ICO reference: IC-40443-T6L2
Thank you for your email of 14/12/2020.
Area 9 Kier Highways Ltd Request
The FoIA request for the KPMG Audit:
Area 9 audit /investigation/enquiries of Area 9 / Kier Highways Ltd. following my meeting with Highway England 21/06/2019 progressed, in part, by KPMG under ‘Project Verde’.
The information will extend, but not be restricted to, exchanges with KPMG and the contractor also all draft reports received.
Highways England’s Response
Initially, the Authority breached the Act (again) and failed to respond.
06/02/ 2020 Highways England responded about Area 9, it ‘neither confirmed nor denied‘ holding the information.
Confirming or denying would not disclose sensitive or potentially damaging information that falls under an exemption. The existence of the information is well known, publicised (to a great extent by me). The Authority relied upon Section 41 – ‘confidentiality’.
However, as evidenced by the below, the investigation was initiated by a substantial amount of information I compiled and presented – it was not provided by another. Much of the audit’s work is associated with corroboration and confirmation – something that is a ‘give’; the facts are irrefutable, documented.
There is no legal privilege or associated confidence with the information and enquiry, no actionable breach and no expected confidence; I submitted information via my SPoC (single point of contact), Mrs Green and was regularly updated about the enquiry and spoke at length with KPMG. KPMG and the Authority were aware of my interest, my circulation of the enquiry’s existence and that I was to be updated, provided the outcome of the report. The Authority, KPMG and the Area 9 contractor, Kier Highways Ltd., have long known of my interest, that I have been seeking information and all have been robustly seeking to keep it from me.
No confidence is attached to the enquiry which, as Mr Reardon confirms (below) was about ‘sub-threshold’ matters i.e. those charges raised to Third parties, the public. The enquiry was raised to investigate a breach of confidence (contracts) and abuses of those the Authority was to serve.
The information is being withheld because it:
- corroborates what I have stated
- demonstrates profiteering and fraud and that
- this was permitted/enabled by the Authority
Why has the Authority acted as above, to the detriment of the public?
When the KPMG enquiry concluded I do not know because the Authority withdrew.
22/03/2018, Tim Reardon, general Counsel for the Authority wrote:
We are investigating your allegations in relation to Kier charges for sub-threshold green claims. This takes time, and we are not yet in a position to come back to you in relation to the issues you raise. When we are able to, we will.
The Authority intended to return to me however, they did not.
The information has been withheld because it evidences ‘state enabled exaggeration and fraud on an industrial scale’ by Kier Highways. The information I submitted set out, giving rise to the investigation report I am seeking, simply how the contractor was not complying with the contract, overcharging Third Parties (drivers, fleets, hauliers or their insurers) and applying fraudulent uplifts.
The evidence I presented was overwhelming, irrefutable and, as evidenced below, factual; in 2020 a Judge was informed by Highways England’s own witness, a Kier employee, that uplifts were being applied for which he was unable to find authority within the contract. I have been informing Highways England (and Kier) of this since at least 2016 since which 1,000’s of demands for payment have been raised by Kier that includes these unauthorised costs, £millions have been sought and paid in the name of the Authority which stood back and permitted the abuse of those they were to serve.
Conversely, if KPMG’s audit failed to uncover:
- the exaggeration – unauthorised uplifts
- contract non-compliance
- use of fraudulent uplifts
- the absence of any schedule of rates
the enquiry was severely lacking.
The exemption is being used to withhold commercially embarrassing information.
The extent of the ICO Investigation
Was Highways England:
(1) entitled to rely on section 41 of the FOIA as a basis to refuse to confirm or deny whether the information you requested about Area 9 is held,
To assist your consideration:
Why My Interest in the Audit?
- As will be understood from the below, I instigated the 2017/2018 audit.
- The evidence I presented to initiate the audit was so overwhelming that a finding of other than:
- contract non-compliance and
- fraudulent conduct was impossible
- The audit appears to have been hijacked by management at Highways England; the outcome hidden
- I suspect the audit gave rise to the departure of management from Highways England; that they were undermined, unable to operate and resigned
- The Authority turned on me, likely to justify keeping the audit outcome secret
- The audit would necessarily require consideration of the rates being utilised by Kier to charge Third Parties and Highways England yet, it was not until 01/2019 that the Authority claim to have discovered they overlooked a schedule of rates in any ASC (contract) since 2012. Did KPMG’s audit fail to identify this?
- if ‘yes’, how superficial was the audit when the subject matter was the rates being utilised
- if ‘no’, the Authority is rumbled; rates exist
Whilst I refer to this below, if KPMG, undertaking a detailed audit about rates, submitting a report to Highways England that caused the Authority to raise further questions, identified a lack of DCP rates, a schedule of rates, why did the Authority not act upon this in early 2018?
The Audit is being kept secret because it exposes the multiple misrepresentations by Highways England, their failure & inability to have a contractor comply with the contract, the abuse of the public and public purse.
This is one of a number of FoIA requests I have made which relate to DCP rates; that is to say, the rates charged by HE contractors for repairs to the strategic road network (SRN) following a collision, fire or spill. My interest was not simply their existence (as a schedule, a price list) but their application and the use of two sets; high to Third Parties (hereafter referring to drivers, fleets, hauliers or their insurers or ‘TP’) and low to Highways England (HE) .
Had Kier acted appropriately, in accordance with the contract and the Authority not permitted the abuses, one set of rates would be common to both HE & TP’s.
The purpose of the KPMG audit, which followed a 21/06/2017 meeting with HE (see below)was to address the concerns I had raised about Kier’s charging process, their exaggeration and fraud.
Since 2008, I have regularly considered these charges in detail, the rates being presented within claims which, with some exceptions, follow two routes:
- over £10,000 the contractor bills the Authority and is paid by Highways England who then seek to recover from the at-fault party
- under £10,000 the contractor retains the ‘loss’, does not bill the Authority and must purse recovery themselves.
Since at least 07/2014, Kier Highways Ltd (Kier) has used the sub-£10,000 matters as an opportunity to profiteer in the most obvious of ways. It beggars belief the Authority is not a party to the abuses of those they are to serve; the public. I now unreservedly refer to the conduct encountered as ‘state enabled exaggeration and fraud on an industrial scale‘.
