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What matters is what works - this is Tony Blair's famous approach to public services and it certainly seems to be working for a number of organisations in this year's Growth 100, Insider's unique guide to the fastest growing companies in the Midlands.

Three of our top 15 businesses in 2006 have prospered as a result of the government's policy of opening up public services to the private and voluntary sectors. And a fourth has won its place partly because of another government policy - ensuring academia plays its role in boosting business competitiveness.

MHA Care, GSL UK and Framework Housing Association are the three that are delivering public services. The Technology Innovation Centre (TIC), part of the University of Central England, combines the traditional activities of teaching and research with a strong focus on business needs. Only GSL is from the private sector. The others are either public bodies or organisations that don't pay shareholders.

But first a word about those that might have been. Top of our original draft Growth 100 was the National College for School Leadership, the Nottingham-based institute that provides training for training for head teachers and research. Its turnover has soared to £3117m but as it's a government organisation that relies to a large extent on funding from the Department for Education and Skills we took it out of our final list.

Also vying for a place was Paragon Healthcare, the specialist provider of residential care based in Lichfield. Majority owned by Duke Street Capital, it neatly illustrates the appetite among venture capitalists for the growing care sector but it hasn't quite made five years of turnover yet (see Growth 100 user guide right). Look out for it in next year's Growth 100.

Top of the list proper is another care specialist, Derby-based MHA Care, whose first care home was built in 1944 in Wallington. Today MHA provides care homes, housing and support services for more than 6,500 elderly people throughout the country.

The profits it makes would please the private sector, but MHA is a charitable organisation of Methodist background. Its success shows not only the growth of the care market that has been opened up but also that charities and the voluntary sector can compete successfully with the private sector. It is one of the top 12 care home providers in the UK and the third-largest not-for-profit group, with as much as 86.5 per cent of its income from revenue and only 13.5 per cent from charitable donations.

MHA can also match the private sector in taking out loans to fund activities and in ensuring top-class management. "As a charity, MHA does not have to generate funds for shareholders so more of the fee is devoted to good quality care," says chief executive Roger Davies. "And we have strengthened our management team, with recruits from the commercial and housing sectors, to ensure our standard of service is maintained and developed as we grow."

Nicole Joynson, senior solicitor in the corporate care sector team at Nottingham law firm Freeth Cartwright, says she has never seen greater demand for elderly care and specialist care homes. An ageing population is one driver of this growth, another is the high level of regulation, which is pushing many of the less compliant operators out of the market.

And where demand is high, fees are attractive. "Local authorities and care home associations are showing a growing trend to grading homes, the best rates being paid for beds in modern, purpose-built fully compliant homes and rates decreasing as one moves towards converted homes with less than 80 per cent single rooms and few or no en suite facilities," says Joynson.

"The reduction in beds and the delays associated with new development have meant an increase in fees as demand exceeds supply."

Joynson expects that demand in the specialist and elderly sector will continue, particularly as the government continues to decrease long-term provision in the NHS. Davies says the need for more services and more choice in housing and care for older people will underpin continued growth for MHA.

MHA and another non-profit taking organisation high in the Growth 100 - Framework Housing Association, which provides hostels and support services for Nottinghamshire's homeless - enjoy some certainty by providing public services. But their customers drive a hard bargain, as the taxpayer would expect.

Local authorities pay MHA on a case-by-case basis but seek to use their purchasing power to keep fees low. And with the continued ageing of the population, government funding may have to be prioritised. Davies recognises local authorities' need to minimise expenditure but says: "We do not feel it right for MHA to subsidise the state nor for self-funding individuals to do so.
MHA and most of the care home sector look for families to top up the shortfall in fee but accept that some are unable to contribute."

He says the system must change as it is a major source of stress for older people and their relatives, distorts assessment of care needs by social services and inhibits residents' choice. "However, what remains clear is that the demographic trends mean that the state will increasingly be able to pay only for those with the highest dependency levels, principally those needing nursing and dementia care."

TIC comes from another part of the public sector. But despite the government's commitment to higher education, here too the public coffers are not bottomless. TIC managers are aware that the European Union's structural funds that have paid for some of its courses are coming to an end. And the advent of top-up tuition fees is a clear sign that the government wants to spread the cost of its commitment.

