Purpose

The review of the Twelve15 service was initiated in response to a sustained decline in school catering contracts and the forecast reduction in net income from 2026/27 onwards, which presents a financial risk to Surrey County Council and the new unitary organisations.  This was initiated after Twelve15 were unsuccessful in securing two significant tenders for catering contracts being renewed in May 2025.

In September 2025, Cabinet agreed to consult on a number of options to address the above, of which the preferred option was to cease the service. During the consultation process, the council was approached by an external provider who expressed an interest in taking on the whole of the Twelve15 business activities.

In January 2026, Cabinet agreed that the optimum way forward was to conclude the negotiations with the provider (HCL), engage with staff on the proposed way forward and novate all contracts in compliance with proper process.

However, in the event that it was not possible to agree transfer terms with the provider, Cabinet agreed to delegate the authority to the Deputy Chief Executive and Executive Director for Resources (Section 151 Officer), in consultation with the Cabinet Member for Finance and Resources, to close the Twelve15 business activities on 31 August 2026. This includes finalising and implementing all consequential activities required to effect closure.

Since September 2025, the number of catering contracts between schools and Twelve15 has been diminishing to the point where HCL concluded that it will not be possible for them (HCL) to take over the Twelve15 service as originally envisaged. This was always recognised as a high risk to the successful transfer of the business.

At the outset of the review in September 2025, there were 160 catering contracts and 156 contracts within the gym and equipment maintenance service.  As at 23 March 2026, there are currently only 49 catering contracts remaining with Twelve15 for the 2026/27 academic year. Gym contracts operate on a rolling, annual basis.

Therefore, the alternative option of ceasing the service is being enacted after duly considering the opportunities and implications listed.

School catering contracts

To ensure continuity of service for schools under contract to Twelve15 several options were considered including novating all contracts to a single provider, market testing to attract alternative potential providers or extending the service until December 2026.  Each of these has been discounted and an update provided to the Informal Cabinet in March 2026 confirmed the rationale.  Preferential treatment cannot be given without due process to any one provider seeking to novate contracts, the contracts themselves lie with schools and not SCC so it would be for individual schools to determine this course of action in line with their own policies.  The Twelve 15 business has reduced to such a degree that it is unsustainable to continue services beyond the end of the summer term rendering an extended service untenable.  The timeframe and legal constraints also rule out approaching the wider market for novation options.  Therefore, the remaining 49 schools will need support in securing alternative catering arrangements from 1 September 2026.

In order to mitigate the risk of schools having a break in provision, next steps will be discussed and agreed with each school individually.  These discussions will range from support from DfE, linking up with neighbouring schools in their re-procurement activities, or reprocuring on their own.

All equipment used within schools are the property of each individual school.

As at the 21 May 2025, work is progressing to ensure all schools have appropriate arrangements in place for the new academic year.   Only 15 schools now require support from the County Council to secure new catering provision with all other schools having confirmed arrangements are in place.  The expectation is that these remaining schools will have new arrangements confirmed over the next 4 weeks, dependent on the outcome of the procurement process and schools own decision making.

Staff

Based on the organisational structure of the Twelve15 service and the individual school contracts in place, frontline colleagues (including many bank employees) will transfer under TUPE in line with any future contract transfer associated with the relevant commercial service.

A number of roles, particularly within back-office functions, gym maintenance and some bank or mobile staff, will not be eligible for TUPE transfer. For colleagues who are not eligible for TUPE, we will work closely with then to explore redeployment opportunities across the Council. If a role is not in scope for TUPE and we are unable to identify suitable alternative employment, redundancy will apply.

All staff will be offered individualised support where required/requested. Regular staff communications, frequently asked questions and a webinar will be available between now and September 2026.

Gym and equipment maintenance

These contracts are procured annually. The remaining 21 contracts will be fulfilled prior to the end of the academic year.

All maintained schools who contract these services will be contacted individually to discuss alternative provision for academic year 2026/2027. Options for schools would be linking up with neighbouring schools, identify how other schools fulfil their requirements and join all schools up in these activities.

Workshop facilities at Danetree school would return to SCC’s Land and Property portfolio for disposal as required.  The equipment within the workshop will be disposed of with the funds being returned to SCC. The vans will be returned to the leasing company.

It should be noted that the market for this business is extremely limited, however opportunities will be explored to ensure continuity.  Alternative providers have been identified.

All expenditure related to the closure will be closely monitored in line with Cabinet approval.

Decision

It was AGREED that:

1. The Twelve15 service in its entirety would be closed as at 31 August 2026.
2. All staff will be supported throughout the process, including:

(a)  TUPE transfer, where applicable.

(b)  Staff at risk of redundancy where TUPE does not apply; redeployment opportunities will be explored.

1. All schools would be supported in finding alternative arrangements to fulfil their existing contracts or enter into new alternative arrangements.

Reasons for the decision

The review of the Twelve15 service was initiated in response to a sustained decline in school catering contracts and the forecast reduction in net income from 2026/27 onwards, which presents a financial risk to Surrey County Council and the new unitary organisations.  Retaining the service would expose the council to escalating financial pressures and operational risks.

All options considered led to a conclusion to either close the service or transfer the business activities to an alternate provider. This provider approached SCC during the consultation period October 2025 to November 2025.

Since September 2025, the number of catering contracts between schools and Twelve15 has been diminishing to the point where HCL concluded that it will not be possible for them (HCL) to take over the Twelve15 service as originally envisaged. This was always recognised as a high risk to the successful transfer of the business.

Therefore the decision is now to close the service as at 31 August 2026. All rationale and financials for this option are included within the Cabinet reports which are linked below.

Alternative options considered

Alternative closure dates were considered to allow more time for schools to procure services, however it was not deemed good value for money for Surrey residents to run the service for an extra 3 months and this would put the contracts out of alignment with other procurement activity for schools in subsequent years.  The staffing situation also renders the business unsustainable in operational terms from September onwards.

There are several pre-contracted framework arrangements available in the market and the impacted schools would likely get a better outcome by re-tendering their service provision during the notice period.

A procurement exercise or market testing exercise by the Council was not appropriate as the Council is a service provider and not the Contracting Authority. Any procurement exercise for the provision of a school meals service would need to be conducted by the schools using one of the many routes open to them.