Explanation of Defined Cost and Uplift

John Stephenson made this Freedom of Information request to Highways England Company Limited

This request has been closed to new correspondence from the public body. Contact us if you think it ought be re-opened.

Highways England Company Limited did not have the information requested.

John Stephenson

Dear Highways England Company Limited,

Under the freedom of information act I am requesting the following information from you. I am informed as below regarding the construction of invoices. Please let me know
- What are defined costs, who calculates these, what is the calculation, what is the defined cost
- What are the uplifts to Highways England and Third Parties who calculates these, how are they calculated, what is the calculation. What is the uplift
- How is compliance with the process monitored?
- Is the process complied with?
- what reports of noncompliance been made and what investigations undertaken. A copy of the reports.
Please give me a full explanation.
Thank you

Yours faithfully,

John Stephenson

Highways England, Highways England Company Limited

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Sheikhol, Zoë, Highways England Company Limited

1 Attachment

Dear Mr Stephenson

Thank you for your request for information regarding Explanation of Defined Cost and Uplift. Your request has been dealt with under the terms of the Freedom of Information Act 2000.

Please find attached our response.

Kind regards

Zoë

Zoë Sheikhol, Business Manager
Business Information and Assurance – Commercial and Procurement
Highways England | Lateral | 8 City Walk | Leeds | LS11 9AT
Tel : +44 (0) 300 4702567 | Mobile : + 44 (0) 7795 301 177
Web: http://www.highways.gov.uk
GTN: 0300 470 2567

show quoted sections

Mr P Swift left an annotation ()

I do not believe the information you have been supplied is accurate or, in the alternative, a Court has been misled …
You have bene informed by Highways England:
1. “Defined Cost is calculated by the supplier”
2. “You may wish to assess how the contract works and definitions by reference to the contract document. These are published and available on a government website called Contract Finder”
3. “Any uplifts are calculated by suppliers and we do not hold information on how any such uplift is calculated.

Kier have stated to a Judge, in the name of Highways England in respect of the working area overhead:
‘it’s calculated and it's calculated with the procurement team from Highways England and defined to the contractors use’

Additionally:

So it’s calculated from overhead costs and then there's, like, a, a calculation that takes place, but it’s something that takes place at the tender stage with Highways England procurement team and we’re just told, “This is the one you have to use.”

A Court was also informed:

“So, effectively, all the costs associated, attributed to a person are put in to against a person, and then once a year our finance team divide that obviously by the number of working hours, and they come up with an hourly rate.
And then on top of the hourly rate there‘s a contract overhead applied, which in this case is 20.58 per cent. That is an overhead that was calculated at the contract end stage and given to us by Highways England to use, and it’s based on all the associated overheads of running an operation like this.”
With regard to the above, Kier have told the Court, when giving evidence for Highway England, that the ‘contract overhead’, the Third Party Claims Overhead, is 20.58%, that it was dictated by Highways England which contradicts the response you have been provided.

It appears you are being misled and sent to search for information within contracts; data that will not be present either because it was discussed at the tender stage or Highway England do not upload this.

However, the uplift and confirmation of same (at 20.58%) is worth pressing for because it is high and to date (to my knowledge) no one has confirmed this. Kier have stated time and time again that 20.58% is the uplift but they have never evidenced the agreement to support this and Highways England have never confirmed it is correct, accurate.
I suspect the uplift is lower. For example, in Area 10 we see uplifts of between 4% and 13%.

Highways England have also advised you:
4. As a result there is not a compliance process.”

It therefore appears there is, or should be, a compliance process. However, with regard to Kier, an audit would find non-compliance – as well Highway England are aware. In 06/2017 we met with the head of claims at Highways England. Within a few hours we had conveyed evidence of non-compliance and the following day we were asked by Highways England whether the issue should be placed with their fraud unit i.e. it appears they accepted there were grounds for making such an allegation. KPMG were to commence an audit in 11/2017. In 01/2018 we were informed the audit had concluded but it transpires this was false. To date, there is no outcome, 8 months!
Good luck.

