Prescott pledges dsos a freer rein

Local authority direct service organisations (DSOs) should be allowed to tender for private sector feeding contracts, Labour deputy leader John Prescott said at the Catering Forum.

Speaking to Caterer after his opening address to the conference, Mr Prescott added that a future Labour government would seek ways to give DSOs a freer rein in the way they operated.

He also reaffirmed Labour's commitment to taking the compulsion out of the Compulsory Competitive Tendering (CCT) process.

"Budget savings from CCT have often been the result of poorer standards of service and employment rights," said Mr Prescott. "Every £1 saved in reduced wages has cost the benefits system £2.

"But there will be no easy ride for DSOs. We will insist on higher standards but we will use other methods," he added.

In a subsequent seminar, Fergus Chambers, director of catering and cleaning for City of Glasgow Council, warned that this year's local government reorganisation in Scotland and the subsequent round of CCT, which will take place in 1998, would force DSOs there to cut costs.

"There will be turmoil in Scotland in 1998, with £125m of local authority business going out to tender," said Mr Chambers. "The DSOs are fed up with constant political interference."

He said that the 12 DSOs in the Strathclyde region were trying to create more efficiency in their purchasing activities by jointly retaining the central buying function of Catering Direct - the former regional caterer which was broken up as part of local government reorganisation in April.

The Authorities Buying Consortium, as the business is being labelled, will handle £25m of food and hygiene purchases a year on behalf of the 12 DSOs.

Mr Chambers also revealed figures showing that DSOs have won the majority of contracts in the second round of CCT. In England and Wales they have won 68% of contracts, and in Scotland the figure is 90%.