Value of school meal voucher scheme called into question

The Public Accounts Committee has said that the Department for Education should have sought better value for money from a private contract for the free school meal voucher scheme.

The spending watchdog said there "missed potential opportunities" for savings in the £425m deal with the firm Edenred, and that the DfE seemed "surprisingly unconcerned" about the firm's profits.

A total of £380m worth of food vouchers were issued to disadvantaged families in England between March and August 2020, when children could not get free meals in school.

In the early stages, there were "serious problems" and "unacceptable delays" with the scheme, according to the Public Accounts Committee (PAC) report. Both the DfE and Edenred took over a month to realise 40,000 order codes for conversion into vouchers had not been delivered to families, say MPs. Edenred's website was also difficult to navigate and its systems failed to cope with the volume of calls and emails from families struggling to access the scheme.

The extensions to the contract should have enabled the Department to consider how it could maintain the scheme as a standing resource and to tender with other suppliers. Instead, when schools were physically closed to most children again on 5 January with 24 hours’ notice the scheme was not activated again until later in January.

Meg Hillier MP, Chair of the Public Accounts Committee, said: "Whether it’s getting life-saving equipment to frontline workers or food to hungry kids in poorer families, government’s failure to learn from its repeated contracting mistakes, over and over, large and small, is costing this nation too dear.

"After the initial urgency we have seen the Government continuing to play catch up on how to support families whose children are entitled to free school meals, and despite the contract with Edenred growing more than five-fold there was no discussion about tendering the contract or even renegotiating it."

Edenred rejected "entirely any suggestion of profiteering" and a DfE statement also dismissed accusations of profiteering, adding: "In its investigation the National Audit Office acknowledged the rapid action this government took to deliver free school meals for eligible pupils, the significant improvements that were made to the scheme and our oversight of it."