Project Verde KPMG & Kier Highways

The latest known ‘investigation’ / audit of Kier Highways Ltd.  by KPMG  appears to have been named project name ‘Verde’; ‘Green’ claims (those against a Third Party) hence, ‘Verde’?

The investigation of Kier should have commenced following a report submitted to Highway England 10/2015 about 5-fold exaggeration.  This principally dealt with the contractor’s 1153 process and related charges. The concerns reached the Authority’s General Counsel, Tim Reardon.  The resultant audit had ‘gaps’ and misrepresentations about the rates Kier were charging Highway England followed. despite protestation about the report, the General Counsel was dismissive.  A process that saw Third Parties likely over-charged £10+ million between 07/2014 and 10/2015 caused no qualms.

An investigation ought to have recommenced in early 2017, following our discovery of Appendix A to Annex 23.  This document sets out how Third Parties (drivers, fleets, hauliers & insurers) were to be charged ‘no more than’.  This document was kept secret from Third Parties; not placed on line whereas contacts and annexes had been.  The Appendix was not mentioned by the Public Authority or Kier.  The protection afforded Third Parties was kept from them and ‘coincidentally’ the contractor did not comply with the contractually agreed process.  We recently asked the public Authority’s CEO if he believed the appendix is good and should be complied with? The response was ‘yes, it’s the contract’

  • For almost 5 years, Area 9’s contractor has failed to comply with the contract, a fact brought to the attention of the Public Authority in person 21/06/2017, conveyed to KPMG 15/11/2017 and about which we have written on numerous occasions.  Yet to date, the failure to abide by the process, to comply with the contract, has not been addressed. Why not?

It appears our 2017 new-found knowledge of the process (Appendix A) and repeated demands, such as appear here, caused a meeting to occur.  Ultimately presented to the Authority’s Chairman, Colin Matthews, all we were asking for was contract-compliance; that claims to Third Parties to be priced in accordance with Appendix A, .

21/06/2017 we met the soon-to-be head of Green Claims for Highways England, Sarah Green and spent about 3 hours conveying our concerns, setting out the issues, referring to documents in support of our allegations and providing corroborate correspondence.  Such was the substance of our allegations, we received a call the following day; the Authority was thinking about appointing the Highways England counter-fraud team to do a full investigation. It was explained they will probably need a bit of our time in order to get all the evidence that we had.

We commenced uploading information to a password protected location for the auditor, Grant Thornton.  However, we were advised there was a ‘blip’ with Grant Thornton, and if not them, it was going to be KPMG.  It took almost 5 months for the matter to progress.  Meanwhile, using the monitoring facility at ‘WhatDoTheyKnow.com, we noted an FoIA request response:

26/10/2017 the FoIA request reported ‘no information held’ about the investigation. The reply is here: – CRS 755461

No information recorded?  100’s of records uploaded for KMPG / HE, meetings, conversations, promises of audit reports … and nothing held!  It was evident there had been activity, as 28/09/2017, I had received a call from Highways England warning me about Kier’s conduct and that they were getting ‘a little bit noisy’ making allegations, being abusive … I was given the heads up just in case  any ‘noise’ came my way.

Clearly a great deal of information should be held. Yet more recently a similar response was issued by Highways England – no information held.  But then a further response … there is information.  Similarly, by 10/2018 the investigation was over, then it was not.

Yet despite all this activity and more to come, no one realised that the subject of our meeting, the schedule of ‘defined costs’ (a.k.a. DCP Rates) was non-existent?  Not one of the requests to re-price (seemingly overloading HE in 03/2018) resulted in the Authority taking any action and discovering that they had never agreed a set of rates with their contractor … on this, or any, contract?

Possibly a different / new inquiry resulted in the 12/2018  ‘discovery’ Highways England hold not ‘DCP (damage to Crown property) rates or the 04/2019 revelation none of their ASC (contracts) have a schedule of rates. It appears KPMG’s inquiries failed to identify:

  • DCP Rates (defined costs) did not exist as a schedule
  • none of the ASC (contracts) had a schedule of rates – since 2012

It appears the 21/06/2017 investigation / audit report is a similar mythical item to that of the DCP Rates Schedule … but the evidence indicates there will also be a lot of information about ther audit / investigation which it appears Highways England are similarly keen to keep secret.  To read more about the farce, click here

 

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