Whilst it is obvious contractors use one set of rates when billing Highways England, lower ‘mates rates’ and higher prices to drivers, fleets, hauliers or their insurers i.e. Third-Parties, the Authority denies this, stating (for example):
‘Mr Swift contends that Highways England contractors charge third parties (and their insurers) higher rates with respect to below-threshold repairs than those same contractors charge Highways England with respect to above-threshold repairs; and that this constitutes fraudulent ‘over-charging’ of those third parties. It has been repeatedly explained to Mr Swift that this is not the case.’
Whilst the above is misguided (using higher/exaggerated rates is not necessarily fraud – though counsel for Highways England, Christina Michalos, remarked at a Tribunal 12/11/2019, “exaggeration is fraud”), the fact is Highways England contractors DO charge third parties (and their insurers) higher rates, with respect to below-threshold repairs, than they charge Highways England with respect to above-threshold repair. Kier and HE (as above) deny this.
Indeed, recently (08/2020) a Court heard evidence on specimen claims there being many proceedings issued by the Authority stayed due to concerns about the sums being presented. The judge, HHJ Harrison was informed by Highways England’s own witness (Greg Cairns) Third-Parties were charged using unauthorised uplifts para. 36 of the judgement reads:
… for the purposes of assessing the extent of Kier’s authority within Area 9 (Area 6/8) the court cannot ignore the evidence given on behalf of the claimant by Mr Cairns. In summary, on this issue his evidence was to the effect that the costs calculated for the purposes of the claim did include uplifts for which he was unable to find authority within the contract.
Highways England are not charged these ‘unauthorised’ uplifts; the Authority knows the rules and cannot be duped so easily with spurious rates – the contractor abuses their position (possibly with Highways England’s tacit agreement) in other ways where Highways England is concerned.
Highways England has repeatedly failed to identify/address the contractor abuses (or ignored them). The Authority appears to have adopted a ‘we’re alright Jack’ approach, a careless attitude toward Third parties likely believing no one would identify the conduct. Highways England were charged using the correct methodology, the correct ‘reasonable’ rates but allowed Third parties to be fleeced.
Differing rates were used; low to the Authority and high to Third parties, despite the Authority arguing to the contrary. Indeed, given the number of FoIA requests I have made and the Authority’s claimed attention, it is frankly staggering they had to be told this by their own witness (Mr Cairns – above) during a Court hearing; to Third Parties, Kier was adding unauthorised uplifts.
A Schedule of Rates
But if the Authority is to be believed (and it should not be), not only did they fail to identify this profiteering, Highways England also failed to note (since 2012) that none of their contracts (ASC’s) contained a price list for repairs, there was no schedule of DCP rates. This is, of course, preposterous. The ‘not held’ stance was only presented 01/2019.
The following failed to identify the absence (because there was none!):
- 01/2016 Tim Reardon’s audit of Kier following my detailed 10/2015 submission
- 10/2016 Jim O’Sullivan’s (CEO) assurance Tim (Readon?) and Nick (Harris?) were putting a ‘lot of effort’ into reconciling the rates
- 2013 to 2018, the Authority catalogued 175 rate-related FoIA requests or reviews to many of which they responded:
- held but
- commercially sensitive
- 2017, the KPMG audit (Project Verde) – see below.
There was obviously the ability to seek rates form Kier as this is precisely what Tim Reardon of Highways England did, writing 05/04/2016:
The current charges levied by Kier are as follows:
a) AIW staff hourly rate: £70.32
b) AOW vehicle hourly rate: £35.53
c) CO1 Standard Beam:£41.52
But the above is false. Tim later wrote that Kier supplied the information; really, the contractor did not know they were charging the Authority about £25/hour for an AIW and £15/hour for a vehicle? Furthermore, why would Kier trouble to ask Kier; the question was what was the Authority being charged – they only need look at any one of multiple claims received weekly!
But clearly, Tim could ask for and be supplied rates, in this case valid (according to Tim) as of 12/2015.
None of the above revealed an absence of rates, a need to create a set, as occurred post 01/2019 when the Authority needed to keep up their sham ‘a schedule of rates is a myth’ stance.
The ‘not held’ stance only surfaced 01/2019 because a Tribunal found against the Authority which was then faced with having to disclose the figures. This would evidence just how much they had permitted drivers, fleets, hauliers or their insurers to be abused by, it would set out the vast discrepancy that the Authority allowed. Third Parties are owed £millions, the Authority’s reckless conduct warranting scrutiny.
Dual pricing has been practised by Kier for years. The process is also at odds with HHJ Godsmark’s judgement which, at para 25, states:
It would be odd if a tortfeasor was liable to Highways England for diminution in value of a damaged chattel in one sum if sued by Highways England itself and in a different sum if sued by Highways England via (a contractor).
But the situation is odd. The Authority deny there is a rate difference in above and below threshold claims. Over the years they have misrepresented what they pay and provided incorrect information in support of this. Their lack of accuracy was reinforced by a Tribunal (APPEAL: EA/2018/0088):
- AUTHORITY INADEQUATE / INACCURATE RESPONSES: We find that the failure to recognise and process the requests was principally caused by inadequate or inaccurate responses by the personnel within Public Authority.
- AUTHORITY PROVIDES WRONG INFORMATION: We have been persuaded that he (Mr Swift) has received erroneous information.
Appendix A to Annex 23
Kier Highways has never complied with this section fo the contract. What is quite incredible is that only they and Highways England knew of it … and the Authority never once mentioned it either. The conduct smacks of a conspiratorial approach to the abuse of drivers, fleets, hauliers or their insurers.
Why has the Authority not simply told Kier to comply with Appendix A? The answer appears to be ‘because they cannot’! This is a very worrying situation for an Authority with control of £millions of taxpayers money and tasked with overseeing the Strategic Road Network (SRN):
- is the Authority so compromised as to be ineffective?
- Is their judgement to be relied upon?
- Are contractors calling the shots,
- Can the Authority’s input to any major project be considered unbiased?
