item13 schools meals by RIM6jr


									                                                  Report for:

                                                  Item Number: 13

Contains Confidential       NO
or Exempt Information

Title                       Tender for the school meal services
Responsible Officer(s)      Gary Redhead, Assistant Director Schools- Planning &
                            Resources, 020 8825 5773. Email at
Author(s)                   David Shailes, Schools Service & Student Support Manager
                            020 8825 9381 Email at
Portfolio(s)                Councillor Patricia Walker Cabinet Member for Children and
                            Young People
For Consideration By        Schools Forum
Date to be Considered       17th November 2011
Implementation Date if      Not applicable
Not Called In
Affected Wards              All
Keywords/Index              School Catering, Meals, Re-tendering

Purpose of Report:
To obtain a view from the schools forum on the proposed tendering of the school meals
service for a new contract starting in August 2013

1. Recommendations
   1.1   It is recommended that Schools Forum supports the proposed tender of
         the school meals service

2. Reason for Decision and Options Considered
   2.1     The existing contract is due to expire on 31st July 2013

    2.2        The management committee of the Ealing School Catering Consortium
               (ESCC) has on behalf of its members obtained the Council’s agreement
               to manage the tendering process and the subsequent contract
               management of the new contract. The Council has agreed to this
               provided that the ESCC member schools bear any costs that may arise

3. Key Implications
   3.1     Responsibility for the provision of a mid-day meal service has been
           delegated to all schools and their governing bodies. The provision of a
           meal service is a legal requirement under the Education Act 1996.
           Consequently, schools are able to make their own arrangements
           regarding the provision of a mid-day meal service

   3.2         The ESCC was formed in 2003 and currently has 59 member schools
               consisting of primary and special schools, which have all signed
               agreements to receive their school meals service under the contract the
      Council holds with Harrison Catering Services Ltd. It has a management
      committee of 10 school representatives that meet as a minimum once a
      term. This committee’s role is to give strategic direction and support to
      the contract manager who is employed by the Council.

3.3   The ESCC cannot at this stage guarantee the numbers of schools that
      will commit to the new contract, but the contract manager will visit
      member schools in the spring term of 2012 to establish the potential
      level of commitment prior to going out to tender. In addition he will visit
      the primary schools that have alternative arrangements to establish if
      they are interested in joining the ESCC arrangements

3.4   The continuation of a consortium of schools is regarded as desirable as
      it offers economies of scale, protects smaller schools, provides
      consistency across all member schools, offers training opportunities to
      the staff that would be difficult for an individual school to provide, assists
      with making improvements to the staff’s employment terms & conditions
      and reduces the administrative burden for member schools

3.5   Prior to tendering the service it is proposed that the Council and the
      ESCC will investigate if a greater economy of scale is available by
      completing a tender procedure with either a neighbouring Borough
      and/or a consortium of other London Boroughs. This will be conditional
      upon other authorities contracts being due to expire at a similar time and
      the other authorities having a similar philosophy with respect to school
      meal provision

3.6   The ESCC management committee has been supportive of the Council’s
      desire to see staff employed by contractors paid as a minimum the
      Mayor of London’s living wage. Whilst this is not likely to be achieved by
      the end of the current contract substantial progress has been made
      (Lowest paid role Kitchen assistant – 2011 – legal minimum hourly rate
      £6.08, current rate on the contract £7.17 and Mayor’s living wage £8.30)

3.7   Whilst the current contract was let for 5 years and will expire on 31st July
      2013, it does have the facility to be extended for a further 2 years.
      Whilst it may appear to be desirable to use this extension, it is not long
      enough to encourage a contractor to consider investing the time and
      energy in developing the service further and consequently there is the
      potential for improvements to be deferred. For a contract of this nature 5
      years is a desirable contract length so that that regular market testing
      ensures that schools continue to receive value for money. Also by not
      committing to use the extension, it remains available should unforeseen
      circumstances intervene during the tender process. No final decision has
      been taken and the ESCC management committee will be discussing
      the issue at it next management meeting on November 10th.

3.8   It is proposed that the new contract will be for 5 years duration with
      schools being required to commit for the whole period
4. Financial

  4.1      Financial impact on the budget
           4.1.1 All schools receive the funding for the provision of the school
           catering service through the fair funding formula, which is part of the
           dedicated school grant.

