Contrary to what many believe, food procurers are not obliged to favour the cheapest bidder
Over 1 billion meals are served in institutions and government departments in England and Wales each year, at a cost of around £2 billion. It is easy to malign caterers for the quality of those meals, but easier still to forget that feeding people in institutions is a complex logistical exercise in which those responsible have to cater for large numbers of people within strict budgetary controls. Meals must be served at pre-determined times and maintained at certain temperatures for extended periods, all the while meeting health and safety standards. The more criteria that must be met, the greater the risk of failing to meet them. Now caterers are expected to embrace another dimension on the criteria spectrum: sustainable procurement.
The Government says that the procurement of local, sustainably produced food is now a priority and in 2003 launched the Public Sector Food Procurement Initiative (PSFPI), to help deliver 'a world-class sustainable farming and food sector that contributes to a better environment and healthier and prosperous communities'. To achieve this aim, Defra provides, on its website, guidance documents for everyone involved in the food supply chain, from farm to fork. The government also launched, in March 2006, the National Opportunities Portal to bring forthcoming public sector tenders and supply opportunities to the attention of local suppliers.
So far, so supportive. Yet despite these worthy initiatives, government priorities are belied by other, more pressing commitments. According to the July 2008 Cabinet Office document 'Food Matters: towards a strategy for the 21st century', 'The four key concerns of food policy should be open and competitive markets, food safety, public health and the environment'. The ordering of those key concerns suggest that the free trade market has clear primacy, with the environment tagging along as an afterthought.
Perhaps that's why the PSFPI hasn't really made much of an impact. In October 2008 Defra commissioned financial consultancy firm Deloitte to carry out an independent evaluation of the PSFPI. Deloitte found that although there was increased awareness of the PSFPI initiative, it was not embedded across the public sector and take-up was limited to isolated cases of independent efforts on the part of enthusiastic individuals to achieve its objectives.
The main problem is that buying local, sustainable food for the public sector is assumed to be either too costly or a contravention of EU regulations governing free trade. Both of those assumptions are false. With a more cost-effective model, and a little creativity, both real and perceived barriers can be overcome and procurement of local and sustainable food a realistic outcome - as evidenced by the examples below.
First barrier: EU trade regulations
The government and its agencies produce a raft of guidance documents expressing its determination to promote local, sustainable food and then solemnly reminds everyone that the EU Treaty of Rome protects the free movement of goods and services and prevents public bodies from discriminating in favour of domestic producers.
Contrary to what many believe, food procurers are not obliged to favour the cheapest bidder
First solution: creative interpretations
In 2004 the European Parliament endorsed two new directives on public procurement that were enshrined in law in early 2006. These introduced a revolutionary change in the European regulatory context of public procurement by stating that, 'Contracting authorities may lay down special conditions relating to the performance of a contract... The conditions governing the performance of a contract may, in particular, concern social and environmental considerations.'
What these changes mean, according to Professor Kevin Morgan and Dr Roberta Sonnino at Cardiff University, who have written extensively on sustainable food procurement, is that public sector institutions, including schools and hospitals, have been given the opportunity to be 'creative' when it comes to interpreting the EU Treaty of Rome. Under EU regulations, and contrary to what many in the UK believe, food procurers are not obliged to favour the cheapest bidder. Instead, they can choose environmentally-friendly, sustainably produced foods.
In a report published in 2007, Morgan and Sonnino demonstrate how Italy had developed a 'creative' approach even before the new directives were introduced. In 1999 the Italian government introduced a law that guaranteed the promotion of regionally sourced, organic food in public institutions, including schools. The year before, the Italian Ministry of Agriculture introduced a school education programme called 'Cultura che Nutre' (culture which feeds). Knowledge of healthy, local food production methods is considered integral to a child's education, so what is taught in the classroom is provided by the school kitchen, as part of that education. This prioritisation of values allows schools to discriminate in favour of local operators, in order to educate children on the provenance, production and cultural meaning of locally produced food and dishes. According to research carried out by the UK School Food Trust, set up to manage the recently introduced nutritional standards in this country, almost 60 per cent of Italian local authorities buy organic food. In 2003 the Soil Association reported that there were over 300 examples of organic school meals schemes in Italy.
In the UK, it's as if these portals of opportunity had never been put in place, let alone opened. No mention of Italy's example is made, or indeed ever alluded to, by any government document. Why is that? According to Professor Morgan, it comes down to values. 'In short, the different national responses to nominally uniform EU regulations are due to the interplay of cultural values and political will in each member state. Where countries set a high premium on quality food, as in Italy, all the forces of culture and politics are mobilised to protect and promote local and seasonal products'.
Case study: Rome
In 2000 an initiative was launched to improve school meals across the city of Rome. As a result, about 92 per cent of the food served is now organic and seasonal, and cooked from scratch. A typical day's food in school in Rome consists of:
Mid-morning snack: organic bread roll (with olives/grapes/nuts/sesame or Fairtrade banana
Lunch: traditional organic lentil soup and pasta followed by:
Dessert: Seasonal organic fruit.
Source: Soil Association
Second barrier: contracts
Small farmers and growers can be put off attempting to find a way into the public sector because of the tendering process that can be a protracted, laborious affair. Contracts tend to be held by a very small number of large suppliers using a centralised distribution system with little or no regard for sustainable farming practices. Buyers often just prefer to deal with one food service company making deliveries in single drop-offs.
Second solution: cooperatives and aggregation of demand
Both food buyers and producers have much more aggregated negotiating power than they realise. One way for local producers to increase their bidding power is by forming a cooperative and submitting a collective bid. Buyers can also come together to increase their bargaining power. The National Audit Office (NAO) claims that opportunities to come together to aggregate purchasing, and thereby obtain basic products at better prices, are routinely missed. In 2006 it published 'Smarter Food Procurement in the Public Sector' in which it highlighted variations in the price paid for the same item - for example, a wholemeal loaf of bread ranged from 32p to £1.10 and a pint of milk from 17p to 44p.
