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Caterers call on government to save cash through outsourcing

29 November 2012 by
Caterers call on government to save cash through outsourcing

Catering bosses have met to thrash out how the industry might remove the barriers to public sector contracts and better communicate the benefits of outsourcing to government decision makers.

The industry leaders believe that by outsourcing more of the £2b spent on food and catering and £11.3b on facilities management annually it can deliver greater value and quality.

Speaking at the launch of British Hospitality report Outsourcing 2012, FCSI chairman David Bentley said that £70bn worth of government contracts were to be let in the next five years.

But there was concern that without a change in focus of government procurement the industry would not have the opportunity to bid against in house providers, generate competition and realise value for money.

Food service firms provided 610 million meals for the public sector in 2011, less than one quarter of the total 2.4 billion meals provided.

Lexington Catering chairman Tim West said: "Catering or nourishment of patients comes a long way down the list of priorities.

"With regard to education the opportunity is also vast but it's wrong that catering is so low on the agenda."

He said that inroads had been made, particularly with the MOD, but that there was still too much focus on cost and not enough on value. West added: "Profitability is regarded as a dirty word, but it's the measure of a business that is well managed and working efficiently."

Dine director Jim Cartwright said that an outsourced caterer could not currently bid against in house on a level playing field because of the amount of risk they were asked to assume, particularly in terms of pension provision.

He added: "The sheer volume of tender documents needs to be addressed, as does the palming of the risk. It costs so much to cover liability that you can't get a level playing field when competing with in house. Though there are situations where there are reasonable expectations and the client gets the benefit of your expertise."

BHA chief executive Ufi Ibrahim said that better communication was required between the industry and government to share best practice.

She said: "We need to define what good looks like and proactively put it forward to the cabinet office. We also need to educate local government and the Commissioning Academy a proposed government procurement education programme] is a good start."

Outsourcing could save government 10% on its catering and FM bills >>

Caterers face uncertain future with confidence >>

UK VAT rate is significant barrier to hospitality growth >>

By James Stagg

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