Agenda item

Invitees:

-        Rhys Cornwall – Strategic Director – Transformation and Corporate Centre, Newport City Council

-        Tracy McKim – Head of People, Policy and Transformation

-        Lyndon Watkins – Managing Director for Newport Norse

-        Mark McSweeney – Director – Professional and Contract Services, Newport Norse

-        Sarah Davies – Head of Asset Management and Valuation, Newport Norse

The Managing Director for Newport Norse gave an overview of the report.

The following was discussed:

• The Committee enquired about the number of full-time employees employed from Newport versus the Cardiff Capital Region and whether these had been double counted. The Director – Professional and Contract Services, Newport Norse informed the Committee that they have 147 employees from Newport and 199 from the Cardiff Capital Region. The Committee requested clarification of these figures.
• The Committee noted the impressive increase of turnover in the last year and queried how it affects large projects like Bassaleg School. The Managing Director for Newport Norse informed the Committee that only professional services are provided for Bassaleg School, which helped the turnover, but it is not the main driver for turnover. The Managing Director also noted that they have had projects where they have acted as the main contractor, which produced larger turnover.
• The Committee noted that the rebate received by Newport City Council (NCC) was around £700,000 and asked how it compared to the rebate received by Norse. The Managing Director explained that under the old model, Norse Group received the first £156,000 and the residual was split 50:50. Under the contract extension, NCC now receives the first £156,000, and Norse Group and NCC split the residual 50:50, which is approximately £800,000.
• The Committee highlighted that the breakdown of diversity and equality data previously requested was not included in the report. The Managing Director apologized and assured the Committee that this data can be included in the report going forward. The Managing Director also informed the Committee that their current workforce is around 300-320 and is predominantly female. They also noted that over the last year, most new hires had been female, however the company was not as diverse with regards to  other characteristics.
• The Committee requested to see data on the gender pay gap as it was discussed in the previous Committee last year. The Managing Director informed the Committee that this information was captured approximately 2-3 years ago; however, they were unsure what data was included due to there being two different companies within the group at that time. The Managing Director agreed to check this information and provide to the Committee.
• The Committee highlighted the positive aspect that staff were getting paid the Real Living Wage as specified by the Living Wage Foundation. The Managing Director informed the Committee that it was a condition of the original contract set out with Newport City Council and noted that if the pay was benchmarked, it would be higher than similar Local Authorities.
• The Committee asked how feedback is captured. The Managing Director informed the Committee that this was done in two ways. Firstly, when operational staff undertake work, they have a feedback mechanism on their handheld devices that capture client feedback immediately, followed up with a survey. There is also an annual survey that takes place within schools and other Council premises. The Managing Director assured the Committee that all complaints are investigated by a member of staff who is independent from the operation, and an action plan is put in place if required..
• The Committee were pleased to hear that paper-based feedback forms were also provided as it reached residents who were not online but still use Norse services. The Managing Director informed the Committee that reward and recognition ceremonies were held quarterly, and colleagues were presented with certificates and a voucher for good feedback. They also noted that they try to match up with visits from the Chief Operating Officer, which helped keep morale high and encouraged staff to do good work.
• The Committee asked whether apprenticeships were done through the Job Centre. The Managing Director informed the Committee that regular sessions were carried out with the Job Centre and schools to get the very best people. They also highlighted a scheme where Norse staff attended pupil forums in schools and targeted students currently struggling with their GCSEs to carry out work experience 1-2 days a week, with a view to providing an apprenticeship at the end. This scheme had proved to be very successful.  
• The Committee asked what apprenticeships are available. The Director for Professional and Contract Services informed the Committee that they offer apprenticeships in Electrical and Mechanical teams and currently have 4 apprenticeships running. The Managing Director also highlighted that they have an office apprentice and recruit using different schemes, not just relying on the apprenticeship scheme. They noted that one of the limitations on the scheme is placing the apprentice with someone who has the time to tutor them.
• The Committee noted that in the report, turnover is approximately £25 million and asked how much inflation had impacted that turnover. The Managing Director explained that inflation in construction was around 10%, which has had a significant impact. They also mentioned that there had been a fluctuation in inflation and demand for building materials. The Managing Director noted that while inflation was a factor, the majority of the turnover is from actual work as the demand from schools had increased.
• The Committee asked how many full-time and part-time staff are currently in post. The Managing Director explained that they currently have around 320 staff, with around 150 of those being part-time. The Committee also asked whether staff have had pay increases in line with inflation, and the Director for Professional and Contract Services explained that employees get a pay rise agreed and backdated the same as Council employees.
• The Committee stated that Newport City Council used to manage their own assets and the assets of other Local Authorities before it was tendered out to Newport Norse. The Managing Director stated that the partnership with Newport City Council had been a Joint Venture since 2014. They manage the assets on behalf of Newport City Council and provide services to other Local Authorities where a profit is made, which comes back into the Joint Venture. The Managing Director explained that if you look at £1.5 million profit on a £25 million turnover, it is about 6%, with 3% going back to Newport City Council, which is lower than any normal commercial arrangement.
• The Committee enquired how Newport Norse's environmental practices align with Newport City Council's ambitions and environmental practices as they could not find any net-zero policies in the report. The Director of Professional and Contract Services explained that they were audited on their environmental standard and were ISO accredited. They highlighted that most of the subcontractors they employ were small businesses in the locality. The Managing Director also noted that they were gradually changing their fleet of vans as leases came to an end, but there was currently up to an 18-month waiting period for electric vans. They noted that regular Joint Venture meetings take place with Norse colleagues, and climate change is on the agenda, with Norse colleagues involved in Newport City Council's climate change workstreams.

