Local authorities and parents will have to pick up the tab for better school meals, industry figures have warned.
They argue that caterers cannot afford to meet the Government's proposed higher nutritional standards within current financial constraints, and claim many could walk away from deals if more money isn't found.
The fresh warnings come after Bracknell Forest Council in Berkshire received no bids for its 2006-07 school meals contract, which covers 31 primary and four secondary schools.
Julian Edwards, managing director of consultancy Tenet, said the lack of bids was a sign of the times. "There's a degree of paranoia among caterers because they're waiting for the Government's nutritional guidelines in May. Local authorities will have to allow caterers to dictate more how contracts are drawn up otherwise they won't look at them."
Food service consultant Norman Deas predicted parents would also have to fork out more for better food. "Catering companies aren't charities," he said. "Parents and local authorities will have to contribute more."
Colin Garnham-Edge, operations director of group LEA contracts at Sodexho, said caterers were being squeezed in other areas too. "The minimum wage went up by 6% last year, but if councils only give 2% extra there's a hole there that needs to be filled," he said.
A spokeswoman for Initial Catering, which operates the Bracknell Forest contract, said it refused to retender for the contract because it would bid only for deals where there was "a sensibly priced fresh-cook offer".
A Bracknell council spokesman said: "We're extremely concerned and are discussing ways forward with the current supplier and potential bidders to ensure that children continue to receive reasonably priced, good quality school meals."
A survey by the British Market Research Bureau last week found that two-thirds of parents would pay more for freshly cooked meals.
By Tom Bill