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Chapter Four Views of Council Officers in East Ayrshire

Background and Method

4.1 In addition to consulting the various stakeholders involved in providing, preparing and consuming food in East Ayrshire's primary schools, ADAS conducted a stage of research to collect East Ayrshire Council officers' first-hand knowledge of the development of the local food initiative, and their perceptions of various aspects of the scheme and the associated tendering process.

4.2 This chapter therefore highlights the key points that were made by council officers Robin Gourlay ⁹ and Heather Murray ¹⁰ during two interviews conducted by ADAS.

Planning of the Pilot Scheme

The Idea

4.3 The catalyst for East Ayrshire Council's scheme to improve the quality of food on primary schools was the Hungry for Success initiative from the Scottish Executive. This focused on the importance of nutrients in school meals that would lead to improved health.

4.4 The Scottish Executive's publication in 2004 of its Sustainable Procurement guidance for public purchasers, caterers and internal customers gave extra impetus to get the East Ayrshire scheme started

4.5 The Soil Association's Food for Life programme also played a part in East Ayrshire's initiation through stressing the benefits of organic food in such a plan

4.6 The primary objective of the pilot scheme was to "improve the health of primary school children and to educate children on food"

• Everything else was secondary in the project's early stages, but aspects such as sustainability, community regeneration, employment, and other economic and social drivers all played some part. These fed into the scheme more as a result of aspects that became apparent as the development of the scheme went on, rather than being included via joined-up thinking at the outset.
• These aspects were detailed in the original report submitted by Robin Gourlay to the Education Committee, where approval was given for the pilot

Development of the idea

4.7 Before the overall scheme was trialled, Robin Gourlay conducted research amongst suppliers of local food in East Ayrshire, to determine their interest in the project. This was informed by the Scottish Food and Drink website.

4.8 Once that research was completed, the scheme was initially set up in one school, Hurlford. The aim of the scheme was always to go beyond just one school, however.

4.9 In early 2005, Robin Gourlay prepared a proposal for the Councils' Education Committee, detailing the objectives and recommendations of a wider roll-out of the local food initiative. The report stressed the environmental and potential community benefits, the fact that the uptake of school meals had increased in Hurlford during the scheme, and that the children, parents, catering and teaching staff were all in support of it.

4.10 The Council agreed to the proposal, and in May 2005 the pilot scheme was rolled to 10 other primary schools in East Ayrshire.

The Tendering Process

The Overall Aim

4.11 The main aim of the subsequent formal tendering process was to encourage and engage the interest of as many local ¹¹ suppliers as possible, in order to attract a competitive and varied supply base.

4.12 The same set of local suppliers identified and contacted during the initial research for the scheme at Hurlford were contacted again right at the start of the tendering process, and all were invited to meet with Robin Gourlay. This meeting was at the same time widely advertised in the local press and Glasgow Herald.

• This was for an informal briefing on the aims of the project, the rationale behind it, and what the Council was hoping to achieve through it.

Drawing up the Tender

4.13 The specifications for the tender documents were drawn up based on the existing specifications used for purchasing from ABC consortia in other parts of Scotland.

4.14 Although these documents were considered fairly straightforward to construct, some complications emerged.

• For example, it was learnt that some of the strict 'straightness' guidelines for class 1 vegetables had to be made flexible. Otherwise, organic growers would not have been able to supply them

4.15 The decision was also made to break the products down into 9 lots instead of the traditional 4 used in the ABC consortia tendering.

• These categories were felt to be best suited to attracting as many smaller and local suppliers as possible, given the known nature of local suppliers.
• Dairy and cheese were split for just that purpose, in that there were specifically local cheese producers who did not necessarily produce milk.