• The Committee asked whether any schools or Council buildings had been impacted by Reinforced Autoclaved Aerated Concrete (RAAC). The Director of Professional and Contract Services informed the Committee that their local building surveying team were able to survey the entire school estate and react quickly. Only one school was found to have RAAC which was outside of the parameters set by the Welsh Government and the school reopened last week. The Managing Director assured the Committee that risk was low level as RAAC is normally found in roof structures, however it wasn’t on this occasion and was supported by steel supports. The Managing Director emphasised that a lot more work was being undertaken to future-proof schools.

• The Committee asked whether liaisons have taken place with school governors. The Director of Professional and Contract Services informed the Committee that an annual Governors’ presentation took place last month. Regular meetings also took place with headteachers, however, due to action short of strike, these had been suspended recently. The Committee queried whether these presentations have been given to governing bodies rather than individual schools govenors. The Director explained that they did not typically attend individual school governors’ meetings, but would be happy to do so if invited.
• The Committee asked for examples of the £5000 gifts in kind noted in the report. The Managing Director explained that the Group had a scheme where if their staff are involved in community organisations, there are sponsorships given out at times. The Director of Professional and Contract Services explained that the £5000 in the report is related specifically to the Bassaleg School construction contract. The Managing Director also stated that donations are made to St David's Hospice, and they support staff taking part in an annual bike ride along with other sponsorship events.
• The Committee noted that the report mentioned the number of volunteering hours provided to support local community projects and asked whether this is based on the employee's rate of pay. The Managing Director explained that there are a number of projects they have done, and there is sometimes a gap between the aspirations of the end-user and what the funds will allow, so they have allowed staff volunteer hours. The Committee noted that it would be useful to see examples of the volunteer work undertaken as last year the importance of community work was mentioned, but the information provided was vague.
• The Committee asked how many people have been employed from the locality to carry out the St Andrew’s School and Transporter Bridge projects. The Director of Professional and Contract Services advised that the KPIs on that will be included in next year’s report as they ongoing projects. The Head of People, Policy and Transformation informed Committee that Norse have regularly attended Cabinet Meetings. 

The Committee thanked the officers for attending.

Conclusions

• The Committee noted that diversity and equality data that was requested during the previous committee meeting is currently missing from the report. The Committee requested to receive additional equality data, including information on age, ethnicity and workforce composition within the organisation.

• The Committee was pleased to learn that the partnership offers paper-based feedback options for service users, recognising that some individuals prefer this method over online feedback or are unable to use online resources. Members also appreciated Norse's provision of award and recognition events for staff, which contribute to maintaining high morale.

• Members sought clarification regarding the National TOM's Wales reference NTW1 - the number of direct employees (FTE) hired or retained within the NCC Boundary. While it was stated that 80% of employees were Newport residents, Members discussed that the figure would actually be less than half (147 out of 346), approximately 43%. Members also requested an updated print version reflecting the correct amount.

• Members noted that the report's information on community work was vague. They requested specific examples of community work undertaken and instances where staff have engaged in volunteer work.