160323 Tim Reardon and the Schedule of Rates

23/03/2016 Tim Reardon calls:

1. Tim Hello Philip.
2. PS Tim, Philip, CMA.
3. Tim Oh, hello Philip, how are you? Are you alright?
4. PS Hi, I’m good, I’m hoping you’re going to tell me when I can expect to receive some information?
5. Tim Yes, I’m sorting it, I’m sorting it. I mean, I think what I’m going to be able to provide you with is not terribly hard and fast. It’s… I mean, from what I can gather, I think the are… The rates look to be similar, the schedule of rates look to be similar. There do seem to be differences in the way that costs are applied…
6. PS Okay.
7. Tim … overheads are applied, between what they charge us and then what they charge [travellers’ 0:00:47] insurers. So yes, and I think, I mean I think the…
8. I’ve had a chat actually with Kier and they are looking to harmonise those rates. So, they’re looking at that. And that’s basically as far as I’ve got, so I haven’t got… I mean, I haven’t come back to you because I didn’t have anything terribly hard and fast, but they’re sort of aware of it basically, and they’re looking to harmonise it. And so, and it does seem to be one of those where, you know, that maybe… I mean, if that’s, if you’re unhappy with the discrepancy that’s presumably an area that you could go back to them on and challenge it?
9. PS Hm. Who is it you’re liaising with?
10. Tim I’ve been speaking with… Crumbs, who is it? Sophie Granville, was it?
11. PS Yeah, well that makes sense.
12. Tim Yeah, Sophie Granville, yes Sophie Granville. Yeah, so…. And I think, I mean I think she did tell me she has been speaking with you…
13. PS Hmmmm.
14. Tim So, I think she spoke with… Has she spoken with you?
15. PS We spoke on 26th February…
16. Tim Okay.
17. PS … and since then effectively she’s not prepared to answer any of our questions.
18. Tim Okay, yeah.
19. PS It quite interests me that she said to you that they’re looking to harmonise the rates. You see, the issue I have and why I’m looking at this is she’s telling me these rates are the same for HE as they are to insurers and I’m saying no they’re not. Now, she’s been quite bullish in saying, ‘You’ve got the rates, I’ve given you all the breakdown, we’re not moving on them.’
20. Tim Hmm.
21. PS The fact that she’s saying she was going to harmonise… I mean, she’s got to the point now where my staff can expect at about 4:30 in the afternoon, maybe a little earlier than that, either you agree this by the end of the day or it’s going to solicitors. There’s something wrong.
22. Tim Hmm.
23. PS And the fact that she’s saying to you, ‘We’re looking to harmonise,’ you would think that that would have been a pick up the phone to me and say, ‘Philip, [unclear 0:02:56], we had a meeting last year at October time where we had a new set of rates, you picked up on a substantial discrepancy, we couldn’t justify those so we’ve put into force a completely new set, we’re re-costing everything,’ but now it looks as though they’re going to harmonise, in other words re-cost again.
24. Tim Mm. Well certainly, I mean that’s an area to…
25. PS Wow!
26. Tim … you know, and that’s an area to probe. So, I mean it’s a…
27. PS Yeah.
28. Tim But um… So…
29. PS I’m astounded that they would be looking to harmonise, which suggests to me they’re going to relook at these… I mean, it could of course be that they’re going to up your rates.
30. Tim Yeah, [unclear 0:03:40].
31. PS [Laugh]
32. Tim Yeah. I mean it’s a… But, I mean, I think… Well, I mean I think so… I mean, I think… I’ve got to be careful not to put words into my mouth. I mean, I think there is a… It may be that there are good reasons why there are differences, and so I think… And I think what she… No, she actually, you know, was, was that, you know, where possible or where it’s appropriate that they would look to harmonise. So, you know, I can say so… I wouldn’t say they are going to, but I mean I think she did sort of… I mean, I think there may be good reasons though why they are different, so…