Dear Sheikhol, Zoë,
Can someone review this. If what has been posted to day is accurate I expect an explanation pdq.
John Stephenson

Sheikhol, Zoë, Highways England Company Limited

Thank you for your e-mail.

I am out of the office on leave until Tuesday 14th August no access to my
emails.

For any urgent EDI queries please contact Belinda Blake
([email address] / 0300 4704473) otherwise I will try
and deal with your e-mail as quickly as possible.

If you would like to make a request under the Freedom of Information Act,
please contact [1][Highways England request email]

 

Kind regards

Zoë

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Sheikhol, Zoë, Highways England Company Limited

Dear Mr Stephenson

I apologise for the slight delay in responding to your email as I was out of the office yesterday.

From your email it is not clear what you are seeking clarification on in relation to our response to your original FOI request (764,253).

If you have specific clarification questions or you wish to raise additional questions, which would be treated as a new FOI request, then you will need to raise these through the normal process via [Highways England request email].

If you are unhappy with the way we have handled your request you may ask for an internal review. Our internal review process is available at: https://www.gov.uk/government/organisati...

Kind regards

Zoë

Zoë Sheikhol, Business Manager
Business Information and Assurance – Commercial and Procurement
Highways England | Lateral | 8 City Walk | Leeds | LS11 9AT
Tel : +44 (0) 300 4702567 | Mobile : + 44 (0) 7795 301 177
Web: http://www.highways.gov.uk
GTN: 0300 470 2567

show quoted sections

Dear Sheikhol, Zoë,

Someone has posted that your response is not full or correct. Is what they have written accurate?

Yours sincerely,

John Stephenson

Sheikhol, Zoë, Highways England Company Limited

Thank you for your e-mail.

I am out of the office on leave now until Tuesday 4th September with no
access to my emails.

For any EDI queries please contact Belinda Blake
([email address] / 0300 4704473) otherwise I will try
and deal with your e-mail as quickly as possible.

If you would like to make a request under the Freedom of Information Act,
please contact [1][Highways England request email]

 

Kind regards

Zoë

This email may contain information which is confidential and is intended
only for use of the recipient/s named above. If you are not an intended
recipient, you are hereby notified that any copying, distribution,
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Highways England Company Limited | General enquiries: 0300 123 5000
|National Traffic Operations Centre, 3 Ridgeway, Quinton Business Park,
Birmingham B32 1AF |
[2]https://www.gov.uk/government/organisati... |
[3][Highways England request email]

 

Registered in England and Wales no 9346363 | Registered Office: Bridge
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C&P CCC, Highways England Company Limited

Dear Mr Stephenson

Thank you for the email.

From your email it is still not clear what you are seeking clarification on in relation to our response to your original FOI request (764,253). It would help us with our investigations if you could provide details of the information from our response that is not 'full or correct'.

If you have specific clarification questions or you wish to raise additional questions, which would be treated as a new FOI request, then you will need to raise these through the normal process via [Highways England request email].

If you are unhappy with the way we have handled your request you may ask for an internal review. Our internal review process is available at: https://www.gov.uk/government/organisati...

Kind regards,

Nicola

Nicola Patchett, Business Manager
Highways England | Lateral | 8 City Walk | Leeds | LS11 9AT
Tel: +44 (0) 300 4702534 | Mobile: + 44 (0) 7795290527
Web: http://www.highways.gov.uk
GTN: 0300 470 2534

show quoted sections

Dear Highways England Company Limited,

Please pass this on to the person who conducts Freedom of Information reviews.

I am writing to request an internal review of Highways England Company Limited's handling of my FOI request 'Explanation of Defined Cost and Uplift'.

There is a post on my request as below. I need someone to review hat I have been sent with what has been written in the post because soemone is not giving me true info'.

Mr P Swift left an annotation (12 August 2018)
I do not believe the information you have been supplied is accurate or, in the alternative, a Court has been misled …
You have bene informed by Highways England:
1. “Defined Cost is calculated by the supplier”
2. “You may wish to assess how the contract works and definitions by reference to the contract document. These are published and available on a government website called Contract Finder”
3. “Any uplifts are calculated by suppliers and we do not hold information on how any such uplift is calculated.

