the three companies wholly owned by the County Council delivered £2.555m in profit, which is funnelled straight back into frontline council services as well as enabling us to keep council tax levels down.

The companies owned by the County Council have recently merged to form The Norse Group, as we continue to seek even greater efficiency from them. At first, the companies competed with the Council itself, which has seen Norfolk County Services (NCS) takeover the maintenance and facilities management of all council buildings, including schools. This not only drives down the cost for the council, but also ensures that employees’ lunch costs a lot less than it would otherwise. In this one example, you can see that on top of the profit made by Norse, other services which cost the council money are also significantly cheaper.

The success of the group now means that it is not only Norfolk which benefits. Some 66% of Norse’s business now comes from outside of the county with councils across the England now benefiting from the long-term relationship with a Norse subsidiary. For example, NPS Property Consultants, another of the companies, has overseen the development of a new health centre for Luton Borough Council. It is rather ironic that a Labour Council is benefiting from a Conservative Council-owned company, based on Thatcherite legislation. This however, demonstrates the key strength of Norse, in that it can compete in the commercial environment to the benefit of people up and down the country.

It is astounding that other Local Authorities never followed this model, and instead chose to carry out all property and waste management work themselves, at considerable expense to the taxpayer. Nonetheless, you will not hear me complain too much as it means more business for Norse, which will continue to grow and realise even more cash for the people of Norfolk.