191216 HE Response to Areas 6, 8 & 9 Rates

Response from Highways England to our email of 11/12/2019

16/12/2019 From: Tim Reardon @ highwaysengland.co.uk
Jim.O’Sullivan @ highwaysengland.co.uk
Colin Matthews @ highwaysengland.co.uk
Alex Bingham @ highwaysengland.co.uk
Subject: RE: Exaggeration & Misrepresentation – Kier Highways / Areas 6, 8 & 9 Rates

Dear Mr Swift

Jim O’Sullivan has asked me to reply to your email below as well as your further email of that date in respect of BBMM rates on Area 10.

Taking the latter first, and in particular the witness statement of Luke Ellis, he expressly states that the Area 10 ASC does not contain any schedule of rates for calculating the costs of repairing damage caused by negligent third parties when the repair cost is less than £10k.

In relation to the email below, as I have set out to you many times (including in my email to you of 17th April which you attach), comparing the rates that Kier use to bill third parties with the rates Kier use to bill Highways England and contending that any difference can only be justified by the difference in uplift is entirely the wrong approach.

As I have set out in an email yesterday to Fergus Poncia, the basis for charging for unscheduled repairs to the network is the reasonable cost of the repair. There is a range of what might be regarded as reasonable costs and it is only if the sum claimed is clearly excessive that the courts will interfere. The contract between Highways England and its contractor is in this respect irrelevant. It does not matter that Highways England can get the repair done at less than cost or at preferential rates (reflecting, for example, the wider commercial relationship). There is now a string of County Court judgements underpinned by the Court of Appeal case of Cole v Hetherton which confirm that position.

In this context, I also note the comments of the First Tier Tribunal in their decision of 12th December 2019 where in dismissing your appeal against the ICO decision that Highways England does not hold schedules of rates for unscheduled repairs to the strategic road network, they explicitly rejected your suggestion that material differences in the invoices for above and below threshold claims indicate something untoward in the charging basis. The Tribunal took the view that the differences were all explicable.

As far as Highways England is concerned that is the end of the matter. As I made clear to Mr Poncia, we will ignore or treat as vexatious:
• further requests for information about whether we hold schedules of rates for unscheduled repairs; and
• further information requests regarding rates charged by contractors to Highways England and rates charged to insurance companies.

Yours sincerely

Tim Reardon
General Counsel Highways England


Our response can be read here