Kier have stated to a Judge, in the name of Highways England in respect of the working area overhead:
‘it’s calculated and it's calculated with the procurement team from Highways England and defined to the contractors use’

Additionally:

So it’s calculated from overhead costs and then there's, like, a, a calculation that takes place, but it’s something that takes place at the tender stage with Highways England procurement team and we’re just told, “This is the one you have to use.”

A Court was also informed:

“So, effectively, all the costs associated, attributed to a person are put in to against a person, and then once a year our finance team divide that obviously by the number of working hours, and they come up with an hourly rate.
And then on top of the hourly rate there‘s a contract overhead applied, which in this case is 20.58 per cent. That is an overhead that was calculated at the contract end stage and given to us by Highways England to use, and it’s based on all the associated overheads of running an operation like this.”
With regard to the above, Kier have told the Court, when giving evidence for Highway England, that the ‘contract overhead’, the Third Party Claims Overhead, is 20.58%, that it was dictated by Highways England which contradicts the response you have been provided.

It appears you are being misled and sent to search for information within contracts; data that will not be present either because it was discussed at the tender stage or Highway England do not upload this.

However, the uplift and confirmation of same (at 20.58%) is worth pressing for because it is high and to date (to my knowledge) no one has confirmed this. Kier have stated time and time again that 20.58% is the uplift but they have never evidenced the agreement to support this and Highways England have never confirmed it is correct, accurate.
I suspect the uplift is lower. For example, in Area 10 we see uplifts of between 4% and 13%.

Highways England have also advised you:
4. As a result there is not a compliance process.”

It therefore appears there is, or should be, a compliance process. However, with regard to Kier, an audit would find non-compliance – as well Highway England are aware. In 06/2017 we met with the head of claims at Highways England. Within a few hours we had conveyed evidence of non-compliance and the following day we were asked by Highways England whether the issue should be placed with their fraud unit i.e. it appears they accepted there were grounds for making such an allegation. KPMG were to commence an audit in 11/2017. In 01/2018 we were informed the audit had concluded but it transpires this was false. To date, there is no outcome, 8 months!
Good luck.

A full history of my FOI request and all correspondence is available on the Internet at this address: https://www.whatdotheyknow.com/request/e...

Yours faithfully,

John Stephenson

Highways England, Highways England Company Limited

This is an automated response:

 

Thank you for your email to Highways England.

 

If you’re reporting a real time issue which requires immediate attention
please call the Customer Contact Centre on 0300 123 5000. 

 

A map of the roads for which we are responsible can be found here
[1]https://assets.publishing.service.gov.uk....
If the road you’re interested in isn’t on this map it will fall under the
jurisdiction of the local authority.  You can find details of local
authorities using the search facility on the gov.uk website
at: [2]https://www.gov.uk/find-your-local-council

 

If your email does relate to an issue on Highways England's network it
will be passed to the relevant team within Highways England and they will
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If you’ve made a request under the Freedom of Information Act we will
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[5]https://www.gov.uk/government/organisati... |
[6][Highways England request email]

 

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6. mailto:[Highways England request email]

FOI Advice, Highways England Company Limited

Dear Mr Stephenson

Internal review reference: 765,808

Thank you for your email dated 8 September 2018.

I understand from your email you are seeking an internal review into the way in which your Freedom of Information Request - 'Explanation of Defined Cost and Uplift' (reference: 764,253) was handled.

I note that on 14 August 2018 you were advised by my colleague Zoë Sheikhol:

From your email it is not clear what you are seeking clarification on in relation to our response to your original FOI request (764,253).

If you have specific clarification questions or you wish to raise additional questions, which would be treated as a new FOI request, then you will need to raise these through the normal process .

Following which I note on 23 August 2018 you asked:

Someone has posted that your response is not full or correct. Is what they have written accurate?

On 29 August 2018 my colleague Nicola Patchett replied:

From your email it is still not clear what you are seeking clarification on in relation to our response to your original FOI request (764,253). It would help us with our investigations if you could provide details of the information from our response that is not 'full or correct'.