33. PS I don’t have an issue with that.
34. Tim So, in which case then they are what they are really, in a sense, so…
35. PS I agree.
36. Tim So yeah, so I think it’s a… But she… I mean, I think what I would suggest is… I mean, I think… I mean, I rather left it with her to see what they were going to do. It may be worth just leaving it with them to see what they’re going to do about these rates. I mean, presumably they are aware of the challenge you’ve put them, to them, so I mean they will… Presumably, if they think the rates, presumably if they think the rates do need adjusting, having looked at it again, then they will come back to you and tell you, and tell you why, and if they don’t, presumably they’ll tell you that as well. So, it’s kind of… So, I mean, I think where we left it was that they were looking at it and… But, you know, there were no promises but there was a sort of, there may be, in some cases there may be a case for harmonisation and in other cases there may not be because of, because there are genuine differences, there are genuine reasons why you wouldn’t. So, and that’s basically where I got to, which was nothing terribly sort of, I hadn’t really moved it on terribly much, which is why I hadn’t really come back to you, because I didn’t really have anything terrible concrete to tell you.
37. PS No, I get there’s good reason why there may be differences, I get they are what they are but…
38. Tim Yeah.
39. PS … when I’m being told by them, ‘You’re charged the same as Highways England,’ I’m not expecting there to be differences, but there are.
40. Tim Well, yeah, I mean, and there may be good reasons for those differences?
41. PS There may be…
42. Tim Yeah.
43. PS … but that still doesn’t explain why somebody would say to me, ‘There are no differences.’
44. Tim Hmm.
45. PS It’s very different, because if they tell me there’s no differences and I find that there is, then they’ve put me through the mill of having to sit down and work these out, and I have done so. I’ve got an HE claim that comes straight from you guys where somebody’s attended on a Sunday, an AIW has attended, and he’s charged at your rate which is about £24-something for a Sunday in the morning. We get double time on a Sunday, the rate to us is £70.32 in, other words I get £140.46 whereas HE get under £25 an hour.
46. Tim Mm. Well, I mean, you know, that is… I mean, at the end of the day, I mean that is a perfectly legitimate question for you to say to them…
47. PS Very.
48. Tim … ’Well, we’re not paying… we’ll pay at £24, but we’re not paying at £72 unless you can provide me….
49. PS But what I don’t, what I don’t like…
50. Tim … unless you can provide me with a, unless you can provide me with a rational explanation.’
51. PS Yes, and that’s what we seek.
52. Tim You know, and as we see, and they haven’t provided it, so you say, ‘Well, we’re just not paying out at that rate.’ I mean effective…
53. PS But the problem I have at the moment is to…
54. Tim … the ball’s in your court.
55. PS … is to go back to my client and say, ‘Look I’m asking Tim at HE for these rates, what their rates are, and I’ve not got them yet.
56. Tim Well… Yeah, no… Yeah, but I mean I think the, but I think the issue is more about… Well, I think the issue is more about you are seeing a discrepancy between the rates being charged, and you have to decide what you think is the reasonable rate, and if you think that it’s, if you think they’re charging too much then, you know, you can push back and say, ‘We’re just not paying that.’
57. PS I do that, but what I’m looking for is the corroboration from you guys. I’ve got figures, I can go back to almost about mid-2015.
58. Tim But I think you don’t… I’m not sure you need anything from me. I mean, I think you’ve got figures. They’ll…
59. PS Well, I need the current rates.
60. Tim Well yeah, but I, I mean, as I say, I don’t have those.
61. PS But you must have them somewhere?
62. Tim Yeah, but… As I say, you’ve got sufficient… It seems to me actually Philip you’ve got sufficient information to be able to say, ‘Well, on the basis of these figures we’re not…’ you know, ‘There is this discrepancy and we can’t see a reason for it, so on that…’ You know, I suppose, you know, in terms of… It’s not for me to advise you but, you know, you may say, ‘Well, in the absence of an explanation for the difference, then we’ll accept the lower number and we won’t accept anything higher.’