4.16 The criteria for what the tenders would be assessed upon were set from the outset and were based on Price (50%) and Quality (50%). "Quality" breaks down into four sub-criteria:

• "Ability to supply to deadlines" (15%)
• "Quality and range of foods" (15%)
• "Food handling arrangements and facilities" (10%)
• "Use of Resources" (10%)

4.17 The invitation to tender provided more details of the issues to be considered within each of the quality-related sub-criteria listed above:

• Method Statement A - Ability to Supply to Deadlines
• Adaptability - alternative delivery methods
• Timescales from Harvest to Delivery
• Method Statement B - Quality & Range of Food Stuffs
• Fair Trade or Equivalent Options
• Shelf life
• Traceability & Recall Procedures
• Quality System - approved by accredited certification body
• Product Assurance Schemes
• Inward Inspection Procedures
• Procedures for Inspections during manufacture
• Equipment Inspections
• Ethnic, Cultural, Religious Diet Needs
• Seasonal and Traditional Produce
• Method Statement C - Food Handling Arrangements & Facilities
• Safety in the Working Environment
• Training Opportunities for Staff
• Equal
• System of Food Safety Management - e.g.HACCP
• Membership of Food Associations etc
• Method Statement D - Use of Resources
• Contribution to sustainable development, e.g. Biodiversity Promotion
• Minimising Packaging
• Minimising waste, e.g. re-use, recycle, composting
• Animal Welfare Standards

4.18 Within the specification the following points were also detailed, quoted verbatim from the specification:

Purpose

• As the purpose of this pilot is to introduce fresh/organic food into school meals, the organic alternative should be offered as far as possible; all products should be fresh, non-frozen, and unprocessed as far as practical.
• The overall aim is to raise the quality of ingredients used in the preparation of food from scratch in the schools, and ensure that they are nutritionally valuable, fun and interesting, therefore improving pupils' lifestyle and Scotland's health record by helping to reduce obesity, heart disease and diabetes. The following are issues related to healthy eating that are to be taken into consideration when preparing tender submissions:
• Reduction in amount of pesticide residue
• Reduction in salt content
• Reduction in saturated fat content
• Reduction in added sugar content
• Reduction in environmental impacts
• No added colourings or artificial flavourings
• No mechanically recovered meat
• No monosodium glutamate or similar (related) hydrolysed protein flavouring salts
• GM free

Links with Education/Council

• As part of the initiative to encourage the children to make healthier food choices, the schools may embark on educational activities on food and how it is produced. Therefore input from suppliers may be requested on occasions.
• Partnership working is already in place between the school, parents, pupils and catering staff and the Council is looking for suppliers that are willing to be included and develop this partnership further. This may include the development of menus and recommendations in seasonal or new products.
• Suppliers may be requested to provide information or feedback related to working with the Council to enable Management Information to be produced and the pilot assessed.

Innovative/Alternative Proposals

• Innovative proposals are welcomed in all aspects from the food to methods of delivery.
• The successful suppliers will be expected to give advice on alternative produce available when prices are high due to seasonal availability, or because of other difficulties with supply.

4.19 The council officers advocated a need to establish a coefficient for sustainability and community aspects. This was covered in Method Statement D of the tender documents.

Problems arising during tendering

4.20 Some of the problems that arose during the process of tendering the work were foreseen by the council officers

• One such problem was the scepticism held by small organisations in tendering for work of this nature ¹²
• East Ayrshire Council attempted to overcome this problem by preparing an information session with the aim of educating potential bidders on Council's and EU Procurement processes, and to highlight ways of avoiding some pitfalls that could be encountered. This was openly advertised in the local and national press.
• Unfortunately, the numbers attending (about 12) were fairly disappointing to the Council officers. Some of the eventual successful bidders did not attend this briefing.