If you have specific clarification questions or you wish to raise additional questions, which would be treated as a new FOI request, then you will need to raise these through the normal process via [Highways England request email].

Having read all of the correspondence in relation to this issue it is my view that to fully answer your queries you will need to provide details of the information you believe not to be full or correct. I conclusion it is my view that unfortunately at this stage the information you have provided to Highways England in insufficient to allow us to provide a comprehensive response.

If you are not satisfied with the outcome of this review you have the right to apply directly to the Information Commissioner for a decision. The Information Commissioner can be contacted at:

Information Commissioner’s Office
Wycliffe House
Water Lane
Wilmslow
Cheshire
SK9 5AF

Yours sincerely
Sian Jones | Lead Information Rights Officer | Information & Technology
Highways England | Piccadilly Gate | Store Street | Manchester | M1 2WD
Web: http://www.highways.gov.uk

show quoted sections

Dear FOI Advice,
It's what you have said needs reviewing. I have an email that says different.
Yours sincerely,
John Stephenson

John

Thank you for your email. To address your questions:

I am not, nor have I been an employee of a contractor or Highways England. I have reviewed hundreds of contractor charges over the past 10 years collating, comparing and presenting the numerous discrepancies which in some cases appear to amount to profiteering in others it is difficult to conclude that the conduct is other than fraud undertaken with the knowledge and approval of Highways England.

I have attended Court to hear claims progressed in the name of Highways England (they are the claimant taking the action against drivers, fleets or insurers) and heard their witness give evidence. Such were my concerns at what I heard, I obtained transcripts – these do not come cheap.

I have reviewed what Highways England conveyed to you. My understanding of ‘defined costs’ is somewhat more simple and based upon what I have been told. A ‘Defined Cost’ is the base rate of something. Principally we are talking about Staff (office employees), Operatives (the employees on the ground attending and repairing), Plant (vehicles) and materials (beams, posts, signs etc.). A defined cost is what an item costs the contractor before any uplift for profit. So, taking an AIW who attends an incident, in 2016, I was informed this was £58.32 and comprised many components:

http://www.englandhighways.co.uk/the-cos...

The response you received includes the following statements:

1. Defined Cost is calculated by the supplier

2. ‘Any uplifts are calculated by suppliers and we do not hold information on how any such uplift is calculated. As a result there is not a compliance process.’

With regard to ‘1’ you can wade through contracts but I do not believe this will help you. It appears Highways England are seeking to tie you up in lengthy, irrelevant, documentation. I do not believe the needle you are after is in published contractual haystack of documents. It appears likely that this cost is something the contractor produces.

As for the response about uplifts, I have mentioned being present at Court and hearing what was conveyed to a Judge by Highways England’s witness. You are being told Highways England hold no information about the uplift, the percentage added to the defined costs.

Having established a set of defined costs of base rates for components (as above), it is reasonable and necessary for a contractor to apply an uplift, their profit margin. I am simplifying this, the % uplift could include an element for variables and unknowns. To Highways England this is referred to as a ‘fee’ to a Third Party (driver, fleet or insurer) this is called the 'Third Party Claims Overhead' (TPCO) or Working Area Overhead. They are percentages.

The uplift to Highways England, the ‘fee’ you would expect to have an input from Highway England if only checking it was reasonable, there being some negotiation. This varies over areas but we see anything between 4.5% and about 13%.

The TPCO is higher. There are arguments for and against this. The link I have supplied you above demonstrates Kier’s use of 20.58% and this was conveyed to a judge in an Area 13 claim.

You are being told the TPCO is calculated by suppliers and Highways England do not hold information on how any such uplift is calculated. The following is from a Court transcript in which Highways England gave evidence at Basingstoke Court Court to a District Judge*:

“COUNSEL FOR THE CLAIMANT: What is the working area overhead?

Witness: 20.58 per cent.

THE DISTRICT JUDGE: The working... I am sorry; you are going to have to explain it to

me. The working what?