I doubt the Authority wanted to meet with me but in January 2017, Kier Highways inadvertently disclosed the formerly secret section of their contract with the Authority – Appendix A to Annex 23. This hidden section set out precisely how Kier Highways were to charge a Third Party (a driver, fleet, haulier or their insurer), for claims that were retained and handled by Kier – claims for sums below the £10,000 threshold. There was an equation that set out how the ‘maximum’ was to be achieved.
But the Authority failed to place this online; the bulk of the contract was present but the small section, just over an A4 page that set out the protection for a Third-party was hidden from the very people who needed it. What use is a shield if you do not know it exists or where it is kept? And what a coincidence; the Authority failed to make the section available, never spoke of it (despite the 01/2016 audit) and Kier ‘coincidentally’ never complied with it and never spoke of the Appendix.
In Area 9, Kier ignored the contract ‘Appendix A’ from the off (01/2014) applying their own gross-exaggeration process, 1153 – this saw many claims costs exaggerated 5-fold for a very simple reason; Kier was dividing their annual attendance costs and admin’ by the annual number of claims, said to be 1153. But they actually handled over 5,000 claims. Additionally, many of the staff were also being paid for from the public purse!
- It is possible Kier’s initial intention (2014) was not simply to profiteer but to make the company, then EM HIGHWAY SERVICES LIMITED, more appealing to investors or an attractive acquisition. Their attendance rates on incidents were now being charged at £2700 (plus £2000 admin’), whereas a year before the attendance fee was about £125.
- mid-2015, EM Highways Services was acquired by Kier Ltd.
- 09/2015, the company’s accounts showed a profit of about £12million – likely about the sum extracted inappropriately from Third Parties – DCP claims were no small beer (as Kier and HE would have people believe).
Highways England failed to address the contract non-compliance and presumably, Kier was not reporting their substantial profiteering to the Authority in the regular claim cost/recovery returns – their monthly lump-sum payment from the taxpayer was not reduced. It appears Kier was presenting the Authority with false cost recovery data – an example appears here – the situation is simple:
- use high rates but convey to HE that lower rates (‘mates rates’) were used
- recover the amount or slightly less
- claim you have broken even or suffered a loss
- by not profiting the monthly lump-sum payment you receive is maintained – the public purse suffers (again)
The court having been told the rates used are subject to ‘unauthorised uplifts’ it is evident Kier have bene conveying exaggerated claim to HE and the losses/breakeven conveyed is false.
- why did Kier provide HE with false information if there was nothing to hide i.e. there is something to keep secret
- how much is the public purse owed?
It is evident Kier Highways misled Third Parties and the Courts for years. This conduct had gone either unnoticed by the Authority or occurred with the assistance of Highways England. Thousands of invoices have been overstated. At or about 03/2016, rather than address the issues, Kier placed matters with lawyers and aggressively pursued overstated claims misleading courts in the process.
Highways England and Kier Highways have always denied this overstatement to Third Parties. However, in an August 2020 judgment (para. 36) the behaviour was confirmed; there had been unauthorized uplifts. This has many ramifications:
- how did the Authority not note the issue, did they?
- why did KPMG’s audit not uncover this, did it?
- upon what was the Authority basing their ‘no overstatement’ responses?
- why was the contract non-compliance not prevented, addressed, stopped?
- what of the sums Kier was conveying to Highways England as their ‘cost’ and ‘recovery’ figures – the claim costs were obviously false, overstated
For more than 6 years Kier has been misrepresenting claim values, overstating costs and demanding these inflated sums from Third Parties in the name of Highways England, enabled by the Authority. They did so with the assistance of their lawyers and Kier Highways was prepared to misrepresent matters in court. I wrote to the Authority:
13/04/2017 14:36 to highwaysengland.co.uk
Subject: Appendix A to Annex 23 – ASC contract ‘AMOUNTS CLAIMED FROM THIRD PARTIES’
Re: Area 9
I am concerned that your contractor has, from the commencement of the contact (01/07/2014) been permitted by Highways England to act contrary to the contract and overcharge third parties. It appears drivers, fleets and insurers are owed £millions, that this is a scandal. The issue continues, is current.
I await your response to the 3 questions below
1. confirm that the manner in which Third Parties (drivers, fleets and insurers) are to be charged by your contractors is as per Appendix A to Annex 23 (or similar) where this exists
2. explain why, in Area 9, where Appendix A to Annex 23 operates, your contractor has not complied with the Appendix since the inception of the contract
3. confirm that the contractor will now be asked to comply with the contract or explain why this is not to occur.
06/06/2017, I reiterated my concerns writing to Colin Matthews (Chairman) and Jim O’Sullivan (CEO) of Highways England and extract form which states:
Highways England claim to ‘protect the public purse’ yet they are squandering funds by making excessive payments and failing to recover sums (it appears).
Highways England is enabling Kier Highways to make drivers, fleets and insurers victims of a charging methodology which is contrary to the contracted process and rates.
The protection for Third parties contained within the ASC has been ignored and Highways England have failed to identify this or are permitting it. Highways England and Kier are misrepresenting facts to enable an excessive profit to be made.
The above resulted in a meeting (21/06/20187 – see below) but failured to address the situation and secrecy associated with the Authority’s enquiries.
21/06/2017 Meeting With Highways England
The KPMG audit was initiated by the Authority.
01/2017, having discovered and circulated Appendix 23 of the contract, it appears Highways England considered it imperative to meet with me and ostensibly undertake an inquiry. Their approach now seems obvious; contrive an enquiry to put yet more time between the conduct and discovery, initiate a ‘project’ the outcome of which was likely preconceived and would be kept secret if impropriety was discovered. Otherwise, why not make it public, demonstrate an open-hands approach and that my assertions were flawed?
After writing about Appendix A to the Authority, I received an email from Sarah Green of Highways England:
Mr Matthews* has asked me to contact you.
I am taking over red and green claims for Highways England from 1st July and looking at the detailed correspondence being received from CMA I would very much like to meet with you to discuss your concerns.
I called your office this morning to try and make an appointment but they advised me you are out all day. Please can you call me on 07901 872141 so we can arrange a meeting?
