Who’s making dough from taxpayer-funded school lunches?

Taxpayer-funded healthy school lunches range from the likes of hot cooked meals such as beef stews through to wraps and Subway sandwiches.

With Associate Education Minister David Seymour calling the Healthy School Lunches programme “wasteful spending”, and in discussions about what comes next for the future of the healthy lunches programme, Stuff takes a look at what the programme is worth – and what it could mean if it is canned or significantly changed.

The Ka Ora, Ka Ako programme launched in 2019 and feeds 230,000 children at almost 1000 schools throughout the country.

There are 158 external providers of the school lunches, including Fed, Montana Group, BiteLab, Lunch by Libelle, Subway, Pita Pit, Pure Catering and Lunchy, the successor to Eat My Lunch. There are also 237 internal lunch providers – schools set up to make lunches themselves.

The Government has put $323 million aside to fund the programme until the end of this year, and more than $1.1 billion has been spent on it since it launched five years ago.

The Ministry of Education says the programme “aims to reduce hunger and food insecurity” by providing a nutritious lunch every day, but there has been criticism about what substitutes as healthy, and concerns that some meals being served up are of poor standard.

Massey University business school professor Bodo Lang said the healthy lunches programme was highly lucrative for businesses — some of which would be making significant profits from holding supplier contracts.

He questioned whether it was ethical for businesses to make financial gains from hungry children.

Businesses won’t say how much they earn from being part of the programme. However, the Ministry of Education’s website says that the lunches are provided at a maximum cost per lunch each day, of:

■ $5.78 for students in Years 0-3

■ $6.77 for students in Years 4-8

■ $8.62 for students in Years 9+

Those costs are based on external providers. For schools that make and provide lunches internally, the cost is about 20 to 40 cents less.

Becky Erwood, founder of lunch provider Fed, said dropping or any changes to the way the programme was run would be “very disappointing”.

“Feeding our tamariki is never wasteful,” said Erwood, who had 23 staff making meals for the programme.

She said the programme had helped children learn better, and also relieved pressure on parents. “Some of the meals that we’re giving people, that might be their only good nutritious meal of the day.”

Fed makes hot lunches. When it joined the programme in 2021, it was providing 2500 meals per day to 10 schools. Today, that is 7500 meals to 18 Auckland schools.

It initially sold cold lunches, and slowly increased the number of hot meals after feedback from schools and children. Its meals include mixed bean stews, chicken and lentil casseroles, and beef stews with mash.

The business also sells ready-made meals for Hello Fresh and upmarket supermarket Farro Fresh.

Erwood would not say what proportion of business the lunch programme made up, but said it was “significant” and an “important part of the business”.

She wanted the programme to continue as it was.

Other meal providers for the programme include Subway and Pita Pit.

It is understood that Subway is a significant provider, through 15 stores, along with 21 Pita Pit stores. It is not known how many schools they provide lunches to.

Subway has been approached for comment.

Downer Group provides 7000 lunches daily to children aged between 5 and 12 at 22 schools in Auckland, under its Alliance Healthy Lunches brand, and employs 75 people in its production facility on Auckland’s North Shore, according to its website.

Lunch By Libelle, which has been part of the programme since 2020, says it serves thousands of lunches to children at more than 100 schools each day, and employs about 500 staff.

Seymour wants the Healthy Lunches programme means-tested and limited to children who need it. Seymour said he did not have a problem with the Government contracting private businesses to deliver the meals “if that was the best way to do it”.

“There is no philosophical objection to it – the question is how much are we spending, and are we getting attendance and engagement [as a result]?” Seymour said.

“What I’d like to see is more focus on the kids who are most in need. It’s clear that at each schools, there are some kids who aren’t taking the lunches or don’t want the lunches, yet we’re funding all of them.”

Seymour said more than $600 was spent on lunches per child at high schools, and this could be done for less.

He would not provide details on work under way or options he was considering for the entire programme.

“It is a lot of money we are spending [on the lunches], nearly $350m, and what’s more, in spite of that money being spent, none of the studies that have been done so far have managed to show that it makes a big difference to an educational outcome.”