Public Sector Local Food Procurement (Hansard, 19 April 2004)

§ The Parliamentary Under-Secretary of State, Department for Environment, Food and Rural Affairs (Lord Whitty)
My Lords, I note my noble friend's request, but our aim is rather more ambitious than that. We want to see more local food purchased throughout the year. A key objective of the Government's Public Sector Food Procurement Initiative is to increase and improve the opportunities for small and local producers to compete for, and win, public sector food procurement contracts.

§ Lord Grantchester
My Lords, I thank my noble friend for that most encouraging reply. He will no doubt be aware that one such public body—the National Health Service—purchases more than 300 million meals a year, spending a huge £500 million on food a year, yet, for example, four London NHS hospitals serve patients with food of which less than 10 per cent is locally sourced. That is at a time when farm incomes average only £11,000. Does my noble friend agree that the public sector, identified by the electorate to be in need of improvement, is well placed to help to implement Defra's initiated Curry report with trade not aid to rural areas and, as the governors of Orton Church of England School near Penrith 6 found, to protect and create local jobs and to provide children with value for money and nutritious meals, as well as developing their social skills by eating together? As St George—

Noble Lords
Question!

§ Lord Grantchester
My Lords, as St George is the patron saint of farm workers, will my noble friend be sitting down to a great English breakfast along the lines of those being organised by the Country Land & Business Association this Friday, 23 April?

§ Lord Whitty
My Lords, I sit down to many such breakfasts and, as my girth probably indicates, I have been eating for Britain ever since I got into this job. I believe that an enormous amount of very good produce is supplied by the English agricultural sector. I say "English" because the Question relates to St George's day but I also mean the British sector. However, an interesting point is that the public sector has hitherto procured less of its supply of food locally than is, for example, bought by the general public through the supermarkets. The Government have sought to address that by encouraging, through this initiative, the public sector as a whole to look more favourably on local producers and to remove the barriers faced by small and medium-sized suppliers, in particular, in meeting government contracts.

Lord Campbell of Croy
My Lords, will the Government support the celebration of St Andrew's day on 30 November with similar procurement of appropriate food, such as haggis and porridge, together with liberal drams of malt whisky?

§ Lord Whitty
My Lords, that is a matter for my colleagues in the devolved administration in Edinburgh. However, another aim of the public procurement of food—this does not reflect on the quality of produce procured by the Scottish agriculture and drinks sectors—relates to health and nutrition. I am not entirely sure that the balanced diet advocated by the noble Lord fulfils such criteria.

§ Baroness Harris of Richmond
My Lords, will the Minister give the House examples of the Government, together with small and medium-sized enterprises, providing local food to hospitals' and schools' catering contractors? He says that that is being done, but perhaps he can give some examples.

§ Lord Whitty
My Lords, there are a number of examples; the school to which my noble friend referred is one. A number of other schools' catering services have engaged with local producers to provide a higher proportion of local produce. The Cornwall Partnership Trust has come together with farmers in Cornwall to provide local produce for the county. The Bradford City initiative runs on a similar basis. We have also to engage the bigger companies within the food provision sector. There are some very encouraging signs that the major 7 food service companies, which provide the bulk of public sector food contracts, are engaged in trying to increase the proportion of local food.

§ Lord Dixon-Smith
My Lords, is there a foreign exchange deficit in the public sector's food purchases policy? If so, what is the size of the deficit?

§ Lord Whitty
My Lords, I would have to look into a definitional point before I could give the noble Lord a straight answer. Over half of the procurement is probably British food, although it is difficult to acquire absolute figures. That means that the rest is imported. Whether that constitutes a deficit or not depends on the success of the British food industry in selling its products abroad. While there has been an increase in competitiveness in that respect, we are still in deficit on food as a whole.

§ The Countess of Mar
My Lords, I declare an interest as a specialist cheese maker. Perhaps I may say nice things about Defra for a change. We have found Defra extremely helpful in the organisation of farmers' markets. We have received inquiries from various organisations such as schools and local hospitals in the West Midlands and particularly in Hereford and Worcester.
Can the Minister do something about food production in hospitals? Last year, while in St Thomas's Hospital for a week, I had to chew my way through the most obnoxious meat that was called lamb—God knows where they got it from. We produce wonderful English lamb—British lamb—so please ask hospitals to procure decent lamb which patients can chew and so get better quicker.

§ Lord Whitty
My Lords, I am deeply grateful to the noble Countess for her initial remarks. It is certainly Defra's intention, through the farmers' markets and elsewhere, to help local producers in that respect. I suspect that mass catering can ruin even the best English lamb. However, standards of catering within the public sector require attention, including where food is procured. There is an initiative involving the London hospitals, which is based on the Brompton Hospital. They are heavily involved in trying to upgrade the nutritional value and the degree of local produce that they buy in. They are starting from a relatively low base, but it is an initiative in which various London trusts, as well as those to which I have already referred in Cornwall, are now engaged.

§ Lord Davies of Coity
My Lords, while recognising that there is justification for the thrust of the Question, it is a pity that it has to be asked. Is the Minister saying that the reason that local food procurement does not take place is largely because of the pricing system?

§ Lord Whitty
My Lords, it is more complicated than that. It is certainly true that the budgetary constraints as regards price per unit have, on a substantial number of occasions, driven the food service company or the public 8 procurer to buy from abroad. It is also true that value for money, which runs through the Government's approach to this matter, is wider than the unit cost. The nutritional. environmental and social benefits of procuring more food from smaller and local suppliers needs to be taken into account when the public sector engages in its procurement. I believe that a large part of the British industry would be able to compete in that.
However, there are changes required from the industry to meet some of the specifications that the public sector requires; for example, the military find it very difficult to procure British lamb as it is not produced in the cuts and with the degree of portability that the military authorities require.

§ Lord Mackie of Benshie
My Lords, does the Minister agree that part of the trouble is that farmers in this country are not allowed to form large and powerful co-operatives, such as exist in Germany and in Denmark, which allows supermarkets to do what they want? For example, I went to a local supermarket and bought some new potatoes. They cost me £1,769 a tonne, which appeared to me to be a little more than the producer would have received.

§ Lord Whitty
My Lords, the noble Lord obviously likes potatoes—by the tonne. It is true that downward pressures on prices have affected local producers. However, it is also true that to some extent farmers, by combining their efforts, have improved their own marketing so that they can make inroads into the public sector contracts, to which the public sector needs to give them greater access, and into supermarkets. The issues of competition policy are not part of the failure to procure a higher proportion of public sector food contracts; they are more a matter of the public sector being aware of the need to help local producers, and the local producers focusing on the public sector as a market and meeting its requirements.