Head of Dart Charge Service
Highways England | West Midlands RCC | 1 Ridgeway, Quinton Bus. Park | Birmingham | B321AF
*Former Chairman of Highways England
21/06/2017, I met with the soon to be head of claims for Highways England Mrs Sarah Green. After the meeting of a couple of hours, Mrs Green left with correspondence and shortly after, the same day, I sent Mrs Green an email:
Thank you and Gary for your time today. I shall email you on matters in future – please say if these become burdensome.
I cannot bring myself to email Tim. I intended to – my email is below but I fail to see how he is not part of the problem
I will send the other items now – I have attached the comparison document* – tweaked a little to be clearer (I hope)
Have a good journey
*the document sets out the rates being charged to the Authority and a third party describing what is charged and what should be:
- to the Authority £23.71 + £1.75 = £25.46
- to a Third Party: £73.05 + 50% uplift £109.58
- a Third Party should be charged £23.71 + £4.88 = £28.59
- to the Authority £14.66 + £1.08 = £15.74
- to a Third Party: £36.91
- a Third Party should be charged £14.66 + £3.02 = £17.68
DRAFT TO TIM (sent to Sarah Green) his 3 points (numbered below) appear followed by my response:
1. It is misleading to compare recovery and repair rates and costs charged to Highways England and those charged to insurers, and expect the various amounts to align. There will inevitably be differences, whether due to timing differences in terms of when the recovery and/or repair were carried out, differences in physical conditions at particular locations, differences in the cost accounting systems used and ways in which overheads, for example, are apportioned, and the impact of the contract between Highways England and the service provider which in relation to asset support contracts treats above £10k claims and below £10k claims differently. There is no “one size fits all” in this area.
There are ‘repairs’ and there are ‘rates’. Rates are a constant (easy to compare), repairs are variable (difficult to compare). It matters not what when an incident occurs – the rates (defined costs) are the same. That you seem keen to convince to the contrary suggests you have been influenced by ‘Kier-hype’.
A comparison is attached – the excel version that Sarah may find easier to ‘play with’ than the document today.
The contract between Highways England and the service provider (Kier) treats above and below £10k claims slightly differently and the one-size-fits-all exists; at least ‘costs’ are the same, ‘uplift’ varies:
Over £10k to HE:
a. Defined costs plus
b. Fee (7.38%) uplift
Under 10K to TP:
a. Defined Costs plus
b. TP claims overhead (20.58% – apparently) uplift
The difference in the current one-size-fits-all environment is as unassuming as above – or should be – 13.2% variation. Simples! The complication arises because Kier say they are applying he process but are not – the result is a cacophony of figures, confusion and the need by Kier to make further misrepresentations to confuse and frustrate.
2. Matters relating to the contract between Highways England and the service provider are for those parties alone and are nothing to do with you or your firm.
I do not understand this comment. Kier refer to the contract when making a claim, the contract (Appendix A to Annex 23) defines how a TP is to be charged using such phraseology as ‘no more than’ and ‘a maximum of’ … Kier’s description of their pricing accords with Appendix A but their conduct does not.
I have no interest in all aspects of your contract, just those that have a bearing on claims, on costs on getting the sum to be paid right.
3. What is important is that the recovery rates and costs being charged to insurers are reasonable. We believe they are, but it is for you and your clients to be satisfied on this. If you are not satisfied you can challenge the amounts being claimed, if necessary in court.
I agree that it is important the costs are ‘reasonable’. Court is an option but we are not playing on a level playing field; fast are misrepresented to a Judge and information withheld. I believe we will overcome this problems but in the meantime the conduct is undertaken in the name of Highways England, apparently with your knowledge and approval.
If you are saying the ‘defined costs’ are not reasonable, I question why Kier would agree to them and charge HE these figures. Possibly, as has occurred, there was never an intention to abide by Appendix A to Annex 23.
You (HE) appointed Kier who signed up to the contract – they signed up to Appendix A to Annex 23. They agreed to charge no more than ‘defined cost’ plus ‘TP claims overhead’ and in your name Kier appear before the Courts stating this is what they are doing. But they are not. The evidence is in front of you, I have provided it. You believe you (HE) are paying £70.32 / hr for an AIW, you are not.
Sarah has my sympathy. What started as an inability to understanding Kier’s charges has developed into a monster … Oh! What A Tangled Web We Weave When First We Practice To Deceive”*
However, possibly the 3 hours Sarah and Gary endured of me today will trump the emails I send and ultimately (when my statements have been reviewed / corroborated) convince all at Highways England that we have unwittingly uncovered a scandal; that it has always been Kier who should have been criticised, not me or my ‘firm’. I believe the facts are incontrovertible.
And you are NOT paying £70.32 / hour for an AIW!
I also sent Mrs Green an email I had received from Kier confirming the ‘same rates above and below’ situation, the process that should be engaged, was stated to be utilised but clearly was not. The email from Kier was as follows:
From: Sophie Granville
Sent: 24 March 2016 16:39
To: Philip Swift
Subject: RE: Your Ref: S08B618 – Our Ref: GC19174
The notional rate for any individual is the same regardless of if it is a HE claim or an under the threshold claim.
The differing pounds is a result of the contract overhead which does differ but the HE are looking to make more consistent in the future.
Other than that the numbers are identical and I have given you the full notional breakdown which also shows the contract overhead.
If you cannot understand this please by all means call me. But it is in the schedule I gave you as I was trying to share more data than I actually needed to in the interest of transparency and collaboration.
There you have it – the rates below and above threshold were the same, the overhead differences should cause the rate to differ. But this was untrue, obviously not the case and I again refer the reader to the 2020 evidence to a Judge; unauthorised uplifts were admitted to by the Authority/Kier witness – exactly what I had been stating for years!
I sent a further email to Mrs Green containing a lengthy report about my concerns. A copy of this can be found here: U04B286 EVIDENCE (the exhibits are available but include personal data though, given the association with civil claims and fraud, I believe diminish the need to keep them private).
I concur with the14/03/2014 comments of the Rt Hon Margaret Hodge MP, Chair of the Committee of Public Account (House of Commons Committee of Public Accounts 47th report into Private contractors and public spending):
“Private provision of public services has become big business, with half of all public
spending on goods and services going to private providers of contracted-out services. We
believe Government needs to urgently get its house in order so that this expenditure is
properly open to public scrutiny, and that measures are put in place which will improve
services and secure a better deal for the taxpayer
But is appears the Authority cannot get its house in order; that ist is so compromised as to be ineffective. Accordingly, it must turn to blocking scrutiny by any means possible.