4.21 The main problems were perceived by the Council to arise on the side of producers during the process of preparing their tenders

• The time required to complete the tender documentation was greater than producers expected and ate into their working day
• Some suppliers were unfamiliar with the standard format of the tendering documents, and in some cases this deterred them from bidding
• Although the Council was able to offer advice if telephoned by tenderers (as happened in some instances), the standard requirements of this type of tendering process restricted the type of information they could give out

Marketing of the tender

4.22 The Council wrote to all of the suppliers who had been involved in the "pre-pilot" scheme at Hurlford and other schools, to notify them of the tender details

4.23 Adverts were also placed in The Herald (based in Glasgow), the Kilmarnock Standard, the Ayrshire Post, and the Cumnock Chronicle, as well as in the EU's Journal. A part of the advert is quoted verbatim below:

East Ayrshire Council Department of Educational and Social Services Tender - Supply & Delivery of Fresh/Organic Food Stuffs (Ref: PS/05/26)

Description of Services:

The Council is extending the Scottish Executive initiative "Hungry for Success" which is designed to promote healthy eating within schools by piloting the provision of fresh and organic food. The Council seeks to contract with a number of suppliers to provide various fresh and/or organic food stuffs to eleven primary schools. Quantities of food stuffs will vary throughout the term of the contract, however the overall anticipated annual value is circa £120,000 across all 8 lots.

4.24 In hindsight, and if the tender process were to be repeated, the Council officers would potentially use associated public bodies, for example Quality Meat Scotland ( QMS), the Scottish Food and Drink Association, and the local Business Enterprise organisation in Ayrshire. Many of these organisations will advertise tenders to their members for free.

Response to the tender

4.25 The level of response to the tender breaks down as follows:

• 22 formal Expressions Of Interest were received after the original tender notice was placed
• 13 Pre-Qualification Questionnaires were returned, but 9 of those who had submitted EOIs decided not to proceed at this stage
• All 13 producers who submitted PQQs were invited to tender
• 10 bids were received, some being for more than one of the 9 lots on offer
• All of the existing 'pre-pilot' suppliers bid with the exception of one - the bakers

4.26 This level of response disappointed the Council officers. They had expected, and would have preferred, to receive more bids. Nonetheless enough bids were received in each lot to allow competition in all but 3 of the 9 tendered 'food type' lots.

• One of these lots, bakery goods, was not bid for at all. The PQQ had been filled out by Brownings the Bakers, a well-known and successful bakery who were already suppliers to the 11 schools in the local food initiative. They seem to have believed that the PQQ itself would be sufficient to be considered for the contract. This illustrates the lack of understanding of the full process on the part of some producers.

4.27 Feedback that the Council collected, both from tenderers and from those who did not proceed after submitting an EOI, suggested that all who bid felt that the forms had taken an inordinate amount of time to fill out.

• Those that had attended the initial presentation by the Council had generally submitted the level of detail of information required
• Others did not bid purely because of the level of information required. Some considered that the information requested on banking details and recent years' turnover was not the business of the Council

4.28 As the Authority awarding the tender, East Ayrshire Council officers were limited in what guidance they could give. The Council officers believe that more help and interest from organisations aimed at supporting local enterprises (for example, Business Enterprise) could help more producers to enter the process of tendering. Such support could offer greatest benefit in bridging the gap between private producers and the public sector procurement process, a process still viewed with suspicion by many producers.

4.29 Overall, Council officers acknowledged that communication between the local authority and suppliers would have to improve in any similar future process

Effect of the Scheme

Sustainability

4.30 East Ayrshire Council's sustainability objectives have to be taken into account when justifying investment in a scheme of this nature. In this case, reducing the distance that the food has travelled and encouraging employment in the local community are both key objectives.

4.31 The Invitation to Tender was partially designed to focus on local supply and reducing the distance that the food has travelled. In line with EU legislation on discrimination, the Council did not include anything in the documents to discourage any business from tendering. Rather, the tender was built such that it would encourage smaller local firms that they could tender on as fair and equal a basis as any other firm throughout Europe.

• The Council officers believed that even prior to the tendering process, the distance travelled by the food used up in supplying the primary schools in the pilot scheme had been reduced by more than 70%.

4.32 One hope for the new tenders awarded and the greater focus on local supply was that the food production sector would benefit through employment opportunities

• Although the tenders awarded have in fact provided little in the way of extra jobs to date ¹³, the Council officers hope that the true employment benefits to the community would become far more evident if the pilot were to be rolled out right across the authority

Impact on council and school staff

4.33 There has been little or no increase in labour within the council that can be ascribed to the new tenders awarded (though extra labour was of course required in the course of administering the tender process itself). Any increased costs have mainly resulted from the higher cost of the food being procured.