Case study: Essex School Meals Supply Project
In 2004, four primary schools in Braintree decided to pool their skills and knowledge of food procurement in order to take control of their catering arrangements.
With the help of the East Anglia Food Link (a co-operative which promotes a more sustainable and localised food system) The schools identified local meat producers who were able to tailor their products to meet the requirements of the schools, for example by producing pure beef sausages which fit the baguettes provided by the schools. Such an arrangement could only be possible using small producers.
Third barrier: poorly equipped kitchens
Local food growers and producers have little chance of selling their goods if buyers are unable to purchase raw ingredients because they only have the facilities to heat up ready-meals or assemble highly processed ingredients. We might like to think of public sector kitchens as places bustling with cooks in their whites, washing and chopping vegetables and tossing them into industrial sized pots. That was once; today, most public sector kitchens do not have the facilities or the staff to deal with raw ingredients, or the storage facilities to keep them fresh.
Third solution: in-house catering with on-site kitchens
Institutions and other public sector organisations can usually choose to outsource the catering contract to a private organisation or take control of the catering themselves. In some areas, especially schools and prisons, there is a small but growing trend towards bringing the catering service back in-house.
The problem with outsourcing the catering contract is that the institution in question is unaware of routine, volume-based discounts and rebates that the caterers may be receiving but not passing on. The National Audit Office estimates that the largest UK catering firms may be earning up to £95 million in discounts and rebates from suppliers, which is not passed on to their public sector clients.
In the long term it is cheaper to buy in raw ingredients and pay someone to cook them than leave the whole service to an outside organisation. There are other benefits. An Ofsted report, published in 2007, found that food which was cooked on the school site tended to be 'well presented and appetising'. Food prepared off-site 'tended to look unattractive and, in several cases, was cold by the time the pupils ate it.' What's more, local authorities who provide an in-house service have been found to be more likely to produce menus mostly or fully aligned with regional seasonal production.
|Case study: St Andrews Healthcare Northampton
St Andrews aims to be a national leader in providing sustainable food for service users and staff. It started by reducing the number of suppliers by a third and deliveries by a quarter, saving, they estimated, 96,000 food miles. They now have 11 on -site production kitchens and a central food store that allows bulk purchase of local and organic food.
Fourth barrier: Poor staff skills
Efficient and effective food procurement in the public sector calls for appropriate skill and training, but, according to Professor Kevin Morgan, 'sustainable public procurement is further compromised by a lack of skills, which means that procurement managers have neither the competence nor the confidence to play a catalytic role in greening the realm.' This is indeed the finding of a number of reports, including those produced by Deloitte and the NAO which found that few caterers used consultants to help them reduce costs and staff lacked basic skills, such as checking stock and deliveries, food storage and book keeping.
Fourth solution: Provide procurers with the skills they need
Although the PSPFI produces written guides there is little evidence that they are either used, or useful. On-line toolkits are cheap to produce but cannot replace real, hands-on training. Mindful of this obstacle to sustainable procurement, the Soil Association offers training to public sector buyers to explain the processes for sourcing local, seasonal and organic food and to help to identify the producers/suppliers to buy it from. The Soil Association also runs a Food for Life programme, which operates an accreditation scheme, or Catering Mark, which offers a step-by-step route to sustainable catering for both the public and private sectors. There are three standards: bronze, silver and gold. To attain gold status, the caterer's menu must be 75 per cent freshly prepared, 50 per cent local and 30 per cent organic.
|Case study: St Aidan's school, Harrogate
Unhappy with the quality of the food provided by their contractors, St Aidan's took the service in-house and appointed an experienced chef/catering manager who had previously worked in the restaurant trade. The new manager instigated rigorous checks on deliveries and replaced all but one supplier with many locally based suppliers. The school invested in staff training in many aspects of catering, from using fresh ingredients to better storage techniques. As a result, the school estimates that they have achieved ten per cent cost reductions and increased ingredient quality.
All together now
The benefits of promoting local economies are well known. Supporting local food producers enhances rural development and regenerate communities. According to the New Economics Foundation, local authorities could increase the amount of money circulating in their area by almost 400 per cent by issuing contracts to local suppliers. By stimulating interest in the provenance of food, individual health and wellbeing is enhanced. Fresh, local, raw ingredients require little packaging and seasonal products are usually cheaper.
The problem, for the shortsighted, is that many of these benefits are not immediately obvious. The urgent need to re-localise the food supply chain is severely hindered by the current absence of a formal, comprehensive food policy. Instead, isolated success cases are entirely due to the will and enthusiasm of individuals. Italy has shown that there is a legal, workable model that can challenge industrial farming methods and global food transport systems. The EU directives are a gift, but without the skills and know-how to do things better procurers will keep on doing what they've always done, getting the same results.
How to be a successful public sector food procurer or provider of quality, fresh local and sustainable produce without breaking the bank or the law.
1. Become efficient. Employ consultants and join the Soil Association's Food for Life programme.
2. Get together with other public sector food buyers in your area to strengthen your negotiating power. The Soil Association can help you do this. If you are a food supplier, form or join a cooperative.
3. Develop a creative approach to EU trade regulations, which are nowhere near as prohibitive as they appear. Read more about how Italy manages to do this in The School Food Revolution by Kevin Morgan and Roberta Sonnino.
4. Get back to basics, and take the catering service back in-house.
Maria Cross is co-author of Nutrition in Institutions (Wiley-Blackwell, 2009)