I also sent Mrs Green an example of the letter we would issue upon receipt of a Kier Highways claim; we reasonably asked the claim be re-priced in accordance with the contract, the template read:
It is evident the charges cannot be in accordance with Appendix A to Annex 23 of the
1. Please explain why the contract is not being complied with
If the invoice as presented has been produced in this manner, then please
2. provide us with a breakdown as to how the total for each individual head of claim
has been arrived at with reference to the methodology above, together with
3. confirmation of the Third Party Claims Overhead and
4. evidence of the figure as at the date of the claim.
Please also provide:
5. a copy of the defined costs agreed with Kier, that are used to invoice parties such as
If the invoice has not been produced on this basis, then please:
6. Re-cost, using the above methodology, and
7. provide the evidence requested.
As soon as we are satisfied that the claim has been quantified in accordance with the
Agreement, we will be pleased to advise our client to release payment
But Highways England ignored these requests. At no time did they state our understanding was flawed, that there were no rates or another process was engaged, they simply failed to respond or ensure claims were priced in accordance with the contract (example: Our Ref: U09C946 Kier Highways ref: GC27976). As evidenced by HHJ Harrison’s judgement (quoted above), Kier was applying unauthorised uplifts. Highways England had failed to address this.
We pointed out why Tim Reardon was part of the problem, that he was providing erroneous information, producing a copy of his 05/04/2016 email in which he misrepresented what Highways England was paying Kier and sought to justify uplifts that were not incurred for out of hours working.
After the 21/06/2017 meeting, Sarah Green responded at about 6pm:
Thank you for your time today.
I have received your emails and will now conduct my investigations.
I will come back to you with proposals for another meeting once I have something to share with you.
In the meantime if anything further comes across your desk that causes you concern please forward it on to me.
Head of Dart Charge Service
Highways England | West Midlands RCC | 1 Ridgeway, Quinton Bus. Park | Birmingham | B32 1AF
Mob: +44 (0) 7901 872141
The evidence of misrepresentation, exaggeration, profiteering and fraud was substantial causing me to write to Mrs Green 04/07/2017:
I do hope I am not overloading you – it is likely best that I concentrate on the rate difference (Appendix A to Annex 23 non-compliance), shifts and multipliers in the hope that Kier ‘put their hands up’ … my glass remains half-full and we can get down to the business of settling these claims fairly for all.
I subsequently spoke with Mrs Green between November 2017 and March 2018. The conversations were convivial and whilst I was not provided with a copy of the report, this had been compiled at least in a draft form, the history being conveyed in various conversations with Mrs Green before the involvement of KPMG:
26/07/2017, Mrs Green advised:
“So, and, you know, and if they, they, they, they now know that if they don’t respond then we will be doing a very detailed um audit, ’cause I’ve had a look at the audit that was done previously* and they said there were some gaps in it, so …., and so I, I actually want another audit undertaken. So I’ll give you some news next week on that as well.”
*Tim Reardon 2016
28/09/2017, Mrs Green advised:
“…, so yesterday, Sophie* has now got wind that they’re being audited, she didn’t know that before, and I had the most abusive phone call off Sophie who accused yesterday of me and you being in partnership.”
*Sophie Granville, former head of claims at Kier Highways
” … CorClaims*, who weren’t corresponding with me, are funny enough this morning trying to get my attention at conference call, and I said to them, “I’m sorry, I’m not pre- you, you had ample opportunity to come and speak to me and resolve some issues with me, you haven’t done that, so no, I, I shall, we shall just go through the audit that we’ve done on this.”
*Corclaims – Shakespeare Martineau, the ‘profit from claims‘ lawyers who, in 2020, were appointed to a £3million Highways England contract, also the lawyers for Kier Highways
Mrs Green stated that an audit would occur. Initially, this was to be by Grant Thornton but apparently, the Authority (28/09/2017) had “just had a blip with Grant Thornton”. Instead, KPMG were appointed and 11/2017 them. Possibly KPMG was selected as their outcome could be controlled.
The Authority has failed to disclose the KPMG report – and much other information. I was informed the audit was given the name ‘Project Verde’; neither ‘confirming nor denying’ the report exists appears unnecessary, excessive and demonstrates an intention to obstruct.
The report has been paid for by taxpayers, relates to an abuse of taxpayers yet is being kept from them. Obvious reasons for withholding is that the report evidences the existence of rates, of processes and a tacit agreement to exaggerate sub-threshold claims to such an extent that a public enquiry would be required to address the conduct which appears to extend to malfeasance and fraud at managerial level in both the Authority and contractor.
At the 21/06/2017 meeting, I produced two claims for comparison one above and one below the threshold. These claims were both from Area 9, a week apart and had common features which made for ease of comparison. The pertinent aspects were:
- Kier exaggerated costs to Third Parties by charging one set of rates for above and below the threshold or, in the alternative
- Kier applied different uplifts and
- Kier applied multipliers, fraudulently claimed uplift; payments they stated were paid to operatives but were not.
The two claim records, the information can be read here. Brief details provided to Mrs Green 21/06/2017, the following day Mrs Green phoned me and said:
“I am thinking about appointing the Highways England counter fraud team to do a full investigation. If I do that, um, they will probably need a bit of your time in order to get all the evidence that you’ve got. Would you be willing to participate if I go down that route?
It was reassuring to learn that someone at Highways England understood the evidence, that there was a prima facie case of fraud. However, whilst agreeing to such a process I raised two caveats:
- is it sledgehammer to crack a nut?
- what comes from that, is it to Highways England’s benefit that this happens?
Mrs Green appeared up to the task in hand, prepared to take affirmative action and the evidence of contract non-compliance and fraud so overwhelming as to make the outcome a foregone conclusion; Kier had been caught with their hand in the cookie jar, but how best to address this for all concerned? We simply wanted claims presented correctly, utilising agreed (common) base rates and the uplift – we could live with the 25.29% (Area 9) and 20.58% (elsewhere), we have never sought to cut the throat of a contractor.
