During 2019, we raised a concern with the NAO; Highways England claimed to have no schedule of Damage to Crown Property (DCP) rates (registered users read more here) in any of their Asset Support Contracts (ASC) – no ‘price list’ for contractor staff, operatives, plant or materials engaged in the 1,000’s of road-repair incidents each year. This has been the situation since 2012. The NAO initially took our concerns seriously, they arranged a meeting with an Authority manager to address the issue.
14/05/2019, the meeting took place and whilst it appears only the NAO kept a note of what was discussed – copy here – our concerns were unwarranted:
Sharon McCarthy (Highways England) advised the NAO’s Mat Kay (the Authority’s Auditor) a schedule of DCP rates exists. Of course they do. The meeting was specifically to address the lack of a price list and went much further than simply obtaining a ‘yes, a schedule exists’, extracts from the meeting note reads:
- Asset Support Contracts (ASCs) are in the process of being phased out, replaced with Asset Delivery model (ADs).
Damage to Crown Property (DCP) have a threshold of £10k.
- below – service providers pursue the third party to recover costs.
- above – are submitted to HE by the service provider
- In submitting the claims to HE, the service provider pulls together a cost pack which summarises the different cost elements
- ASCs include a schedule of rates – the basis for the cost pack (for claims both below and above £10k).
- Individual claims differ due to different schedules of rates between areas, and because every incident is different.
We were assured ASC’s have a schedule of rates for repairs.
However, when Highways England became aware of the above, they claimed there had been a misunderstanding, the Authority was referring to ‘ASC’ not ‘DCP’ rates.
‘ASC’ rates are for pre-planned works, schemes. Odd, we never raised these, we have no interest in them and the NAO’s note contains no reference to such rates – it is clearly about DCP matters, the subject of our concerns.
We sought an explanation from the NAO and received a letter 09/12/2019, an extract from which reads:
‘The minute of my original meeting of 14 May 2019 with a Highways England official, which you included in your correspondence, said that ‘ASCs include a schedule of rates’. This might have been taken to imply, in the context, that a schedule of pre-defined rates existed for the settlement of DCP cases.’
Really? The minute actually went further than above:
ASCs include a schedule of rates – these should be used as the basis for the cost pack (for claims both below and above £10k).
‘ASC’s include a schedule of rates’ is just half the sentence.
The rest of the sentence did not ‘imply‘ a schedule of rates existed, it confirmed this was the case by referencing ‘claims‘ which was, after all, the point of the meeting! Why would there be a reference to ‘claims‘ in the NAO’s note unless rates for damage were being discussed (the point of the meeting)? ASC rates, pre-planned rates do not relate to ‘claims’ or damage following a collision, fire or fluid spill. ‘ASC rates’ relate to improvements, maintenance or scheme work.
Similarly, why is there mention of the £10,000 claim threshold if discussing ASC rates? There is no threshold associated with pre-planned works. The threshold relates to DCP events; attendance and repair costs below £10,000 cause the invoice to be retained by the contractor who must pursue recovery from the at-fault party. Above, £10,000, the contractor bills the Authority who pursues the Third Party.
The minute also reinforces what we and the Court have been told; the schedule of rates should be the basis for the cost pack for both below and above £10,000 claims. But it is not and that is the point … below the threshold, at least one contractor has been using a concocted, high, schedule of rates since 2014 to bill Third Parties … with the knowledge of the Authority.
Is it surprising the Authority does not want the schedule of DCP rates disclosed … for tens of thousands of drivers, fleets hauliers or their insurers to discover just how much they have been overcharged by a contractor acting in the name of a Public Authority?
The NAO doth protest too much, methinks … we have followed this up raising yet more concerns – read more here.