For some , if not many, the Government’s move to delegate funding will be a welcome opportunity to escape the perceived tyranny of poor service.

However, the freedom to set up one’s own meals service or to buy it in from private contractors or direct-service organisations entails significant risks for headteachers and governors unfamiliar with negotiating private-sector contracts or with the relevant health and safety legislation.

Under the Fair Funding initiative authorities will be required to delegate money for school meals from April 1 next year to secondary schools not covered by existing contracts with suppliers.

However, from the year 2000, all funding for secondary school meals will have to be delegated, and from the same year all primary and special schools will be able to opt for delegation of funds individually.

Last week the Government issued a consultation paper on delegated funding for school meals. Local authorities and other interested parties still have a fortnight (until Friday November 27) to comment on the proposals.

Under competitive tendering, introduced in the early Nineties, local authorities have been obliged to put their school meals services out to tender every five years. Many authorities have used their own direct-service organisations to supply the service, while more than 30 per cent have signed contracts with private providers.

Since 1989, grant-maintained schools have had the freedom to set up their own service or to buy-in services.

It is estimated that private firms provide meals for some 16 per cent of state schools, 22 per cent of grant-maintained schools and 25 per cent of independent schools. The market in state schools alone is worth #163;800 million a year and private caterers share #163;130m of that. With the advent of delegated funding, school meal consultants are anticipating an explosion of interest among schools in setting up their own service or buying in from private contractors.

Mike Bond is managing director of Chartwells, a private company that supplies 600 schools in Kent, 60 in Essex, 120 in Sandwell and 300 in Durham. “We see Fair Funding as an opportunity because we think that a lot of schools will want to head towards deregulation,” he says. “It’s not a mature market and the self-funding situation may change the face of the state system in terms of food provision.”

Tim Crookson, managing director of the education division of Gardner Merchant, which supplies school meals services to 240 private schools and 260 state schools, says he does foresee an upsurge of business. “We are anticipating consortia of schools coming together and putting their services out to tender,” he says.

Jim Walker, chief executive of Initial Catering Services, which supplies all the school meals in 10 authorities, including Berkshire, Hampshire, Gloucestershire, Cornwall, and the London boroughs of Camden, Merton and Redbridge, thinks that secondary schools will go out to contractors, whereas the primaries will not do so except in consortiums.

Richard Wedgbury, a consultant with Alexander Jon Richardson amp; Associates, who advises schools on catering, sounds a note of caution for schools considering contracting out. Many grant-maintained schools, he says, put their services out to private contractors. Although the contractor’s service was better than that provided by the authorities, many of the smaller and medium-sized schools found that it was too expensive.

He knows of some 200 grant-maintained schools who have taken the meals service back and opted to provide it themselves.

“In those early days the schools were easy prey,” says Mr Wedgbury. “Since then they have become much more commercially aware but still remain hopelessly lacking in real understanding of catering service provision and all its specialist and technical areas.”

Those schools that take on the service, he says, are themselves “a worry in that they make many mistakes and often fall foul of legislation in regard to health, safety and hygiene and employment”. One school he looked at recently was employing kitchen staff without a contract or terms and conditions of employment. They were also unaware of new European Union legislation under which they are now entitled to three weeks’ holiday pay.

Victor Tippins, managing partner of the Cater Check consultancy, says that between 1994 and 1997 self-operated services in grant-maintained schools in-creased from 34 to 38 per cent. He believes that initially, after April 1, there will be an “explosion” in the size of the contract-catering market. But he thinks it likely that the experience of the grant-maintained schools will be repeated and that many schools may well go to the private contractors then decide to take meals in-house.

In future, Mr Tippins considers that questions will start being asked about the morality of multinational companies making money out of feeding children. There is, he muses, ultimately a moral dilemma to be wrestled with here.