Nevertheless, in the five years since it set up in Birmingham's Millennium Point TIC has established itself as one of the country's leading technology faculties. It offers the teaching and research expected of all higher education institutions, with over 50 technology categories and more than 30 degrees, but its accent on assisting businesses chimes with government policy. "We developed at the right time when there was more demand for this approach," says Professor Ian Oakes, TIC's commercial director. "The traditional model has focused on research and teaching but we have tried to deviate from that."

Oakes says TIC's expertise is not blue-sky research but technological knowledge that can be applied to markets, whether for small or large companies. It's an approach that also fits with regional economic strategies that attempt to steer a course away from mature industries into new ones such as ICT and creative industries.

TIC is leading a programme funded by regional development agency Advantage West Midlands that assists companies looking to move into the growing flood defence market - an obvious opportunity for the region's engineering companies. As the lead university partner in EnviroInnovate, a programme helping the region's SMEs in environmental goods and services, TIC has performed technical and market appraisal of biodiesel.

It also manages Market Maker, a £34.5m scheme funded by the European Regional Development Fund and the Learning and Skills Council aiming to stimulate growth in the West Midlands' creative and screen-based digital media industries. Links with larger companies and overseas institutions are also important for TIC. It is one of the leading training academies in Europe, the Middle East and Africa for Cisco Systems - feeding that expertise into its generic IT courses as well - and has similar though smaller relationships with Microsoft and Sun.

Like many UK academic institutions TIC is playing its part in China's economic development.
Each year it accepts 60 degree students from Nanjing University of Science and Technology to study networking.

TIC has a team of recruits from the private sector to help guide businesses to the services they need. "Industry has found it hard to access academia," says Oakes. "Our team provides a day-to-day interface and speaks the right language. The interface is working effectively."

It needs to work effectively because as EU funds come to an end TIC is seeking to persuade businesses to take on some of its costs. "We are slowly encouraging companies to pay more for our services," says Oakes. "We won't do it overnight but companies are seeing the value of our technology. We aren't short of companies who approach us for help."

As expected, student numbers went up last year as students sought to get on to courses before top-up fees came in. Encouragingly for TIC, numbers are even higher this year, even as the national figure has fallen.

Controversy over top-up fees may have abated but will not disappear entirely, with predictions from some that fees could reach £35,000 a year by 2010. Meanwhile, controversy over the value of the private finance initiative - an important part of GSL UK's business - is rising.

The National Audit Office has questioned the value for money of PFI and companies such as Jarvis have nearly been brought to their knees by their PFI projects. Health secretary Patricia Hewitt's policies of payment by results and moving services into the community have led some to question whether large-scale health PFIs such as Birmingham's new hospital will ever get off the ground. But the success of GSL - which began in the mid-1990s as a standalone Group 4 subsidiary before being bought by private equity firms Englefield Capital and Electra Partners Europe in 2004 - is in part based on its PFI expertise.

GSL has brought that expertise to bear in a variety of PFI schemes, from schools in Wiltshire to the Nuffield Orthopaedic Clinic in Oxford to Altcourse Prison in Liverpool, and has exported it to Australia and South Africa. John Bates, GSL's director of communications, says it is not for the company to make the case for PFI and points out that there are other forms of public procurement available. But with politicians keen to ensure the provision of public services, "PFI and public-private partnerships are ways of achieving long-term goals".

Nor is GSL unduly threatened by the doubt surrounding healthcare PFIs. As Bates points out, GSL's expertise in this field is in smaller PFIs, run through the Local Improvement Finance Trust, such as in Wolverhampton. These usually involve the provision of community health services, which are exactly the priorities Hewitt is seeking to pursue.

But PFI and PPP projects are only one aspect of GSL's business. It manages prisons and courts and provides innovative police support services such as in Cheshire, where its staff take over from police at the point of arrest. It runs the government's Charter Mark awards for public service, inspects guest houses for tourist organisation Visit Britain and has bought the rest of Accuread, which reads gas and electricity meters.