John Montague exchanged life at a billion-pound turnover contractor for a career in charitably funded ‘social enterprise’.
What exactly is Newlife?
In a sense we’re just a traditional building contractor, concentrating on refurbishment with some new build.
The difference is we’re wholly owned by an industrial and provident society that has charitable status. We gift aid our profit to them, and they distribute it. But some of that money then comes back to us to spend on training. We use construction as a means of training and investing in people.
So why did you switch from a major contractor to a social enterprise start-up?
I was tired of not paying subcontractors on time. People had been forgotten and it was all about numbers. We talked a lot about training, but we didn’t employ anyone to do the training. Then I happened to meet the chair of the Leicester Housing Association, which had already set up a social enterprise gas-servicing company, Thorpete. We thought we could do something similar in construction.
How does Newlife do that?
We have a direct workforce of more than 100, of which 25 are trainees, and 20 are ex-trainees who qualified with us. Some of the lads and lasses who come to us aren’t even on the first rung of the ladder. Some are on probation, or have been excluded from school – I’d say that 30% have a “difficult” background. One lad had done some painting and decorating at college, but was working as a taxi driver. With us he got an NVQ level 3 and an HND, and he’s just picked up a £31,000 job as a finishings foreman.
What are the differences between working for a mainstream major contractor, and running Newlife?
I became the boss and I could make a difference, but, in a sense, a cushion was taken away. There was no company car department, no accounts department. Suddenly the bank account was my responsibility and there’s no £1bn firm behind you. At Mowlem, the day-to-day paying of bills wasn’t part of my life, but here I think: “Where are we going to get the wages this week?”
How does the salary compare?
My salary is fine. We don’t operate a bonus system, but we get company cars and health insurance. Just because we’re a social enterprise doesn’t mean we don’t pay people well. In fact, because we’re a social enterprise, if anything we have to be more professional. We price jobs at the market rate – the difference is what happens to the profit margin.
But there must be differences compared with operating in the commercial sector.
But we are commercial – I don’t make that distinction. Social enterprise isn’t woolly jumpers – it’s important to me to get that across. It’s about how we decide to invest in our people. We have shareholders, but they demand social justice, not cash.
How do you see your future? Would you ever return to a mainstream contractor?
I feel totally shattered and I’ve never worked so hard in all my life. But I couldn’t see myself doing anything else any more. The real kick is not making £1m turnover, but seeing someone two years on from when they joined and seeing them change their lives and thinking: “I helped do that.” I wouldn’t go back. There’s a bit of ego in that, but it’s also enjoyable to see people develop and to be part of that. But maybe in 10 years’ time I’ll fall off my New Labour soap box!
Job Founder of Newlife. This is a Leicester-based, £6m turnover “social enterprise” contractor set up by Leicester Housing Association that reinvests its profits in training local people
Employment history After graduating in 1982, he spent seven years working for French Kier in London and the Midlands. He worked for Mowlem until 1999, latterly as construction manager for the Wolverhampton office
Lives Ironbridge, Shropshire. Married with two children, eight and six
Qualifications BSc in building engineering, Liverpool University