• Council officers acknowledged though that if this program were to be rolled out across the rest of the authority, then a dedicated procurement officer might be required given the likely increase in issues related to quality, supply and sustainability

4.34 Within schools, the majority of the increase in workload will affect the catering staff and in particular the catering managers

• In order to try and reduce this burden and cost of invoice processing, the council have specified that suppliers submit only one invoice per month ¹⁴

Monitoring and Analysis

4.35 East Ayrshire Council's school meals organisation has used a proforma to monitor the Sales, Costs and food for life targets. The example in Table 4.1 below shows the detail that is captured during the monitoring process of each meal at each school on each day.

Table 4.1: Information captured daily for monitoring of ingredient amounts and costs

Mauchline primary

Paprika meat balls and spaghetti sales analysis

Paprika meat balls and spaghetti cost analysis

Moving the Scheme Forward

Support for the scheme

4.36 Council officers have been involved in tasting sessions at parent/teacher meetings, healthy eating talks for children, healthy cooking tips and demonstrations for parents

• They were also in the process (as of June 2006) of issuing a booklet to show parents, children, and teachers just where in the community their food comes from

Factors helping or hindering the scheme's progress

4.37 Council officers believe that as the project expands and is trialled in other schools it may become to difficult for smaller suppliers to remain competitive, given their need to step up their system to meet requirements in terms of greater production costs, more deliveries, more production, and more administration. Some may even see an expanded supply requirement as a real disincentive.

• Collaboration with other local suppliers could help address this, although schools and/or the Council will always prefer to deal with a single lead supplier

4.38 The variable, and sometimes premium, prices of commodities obtained from a local source (often a small producer) versus those from a large buying group or consortium may be a barrier

4.39 Table 4.2 below demonstrates the price differential between locally sourced produce versus that purchased from a larger buying group.

Table 4.2: Prices for commodities used in East Ayrshire primary school dinners between 22 May and 5 June 2006

Note: Column C show the price on offer were overseas organic produce to be used. Column E states whether the supply price quoted in column A refers to solely local produce or organic local produce.

4.40 It must be noted that prices for fruit and vegetables generally, and from the local and organic supplier, can vary enormously on a weekly and seasonal basis.

4.41 Catering Managers in the 11 schools in East Ayrshire's local food initiative can purchase through either of 2 contracted suppliers for fruit and vegetables. When ordering, they are empowered to make a judgement to buy from either the organic, local supplier or from what is available at the Glasgow fruit market. The purchasing decision is made on availability, price and quality.

4.42 The view was expressed that until such time as a truly competitive local area market is available for local and organic produce, the cost for small-scale production with local delivery direct to schools will remain economically disadvantageous.

4.43 Further to the comparison of local and general wholesale prices given above, Council officers are aware that the definition of 'local' as meaning coming from Ayrshire could be relaxed somewhat.

• For example, by moving to a situation in which sourcing from anywhere in Scotland would be considered 'local' the range of suppliers, including wholesalers, would immediately increase. This would offer significant cost benefits compared with using local Ayrshire suppliers. For example spot checks by the Council suggest that asking only for guaranteed Scottish origin of beef mince or lamb would bring cost savings of around 30-40%.
• However, the broader context must always be considered. Offset against the cost benefits, the Council funding the school meals programme must also consider local democracy and accountability. This will include the benefits that much stricter local sourcing brings to the local economy, the community strengthening that may result, and the clear advantages of local sourcing in terms of sustainability.

4.44 Council officers also feel a responsibility to avoid a situation where a supplier invests significantly to successfully address the demands of a larger scale version of the project, only to be left high and dry were the scheme to be cancelled.

4.45 Council officers estimate that around £200,000 extra funding will be required to roll the project out to all the other primary and secondary schools in East Ayrshire. Securing this amount would be a major step in ensuring the scheme's progress.

