Claims & Costs
If your vehicle causes damage to property, you can expect to receive a demand for the repair cost. Who presents this claim and the amount sought will depend upon the location and the contract the Local Authority (LA) or Secretary of State (SoS) / Highways England has entered into with their contractor. It is important to be aware of the process that occurs in some regions of England, referred to as ‘Areas’:
- If the invoice is over £10,000, the contractor usually presents their invoice to Highways England who make payment to them. Highways England then seek to recover their outlay from the at-fault party.
- Generally, invoices below £10,000 are presented to drivers, fleets and insurers by the contractor who bears the cost of the restoration and attempts to recover payment from the at-fault party where they are identified. These ‘parties’ are drivers, fleets and insurers – referred to as ‘Third Parties’.
The concern is that at ‘1’ above, some contractors charges Highways England by use of ‘mates rates’ yet, with regard to ‘2’, despite using the same operatives, plant, materials and staff, Third Parties are charged using higher rates.
Claims are either pursued by a Council, Transport for London (TfL) or Highways England Ltd (which, in April 2015 replaced the Highways Agency) or their contractors. For further information, click here
Dealing with the Public Authority is generally straightforward. However, contractors appear to be a law unto themselves – a situation which is known to Highways England who advise:
“They can do what they like with their own claims, that’s absolutely nothing to do with us”
The evidence in our possession indicates contractors charge higher rates to drivers, fleets or their insurers than to the Public Authority supplier. Until recently, neither a contractor, TfL nor HE has formally acknowledged that this is the case. However, in early 2017, Kier Highways Ltd (Kier) presented evidence to a Judge during a Court hearing. Kier acknowledged that they charged differently to Third Parties (drivers, fleets & insurers), that they charged less to their client, the Public Authority. However, they explained the differences as relatively small, specifically:
- Defined Costs (set ‘base rates’) were charged the same to Third Parties and the Public Authority
- The uplift was different and caused the amount changed to be higher to Third Parties:
- 7.38% to the public Authority
- 20.58% to Third Parties
Therefore, a Third Party should be charged 13.2% more than the Public Authority. But the information imparted is wrong, false. The information within these pages evidences the substantially greater sums being claimed from Third Parties.
Update 06/03/2017: A Freedom of Information Act request of Highways England resulted in the disclosure of Annex 23 to the Area 9 ASC contract – a Kier contract. This disclosure is important.
Annex 23 has long been available online however, the disclosure included, tagged on as the last 2 pages, Appendix A. This document was not previously known to be in the public domain. Whilst Annex 23 defines ‘Third Party claims’, Appendix A describes how the costs should be calculated; the way the maximum charge to Third Parties is arrived at. Appendix A reiterates the process Kier explained to the Court. It therefore transpires that the process described to the Judge is also dictated by the contract. The contract is not being complied with. The protection Highways England built into the contract for Third Parties has been ignored since the commencement of the contract 01/07/2014 and the public Authority appears not to have identified this.