63. PS We’ll do that, but one of the problems we get is actually being able to justify this and go back to my clients and say, ‘Look guys…’
64. Tim Well that, but that is a justification, isn’t it? I mean, that’s a justification is that…
65. PS Not without… They’re going to want the substantiation, because what HE, what Kier Highways are doing at the moment is saying, ‘Look, we’ve got this complete new set of rates.’ The trouble is they’ve brought them in at about January 1st, um you’ll be seeing them, what I don’t have is your rates, I don’t have the rates that you guys are being charged, so I can’t turn round to my client and say, ‘Well look, they’re charging this, but I’m comparing apples with oranges because I’m comparing it with rates that in…’
66. Tim Well, you can, I mean you can ask… I mean, you can… It’s a question that you can, it’s a question you can put to them…
67. PS Well I have.
68. Tim I mean, you can say, ‘Look, on the basis of the info…
69. PS That’s why I’m coming to you.
70. Tim … on the basis of the information I’ve… Yes, I know, but hold on, but I think it’s…
71. PS I’ve gone to Kier, and I’ve said to them…
72. Tim Yeah, but I think it’s [over speaking 0:09:49]…
73. PS … ‘What rates do you charge?’ And they say, ‘The same.’
74. Tim But I think there is an argument… But I think it is an argument… I mean, if I were you, I would said to Kier, ‘Well look, the sort of rates you were giving, I’ve seen the rates that you’ve been charging for Highways England and the rates you’re charging us, which appear to be very different, you are now telling me that this is the new rate, you’re going to have to just…’ I mean, ‘Is this a new rate which is applying across the board, or is this again a different rate from what you’re charg-…’ So, you know, and it’s, ‘I can’t understand the reasons for the difference, therefore we will go back and pay you the… We’ll allow you the lower charge, but we’re not allowing you this charge unless you can come to me with a rational explanation.’ And it…
75. PS But in order for me to take that stance, in order for me to actually go to my client and say, ‘This is one to defend, this is one to which you’re insured to the trouble of appearing at the court to defend, to put him out, to cause him inconvenience, distress, financial hardship, I can demonstrate that Highways England at the moment are not being charged these rates.’ I can’t do that because the most recent I’ve got of you guys might be August, but I think it’s about June 2015.
76. Tim Okay, well that’s pretty recent, isn’t it?
77. PS Not recent enough, because…
78. Tim I mean, if it’s… Well, it’s very… I mean, and our…
79. PS What Kier are saying is, ‘We’ve changed our methodology, we’ve been audited by HE, we’ve got these new rates in place…
80. Tim Okay, and what are those new rates?
81. PS … and we’re doing this across the board.’
82. Tim What… Oh, and that’s what they’re telling you? Okay.
83. PS Well, they’re telling me that what they charge is the same as they charge insurers, as they charge you.
84. Tim Right.
85. PS Now, I’m going to have to wait six months before I see one of your claims come through from now January in which it’s going to say to me you get charged for an AIW no different from what you got in June or August last year. I can’t imagine that they’ve sat down round the table and said, ‘Well, HE, you were paying £24 an hour or £25 an hour, you weren’t paying multipliers, you weren’t paying the overtime at one time and a half, double time, two and a half, but because of Mr Swift we’ve had to bring in this new system…’
86. Tim I mean, in a sense you… Yeah, I mean, to be fair… I mean, if you do… I mean, if they’re telling you they’re charging you the same rate and… And actually, I think from what I can understand I think the underlying rate is probably the same, from what I understand, so that’s maybe what she’s referring to or what Kier are referring to, but I mean, I think if you did challenge it and then it came out that actually that was wrong, then you’d have a very clear, you’d have a very clear case just to pay the lesser amount. I mean, it’s a… I think it’s a… I mean, I think, I do think you’ve got enough information to be able to have the argument and come to a… Come to a…
87. PS Why should I? Why, why, why don’t people come to me with open hands and…
88. Tim You know, I mean, I think because ultimately…
89. PS HE say to me, ‘Look, these are the rates we’re charged for an AIW, an AIW vehicle and a CO1 being 4.2 metres, three double items.’ And Kier say… Well, I don’t need Kier to tell me, I know what the charge will be an AIW, I know what the charge will be for the vehicle, I know what the charge will be for the beam, and I’ve got both the current rates sat in front of me and I say, ‘Look guys, come on, let’s play fair here.’ What I get from Kier is, ‘Oh, we’ve dealt with this now, we’ve got all these rates, we’ve put them all forward, everybody else agrees them but not you,’ and I’m thinking, ‘Well…’ It’s wrong.
