Free school meals

Newham Council’s flagship free school meals firm posts £1.4m loss

Catering company blames 'rocketing inflation' for financial difficulties

Catering company blames 'rocketing inflation' for financial difficulties

School meals
Exclusive

The catering arm of a London council that led the charge for universal free school meals has posted a £1.4 million loss amid soaring costs.

Accounts for Juniper Ventures Limited, set up by Newham Council in 2017, declare the borough’s meal service the “front-running example of a high impact primary school meals ‘ecosystem’”. 

The borough has had a universal free school meals offer since 2011, but new figures reveal how “rocketing inflation in the supply chain” drove the company from a £38,000 profit in 2021-22 to a £1.4 million loss last year.

The loss would have been more than £1.6 million but was offset by a profit made by Juniper Pursuits Limited, a subsidiary of Juniper Ventures.

School food campaigner Andy Jolley said the “really worrying figures highlight two things: the threat posed to catering firms by the chronic underfunding of school meals; and the profligacy of Newham Council in pushing ahead with a supposedly flagship policy without properly considering the practicalities”.

Government funding fails to keep up

Spiralling food, staffing and energy costs in recent years have prompted repeated warnings from the catering industry that funding for school meals is not keeping pace with actual costs.

Andy Jolley
Andy Jolley

Central government funding for universal infant free school meals and means-tested lunches for older pupils sits at £2.53. Funding for Sadiq Khan’s extension of free meals to junior pupils in London is £2.65, rising to £3 from September.

Meals in Newham, meanwhile, cost the council £3 each, and this will rise again next year as a 10 per cent living wage increase takes hold.

“This organisation has and continues to lobby the government for an ongoing inflationary review of this amount and contributed to a paper recommending the meal price be raised in line with inflation which would bring it today to £2.97 as a minimum,” accounts state.

Data from the Office for National Statistics shows average food prices have risen by 27 per cent in the last two years.

A council report from last year warned food costs exceeded forecasts by £409,000 in the 2022 calendar year. Juniper’s wage costs were also “significantly affected by the need to use agency cover to manage sickness”. This resulted in an overspend of £622,000 in 2022.

‘Food inflation’ hits free school meals

Inflation caused “huge issues” in 2022-23, and although rates stabilised and then began to reduce, “food inflation remains high, with the impact on the cost of raw materials continuing to be a challenge.” 

Accounts show that although Juniper’s turnover increased by 0.4 per cent last year, cost of sales rose 5.9 per cent and admin expenses increased by 33.6 per cent.

Because it is wholly owned by Newham Council, funding from the borough keeps Juniper afloat where commercial providers might have gone bust.

Councillors also approved a deal last year which converted an existing £4 million capital loan it made to the company into shares. This can be used to balance the books.

The company is now forecasting a “major change in direction for the business with growing profitability”.

A statement said: “The losses made in 22-23 are anticipated to be reduced by over 50 per cent in 23-24 with further improvements leading to profitability and sustainability over the following two years.”

Latest education roles from

IT Technician

IT Technician

Harris Academy Morden

Teacher of Geography

Teacher of Geography

Harris Academy Orpington

Lecturer/Assessor in Electrical

Lecturer/Assessor in Electrical

South Gloucestershire and Stroud College

Director of Management Information Systems (MIS)

Director of Management Information Systems (MIS)

South Gloucestershire and Stroud College

Exams Assistant

Exams Assistant

Richmond and Hillcroft Adult & Community College

Lecturer Electrical Installation

Lecturer Electrical Installation

Solihull College and University Centre

Sponsored posts

Sponsored post

It’s Education’s Time to Shine: Celebrate your Education Community in 2025!

The deadline is approaching to nominate a colleague, team, whole school or college for the 2025 Pearson National Teaching...

SWAdvertorial
Sponsored post

Navigating NPQ Funding Cuts: An Apprenticeship Success Story

Last year’s NPQ funding cuts meant that half of England’s teachers faced costs of up to £4,000 to complete...

SWAdvertorial
Sponsored post

Embedding Formative Assessment: not just a box-ticking exercise but something long-term and meaningful for all

Our EFA programme has been proven to help schools achieve better GCSE results, as evidenced by the EEF. Find...

SWAdvertorial
Sponsored post

Building capacity in family support to tackle low school attendance 

Persistent and severe school absence impacts children, families, and communities—especially in disadvantaged areas. School-Home Support’s Attendance Support and Development Programme...

SWAdvertorial

More from this theme

Free school meals

Universal infant free school meals funding rises by 5p

But funding still lags far behind the actual cost of providing meals in schools

Freddie Whittaker
Free school meals

Proportion of poorer school pupils going on to university falls

Fall in the 'progression rate' of pupils eligible for free school meals is first since current records began in...

Lucas Cumiskey
Free school meals

Minister ‘keen to learn’ from Khan’s free school meals policy

Stephen Morgan reveals 'live conversation' in government over potential future 'interventions'

Freddie Whittaker
Free school meals

Make ‘adjustments’ to give disabled pupils free school meals – DfE

DfE also beefs up guidance for councils about providing meals for children educated outside state schools following legal threat

Freddie Whittaker

Your thoughts

Leave a Reply

Your email address will not be published. Required fields are marked *