Norse Group model benchmarks think-tank council outsourcing recommendations
In ‘Ethical Commercialism’, a report published on Oct 30th, 2018, Localis advises councils to look at a number of key factors to reform their services outsourcing, factors that Norse Group is already embedding in its well-established Local Authority Trading Company (LATC) partnership model.
Following in the wake of the high-profile collapse of a number of key national outsourcing groups, the report suggests that greater levels of openness and transparency on the part of the council and behavioural standards by private organisations is the only way future public trust in outsourcing can be ensured, a sentiment echoed by Norse Group Managing Director Dean Wetteland.
“With the economic pressure on budgets, the traditional supplier/contractor relationship for the delivery of local authority services is increasing,” Wetteland says.
“Shared objectives, flexibility in budgeting to meet changing service needs or cost reduction pressures, ethical and social values and realistic performance measures are now the fundamental principles of service-delivery relationships,” he suggests.
Norse’s own approach, based on what Wetteland terms ‘insourcing’, as opposed to ‘outsourcing’, is very much a partnership approach.
“We form a jointly owned company and share control.” Wetteland says, “Our local authority partners retain control over service delivery, but changes to budgets or specification require no formal re-negotiation, creating a culture of transparency and trust. Existing services and staff TUPE transfer into the company, and services are improved, costs reduced and profits shared. Partnering with the Norse Group can not only save money by delivering greater efficiencies , it can also provide a welcome annual dividend for the public purse”.
Recognising that the general public’s perceptions of involving private companies in delivering public services are increasingly negative, Localis says that this is ‘exacerbated by public ignorance as to which companies are delivering local services for their community on behalf of councils.’
The Norse model has been highly successful in addressing this issue by ‘co-branding’ the services delivery to stress the fully-integrated partnership with the local authority.
Another recent report, by leading business and financial adviser Grant Thornton, which looks at latest trends in LATCs, confirms that Norse Group is now the largest such organisation in the country. According to Grant Thornton’s research there are 743 trading companies in England, Scotland and Wales, and the report points out that the Norse Group remains the clear market leader amongst all local authority trading companies, with a turnover in excess of £300m.