Witness: Area overhead, so under the contract—

Q. Hang on. I will write it down and then you can explain it to me. The working area

overhead.

Witness: An overhead calculated at the time of contract award with Highways England.

Q. Yes.

Witness: And it’s basically all the costs associated or the overhead costs associated with

(inaudible) the incident response divided by the number of incidents over a period

which would be a year in this instance, and then it comes down—

Q. Hang on. I have got to write it down.

Witness: I'm sorry.

Q. The cost of running the incident cost divided by...?

Witness: The number of incidents in a year.

Q. Yes.

Witness:. Then that spits out a percentage that you have to uplift claims by to cover—

Q. It splits out or—

Witness: Produces, if you like, produces.

Q. Produces.

Witness: The number, which is the percentage.

Q. The percentage.

Witness:. Yeah, that is checked and signed off by Highways England, and their procurement (inaudible)”

According to their own witness (the former head of claims for Kier) Highways England check and sign off the figure, the TPCO. How are they able to do this without knowledge / information?

The witness further explained when questioned:

“COUNSEL FOR THE CLAIMANT: Do you know what the calculation is?

Witness: There is a big sheet of numbers that I haven't got with me, but because they are sensitive of Highways England but they can be produced.

THE DISTRICT JUDGE: Presumably, you did not produce these and neither did Kier.

Witness: No.

Q. Highways England produced them.

Witness: Yeah.”

According to their witness, Highways England produced the percentage.

Counsel for the defendant queried why Highways England would have an involvement in what Kier charge asking:

“Q. —since this claim is not paid by Highways England, what does it matter what they add

to things that they have to pay for? Where is the reverence in today’s claim of that?

Witness: That's what they defined as us using as our overhead.

Q. Therefore, they tell you—

Witness: It has to be (inaudible). Yes.

Q. —what you have to charge as an overhead.

Witness: They sign that off, yeah, yeah. they work on that, basically, so it’s procurement …looking at tender information.

Q. Yes.

Witness: I'm not involved in—

Q. Highways England tell you what you have to charge.

Witness:. Based on the figures provided, yes.”

Highways England defined the rate.

The question that it appears someone needs to ask and answer is ‘who is telling the truth’? Are Highways England misrepresenting facts to you or are Kier misrepresenting facts to a Court / Judge … or are both not being forthright?

It appears that Highways England are involved in the process as the witness explained how the Public Authority uses information provided by the last incumbent – that is to say the costs Highways England have seen form the existing contractor are used to calculate figures for the new contractor.

On another hearing date the same witness was asked:

“Q. Why are they (Highways England) not charged a working area overhead like insurers? What makes the working area overhead reasonable?

Witness: Well, it is our overhead. It is our overhead costs, it’s calculated and it's calculated, like I said on Monday, with the procurement team from Highways England and defined to the contractors use”

So there you have it. The procurement team at Highways England produce the percentage and it appears that it is calculated by reference to figures the current contractor does not possess, data from the existing contractor.

It is this information which appears to have been kept form you. If Highways England’s witness told the truth to the Judge, Highways England hold information. In turn, it appears there should be a compliance process.

If the above needs clarification just say but in my experience Highways England will resist supplying information about their contractors, particularly Kier as the rules are not being complied with below threshold i.e. on those claims where the contractor bills Third Parties directly. Highways England made it very clear to me – contractors can do what they like.

*THE COUNTY COURT AT BASINGSTOKE Claim No. C06YM610

Monday, 30th January 2017

Before: DISTRICT JUDGE COOPER

Between:

HIGHWAYS ENGLAND CO LTD

Claimant

FOI Advice, Highways England Company Limited

Dear Mr Stephenson

As stated below if you are not satisfied with the response you should refer the matter to the Information Commissioner's Office; details of which can be found below:

Information Commissioner’s Office
Wycliffe House
Water Lane
Wilmslow
Cheshire
SK9 5AF

Yours sincerely
Sian Jones | Lead Information Rights Officer | Information & Technology
Highways England | Piccadilly Gate | Store Street | Manchester | M1 2WD
Web: http://www.highways.gov.uk

show quoted sections

Mr P Swift left an annotation ()