           4.1.2 The service is funded from contributions collected from ESCC
           member schools and money collected from parent and carers for
           payment for meals, so there is no direct financial impact on the Council

           4.1.3 The ESCC currently pays the cost of the contract management
           services provided by Children and Adults.

   4.2     Financial background
           4.2.1 The current cost of a meal to parents is £2.10 (September
                 2011) and parent/carers can pay by cash, debit & credits cards
                 over the telephone or on-line

           4.2.2 The contractor is responsible for the collection of payments from

           4.2.3 The contract’s current annual value 2010/11 is £4million and
                 supplies 1.8million meals a year

           4.2.4 Take up rates have increased since this contract started in 2008
                 and stand at 46%, which is slightly higher than the School Food
                 Trust’s 2011 national annual survey of take-up for primary schools
                 of 44%. In the three years that the current contract has been
                 running meal numbers have increased by 20%. Higher take up on
                 the contract as a whole and significant improvements at individual
                 schools with low take-up have improved the financial performance
                 of the contract

               4.2.5 Member schools contribute the funding they receive for the
                     provision of Free school meals, which is used by the ESCC to run
                     the service, which includes equipment repair and replacement
                     and limited repairs to the fabric of the kitchen to ensure
                     compliance with Food safety legislation

               4.2.6 Each member school has a trading account and those schools
                     which trade adversely are required to pay extra after the
                     deduction of a £7,000 subsidy provided from the ESCC funds.
                     Conversely, those member schools that produce a surplus,
                     receive the balance of the surplus less £10,000 retained by the
5. Legal
   5.1     The Council has a power and in certain circumstances a duty under
           s512 of the Education Act 1996 to provide meals at schools maintained
           by the Local Authority. Councils must provide facilities for the
           consumption of food brought to school by pupils.
             Under the Education (Transfer of Functions Concerning School Lunches
             etc.) (England) (No. 2) Order 1999/2164 the Secretary of State has
             imposed on the governing bodies of maintained schools with delegated
             budgets corresponding duties under S512 Education Act 1996

             Under Schedule 1 of the Contracting Out (Local Authority Education
             Functions)(England) Order 2002-the Local Authority may exercise
             functions under S 512 Education Act 1996 by entering into a contract for
             the school catering service on behalf of the schools that have delegated
             budgets and wish to enter into such arrangements.

   5.2       The contract will be let in accordance with the Public Contracts
             Regulations 2006 as applicable and the Council’s own Contract
             Procedure Rules.

   5.3       Any food provided under the contract must comply with the nutritional
             standards for food and drink supplied in maintained schools under The
             Education (Nutritional Standards and Requirements for School
             Food)(England) Regulations 2007

   5.4       The Schools Finance Regulations 2011 and the Schools Forum
             Regulations 2010 and Para 2A of Schedule 14 Schools Standards and
             Framework Act 1998 set out the functions of the Schools Forum .

             These include the requirement to respond to consultation by the local
             authority in respect of the authority’s functions relating to the schools
             budget, in connection with the arrangements for free school meals and
             to respond to consultation on the terms of any proposed contract for
             supplies or services (being a contract paid or to be paid out of the
             authority’s schools budget where the estimated value of the proposed
             contract is not less than the threshold which applies to the authority for
             that proposed contract pursuant to regulation 8 of the Public Contracts
             Regulations 2006 at least one month prior to invitations to tender).

             The Forum has the responsibility of informing the governing bodies of all
             schools maintained by the authority of the results of any consultations
             carried out by the authority relating to the issues in paragraphs 5.4

6. Value For Money
   6.1     The current contract pays a management fee to the contractor, which is
           linked to meals numbers. The more meals the contractor sells the higher
           the fee. The budget is set annually, by the contractor and the council,
           with a stop loss limit being agreed to cap the council’s liability in the
           event of the budget not being achieved and a loss being incurred.
           Should the actual performance produce a surplus this is shared between
           the contractor, their staff and the ESCC. This method of working means
           that joint decisions are made about issues that relate to the financial
           performance of the contract and we can respond quickly to changes.
           The ESCC is looking to continue with a similar arrangement for the new
    6.2       Monthly contract review meetings are held with the contractor,
              culminating in an annual review in late August.

    6.3       The contract manager is a member of a pan London group of officers
              with responsibility for school catering, who meet each term to discuss
              latest developments and to compare services. Our current meal price of
              £2.10 is in the upper quartile, with the highest price being £2.45

7. Sustainability Impact Appraisal
   7.1     The caterers have use of kitchens in ESCC member schools and
           consume energy. Whenever new equipment is purchased for use in the
           kitchens any purchasing decision will take into account energy
           consumption. The energy used is provided by the school without charge
           to the caterer, who acting responsibly by instructing their staff to use
           energy sensibly, without compromising the provision of the meal service

    7.2      The current caterer supports the two recycling initiatives that the council
             has introduced (waste cooking oil and schools cardboard and food
             recycling), and both of these would be included in the specification of the
             new contract.

