Hampshire County Council

Policy & Resources Policy Review Committee (PRC) Item No.

14 December 2001

Best Value Cross-Cutting Review of Catering Services - Options Report

Report by the Director of Property, Business and Regulatory Services

1.

Purpose

1.1

This report summarises the main findings and conclusions of the review group. It offers Members options for the future management of catering services in the County Council. Members are invited to consider the options identified and agree which option(s) should form the basis of the improvement plan that will accompany the final outcome report. A short presentation providing further background and details on the options will be made at the meeting. The review group expects to be able to present the outcome report to the PRC on 24 January 2002.

2.

Background

2.1

Copies of the original Service Specification and Project Brief, which were presented to the Policy & Resources Best Value Review Panel on 25 May 2001, are attached for information.

3.

Work Completed

3.1

The review group has examined the current arrangements for the delivery of catering services across the County Council, looking particularly at issues in four key strategic areas identified in the original project brief. These are:

People Premises & Equipment

Purchasing Organisation

3.2

A number of actions have been identified in each area to improve service delivery and make more efficient use of resources and expertise. The review group has developed a range of options for the future direction of catering services and considers that some degree of organisational change will be necessary to achieve and sustain the improvements identified.

3.3

The initial work has been modified following informal consultation with managers of catering services in the County Council. A formal consultation was undertaken with staff and managers in Social Services and the overall work of the cross-cutting team was examined on 6 November by a `challenge' group, which consisted of a County Councillor, a headteacher, representatives of departments managing catering services and three external catering experts from the private sector. Further consultation is planned among a sample of managers and staff responsible for the delivery of catering services to fine tune the final recommendations.

3.4

The proposed actions and organisation models which have been identified are described below.

4.

People

4.1

Current arrangements:

· Recruitment and training are managed separately in Hampshire Caterers (HC) and Social Services (SS)

· There are severe recruitment difficulties in both areas

· The recruitment process is too slow.

4.2

Proposed changes:

· Draw up service level agreements between HC and SS to share knowledge, experience and resources

· Work to streamline recruitment process

· Proposed changes are common to Options 2-5.

4.3

Benefits

· Improved recruitment and retention

· Better value extracted from training resource in HC.

5.

Premises & Equipment

5.1

Current arrangements:

· Education, Social Services, Country Parks and Museums:
the replacement of catering equipment and its maintenance are subject to separate management arrangements (although Education and Social Services both use a joint maintenance contract let by Property Services)

· There is very little investment in research and development, particularly in the area of alternative methods of production or the number of sites required.

5.2

Proposed changes:

· Consolidate the assessment of the condition of catering equipment and the administration of maintenance in one place (Options 3, 4, 5, 6)

· Create additional research and development capacity (Options 5 and 6).

5.3

Benefits:

· Better control of quality and value for money

· Service development

6.

Purchasing

6.1

· £5.5 million is spent against food contracts arranged by County Supplies, which are available to all departments

· Private sector contractors make their own arrangements

6.2

Proposed changes

· Improve contract management to respond to customer demands, for example new products, more fresh products, smaller pack sizes

· Explore further cost-reduction opportunities through membership of the Central Buying Consortium

· Benchmark buying effectiveness against other authorities and private sector organisations (including a subscription to the independently run Catering Price Index)

· Proposed changes are common to Options 2-6

6.3

Benefits:

· Lowest prices consistent with quality and customer satisfaction

7.

Organisation

7.1

Current arrangements:

· There is a mixed economy of public and private provision

· The management of catering services is fragmented across a number of departments

7.2

Options for change:

i) Option 1 - No service

Cease to offer services

ii) Option 2 - No change

Retain current organisational arrangements

iii) Option 3 - HC and SS form catering `partnership'

HC and SS develop a partnership to share knowledge, experience and resources in the management of catering personnel. HC is an established Investor in People with developed skills in the management, training and development of catering staff.

iv) Option 4 - Extend remit of existing Catering Support Unit (CSU)

Create a minor increase in the resources of the existing CSU within County Supplies and widen its remit to provide support services to all departments. The Unit currently provides schools with advice on premises and equipment, administration of budgets, performance monitoring, compliance and standards, catering contracts and SLAs. It would have no operational responsibility for service delivery and have no significant capacity for research or development of the Council's services.

v) Option 5 - County Catering Unit (CCU)

Form a new County Catering Unit (from existing resources) with significantly greater mass than would be the case in Option 4 by merging all in-house specialist catering expertise with the management of the largest existing operation, Hampshire Caterers. The CCU would provide professional leadership and would serve all departments on policy matters, research and development and training as well as the services listed in Option 4. The CCU would lead the Council's Food Safety Group, have responsibility for

achieving continuous improvement, risk management and quality across the Council. The Manager of this unit would report direct to the Head of Business Services within the Property, Business and Regulatory Services department.

vi) Option 6 - CCU with operational responsibility for all catering operations

As Option 5, but with the added responsibility for all catering services provided on County Council property (particularly those in Social Services).

vii) Option 7 - Further Externalisation

Externalise all or part of the catering services (including support services) delivered internally by the County Council. This option could apply to all catering services, but the largest element of in-house provision is Hampshire Caterers. In this area, catering budgets are delegated to schools (with effect from 1 April 2002 in primaries and special schools) and the future balance between internal and external provision will be directly affected by the wishes and preference of headteachers and governing bodies.

8.

Summary

8.1

The review team has identified a number of opportunities to improve the management and delivery of what is currently a loosely connected range of catering services.

8.2

Options 3, 4 and 5 are most likely to deliver service improvements in the short to medium term and will deliver benefits of an increasing scale. Implementation for all of these should be relatively straightforward.

9.

Recommendations

It is recommended that:

1. Members consider the options identified by the review team and approve the preparation of an improvement plan based on Option 5.

2. The final outcome report is presented to the next meeting of the Committee in January 2002.