Public Sector Procurement Explained
Getting local food onto the public plate
The public sector spends a lot of money on goods and services in a wide range of institutions, including schools, hospitals, prisons and the armed forces. At the same time, competition from across the European Union and beyond, has put farming under pressure and many producers are keen to find new markets.
It is now a central objective of Government that sustainability should be incorporated into all public sector delivery. The benefits of supplying local food to the public sector are many: the evolution of healthy sustainable local economies, a sense of food provenance and seasonality in the local community and a significant reduction in food miles.
Although government policy supports the procurement of local food, actually getting it onto the public plate isn’t as simple as it sounds.
Who supplies food now?
Our research in four main sectors - hospitals, schools, the armed forces and the prison service – revealed a complex supply chain dominated by wholesalers, distributors and contract caterers who operate on a national and sometimes international scale. The buying power of these companies and the restrictions imposed by long-term and sometimes inflexible contracts make it difficult for producers and smaller companies to break into the supply chain at a local level.
Can public sector buyers use local food?
Although nearly all public sector institutions have sustainability policies in place, few buyers currently feel encouraged to prioritise sustainability objectives over price considerations.
Where individual catering managers try to source more locally, they may be involved in a lot more hard work to make it happen. Many hospitals and schools also lack adequate kitchen facilities or skills to prepare meals from fresh or unprocessed ingredients. In addition, EU competition laws prevent contracts being written which stipulate local food as a necessary criteria for winning a contract.
What barriers do farmers & producers face?
Farmers & producers wanting to supply to the public sector, particularly smaller businesses, have felt disadvantaged in the past on a number of levels. Payment terms and costly auditing procedures, which the larger contractors may require, can be off-putting for smaller producers. Also, the complex hierarchies of the public sector make it difficult to contact decision-makers directly.
However, producers can find support and new routes to market in a number of ways. For example, SALSA (Safe And Local) is a new and cheaper food safety standard for small producers, and meat processors can use off sizes and less popular cuts to produce products that schools and other may want, ensuring that the whole animal is sold profitably.
Opportunities for change
Demand for good quality, traceable, local food is increasing, particularly in the public sector in the wake of recent campaigns to improve school food.
Several of the large contract caterers have stated their intention to source more local food and supplier/distributors such as 3663 First for Foodservice, are keen to offer more local foods to public sector buyers. They also offer the opportunity for buyers to nominate non-core items (eg. a local & unique food product) which they will deliver for an agreed cost.
Councils & public sector institutions are starting to write contracts & tender documents which offer smaller producers the opportunity to bid for parts of a whole contract. And whilst it is not legal to specify local suppliers, contracts are being written which require wider sustainability criteria, favouring local producers.
However, producers need to gear up to comply with industry standards, be prepared to develop products which are suited to public sector catering and be prepared to be more flexible and innovative in their business development.
In many cases, particularly to meet demands of scale, collaboration around production, processing, marketing and distribution will be essential.
Further information
SEFGP works with buyers and suppliers to deliver the Public Sector Food Procurement Initiative (PSFPI), a government policy with the following key objectives:
1. Raise production and process standards
2. Increase tenders from small and local producers
3. Increase consumption of healthy and nutritious food
4. Reduce adverse environmental impacts of production and supply
5. Increase capacity of small and local suppliers to meet demand
The policy is managed by
Defra, who have a very informative website with a wealth of documents for both buyers and suppliers available to download.