Foodservice wholesaler 3663 has won a new £60m contract to supply all food and drink to publicly-run prisons in England and Wales.

It has supplied prisons since 2007, but under three separate contracts - and beat off competition from three rival bidders, including Booker and DHL, to clinch the four-year contract.

However, the new contract - which marks the first time the Ministry of Justice has consolidated the supply of the 90 million meals served in prisons each year - could prove to be less lucrative.

The Ministry said it would save 11% through the new deal, which will be worth up to £60m to 3663 in the first year, with subsequent prices indexed and capped.

3663 said it would now combine frozen and ambient deliveries to deliver savings for the MoJ, with further efficiencies to be found from centralised buying, ordering and customer service.

“The savings are being made mainly through reductions in food costs brought about by improved purchasing,” a spokeswoman said. “There are further efficiencies on offer for reducing deliveries, combining deliveries, as well as reduced and standardised ranges.”