More than 500 jobs are at risk after the food service provider contracted to deliver the government’s school lunches programme was tipped into liquidation today.
Libelle Group delivers approximately 125,000 meals daily as part of the Government’s Ka Ora, Ka Ako Healthy School Lunches programme.
Robert Campbell and David Webb of Deloitte New Zealand were appointed liquidators of the company, which had been in business for more than 20 years.
Webb confirmed to the Herald that just over 500 staff are affected.
“We understand Libelle Group’s director had concerns about the solvency of the business, which is why the company’s shareholders appointed myself and Robert Campbell as liquidators this morning,” Webb told the Herald.
“The liquidators’ focus today has been on supporting the continuity of services that many New Zealand families rely on. The reasons for the appointment of liquidators beyond the director’s concerns around solvency will be part of the liquidators’ review of the business.”
Libelle also provides residential catering, tuckshop solutions and school catering services.
Libelle is contracted by Compass Group New Zealand Limited – an arm of the multinational catering company – to deliver the school lunches.
Compass Group leads the School Lunch Collective, which was awarded the $85 million annual school lunch contract last year as part of Associate Education Minister David Seymour’s Healthy School Lunches reform.
The new programme only started rolling out to schools in January.
“The liquidators are undertaking a full and urgent review of all of Libelle’s operations, with our immediate focus being working with Libelle’s employees and affected stakeholders to ascertain the way forward, including ensuring students around New Zealand continue to receive their school lunches,” Webb said earlier today.
Seymour said the liquidation process will not materially impact the provision of school lunches.
“This is a commercial matter between Compass and Libelle. Compass has assured the ministry that any disruption will be minimised, and the liquidation process will not materially impact the provision of school lunches.
“To ensure the uninterrupted delivery of the school meals provided by Libelle central production kitchens, the Compass Group has told the ministry that it will assume operations during this transition and take responsibility for providing meals every school day.”
Compass boss Paul Harvey said his priority remains ensuring that 120,000 students continue to receive nutritious meals every school day through the Ka Ora, Ka Ako Healthy School Lunches programme.
“Deloitte, as liquidator, has asked Compass Group New Zealand to help manage the transition and ensure stability while exploring options for Libelle’s future,” Harvey said.
“To minimise disruption, Compass has taken immediate steps to support Libelle, including ensuring staff wages are paid and keeping kitchen facilities running.
“We recognise the vital role that Libelle’s staff and partners play in delivering school lunches, and we are committed to ensuring the future of Libelle as part of the programme and supporting its people through this process.”
Todays menu for Gisborne Girls High School was chicken teriyaki on rice or gluten-free pasta and plant-based meat with tomato sauce for those with dietary requirements.
Seymour reformed the Healthy School Lunches programme last year, saying it would save taxpayers’ dollars.
But so far it’s been plagued with issues under the new contractor, including late deliveries, lunches not turning up and issues with the quality of food.
In a letter to Seymour last month, the Principals’ Federation (NZPF) said “teething issues” were still ongoing after a month.
“Minister Seymour’s cost-saving system for the lunches, introduced this year, has not however won the hearts and minds of school principals, particularly in areas where well-established, community-driven solutions were already working effectively.”
Seymour has said he expects the ongoing issues with his school lunches to be sorted by the next school term.
Cameron Smith is an Auckland-based journalist with the Herald business team. He joined the Herald in 2015 and has covered business and sports. He reports on topics including retail, small business, the workplace and macroeconomics.