I was also concerned that TfL’s fraud investigator had undertaken a sham enquiry when concerns were raised with them. The concerns about Kier and they activity with Highways England also apply to TfL – and other Authorities.
Mrs Green wanted a steer from me about how heavy I wanted her to go in. I was informed Grant Thornton was to be appointed to undertake an audit though this changed and became KPMG.
11/2017, I spoke for almost an hour with KPMG repeating what I had conveyed to Mrs Green. A copy of the conversation can be found here.
It was evident the contract was not being complied with, that Kier was making unauthorized uplifts, exaggerating costs. With regard to multipliers, uplifts on already exaggerated rates, these appear to amount to fraud.
Fraud & Exaggeration
I have always made a distinction between exaggeration and fraud:
- Exaggeration – this is the contract non-compliant process, the use of unauthorised uplifts on rates, profiteering from a monopoly position, acting as though the Authority, Highways England, demanding payment of rates that are substantially above those charged to Highways England. There is an element that appears to amount to fraud, or contempt of court; misrepresenting facts to Judges.
- Fraud – Kier Highways charges Third Parties (drivers, fleets, hauliers or their insurers) an uplift on hourly rates stating to us, insurers and the Courts (documenting the conduct) they apply the uplift of 50% because after 5pm of a weekday, they pay their operatives this increased rate. Additionally, of a weekend, they charge Third Parties a 100% uplift because they state they pay their operatives this double-time. They state their operatives do not work shifts but 8am to 5pm weekdays. But, the operatives:
- Do work shifts
- Are not paid the uplifts
- Are paid a flat rate for overtime
If there is not an uplift paid, why is Kier stating to the contrary, where is the multiplier-money charged/paid going? Further evidence no uplift is incurred, that the operatives are not paid the increase, comes from the Authority who, unlike Third Parties, are not charged the uplift after 5pm of a weekday.
- What element of fraud is missing?
Was Kier running at a loss when billing Authorities and profiteering form Third parties on Highways England, TfL and other contracts … nationwide, generally?
To put this another way, to demonstrate the reality, a Third Party was being charged over £70/hour for an AIW. Ms Sophie Granville, formerly Kier”s head of claims, emailed the breakdown of the hourly rate and that the base rate/cost of an AIW was about £58/hour. yet Highways England was being charged £23.71/hour + 7% (approx.) fee uplift … Kier Highways was losing about £30/hour every hour an AIW worked for the Authority …. if Ms Granville’s figures were true.
But after 5pm of a weekday, an AIW was apparently paid a 50% uplift … not to the Authority! Highways England paid the same £23.71/hour whereas the cost was stated to be £58/hour plus 50% uplift … something was wrong. It appeared Kier were providing false information – supported by Highways England – and that drivers, fleets, hauliers or their insurers were being fleeced by this combined activity. All this was conveyed at the 21/06/2017 meeting.
I subsequently left Mrs Green in no doubt advising 28/02/2018:
“… what I’m saying to you is, this multiplier of 1.5, from the evidence in my possession this is clear-cut evidence of contempt of court and fraud.”
It is evident Mrs Green understood this aspect of my complaint as she responded:
‘Cause that’s one of the things that we, we have asked for is to be clarified under the audit.
But it has never been clarified:
- Mrs Green never returned to me and said ‘no fraud because ….’ and
- the conduct continued
The conduct is undoubtedly fraud, it was apparent the Authority could not account for it. But having permitted/enabled the conduct, what could they do?
In Area 9, the uplift (fee) was about 7% to Highways England and should have been 25.29% (TPCO) to a Third-Party. The difference in rates charged to the parties (HE & TP) should have been about 18% but in reality, was 200% or more. To aid this deception, whilst Kier set out their charges to the Authority separating ‘rate’ and ‘fee’, a Third-Party saw no such clarification, just a single figure, an hourly rate.
How much simpler to utilise the same claim cost presentation and alter the percentage uplift form the ‘fee’ (about 7%) to the TPCO (25.29% in Area 9)? But simplicity and openness did not enable profiteering.
Post 11/2017 KPMG Conversation
I spoke with Mrs Green on a number of occasions after my 11/2017 conversation with KPMG, I was obviously keen to ascertain the outcome of the audit, ‘Project Verde’.
12/12/29017, I emailed Mrs Green again highlighting that claims should be presented to Highways England and Third-Parties using a common set of rates. My email can be read here and includes an attachment, a copy of an email to Mark Merrell of Corclaim (Shakespeare Martineau solicitors) correcting his use of what I had written, that I had conveyed:
“There will be no change in our conduct until such time as you and your client stop
presenting spurious charges and start to act honestly.”
13/12/2017, Mrs Green said:
“I need their (KPMG’s) summary report, and then hopefully in the New Year we should be able to sit down, I’m confident that we can, that everything is fully explainable from what I’m seeing so far. I can’t share with you what I’m seeing so far, and I don’t want to give you half a story, so I want to come and see you with the, with the full story.“
“Well, again, we should see, we should see all of this come out in the audit, and I haven’t had, I haven’t seen, I haven’t seen the um, I haven’t even seen the draft audit report yet, but I’m hoping we should be able to explain all of that when I, when I see you in the New Year.”
“The main questions, the main questions that you asked me when I came to see you are the main points that I’ve asked to make sure that they are covered in depth within the audit report.”
“Yeah, I mean there’s nothing going to happen next week. I think I’m not due the report until some point next week which, and then obviously then it’s, it’s the err, break between Christmas and New Year, so there’s nothing’ll happen now until the new Year.”
“But the most sensible approach is that we, I come and see you in the New Year now with the outcome of the audit and then we, then we, we can err, we, we kind of come to, try and come to some arrangement then”
I was to receive ‘the full story’.
I explained to Mrs Green we were being told AIW’s (operatives) work 8am to 5pm and that is their standard hours. Mrs Green responded:
“And I don’t want to… pre-empt what’s in the audit, but I believe all of this is covered, ’cause these are the quest-… The main questions, the main questions that you asked me when I came to see you are the main points that I’ve asked to make sure that they are covered in depth within the audit report.”
By the New Year (2018), it appeared I was being fobbed off, the subject of prevarication.