    7.3      Since the last tendering in 2007, the Council and schools have through
             rebuilding schools and making improvements reduced the transporting of
             food from a production kitchen in a school from 11 to 4. This has
             reduced CO2 emissions. The local food miles reflect the city nature of
             the borough and fruit and vegetable travel from Covent Gardens, meat
             comes from Park Royal and dry and frozen food from either Basingstoke
             or Central London. The current caterer’s suppliers have minimised the
             deliveries into schools, despite our reliance on predominately fresh food:
             2 a week for fruit & vegetables and 1 to 2 for frozen food and 1 for dry

8. Risk Management
   8.1     As schools are responsible for the provision of the mid-day meal they
           may decide not to support the consortium. If significant numbers of
           schools with high meal numbers left the consortium, costs would
           increase for those remaining. A priority for the contract manager’s visits
           mentioned in Para 3.3 above will be to these schools to ensure the
           specification reflects the ESCC’s member’s future requirements

9. Community Safety
   9.1   None.

10. Links to the 5 Priorities for the Borough
   10.1      The consortium approach delivers value for money in a direct way as
             well as by improving children’s eating habits, by providing a nutritious
             meal that meets the governments guidelines for school food, which
             ultimately will reduce the future costs of the Health service

11. Equalities, Human Rights and Community Cohesion
    11.1     An initial equalities impact assessment has been carried out and a full
             Equality Impact Assessment (EIA) is not required.
12. Staffing/Workforce and Accommodation implications:
    12.1     Should there be no support for the continuation of the ESCC, then
             potentially the loss of income to Children and Adults, could put jobs at
             risk, unless an alternative source of income could be found
    12.2     It is anticipated that the TUPE regulations will apply to the current
             contractors staff on the transfer of the service

13. Property and Assets
    13.1     The contractor is given use of school kitchens, which are maintained and
             the responsibility of the schools. Funding of minor repairs is included in
             the funding provided in the Fair Funding Formula to schools. Any major
             works required will be prioritised with other works needed in the school
             and if necessary consider for inclusion in the Council’s capital program

14. Any other implications:
    14.1    None

15. Consultation
    15.1    All member schools will be visited by a Council officer to discuss their
            catering requirements and these discussions will inform the writing of the

    15.2     Pupils, school staff and governors will be involved in the tender
             process, as it is intended that for those contractors that pass the pre-
             tender qualification and are invited to tender we will visit a school(s) that
             they provide a meal service at to sample the food which will be
             evaluated by pupils, school staff and governors as part of the tender

    15.3     Members of the ESCC management committee will evaluate the final
             part of the tender process that will involve a presentation by the
             contractors that have been invited to tender and make the final
             recommendation for cabinet approval in the spring of 2013

16. Timetable for Implementation
   Date                      Action                            Measurable Outcomes
   26/09/2011                Cabinet approval                  Given go ahead
   October to December       Initial contact with other        Contact all the other 32
   2011                      London Boroughs to                London boroughs.
                             see if joint procurement          Establish how they
                             could be possible                 provide a school meals
                                                               service and whether
                                                               they are interested in
                                                               Joint procurement
   10/11/2011                   ESCC Termly Meeting            Timetable, key dates,
                                                               and topics for
                                                               discussion with school
                                                               members in the visits
                                                               mentioned below
   January to March 2012        Officer to visit 59            To confirm support for
                                schools                        ESCC to continue
   January to February          If a partner(s) London         Strategy written and
   2012                         borough is/are found     timetable, key dates
                                develop a strategy to    agreed
                                deliver joint
   February 2012                ESCC Termly meeting      To discuss the initial
                                                         results to confirm our
                                                         approach or to make
   April to June 2012     Decide if joint                Documentation
                          procurement is possible        completed
                          and Draft Specification,
                          PQQ and evaluation
                          criteria prepared
   June/July 2012         Advertise and invite           Sufficient expressions
                          expression of interest         of interest received
                          and issue PQQs
   September/October 2012 Evaluate PQQs and              Documentation issued
                          issue invitations to
   November 2012          Visits                        Visits completed
   December 2012          Evaluate tenders              Tender submissions
   January 2013                 Presentation and ESCC Presentation evaluated
                                make recommendation     and ESCC able to
                                                        recommend preferred
   March 2013                   Cabinet approval        Approval received
   April to August 2013         Contract awarded, TUPE Schools sign up,
                                consultation,           contract is awarded,
                                mobilisation starts and TUPE consultation
                                school sign up begins   undertaken
   September 2013               First meals served in   All signed up schools
                                schools                 receive a meal service
                                                        starting at the
                                                        beginning of the 1st day
                                                        of term

17. Appendices

18. Background Information
    Nutritional Standards for Schools Legislation 2007

     Name of                Post held           Date         Date         Comments
    consultee                                  sent to    response         appear in
                                              consultee    received       paragraph:
 David Archibald    Executive Director        26/10/2011 07/11/11
                    Children & Adults
Jane Batalona       Head of Legal Social      26/10/2011 07/11/11     5
                    Care & Education
Adele Taylor        Head of Finance Childrens 2610/2011 07/11/11
Cllr Patricia Walker Cabinet Member for      26/10/2011 07/11/11
                     Children and
                     Young People

Ben Cassidy         Chair of the Ealing School 26/10/2011 04/11/11
                    Catering Consortium

Report History

Decision type:         Urgency item?
Key decision           No

      Report no.:      Report author and contact for queries:
                       David Shailes, Schools Service & Student Support Manager 020
                       8825 9381 Email at

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