Private caterers will ditch state school contracts if chocolate, crisps and fizzy drinks are banned, leading industry figures have warned.

They claim the loss of profitable confectionery lines, against the backdrop of falling meal uptake, Government underfunding and tougher nutritional standards, could push many contractors out of the state education sector.

The proposed ban on junk food forms part of the School Food Trust's recommendations for school food other than lunch, which cover vending machines, tuck shops and breakfast clubs. The recommendations went out for a four-week consultation period last week.

Julian Edwards, managing director of Tenet consultancy, said: "It's the cost sector but private companies have enjoyed a lucrative era. Anyone with a purely commercial hat on will now think twice about state school contracts. The writing has been on the wall since Jamie Oliver."

Others believe caterers will be put off by the loss of profitable bulk discount deals with suppliers such as Walkers, Mars and Coca-Cola. Gary Stewart, managing director of Catering Management Consultants, said: "Caterers will struggle to get the discounts on healthier items because they'll have to buy according to nutritional content not price."

The British Hospitality Association (BHA) went one step further and said the Government should compensate caterers for a service that was "already chronically under-funded". Chief executive Bob Cotton said: "Vending in schools is worth more than £40m a year and we would urge the Government to make up this loss."

While private caterers denied a confectionary ban would prompt a wholesale pull-out, a spokeswoman for Compass Group education division Scolarest hinted it would think twice about deals in the future.

She said: "There are enormous changes in the sector and good working relationships are key to managing the situation going forward. Where we do not believe that we can form such strong relationships we may consider whether to tender for contracts or even continue an existing one."

Sodexho was also wary about the proposed changes. "We would prefer to see a gradual change to allow children's tastes to adapt to healthier choices. Children at schools without a gated policy will go to the high street," a spokeswoman said.

Simon James, managing director of Initial Catering, said it would work to change teenagers' tastes. "It will be a challenge but there are plenty of alternative options including nuts, seed and yogurt-based snacks."

By Tom Bill

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