04/01/2018, Sharon McCarthy of the Authority sent me an aggressive email the tone of which took me by surprise, I phoned Ms McCarthy to be accused me of bombarding Sarah and KPMG with emails, explaining:
” … I’ve understood from conversations that I’ve had with both KPMG and Sarah that it’s not one or two instances, it’s at least 30, 40, 50 emails a day”
It was apparent Ms McCarthy had an issue with accuracy, facts; what was it … 30, 40 …? This was a ludicrous accusation, incapable of being supported but this misrepresentation became a common theme of the Authority. I understood a check of my emails and in the months since speaking with KPMG, I had sent 14 emails, I had updated Mrs Green as requested, at her invitation. My emails to Ms Mcarthy can be read here. Ms McCarthy unable or unwilling to explain the conduct, the issue is currently with the Parliamentary Ombudsman.
01/2018, I received an email from Peter Williams of the Government Legal Department (GLD) which contained the following statement:
‘I’m instructed that Sarah Green is satisfied that there is no substance to your complaint about Kier’
18/01/2018, Mrs Green responded to the above “I have not had that conversation“. This is typical of the contradictory responses received, of the lack of professionalism. However, it appeared all was not as was being conveyed.
18/01/2018, Mrs Green said:
“I was on a call last Tuesday, was… Yesterday morning, sorry, and we should be getting the initial draft of their report at some point next week.”
“To be honest, I haven’t seen the full extent of the report, so I wouldn’t like to comment, to be honest with you.”
“I just need to get the report next week and then do what I need to do.”
“My mad world of the things that, the other things that I do in my life is starting to calm down a bit now, so um, once we get the audit report, which might be next week, hopefully, it’ll be next week, is … I’ll come, try and down, I will come and see you at some point in February…“
I raised a suspicion; that Kier has been telling Highways England that they’ve only been recovering lower figures from people, whereas they had actually been recovering their (higher) figures, and that as a result, their lump sum has stayed high when it should have been reduced. An example of the conduct that concerned me can be read here. Ms Green responded:
“… that should come out as part of the audit“
In early February, I took the time to explain to Mrs Green, in separate emails, various aspects of claims that were being misrepresented or overstated, examples of which were:
- ‘Planning’ Charges – Duplication / Exaggeration
- Averaging of Admin’ Staff Costs
- debris collection/disposal
The issues were not responded to (despite my resending them in early March – see below), not addressed and the conduct continued by Kier.
Then, a further contradiction arose …
02/02/2018, I spoke with Ms McCarthy who had already made misleading, false statements (above). I was seeking an update; when were we were going to meet and when the report would be concluded by KPMG. Whilst Ms McCarthy tone was unprofessional, abrupt she responded “the update on the investigation is that they have concluded their first part of their field work” adding:
“I have a report that’s sitting on my desk at the moment, it’s still very much in draft form and I need to go through that, so err, err, and err, and, and we need to, you know, we as the company need to, to, to review what err, has come out of that, but that’s all I can tell you at the moment.”
When I asked about a date for the meeting, Ms McCarthy would not be held to a time and terminated the call abruptly. I responded by email which can be read here.
12/02/2018, Mrs Green said:
“… so we had a draft audit report that went to our audit committee last Wednesday, and they have asked for some further work to be undertaken … the audit highlighted a few things and they said, “Well actually, I want to check out this this, that and … So, the audit, as we stand here today, is therefore not complete.”
” … so that work will take place now over the next few weeks, so, and I’m not going to obviously be able to sit down and discuss anything with you because it, it’s not completed yet. And as soon as we’re in a position to do that then, as I say, I say, I will do. And that’s probably as much as I can tell you on, on the audit right now.”
The conversation included references to an intention for us to meet up in March 2018 – at odds with Ms McCarthy’s statements.
28/02/2018, I again spoke with Mrs Green about Kier’s use of a multiplier on operatives hours after 5pm of a weekday, the multiplier of 1.5, advising “from the evidence in my possession this is clear-cut evidence of contempt of court and fraud” to which Mrs Green responded:
” ‘Cause that’s one of the things that we have asked for is to be clarified under the audit.”
The ‘neither confirm nor deny’ stance of the Authority is at odds with Ms Green’s statements and intentions; there is ample confirmation an audit report exists.
It is also evident:
- the Audit did not discover the absence of DCP rates, the absence of a schedule or price list because no one mentioned it or sought to address the issue. As a result, by way of example, no one compiled a set of rates as occurred post 01/2019, ‘the NSoRC‘. The discovery was not made because a schedule exists
- the application of unauthorised uplifts, the Greg Cairns ‘confession’ to a Court 08/2020 (above) was missed or turned a blind eye to the process
- the fraudulent uplifts were ignored, they continued
- the dual rates process continued
It appears the Authority has lost control, that the tail wags the dog. I suspect the Authority, complicit in the gross exaggeration/fraud, is so compromised as to be ineffective. An example of this impotence arose with regard to Shakespeare Martineau. Whilst Mrs Green assured me all matters were on hold, their lawyers (a.k.a. Corclaims) were still issuing proceedings. When I explained to Mrs Green (28/02/2018) that Corclaim were not doing as they were told (by Highways England – their master), the response was blunt:
“I’m fully aware of that, Mr Swift.”
When I asked why, it appeared exasperation had set in, Mrs Green responding:
“If you can give me an answer, then I’d be… I don’t know.”
Despite convivial conversations, it was evident Mrs Green was ineffective.
07/03/2018, exasperation was conveyed in our email about rates, Kier, Shakespeare Martineau and Highways England, a copy of the email can be read here.
03/2018 the report should have been available. I believe the substance of the report was not only available but the content fully supported the obvious dual charging Highways England denied yet a court in August 2020 was told existed.
The report should also have identified:
- there was a schedule of DCP rates being applied – but only to Highways England or
- no such schedule existed – but as there was, such a stance was not required until late 2018, early 2019.
