Chartwells is close to signing pioneering school meals deal

A flagship private-finance deal under which contract caterer Chartwells will take over school meals in the London Borough of Lewisham is finally nearing completion almost a year after initial agreement was struck.

"The latest date we have for completion is after the spring half-term," said a council spokesman. This would mean Chartwells taking over the service from the borough's in-house team on 13 February.

The deal was first announced at the start of March last year, with Chartwells and Lewisham still needing to agree precise terms. The deadline for final agreement was originally set for last July.

"It's a pioneering, ground-breaking deal. We always knew it would be a challenge to get it done in time and we wanted to cross all the ‘t's and dot all the ‘i's to make sure we had it right," said the spokesman.

He dismissed as "rubbish" rumours that legal costs on the deal were already approaching £1m. "Much of the cost was covered by a Government grant and, in any case, it's more likely to be tens of thousands of pounds."

Chartwells managing director Mike Sparrow said he was confident the contract would be signed by the end of January.

The private-finance deal has a projected turnover of £65m over 10 years, the first of its size in local authority catering. It could pave the way for many similar deals, where cash-starved councils bring in private money to replace ageing equipment in return for long-term contracts.