26/10/2016 from Highways England Our ref: FOI 743,153
Thank you for your email of 23 September 2016 to Layla Beckett in concerning various
issues relating to our Kier contracts. I am writing to confirm that we have now completed
our search for the information.
In your email of 23 September you asked for the following information:
I have been provided the attached letter from Highways England (HE). I note you have advised:
“Keir (sic) – 24/7 cover facility from 6am on Monday to 6am on a Saturday. From 6am on a Saturday to 6am on a Monday Kier operate a call out basis cover system”
If I have understood the response correctly, Kier Highways Ltd provide an on-duty, employed, emergency they refer to as AIW’s:
06:00 hours Monday to
06:00 hours Saturday
That is to say, from 6am of a Monday morning the AIW’s provide 24 hour-a-day patrols which conclude when the Friday shifts ends at 6am Saturday. This period of 120 hours is not the subject of a call-out process but AIW staff are on duty.
Of a weekend, from 6am Saturday morning, through the next 48 hours, until 6am Monday morning, AIW’s work a call-out system.
1. Please confirm that my understanding (above) is correct or clarify the arrangement
I ask to be supplied all information Highways England possess in support of the statement made in the attached letter (relevant aspect above), for example:
2. the source of the information conveyed, the enquiry made of KHL and response(s) supplied
The sources include our contracts, associated documentation, and liaison with Kier
3. the contract extract (or relevant records) that support this weekly shift / cover pattern
The Area 9 Asset Support Contracts (ASC) requires adherence to the Asset Maintenance and Operational Requirements Part 3 “Incident Response”, which sets outcomes that the service provider must deliver, permitting them the opportunity to make suitable arrangements within their area and innovate to deliver quality at the best value through a risk-based approach. Service providers are required to produce a regularly updated plan that details their approach. This can vary from each service provider and across the section of the network in which they work to deliver the specific outcomes required on each route or part thereof.
The Asset Incident Watchman (AIW) service is not a 24/7 patrolling service. Under the ASC this function is now facilitated by Highway England traffic officers. The AIW service has full coverage during daytime, weekday hours. Outside of this, Kier operates a standby rota in line with its maintenance requirement plan. Details of how the AIW service operates, in relation to incidents, are covered within the Kier Insurance Guide leaflet which is included for reference.
Incident response is paid for by Highways England as part of a fixed ‘Lump Sum’ payment to the service provider, on a monthly basis. However, under the ASC this payment is calculated based upon the predicted split of identified culprit claims so it is designed to cover the proportion of claims that are not traced to a specific driver.
- All contractors reconcile their costs annually against their recoveries. If the proportion of traced incidents exceeds expectations an assessment would be made and the Lump Sum payment would be reduced. However, no contractor has ever been in the position where the proportion of traced claims exceeds these assessments and there are various factors for this. The main one being not all damage linked to a driver is reported by the driver.
Where the over threshold claims are concerned, Kier would pass the charges through to Highways England and assist in their recovery in the same way as they would with the below threshold claims that they pursue directly. The only differing factor between the claims is the format as the insurance community have worked with Kier to display their breakdown of charges in a manner that they prefer. With an over threshold claim, Kier would allocate charges in accordance to its minimum shift allowance i.e. if an incident occurs out of hours they would charge for the full period of coverage as opposed to charging a multiplier. Ultimately, this results in the same number; it is just a different way to display it.
The service provider will incur costs differently dependent upon time, location, level of response required etc. and have the right to recover these specifically against the relevant negligent party, if they can be identified
Please note I am seeking information relating to the rates. However,
6. I would also appreciate being supplied the actual sums charged, the hourly rate, the fees presented to HE for this specific aspect of the work undertaken by KHL. I understand that the current rate has been disclosed.
With regard to the above information,
7. I ask that this be for the period 01/01/2014 to the present i.e. all rates / arrangements during the past 3 years (almost) and that these are separated by area if they differ.
The information you request in points 6 and 7 above is being withheld in reliance on the exemption(s) in section(s) 43 http://www.legislation.gov.uk/ukpga/2000/36/section/43 of the Freedom of Information Act 2000 because information is exempt information if its disclosure under this Act would, or would be likely to, prejudice the commercial interests of any person (including the public authority holding it).
In applying this exemption we have had to balance the public interest in withholding the information against the public interest in disclosure. The key public interest factors for and against disclosure are in the table below.
8. Please clarify whether the rates / arrangements vary over the areas.
Each service provider is given an indicative number of incidents at the tender stage for the contract and they price accordingly based upon their pricing model. This is checked and challenged to assess, among others, its quality, value for money and sustainability for the life of the contract in the open marketplace.
Factors supporting disclosure
• There is a clear public interest in the work of
government being closely examined to encourage
the discharging of public functions in the most
efficient and effective way;
• There is an important public interest in the work of
public bodies being transparent and open to scrutiny
to increase diligence and to protect the public purse;
• There is a public interest in disclosing information
about public procurements to ensure there is
transparency in the spending of public money and
that public bodies are getting value for money when
entering into contracts;
• There is a strong public interest in releasing
information which shows the criteria used when
assessing options to illustrate that the processes
used were fair and appropriate
Factors supporting non-disclosure
The procurement process must be seen to be fair
and that commercial interests of the suppliers of
services are not unduly prejudiced by the release of
commercially sensitive information. It is important to
maintain the confidence of our suppliers in order to
achieve best value for the tax payer;
• The methodology outlined in the bid may be
construed as a “trade secret” in that it is a strategy
owned and developed by the consultant. If the
methodology was made available to competitors in
the market place it would undermine the commercial
interests of the consultant when bidding for other
contracts by reducing their competitive edge;
• To reveal the details of the bid would seriously
undermine our ability to negotiate the best value for
money for the public purse on future contracts as the
rates and methodology are still current;
• The consultants object to the release of their bid
information on the grounds that it contains
commercially sensitive information in terms of a
“trade secret” and rates; and such a release would