Scottish Government

Executive Summary

Introduction

• There has been considerable interest in the role of public sector food procurement in providing opportunities for local and Scottish produce.
• Sustainability in food procurement does not necessarily always imply local suppliers, but is more likely to imply local food in the case of provision of fresh, seasonal and unprocessed food.
• The three largest parts of the public sector purchasing food and drink are education (including social work), health and prisons.
• The food supply chain to public bodies is complex and primary producers can supply direct to public sector bodies or indirectly via wholesalers or manufacturers.

Benefits

• The case for sustainable food procurement is based around a wider range of environmental, economic and social benefits.
• The evidence on these benefits is uncertain and in some cases overestimated. For example, food miles as a concept is increasingly being challenged. Environmental benefits do not use life cycle analysis and economic models used often assume local economy is closed and therefore overestimate the benefits.
• There is stronger evidence that sustainable food procurement can contribute to the regeneration of rural economies and should encourage the growth of the Small and Medium Sized Enterprises sector and can lead to environmental benefits in the form of reductions in packaging and waste.

Size of market

• Public sector expenditure on food and drink procurement is £129.3 million which represents approximately a third of the total catering and canteens market.
• Around three quarters of total spend is by local authorities (education, social work), health and prisons. Other public bodies account for the remainder of spending but are more disparate.
• Frozen food accounts for a third of spending by local authorities.
• Local authorities spend 34% on Scottish produce. Scottish produce is particularly predominant for bread, backer supplies, meat, poultry and fish milk and dairy in local authorities.
• Smaller suppliers account for 55% of the market for local authorities (compared to 30% for NHS and 11% for prisons)
• Local authorities indicate a desire to support local and regional economies with "Supporting local and regional economies" the most important criterion when local authorities are asked to rank sustainable food criteria in order of importance.
• Awareness of guidelines on Sustainable Food Procurement is low - with around half of local authorities aware.

Demand and Supply

• There are nearly 700,000 pupils in local authority schools in Scotland and 2,720 local authority schools in Scotland.
• The production of primary produce in Scotland is concentrated on a regional basis. The main areas of agricultural production are the North East (cereals and livestock) and South West (dairy). The top three local authorities account for between 47% and 85% of output.
• This suggests that the focus of public sector food procurement should be on sourcing Scottish produce rather than local produce as it will be difficult for some local authorities to source locally.

Barriers and opportunities

• For suppliers, there is evidence that barriers exist which mean that SMEs cannot always compete for contracts on an equal footing. For smaller businesses there is confusion regarding access to tenders and the tendering process itself can be a burden.
• For procurers, there is evidence that Scottish products are often beyond public sector budgets and that there are insufficient quantities of Scottish produce to meet demand. There is also an administrative burden of contracting with smaller suppliers.
• There are opportunities for producers including the fact that some products suited to a shorter supply chain e.g. fruit & vegetables, milk, bread, eggs and the Healthy eating agenda creating a demand for new products

Good practice

• There is evidence of creative procurement practice in Italy and Scotland.
• In Italy the school meals programme is more integrated into education and incorporates teaching children about the seasonality of foods and the school.
• In Scotland, the East Ayrshire school meals programme has adopted creative food procurement practice by specifying requirements on time scale from harvest to delivery and fair trade, seasonal attributes.

Recommendations

• Based on an assessment of the evidence, the following can be recommended:
• • There is a need for clarity of definition of sustainable food
  • There is an evidence gap on the use of life cycle analysis to estimate the environmental benefits of local food
  • Supply constraints mean that the public sector food procurement should recognise that sourcing Scottish produce rather than local food is more potential
  • There is a need for improved monitoring of the use of Scottish produce by food type as well as to monitor the number of SMEs being awarded contracts. This could focus on local authority procurement practice in the first instance as it is the largest sector.