HORSE MEAT in school meals, pork in prisoners' halal pies and a damning verdict on hospital catering have meant a troubled start to 2013 for catering companies.
It might be a silly superstition, but 2013 is not turning out well for companies involved in public-sector procurement. First, there was the discovery of pork DNA in halal pastries served to prisons. And it wasn’t long before the catering sector was mixed up in the horse meat scandal, with equine DNA found in beef mince served in some school canteens. This, perhaps, prompted the head of Iceland to criticise the “invisible” catering industry for driving down the price of food, which some believe created the temptation to replace beef with horse.
But it didn’t end there.
There was also a stark assessment of the £54m of taxpayers’ money spent on “failed” voluntary initiatives to improve hospital food. Simultaneously, the Academy of Medical Royal Colleges announced support for mandatory food standards in all UK hospitals, as exist in schools. But schools didn’t escape either, with only one in 10 children fed sustainable fish, according to a report by the campaign group Sustain.
In Scotland, ministers are looking to revamp their school meals policy given that price receives “three times greater weighting” than quality. Public procurement has, it seems, become a race to the bottom price.
But have sustainability, provenance, transparency and quality been lost? Could kids have been spared horse pie if central government better policed its mandatory standards? Or in a time of austerity is it impossible to match sustainable ambitions with commercial reality?
In opposition, the Conservatives brought together a taskforce led by Zac Goldsmith, the environmental campaigner turned MP, to investigate how to improve the quality and sustainability of food in the public sector. They recommended that all main meals should contain fruit or vegetables and that fresh produce should be used rather than processed goods. A “Code for Sustainable Food in Public Procurement” would be introduced to “‘nudge” consumers towards better choices. It would also reduce dependence on the “vulnerable” international supply chain.
But things didn’t quite turn out as campaigners expected. In 2011, a watered- down version of the code was announced. The Government Buying Standards (GBS) would require a third of public-sector institutions – including government departments, prisons and parts of the armed forces – to buy food which meets nutritional, environmental and ethical standards. Schools and hospitals would be encouraged to follow the standards.
Two years on, little information is publicly available on the GBS (apart from hidden away in the appendices of documents on the DEFRA website). If this scheme were working, would it not be high profile?
“It’s a fragmented system,” says Sustain’s Alex Jackson, “whereby public-sector organisations are buying wildly different food, to wildly different standards and at wildly different prices” – between 86p and £7.44 per meal, according to NHS figures last year. “And the caterers will tell you that also doesn’t allow them to create the economies of scale.”
In the 2010 taskforce report, Compass said: “Change will require clear mandatory standards, and this will ultimately bring price down through economies of scale. While the approach to procurement remains voluntary, change will not be made.”
DEFRA says it will be publishing more GBS results this year. However, support is building for a wider analysis of food procurement. Goldsmith has said the door has been opened for a debate, claiming that sustainable public food procurement would be “an obviously beneficial policy” for the government to pursue.
Others say price is the sticking point. There is a £2bn budget at stake and the government is keen to get “value for money” – a concept some procurement managers may have misunderstood. “Value for money is not just about price,” says Ashley Clarkson, an associate director in Grant Thornton’s food team.
However, price seems to be the dominant factor in many contract tenders. David Cox, the general director at catering supplier Supply Direct, says that tenders are “50-70%” based on price. “Sometimes the emphasis does sit more on price than it should,” he adds.
The weighting of public procurement contracts for schools was brought up in a Scottish parliamentary debate this month. The Labour MSP Claire Baker said: “The Scotland Excel contract for school catering [which covers most councils] is awarding a weighting of 65% to price compared with 20% to quality. That is not a balance.”
This imbalance prompted Iceland’s boss, Malcolm Walker, to suggest that “if we’re going to blame somebody let’s start with local authorities. Schools, hospitals, it’s a massive business for cheap food and local authorities award contracts based purely on one thing – price.”
It’s not the first time retailers have tried to turn the spotlight on caterers and the public sector – and let’s not forget that the proportion of family income accounted for by food shopping has declined from about 50% to 10% since the arrival of the supermarket. But budgets are an issue. With 10 and 11 Downing Street in agreement that cuts are necessary, finding the balance is the almost impossible task facing those in public procurement. As Anne Bull, the chair of the Local Authority Caterers Association, points out: “Buying food isn’t like buying pens – there are price fluctuations to deal with.” Potatoes provide an example: harvests have been wrecked by the weather and prices have rocketed; this can put pressure on a chain already working on wafer-thin margins.
But does good food have to come at a price? The Hospital Caterers Association supports a proposal by Sustain – and backed by Albert Roux and Loyd Grossman – for legally binding minimum food standards for hospitals, but says it is shackled by dwindling budgets. “Those hospital caterers having to conform to £2.50 per patient per day will not be able to meet the standards in the same way as those who have, for example, £6.50 per day for patient food,” says a spokeswoman.
According to the Soil Association, its Food for Life Catering Mark proves that good standards can be put in place cost effectively. In Richmond the price of school meals has been cut by 18p a day while meeting the “silver” standard for sourcing and promotion of healthy foods. At this level at least 5% of the food has to be organic. Gerry Clinton, the catering manager at Havering Borough Council, has achieved the gold grade. He admits that he sometimes pays a few more pence for organic and local food, but as the popularity of what he offers grows, economies of scale will kick in. He says there’s “no pressure” to do what he’s doing from central government but, who knows, there soon could be.