190920 FoIA response re Explanation of Defined Cost Calculation

continued from request here

20/09/2019 from Highways England
Ref: 770,541 / 770541

Thank you for your e-mail on 10 May 2019 and our apologies for the delay in responding to you.

Your request has been handled under the terms of the Freedom of Information Act 2000 and our response is below–

B. Please explain the calculation that is undertaken which results in the defined cost, or DCP Rates, charged to Highways England and Third parties; set it out for me so I can understand how the figure is arrived at, how ‘providers’ establish on any given date / time the rate to apply.

We consider that this question has been addressed previously please see our response to your request 769,306 where the calculation is set out and explained. For the avoidance of doubt, we confirm that the Asset Support Contract contains the mechanism to produce a Defined Cost. The model Conditions of Contract for Highways England Asset Support Contracts (ASC) is publicly available online (link)

It is also claimed ‘this work is thereby far less efficient than planned repair work in the contract and hence more costly’. Again, I am not taking issue with this, what I wish to know is ‘how much more costly?’; give me the figures. The impression received is that these response are provide to add quantity not quality to responses, that they are ill-conceived (as they are not relevant) and intended to dissuade and distract.

Tendered contract rates held within the contract are withheld under Section 43 commercially sensitive as found at First Tier Tribunal Ref. EA/2018/0104.

The only relevant comment is ‘a’ ‘Defined cost is in effect the actual costs of an individual repair’. The ‘in effect’ appears less than certain, it either is or it is not. But how are the actual costs arrived at, who holds these, how are they calculated?

The Defined Cost is calculated by the service provider based on the resources required to complete a repair.

I have asked for the

* The rates you are charged for above threshold DCP works, the schedule of rates used for above and below works

There is no schedule of rates that can be provided, therefore under Section 1(1)(a) I can confirm that this information is not held by Highways England. The rates charged are those contained in the CBD for a specific incident.

I have written in respect of specific incident, in an Area on a specific date / time. I am seeking the charges presented to you on the dates. I believed my reference to ‘above threshold’ rates conveyed this.

B. Please supply these. For your ease of reference they are, as per my original request:

a. 20/11/2016
b. 21/12/2016

There is no schedule of rates that can be provided, therefore under Section 1(1)(a) I can confirm that this information is not held by Highways England. The rates charged are those contained in the CBD for a specific incident.

I am not asking you to comment upon any allegation, I am seeking information. I have asked your General Counsel twice which exemption(s) are being applied to my request as, to date, I have received a blanket refusal to address requests due to an ongoing enquiry. I anticipate the relevant exemption being conveyed

C. Please cite the exemption upon which HE is relying

In regard to requests about a schedule of rates, under Section 1(1)(a) I can confirm that this information is not held by Highways England. In regard to requests about tendered contract rates I can confirm that Highways England is applying Section 43 commercially sensitive as upheld at the First Tier Tribunal Ref. EA/2018/0104. It is also noted that as the requests were not answered due to ongoing Decision Notice appeals and investigations of responses previously provided to yourself on the same subject, that Section 14(2) repeated request will have been applied. In this circumstance this should have been conveyed by issue of a refusal notice stating Section 14(2).

I asked:

Unless there was a schedule of rates to review and consider, what was he commentating upon and how could he reach such a conclusion? It appears I will require all information to which Mr. Reardon was referring, what he reviewed.

D. Where is the information Mr Reardon reviewed

Under Section 1(1)(a) I can confirm that this information is not held by Highways England.

I asked that the review consider how the process (whatever this is) applies to charging on a case by case basis, without a pricing schedule The reply is ‘An assessment is made based on each individual claim’. This is unhelpful:

E. How is an assessment made?

The only information that Highways England holds with regard to how Kier make an assessment, other than that detailed in Annex 23 of the contract which you already have a copy of, is Kier Highways document ‘An Insurer’s Guide to Incident Management & Claims Recovery’. This document has been provided along with the response.

I asked ‘To what was the contractor objecting unless a schedule exists’. He responded:

The contract contains a Pricing Schedule which the contractors and Highways England consider is exempt from disclosure under section 43 of the FOIA as it contains commercially sensitive information as confirmed by our service providers and the First Tier Tribunal.

The Pricing Schedule contains information that contractors use to prepare their tender submissions. The rates in the Pricing Schedule are then used throughout the duration of the contract but not in relation to third party claims.

The DCP Rate schedule is not ‘commercially sensitive’. Requests have bene presented clearly, unequivocally, in respect of DCP Rates. You and your contractor have deemed these DCP Rates to be commercially sensitive ergo they exist. It is these I am seeking. As above, I do not want, nor have I ever sought, ASC rates for pre-planned works – as HE is aware from the statement they made, supported by exhibits, identifying 57 requests / reviews.

Tendered contract rates held within the contract are withheld under Section 43 commercially sensitive as found at First Tier Tribunal Ref. EA/2018/0104. Your request about so called DCP rates has already been answered and therefore falls under Section 14(2) repeated request but for clarity and in an attempt to draw this to a conclusion under Section 1(1)(a) I can confirm that this information is not held by Highways England. You will be aware that this is subject to appeal via Tribunal with hearing listed for 12 November 2019 under the following reference EA/2019/0119.


30/09/2019  Request for an internal review


02/12/2019 Highways England response extract:

On the 20 September 2019 Highways England responded under ref. 770,541. I have not repeated the response here but have included as attachment alongside this review.

Also on the 20 September 2019 following a request for an internal review on 11 June 2019 because no response had been received, I provided a response accepting that response ref. 770,541 had been provided outside of the statutory 20-working day deadline and apologising for this. Therefore, having already covered this issue I will not be addressing it again in this review.

On the 30 September 2019 you e-mailed Highways England asking for an internal review of the response provided on 20 September 2019.

I have now taken the opportunity to review the request and the response provided, and to discuss this with team who provided the response. Following my review of the response and my discussions with the team, I am satisfied that the original response to 770,541 addressed the questions in your request correctly and that there is nothing further to add to those responses.

Jonathan Drysdale
Freedom of Information Officer


18/12/2019 to ICO