When the school bell rings students back to class at the end of the summer, it will usher in the age of the $3 lunch.
It’s a bargain price at which to feed over 150,000 school kids, and one that responsible minister David Seymour, Associate Minister of Education, touts as a triumph of efficiency measures and large-scale government buying power.
Under the previous lunch programme, introduced by a Labour-led Government in 2019, the expense was far higher. By the end of the 2024 school year, the cost per lunch under that system had risen to: $5.97 for kids in Years 0 to 3; $6.99 for kids in Years 4 to 8; and $8.90 for those in Year 9 or above. The annual cost was a whopping $325 million.
Seymour has now wrestled that total down to $239m per year (even as he expanded the lunches to some 10,000 pre-schoolers).
His method entails procurement through a single, central contract with global catering firm Compass NZ, the company is private but market research firms say it has the largest share of the catered food services business in New Zealand.
Starting with the school year, all lunches for kids in Year 7 and above will be delivered by Compass. The meals must be at least 240g for Years 0 to 8 and at least 300g for the upper years.
Both Compass and Seymour have emphasised that Compass will work with a host of New Zealand-owned businesses to supply the lunches, including the Libelle Group and supermarkets-owned wholesalers Trents (Foodstuffs South Island) and Gilmours (Foodstuffs North Island).
That’s likely because the new model will replace a system that emphasised local job creation and food supply through the lunch programme.
The savings will be achieved through a significantly lower cost of wholesale food and packaging, and more centralised production that will reduce the number of staff required — all suppliers to the programme must pay the living wage to those working on the programme (currently $27.80). The relatively high hourly cost of staff magnifies the savings in reducing their numbers. Whether the cheaper price will also result in lower quality remains an open question.
For now, the old system remains for the provision of lunches to some 65,000 primary school children. However, this is a short-term measure and the Government intends to move all children on to the $3 programme by Term 1, 2026.
Under the new model, an additional $1 per student lunch is available for schools that wish to continue in-house or community-based food preparation. However, this may be a short-term provision.
The programme is funded until the end of the 2026 school year and in the interim the system will be reviewed, Seymour has said.
Free school lunches are currently provided to some 242,000 schoolchildren — 28% of the school roll. The programme is offered to schools in the lowest socio-economic catchments, and, to avoid stigma, it is provided to all students in the schools where it’s offered.
Sceptics, including the Health Coalition Aotearoa, are very wary of the rock-bottom price, and warn that the $3 lunches are likely to be highly processed and less nutritious than those supplied previously.
Seymour countered this with a launch of the new menu and a tasting last October to showcase planned offerings including: butter chicken, beef rissoles with mash and gravy, and chickpea curry (RNZ scores for the demonstration meals ranged from 5/10 to 7/10).
He said the nutritional content of the cheaper lunches will not be appreciably different from the previous offerings.
But the proof of the pudding, as they say, will be in the (children’s) eating, and, indeed, in the sustained delivery of appetising meals. A slow drip of reports of inedible and discarded “hospital food” could change the public goodwill with which the Government’s cost-cutting measures have largely been met to date.
Compass Group, which has a two-year contract with the Ministry of Education expiring at the end of 2026, also has the single largest contract to supply New Zealand hospital meals.
Health NZ (HNZ) told the Herald that it does not budget meals on a cost-per-patient basis; consequently it refused to provide the price it pays per hospital lunch or per hospital meal.
While HNZ wouldn’t provide costs, its predecessor the district health boards (DHBs) did, though not in a uniform fashion. In 2019, before the amalgamation of the boards into Health NZ, the cost of a served meal (as opposed to just the food cost) ranged from a little over $3 to more than $6.70, according to information released through OIA requests.
At the low end, the West Coast DHB reported that each standard patient meal cost $3.16 — the Reserve Bank of New Zealand’s inflation calculator indicates that equates to $4.12 today.
At the upper end, Counties Manukau DHB reported that the average total cost for inpatient meals was in the range of $20-30 per day, or $26-$39 adjusted for inflation. That’s roughly $6.70-$10 per meal.
A search of the Government Electronic Tenders Service shows no procurement effort by HNZ to shake up or reform its hospital catering or food services contracts since HNZ’s inception in mid-2022; indeed, the search showed no public tenders in this area over the period.
In addition, records show that from the beginning of 2019 through to the establishment of HNZ, only four DHBs (of 20) tendered to update their food services contracts — MidCentral, Whanganui, South Canterbury and Wairarapa.
The data is limited, but together with tender records, it suggests today’s hospital lunches are likely considerably more costly than the new $3 schools offering.
The Department of Corrections told the Herald all prison meals are cooked by prisoners taking part in industry training and employment in prison kitchens, under the supervision of instructors (Auckland South Corrections Facility is an exception, it is managed by Serco under a Public Private Partnership).
Corrections provides the same menu across all of its men’s and women’s prisons and costs don’t vary between prison facilities.
The department said that while the cost per prisoner can vary through the year due to changing food prices and menu variations, the budget for the current financial year is $9.74 per prisoner per day, or $3.24 per meal.
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