Since 2013, Highways England have kept ‘Defined Costs’ (a.k.a. DCP Rates or Base Rates) from Third Parties citing commercially sensitive or ‘vexatious’ when asked to disclose them. Of 175 requests or reviews between 2013 and 07/2018 (118 from others), there was no mention the rates were not possessed, did not exist – just the opposite, they do (or what were they considering?) but there were commercial interests at stake. Subsequently, continued requests were deemed ‘vexatious’. Then …
11/2018 – A Highways England manager, Patrick Carney, informed a Tribunal DCP Rates are not commercially sensitive … a further request was made and the response:
They do not exist … they are mythical. Examples of these responses can be found here:
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.
Sian Jones| Lead Information Rights Officer | Information & Technology
Highways England | Piccadilly Gate | Store Street | Manchester | M1 2WD
We do not hold this information. The term ‘Defined Cost’ refers to the definition in the contract as previously provided. The contract does not contain a schedule of Defined Costs. The Defined Cost for each incident is calculated in accordance with the definition.
The overhead is not applied according to a schedule of rates. The overhead is calculated in accordance with the definition, as previously provided.
27/03/2019 – email from Highway’s England’s General Counsel
As you note from your discussions with Jim, Highways England is working on a schedule of repair costs for typical instances of damage to the strategic road network, or DCP. This new schedule of costs, which we intend to publish on Highways England’s website in April this year, will be piloted in Areas 3, 7 and 9 with a view to national roll-out. The new schedule of costs makes no distinction between above threshold and below threshold claims. All future claims in those Areas will be taken forward on the basis of the new schedule.
In Area 9, Kier have withheld bringing new DCP claims since January this year. Those outstanding claims will be taken forward on the basis of the new schedule of repair costs.
For the avoidance of doubt the contract does not contain a schedule of rates for use in conjunction with 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
Following complaints from loss adjusters, Highways England commissioned an independent investigation into the pricing in Area 9 of below threshold (i.e. below £10,000)
claims for damage to the strategic road network (sometimes referred to as Damage to Crown Property (DCP) or Green Claims). The investigation revealed a lack of transparency in the pricing of Green Claims in Area 9, citing the lack in the Asset Support Contract of any schedule of rates (labour or materials) for third party repairs.
As none of the ASCs contain schedules of rates, and Highways England considers that the lack of transparency applies equally to above threshold claims (i.e. those above
£10,000) claims as well as claims below threshold it was considered that a review covering all areas was required.
Whilst the investigation into Area 9 in isolation was concluded it was widened into a root and branch review to improve the end-to-end process for the recovery of Green Claims
generally. This review is ongoing and a final report has not been produced.
To read more, click here.
Another similar responses is recorded that same day:
I have taken the opportunity to discuss this with my colleagues and they have provided the following statement as explanation.
Following complaints from loss adjusters, Highways England commissioned an independent investigation into the pricing in Area 9 of below threshold (ie, below £10,000) claims for damage to the strategic road network (sometimes referred to as Damage to Crown Property (DCP) or Green Claims). The investigation revealed a lack of transparency in the pricing of Green Claims in Area 9, citing the lack in the Asset Support Contract of any schedule of rates (labour or materials) for third party repairs.
None of the ASCs contain schedules of rates, and Highways England considers that the lack of transparency applies equally to above threshold claims (ie, those above £10,000) claims as well as claims below threshold.
Following the investigation, Highways England wrote to service providers under the ASCs reminding them of their obligation to charge the reasonable cost of the repair and not to duplicate or inflate costs.
Whilst the investigation into Area 9 in isolation was concluded it was widened into a root and branch review to improve the end-to-end process for the recovery of Green Claims generally. This review is ongoing and a final report has not been produced.
To address the transparency issue as soon as possible, Highways England decided that a schedule of repair costs for typical repairs to the infrastructure should be created and published. This schedule of repair costs will apply nationally to most Green Claims (bearing in mind that the new Asset Delivery Contracts remove any distinction between above and below threshold claims).
The schedule of repair costs will reflect Highways England’s view, informed by service providers and insurers, of what constitutes a “reasonable” cost for a typical repair. This increased transparency should enable claims to be processed more quickly, with less room for argument and fewer court proceedings. The new schedules of repair costs will be put on the Highways England website in April 2019 and will be piloted in Areas 3, 7 and 9, with a view to rolling them out nationally after three months.
Full response here: 190408 Internal Review 769260
08/04/2019 FoIA response from Highways England 769,535 / 769535 (WDTK FoIA Request)
Extract from request:
You replied the release of all labour, plant and equipment rates, is considered commercially sensitive and inappropriate, particularly given that these rates are detailed individually with each claim form submitted to the insurance company. I am told this is not commercially sensitive and you say the rates are detailed on claims so why would it be. I am asking for the rates.
Under section 1 of the Freedom of Information Act 2000 Highways England does not hold Schedules of DCP rates. Each incident is treated on its own merits in line with the relevant contract. The reasonable repair costs are built up from Defined Costs using the Schedule of Cost Components (as defined in the contract) plus fees and third party overheads, where appropriate. In other words effectively, the actual cost of undertaking the individual third party repair work.
Full response here.
15/05/2019 WDTK FoIA Request response:
Works in Area 6 and Area 8 CRS Ref: 770,360 / 770360
I’ve got an email that says the areas have no rates for damage works and will not
have. Why’s this and what’s the difference in rates now Kier have got them?
You are correct, there are no schedule of rates within our Contracts for the
calculation of the repair costs for claims against negligent Third Parties (TP) who
have caused damage to the Strategic Road Network. Instead such claims are
calculated using the contractual mechanism of Defined Costs incurred. Though they
are pursued as reasonable costs under an action outside of contract and under Tort.
The majority of TP repair works are involved in an emergency response which is
determined by the nature, scale and urgency of the incident and repair, and
consequently the repair costs are a bespoke calculation related to need.
Such unplanned work tends to be far less efficient than planned repair work (for
which in our Asset Support Contracts there is a contractual Schedule of Rates) and
hence will be costlier. The Schedules of Rates specified in the ASCs are not used to
work out the Defined Cost, or for assessing the reasonable cost, of repair in respect
of such TP claims.
For the avoidance of doubt, we do not have any contracts with Kier that contain a
schedule of rates for the calculation of the repair costs for claims against negligent
TP’s who have caused damage on our Strategic Road Network
The conflict is not lost on the Information Commissioner – the contradictions and logic supporting the existence of the rates
Notes: But the rates do exist in Areas 6&8, 9 & 10:
Area 6 & 8