Recommending the Scheme to other Councils/ Extending the Scheme

4.46 The Council officers concluded by listing a number of recommendation that might be made to other councils considering running such a scheme

• Use of alternative routes for advertising, and targeted and strategic advertising in order to attract a greater and more competitive response. The more suppliers attracted to tender, the lower the chance of price fixing or the emergence of a 'cartel'.
• More approachable external help to assist the average small supplier in dealing with the complexity of the tender. Whether this is delivered by one or more organisations, such help would need to be well sign-posted to bidders.
• Straightforward tender documentation, not least to dispel the thought in smaller producers' minds that bigger suppliers will always win out given the need to clear all the hurdles that public procurement places in their path.
• Adequate warning being given to producers of the time likely to be required to prepare a bid.
• A workshop session to brief potential bidders (as all who attended in East Ayrshire correctly completed the basic elements of their tenders).
• Consideration of the need to (a) train catering staff with no experience of preparing food dishes from scratch, and (b) fit out kitchens to make such preparation easier.
• Marketing the scheme to convince parents and children of the benefits of the new ingredients and menus, so ensuring a continuing high uptake of school meals. This is all the more necessary given the extra costs, anticipated to be around 10 to 15 pence per meal.
• Consider limiting the roll-out of the scheme to primary schools, where the operation is more easily controllable - and menus less extensive - than in secondary schools.

4.47 Council officers also commented that whilst economies of scale may be expected in a wider roll-out, this cannot be taken for granted. The number of suppliers could increase and cost benefits per supplier may reduce.

Summary

4.48 East Ayrshire Council's local food for schools initiative has developed steadily, the kernel of the idea being nurtured by the introduction of the Scottish Executive's Hungry For Success scheme. This then developed through involving ideas of sustainability, community regeneration, and employment, amongst other aspects, to become a programme with a clear focus on local food.

4.49 Throughout, the primary objectives of improving the health of primary school children, and educating children on food, have remained to the fore. The Council is still working toward both goals, and looking for opportunities to reach them, for example by better communication with parents, recognising the vital role they play in the success of such an initiative.

4.50 One key factor that must not be overlooked is the drive and enthusiasm of the officers at East Ayrshire Council's school meals organisation. These have been essential in bringing the programme to a point where 11 primary schools are now serving meals with a very high proportion of local and fresh ingredients. For such a programme to be successfully repeated elsewhere, the same personal commitment to meeting the objectives will be required.

4.51 Following on from a period when uptake of school meals has been dropping in many different areas, it is encouraging to see the rise in uptake from autumn 2004 to autumn 2005 in the 11 primary schools in the programme. The uptake of school meals will continue to need careful monitoring over the coming months, to ensure that the programme is succeeding in providing good food that children want to eat.

4.52 The tendering process in summer 2005, aiming to follow EU procurement guidelines in contracting suppliers of fresh, high quality food for 9 separate lots of food types was successful in attracting at least 2 competitive tenders for all but 2 of the lots offered. Almost all of those now supplying the 11 schools in the initiative are indeed Ayrshire-based suppliers, vindicating the approach taken.

• Further advertising of the tender, for example by making use of local business support organisations and public bodies with an interest in the food sector, should ensure further competition in any future tendering process
• Further effort will also be required to ensure that the tender specifications are carefully communicated and explained to ensure maximum response and hence competition in tendering

4.53 The Council reports little or no increase in labour arising from the local foods initiative. They also recognise, however, that a wider roll-out may require a dedicated procurement officer to be appointed to deal with the extra administration required at that stage.

4.54 Factors to be considered in the future, if the programme is extended in time or scope, include:

• Control of costs, including considering the consequences of a wider roll-out, and weighing up the benefits of retaining or relaxing the emphasis on sourcing as locally as possible
• Reaching out to parents and children to promote the scheme in the community, to maintain or improve the high level of uptake
• Ensuring that all contracted suppliers can maintain the supply of food stuffs in the quantities required, without making them over-reliant on a short-term contract
• Refining the tendering process slightly, to ensure, among other things, that more external help is available to support producers interested in tendering

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