Sir
Highways England do not wish to release the information and I would suggest that this is because were they to do so, it would be realized that drivers, fleet sand insurers are subsidizing road repairs or contractors are being allowed to overcharge, profiteer. I will address your request as best able:
- What are defined costs, who calculates these, what is the calculation, what is the defined cost

A: they are the base rate (before profit)of an item. In Area 9, for example, they should be the sane to you (a third Party) and Highways England (HE). They are not. If HE disclosed the rates they would evidence:
Non compliance with the contract by Kier Highways Ltd.
Failure of HE to enforce the contract
Profiteering
Kier have not complied with the contract since day 1, 07/2014.

What are the uplifts to Highways England and Third Parties who calculates these, how are they calculated, what is the calculation. What is the uplift

To HE the uplift depends upon the date. It is referred to as a fee and is current 7.38% or 7.4% in Area 9

A. The uplift to a Third Party isn Area 9 is 25.29%. This NOT commercially sensitive, it has been released on this site. In other Areas, seemingly even where Appendix A to Annex 23 does not apply, Kier charge 20.58%

- How is compliance with the process monitored?

A: it would seem it is not. We have raised the matter so many times it is not possible for HE to be unaware of the issue.

- Is the process complied with?
A. No

- what reports of noncompliance been made and what investigations undertaken. A copy of the reports.

A. good luck with this! We and others have made reports of non-compliance. The contract has not been complied with insofar as Third Parties are concerned, the process is not applied and this has not been addressed by HE. In 06/2017 we met with Mrs Green the new claims manager for HE. We evidenced the overstatement, the exaggeration and non-compliance with the contract in less than 1/2 day providing documentary corroboration. More than a year later and the dismissive response received to their 'investigation' indicates there is not intention to put a stop to their contractors profiteering.

Please give me a full explanation.
Thank you

Mr P Swift left an annotation ()

re pm
email you need for the ICO is casework@ico.org.uk

Mr P Swift left an annotation ()

Rates are not commercially sensitive. Tribunal Decision EA/2018/0104 ICO 02/04/2018.
you need to ask for the DCP Rates.
see:
http://www.englandhighways.co.uk/area-10...
I sought ‘DCP Rates’[1]
HE described these as ‘commercially sensitive’
I appealed
HE upheld their decision
I appealed to the ICO
The ICO supported HE
I presented the matter to a tribunal

Case Reference Number FS50797132
Dear Mr Stephenson,
I write further to your complaint regarding the information request you sent to Highways England on 3 July 2018.
Highways England provided you with a response on 31 July 2018 however I can see that you are concerned that the information provided to you is not full or correct. I can see that you have asked Highways England for an internal review however they are unclear of what your ongoing complaint is.
I would take this opportunity to explain that under the Freedom of Information Act 2000 (FOIA) you are entitled to request recorded information from a public authority however this does not extend to the accuracy of the recorded information held by a public authority.
You are therefore unable to pursue any concerns regarding the accuracy of information provided under FOIA.
If however your concern is that not all information held relevant to the scope of your request has been provided to you this is something that you are able to pursue under FOIA and in relation to which Highways England should be able to carry out an internal review. 
Could you therefore confirm that you wish Highways England to carry out an internal review on the issue as to whether all recorded information has been located and provided to you in response to your request? If this is the matter you wish to pursue I will write to Highways England and ask it to proceed to carry out an internal review to address this specific issue.

FOI Advice, Highways England Company Limited

Dear Mr Stephenson

We are in receipt of the below which appears to be a response to you from the Information Commissioner's Office (ICO). We have yet to receive any correspondence on this matter from the ICO and as such I am unclear what action you wish Highways England to take at this stage. Please can you confirm the purpose of the below eg are you informing us this matter has been referred to the ICO?

