A business case for privatising the food service at Dunedin Hospital is likely to go ahead.

The Southern District Health Board is pursuing the plan, and will consult staff in February.

If privatisation of the food service stacks up as expected, it will be implemented.

The health board estimates it will save almost a million dollars in the first year with a private provider.

Existing staff will be able to transfer from the health board to the new provider, and there shouldn't be any redundancies.

But the change will likely affect local suppliers, with some food being pre-cooked elsewhere.

At the moment hospital food is prepared locally.