90. Tim And are these rates, are these rates that you’re now being quoted, are they lower than the rate you were being quoted before?
91. PS No. No you’re the…
92. Tim They’re more, are they?
93. PS They’re actually about the same.
94. Tim About the same?
95. PS And I haven’t broached that aspect with Kier just yet because I’m still working through…
96. Tim I mean you… It would be worth, it would be worth actually approaching… You say they went through a, they did an audit or a review of their charges and they came up… You know, it might be…
97. PS Well your audit turned that up, I mean you… I say you turned that up, HE were advised in the audit…
98. Tim Yeah.
99. PS … that they’d re-costed all the claims. That was a misrepresentation. I mean, there’s just no way that they did it. We’re still getting them through. I mean, the fact that they told you that all of them had been re-costed in January was just a lie.
100. Tim Mm. Well yeah, I mean they told us that… I mean, they… Well, they told us that they’d gone back to actual reasonable costs and that they’ve resubmitted the claims.
101. PS Yes, it actually says in the report that they’ve done all of them. All their claims now reflect the new approach. That’s not true.
102. Tim Mm.
103. PS I mean, we’re still getting them through. And as for the overcharging that’s mentioned in here, it’s…
104. Tim But they should, I mean they should sort of… Well, they should now reflect, I mean…
105. PS Well, again, they’re two months later, well it’s three months later…
106. Tim Yes, well okay, okay.
107. PS But I mean it’s…
108. Tim Yeah, okay, so as they… So the new ones that are coming through are, do reflect the, do reflect the actual reasonable costs, I mean so…
109. PS No, they reflect a new set of rates.
110. Tim Hm.
111. PS They don’t reflect reasonable costs.
112. Tim Well, that’s an argument you can have with them.
113. PS Oh, yes, don’t get me wrong. I mean, having said that though I am also mindful of this audit and that we’ve been invited to return. I’ve also noted that the marginal figure that was referred to of about 3.5% on the discrepancies, that the audit didn’t reveal anything that suggested overstatement. I mean, when I show you the figures, when I show you, when I demonstrate the figures on the 30-odd claims that we’ve had re-costed I would be surprised if the average re-costing was less than 30%, 33%.
114. Tim Right.
115. PS I would suspect that on every claim that was submitted under their old methodology, I would anticipate at least £1,000 a claim, and they’re supposed to have 2,000 of them, so that’s about £2 million…
116. Tim Hm?
117. PS … that’s been overcharged. I think that’s probably conservative.
118. Tim And they’ve re-costed those claims for you?
119. PS Yes, they’ve re-costed them, but I’m astounded at your audit, the guys who went down were…
120. Tim Well, I don’t think we did give it an entirely clean bill of health, I think we did say there were things that they did recognise that in the methodology which was not as exact as was desirable, and actually they’ve, they have taken steps to do that. But if you’re still…
121. PS Well, Kier are telling us, they’re using your report as a, you know, ‘We’ve passed, we’re fine,’ and that is not the case. I mean, the figures that I’m looking…
122. Tim Yeah, but they are resubmitting, but they have been resubmitting the claims based on a better appreciation of the actual costs.
123. PS A different appreciation of the costs.
124. Tim Yeah, okay.
125. PS It’s a different methodology. But I’m simply dealing with their old one and the fact that historically…
126. Tim Hm, but they… Okay, but, but I mean you can [unclear 0:17:09] the old ones, I mean… To the extent they haven’t resubmitted those claims and they are based on the old figures, presumably they are going to resubmit those claims on the basis of the new figures?
127. PS Yes. Yes.
128. Tim So, you know, so the… So yeah, so I would… You know, I think the thing to do is to wait to see what these new figures are.
129. PS But we’ve got those, and I can work with those.
130. Tim Okay, fine.
131. PS What I’m talking about is, they did an audit and they said, you made reference…
132. Tim Yeah, but if you’ve got… Yeah, but hold on, but if you’ve got the new figures then… Okay, I mean you’ve got a choice, you either accept those new figures or you don’t. If you… I mean, you know, you can either advise your client to go ahead on the basis of new figures, or you can go back to Kier and say, ‘Well actually, you’ve given us these new figures and we don’t…
133. PS No, we’re talking at cross purposes, sorry we’re… The current figures, we’ve got those and we’re dealing with those.