Yours sincerely
Sian Jones| Lead Information Rights Officer | Information & Technology
Highways England | Piccadilly Gate | Store Street | Manchester | M1 2WD
Tel: +44 (0) 300 4705240
Web: http://highwaysengland.co.uk
GTN: 0300 470 5240

show quoted sections

Dear FOI Advice,
There's a statement on this request that tells me Rates are not commercially sensitive. Tribunal Decision EA/2018/0104 ICO 02/04/2018.

The information I am requesting is the rates.

Yours sincerely,

John Stephenson

FOI Advice, Highways England Company Limited

Dear Mr Stephenson

Further to the below my colleagues have provided the following response:

Highways England does not hold schedules of individual service providers’ DCP Rates, with the exception of A-one+ who, of their own volition, took a business decision to publish what has been referred to as “DCP rates”.

For the most part, repair costs are built up on a case by case basis using defined or reasonable costs, plus third party overheads or a fee where appropriate

Consequently I can confirm information relating to schedules of individual service providers DCP Rates is not held by Highways England.

Yours sincerely

Sian Jones| Lead Information Rights Officer | Information & Technology
Highways England | Piccadilly Gate | Store Street | Manchester | M1 2WD
Web: http://highwaysengland.co.uk

show quoted sections

Dear Highways England Company Limited,

Please pass this on to the person who conducts Freedom of Information reviews.

I am writing to request an internal review of Highways England Company Limited's handling of my FOI request 'Explanation of Defined Cost and Uplift'.

There's a statement on this request that tells me Rates are not commercially sensitive. Tribunal Decision EA/2018/0104 ICO 02/04/2018. How can you not have the rates you are charged?

A full history of my FOI request and all correspondence is available on the Internet at this address: https://www.whatdotheyknow.com/request/e...

Yours faithfully,

John Stephenson

Highways England, Highways England Company Limited

This is an automated response:

 

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Mr P Swift left an annotation ()

FOI Advice, Highways England Company Limited

Dear Mr Stephenson

Internal Review reference: 768,922

Further to your request for internal review dated 8 February 2019 as previously stated:

Highways England does not hold schedules of individual service providers’ DCP Rates, with the exception of A-one+ who, of their own volition, took a business decision to publish what has been referred to as “DCP rates”.

For the most part, repair costs are built up on a case by case basis using defined or reasonable costs, plus third party overheads or a fee where appropriate

Consequently I can confirm information relating to schedules of individual service providers DCP Rates is not held by Highways England.

By way of further clarification:

The model Conditions of Contract for Highways England Asset Support Contracts (ASC) is publicly available online (https://webarchive.nationalarchives.gov....). Please note that the various ASCs whilst based on the model documents may differ in some respects. For example, some ASC contracts have an additional appendix to Annex 23.

The term ‘Defined Cost’ refers to a definition in the contract which can be found in clause 11 at point (27). The contract does not contain a schedule of Defined Costs. The Defined Cost is calculated in accordance with the definition.

In the Conditions of Contract Schedule 1 contains the Schedule of Cost Components, which can be found at page 101 (https://webarchive.nationalarchives.gov....). The schedule does not contain any figures or rates but sets out the heads of costs.

The Pricing Schedule, including Appendices A, B and C, includes the rates tendered by the provider. We have previously advised that these rates are exempt from disclosure as the conditions under s43 of the Freedom of Information Act 2000 are met. This was recently upheld by the First tier Tribunal reference EA/2018/0104.

Paragraph 52 of the judgment sets out the tribunal conclusion that “… the withheld information does not contain specific DCP rates. We accept [Highways England's] evidence that the withheld information sets out target rates for the main contract as part of the tendering process for ASC Area 10, and is very different from DCP rates which are actual costs charged in emergency situations”. The Tribunal confirms that [while] “there may be some overlap in the types of items covered, the withheld information would not easily allow DCP rates to be calculated, and would not give an accurate picture. In particular, it would not show clearly how DCP rates charged to third parties are calculated, or whether different rates are charged to third parties directly by contractors”

The Tribunal summarised at paragraph 53 that “Put simply, the withheld information simply does not show what the appellant wants to know about DCP rates”.

