04/01/2019: Jim O’Sullivan. CEO of Highways England when discussing overstatement and misrepresentation by their contractors Kier and Balfour Beatty Mott MacDonald, commented:
“you and I, we are dealing with one of the less sophisticated ends of the construction industry, I think that’s true”
Having conveyed various concerns during the conversation brought about the damning criticism of Highways England by a Judge, Jim had written down eight things which he was going to go away and look at.
- charging separately for planning even though it’s part of admin (if Kier were complying with the contract, ‘planning’ would be rejected in the percentage uplift, not a operate item)
- charging £300 for, for debris removal instead of £75 (Third Parties were charged almost £300, the Authority £75 – on larger claims! This should be £30 by reference to the NSoRC)
- accident/incident watchmen the HE rate being £23 whereas you’re charged £65 (Third Parties and Highways England should have the same base rate of approx. £23/hour).
- and then there’s the huge uplift put on, on top of that on the basis that they’re um working overtime when they’re out of hours even though they’re on 24 hours (Kier charged over £60/hour but added a 1.5x uplift after 5pm of a weekday and 2x of a weekend – cost they did not incur but misrepresented to insurers and the Courts).
- Balfour Beatty, in terms of being number 2 behind Kier in terms of concerns
- then I’ve got using averages including identifying the claimant’s storeman (a Judge had identified that a Kier manager would need to work 1.4 hours in every hour and do nothing else to justify the charge presented).
- the gap between the over-threshold and under-threshold claims in terms of averages and the fact that they’re different (Kier’s witness stage some charges are averaged across all claims, all Areas. They are not; Highways England is charged by use of hourly rates)
- this concept of the use of averages in general rather than actual costs (following a white-wash audit in 01./2016, it was understood averages would not be engaged).
But also, important from a costing perspective, we were assured
“You know, you know the very minimum that is going to happen as a result of um, of this call, or certainly as a result of the judgment um is that we will, um we will have a, a schedule of rates um published by Kier, so that this thing is um, is, is transparent”
But Jim’s assurances have yet to come to anything, it appears they cannot be relied upon. The eight subjects above have not been addressed. We will write shortly about Jim’s knowledge of ‘Appendix A to Annex 23’ and Highways England abandoning the public they serve to companies adopting profiteering conduct.
This less-sophisticated end of the construction industry appears to be out of the Authority’s control, able to charge contrary to the contract with Highways England unable to do anything about it. Why? Is the Authority so compromised as to be ineffective?
A Freedom of Information Act request has been presented to obtain related information resulting from conversations 04/01/2019 & 15/02/2019. The request can be found here, at WhatDoTheyKnow. The request was refused, the Authority citing ‘vexatious’ (31/01/2020) and an internal review sought 09/02/2020.
The ‘less sophisticated end of the construction industry’ appears to have the authority wrapped around its little finger, unable to address the concerns we have raised prior to 21/06/2017 when we met Highways England and presented evidence of exaggeration and fraud. 15/11/2017 we reiterated the issues to KPMG – the conversation is provided here. The concerns involving Kier and BBMM are summarised here.
Some contractor conduct does appear plain dense … suspected tampering with images . It is these people we are engaging with to undertake Smart Motorway construction and HS2!