134. Tim Right.
135. PS The audit came along and said there was no evidence that Kier recovered over their entitlement, that the early claims did contain a small number of minor errors. That is…
136. Tim Right.
137. PS I find that absolutely incredible.
138. Tim Yeah, but… But I’m just going beyond the report, I’m just going into the sort of the, actually the way this is working out in practice, that actually I think Kier are accepting there are a number of claims where the figures they’ve originally put to you were wrong and that they are resubmitting those claims, and, you know, they may have completed that exercise, I don’t know, but… So, if you… I think the thing is not so much to worry about the audit report, I think the thing to do is to think about what are the new figures that have been given to us? Do those figures stand up to scrutiny? If they do, all well and good, go ahead, advise your client accordingly. If you don’t think they do then by all means go back to Kier and argue the case. I mean, at the end of the day, you know, as I’ve said to you before Philip, the ball was always in your court, it’s always in your court to decide whether you pay or not, or whether you challenge it and you say, ‘Look, we’re not paying this because we think it’s too much, we think you’re overcharging.’ So, you know, I think it’s a… It is a discussion between you and Kier, and I think that actually you have the information, you’ve just got, you have now to take a view on the information you have, and I think as a… There’s not a lot more I can do to help you.
139. PS When I spoke to Mr O’Sullivan, the word he used was ‘transparency.’
140. Tim Yeah.
141. PS And I have two current issues. The first one relates to this report, and there is no transparency in this, as far as I can see, there’s been misrepresentation, and they’ve been given a big pat on the back and effectively think therefore that they can put what they’ve done behind them and carry on regardless. The second one…
142. Tim Well, they’re not, they’re not… But they’re doing that, are they, because they’re resubmitting those.
143. PS But they have. Oh they… Yes.
144. Tim But they’re resubmitting those claims, so, I think, you know, I think…
145. PS It’s disingenuous of them though to turn round and say, ‘You’ve got…’
146. Tim But I’m… But I’m struggling to, I’m struggling to understand what the problem is actually, Philip. You know, I… Look at what is actually happening as opposed to…. Because the report doesn’t give them a clean bill of health, the report, you know, and…
147. PS Well, it says, ‘There’s no evidence that Kier recovered over their entitlement.’
148. Tim Yes, but they…
149. PS But I don’t, I don’t accept that.
150. Tim … there were issues, there were issues with a methodology…
151. PS No, I don’t accept.
152. Tim There were issues with the… Okay, but Kier, but Kier…
153. PS I don’t accept this report. This report is a whitewash.
154. Tim Okay, but Kier… Whatever you think of the report Kier are resubmitting their claims, so, you know, and so the ball is in your court to look at what those figures they’re resubmitting and saying…
155. PS I real- As I say, I’ve got two approaches here.
156. Tim … and saying, you know, whether you accept them or not.
157. PS I’m coming from two aspects: one, Highways England have gone in and apparently audited, and the result of this actually raises more concerns than it addresses, and I will come back to that at some stage, when I get a chance to, but this is an absolute whitewash. With regard to what they’re doing now, all I expected from yourselves was transparency, the transparency I was assured, and all I’ve asked is, you know, ‘Just tell me what you’re currently paying for these aspects so that I can do a straight comparison, go to my clients, or go to Kier and say, “Look guys, you’re telling me the same thing…”’
158. Tim If I can find out, if I can find out the figures for you, I will.
159. PS Thank you.
160. Tim Okay? If I can find out those fig-
161. PS Any chance they could, they’ll be available by tomorrow?
162. Tim If I can, I will. I doubt it.
163. PS I would think anybody in Green Claims must have them.
164. Tim [Inaudible 0:22:02]
165. PS Anybody that…
166. Tim So, okay, If I can, if I can find out, I will, okay? I’ll [inaudible 0:22:06].
167. PS Lovely.
168. Tim Okay?
169. PS Thank you very much, cheers.
170. Tim Thank you, bye bye.
171. [ENDS]