The process for administering Third Party Claims is covered in Annex 23 Third Party Claims (https://webarchive.nationalarchives.gov....) For the avoidance of doubt the contract does not contain a schedule of rates for use in conjunction with Annex 23.

The use of the term DCP Rates appears to have unintentionally caused additional confusion. For the purposes of dealing with the material raised in Tribunal matter EA/2018/0104 Highways England used in its statement used the term ‘DCP Rates’.

Any references to DCP Rates are merely an effort by Highways England to deal with the rates provided to the Tribunal. The ASC contracts do not contain DCP Rates or indeed any schedule of rates that is used to calculate the Defined Cost or the cost of repair for DCP claims.

The above should now provide additional clarity:
a. The Schedule of Cost Components does not contain a schedule of rates.
b. A schedule of DCP rates is not held and has never formed part of the contract.
c. The contract does not contain a schedule used to build up the invoice or containing base rates.
d. Whilst the Pricing Schedule contains schedules of rates, the rates are tendered rates and not applicable for the purposes of Annex 23 or DCP. As stated above the tendered rates are commercially sensitive.

If you are not satisfied with the outcome of this review you have the right to apply directly to the Information Commissioner for a decision. The Information Commissioner can be contacted at:

Information Commissioner’s Office
Wycliffe House
Water Lane
Wilmslow
Cheshire
SK9 5AF

Yours sincerely
Sian Jones| Lead Information Rights Officer | Information & Technology
Highways England | Piccadilly Gate | Store Street | Manchester | M1 2WD
Web: http://highwaysengland.co.uk

show quoted sections

Mr P Swift left an annotation ()

which Area rates are you seeking? Evidence of 9 & 10 can be found here:
http://www.englandhighways.co.uk/defined...
The response you have received is identical to one I was provided on a related matter.
For almost 5 years I have sought rates and been advised that they are commercially sensitive, then my requests were deemed vexatious. A tribunal found that the rates were not commercially sensitive, I applied again and was told ‘we do not hold them’ – after 5 years! Would have bene nice to have this stated at the outset!

Area 10 is managed by BBMM who have agreed rates with Highways England for repairs where the total is over £10,000. BBMM / Highways England claims against Third Parties and claims the repair cost is calculated by reference to rates agreed with BBMM for works over £10,000. The £10,000 + rates are negotiated prescribed rates. Possibly you need to specify this; the rates are known by various names:
Defined rates
Prescribed rates
DCP rates
Nominal rates
Base rates
But ultimately it seems to be the above threshold ‘pricings schedule’

Peter Anderson left an annotation ()

Are they are now calling DCP rates (previously known as defined costs) a ‘Pricing schedule’?

No rates to compare what they are charged against. Explains why there's controversy surrounding the charges.
https://www.5rb.com/case/swift-v-informa...

The Tribunal was asked to use its discretion to order disclosure of specific DCP information. However, we are not able to order disclosure of information which falls outside the scope of the appellant’s request in this case.

Is the decision about the rates you want?

Dear FOI Advice,
The posts here say this is wrong. What are you charged? What rates have you got? Send me them.
How many claims are there sent to you every day ? How are repair costs are built up on a case by case.
Yours sincerely,
John Stephenson

John Stephenson left an annotation ()

Case Reference Number FS50797132

John Stephenson left an annotation ()

Mr P Swift left an annotation ()

The situation with regard to the Authority's contracts is as follows:
Highways England have two main maintenance contract models in use:
1. the original Asset Support Contract (ASC), which is in the process of being phased out and replaced with
2. the Asset Delivery model (AD).
In the former contract model, a schedule of rates is included.
This should be used as the basis for the calculation of costs for claims above and below the £10,000 threshold. As we have long explained, these 'base rates', DCP Rates or 'defied costs' are to be common to all claims in ASC Areas. But they are not.
Below threshold claims are presented to drivers, fleets, hauliers and insurers but they are compiled using a much higher set of rates. In Area 9, Kier Highways have not complied with the contract since day-one, 07/2014 as a cost of £millions to those unfortunate to receive one of their state-supported demands.
More here:
http://www.englandhighways.co.uk/dcp-rat...