However, in March 2018, the Authority changed their attitude toward me. Tim Reardon made spurious, simplistic and ridiculous allegations (the issue currently with the PHSO) and withdrew from exchanges. It appears the conduct was intended to remove Mrs Green from the enquiry and prevent findings being passed to me; that unfounded, baseless accusations were concocted because the report was damning of the situation. How could it not be; the evidence I submitted confirmed irrefutably the existence of a dual pricing arrangement, that the Authority had misrepresented facts and supported Kier’s contract non-compliance for years. In turn, Third Parties have been subjected to exaggerated pricing, overcharged on thousands of claims. The Authority is potentially liable for the reimbursement of £millions.
It should be a simple matter to have Kier Highways abide by the Third-Party-protective section of the contract and have them charge:
- cost (the base rate) charged to the Authority i.e. known and
- to add the agreed uplift, the Third Party Claims Overhead (TPCO) of 25.29% in Area 9. What was the point of calculating the TPCO if it were not to be utilised?
But it is evident the Authority cannot enforce the contract or is unwilling to do so. In 2020, rather than have Kier Highways comply with the contract, the Authority changed the agreement to enable Kier to charge more …
- So much for HHJ Godsmark’s judgement which, at para 25, (above) and the ‘odd’ situation of a Third Party being liable to Highways England in one sum if sued by Highways England itself and in a different sum if sued by Highways England via a contractor. This is now what is occurring – two sets of rates, subject to who is being billed
- The Authority is charged using ‘reasonable rates’ so what are Third Parties subject to if not unreasonable rates?
- The Authority pursues claims based on the actual cost of carrying out the repairs. Clearly, they know these; so why are they not appropriate to utilise when billing a Third-Party?
There you have it, an Authority complicit in exaggeration and fraud in charge of the strategic road network (SRN), £millions of taxpayers money and entrusted with controversial projects (Smart Motorways, Stonehenge Tunnel etc.) beholden to its contractors who wish to partake in these works and receive the revenue.
The purpose of my June 2017 meeting with Mrs Green was to raise the issue and put a stop to the abuse of drivers fleet’s hauliers and their insurers. All I have ever sought is for Kier Highways to comply with their contract and price damage repairs reasonably appropriately.
It has become evident that the profiteering is so great as to be unstoppable. The issue appears to be too small for the Serious Fraud Office (SFO) and too large for any individual constabulary. Aspects of the conduct are ‘undoubtedly fraud’, straightforward and relate specifically to charging uplifts the Kier do not incur.
There is significant interest in the issue and its importance is conveyed in a Tribunal judgement 13/12/2018 – APPEAL: EA/2018/0088. The Authority, having cited ‘commercial interests’ then turned to obstructing the release of information by citing ‘vexatious’ but a Judge saw through this:
A Tribunal’s finding; NOT vexatious but that the Authority’s conduct was lacking:
- SERIOUS PURPOSE: ‘We have considered the motive of the requestor and in particular his detailed Reply and exhibits. These submissions supported by the documents provided and annexed have persuaded us not only that the motive of the requestor had a serious purpose and arose from genuine and informed concern but had significant value with a high degree of Public Interest.’
- PROPER USE: On the evidence before us we could not find the request were manifestly unjustified, inappropriate or an improper use of FOIA.
- AUTHORITY INADEQUATE / INACCURATE RESPONSES: We find that the failure to recognise and process the requests was principally caused by inadequate or inaccurate responses by the personnel within Public Authority.
- AUTHORITY PROVIDES WRONG INFORMATION: We have been persuaded that he (Mr Swift) has received erroneous information.
My purpose has always to ensure insurers pay reasonable costs for attendance to incidents and repair to the SRN. The contract should have made this easy; Appendix A sets out how Third Parties were to be charged; cost-plus. In this case, cost + 25.29% (Area 9). I never sought to have Kier pay less than that to which they agreed.
I have sought ‘costs’ but despite the Authority commonly stating these are utilised for their claims (and for the reasons detailed should be the same to Third Parties), the figures have been withheld. This has prevented me from making ‘spot on’ calculations. The purpose of my request, the information held within the audit must, by virtue of my complaint and Mrs Green’s understanding, address:
- the existence of a schedule of rates, the ‘costs’ price list
- the application of the costs pricing to Highways England only
- contract non-compliance
- the application of fraudulent and contract-non complaint uplifts
I again refer to the judgement of HHJ Harrison and that Kier has applied unauthorised uplifts. This was stated to a Court in 2020; why was it never uncovered before?
I suggest the answer is that it was, but the parties (Kier and Highways England) acted in harmony to keep the abuse secret, to maintain the profiteering conduct that saw Kier profiting handsomely. It is inconceivable that the KPMG enquiry did not address this comprehensively.
But my purpose with regard to this request took on even more serious purposes. Kier was not simply profiteering from the claims they retained and presented to Third parties themselves but:
- Kier was misrepresenting their costs to Highways England, providing false information by presenting their ‘unauthorised uplifted’ rates and fraudulent ‘multiplier enhancement’s to the Authority as though ‘defined costs’ i.e. as though base rates
- the Authority appeared so set upon defending/protecting kier and permitting the conduct that it appeared they were beholden to their contractor, unable to control them. I question whether the Authority is fit for purpose. Highways England appears riddled with managers prepared to mislead or bury their head in the sand such that Kier’s conduct was facilitated, protected. What confidence can be placed in Highways England’s conduct, for example, their approach to major projects?
But the ‘serious purpose’ above extends to wider considerations, greater concerns; if the Authority cannot control their contractors when it comes to incident attendance and damage/repair costs, where else are they similarly impotent? DCP is possibly the tip of the iceberg.
The Authority regularly withholds information. I handle claims associated with damage to the highway. The Authority advises that they will respond in the course of ‘business as usual'(BAU) but do not. Their ‘business as usual’ timescale is 15 working days. They commonly fail to comply with this. I am therefore left with no alternative but to progress a request by use of the appropriate, formal, gateway; FoIA. Yet even when exercising my rights, the Authority fails to address response in time, provides contradictory information (or no information) and has gone so far as to try and prevent any access to information.
For example, where contractors such as Kier are concerned, it is evident the Authority has problems extracting information from them. The 15-day (working) BAU rule is commonly ignored with weeks or more passing, even months. In some instance over a year passes and it is apparent the contractor is not assisting.
Engaging FoIA appeared agreeable to Highways England, proved helpful in some cases. In early 2020, I wrote to Highways England about 5 claims explaining that these saw the Authority fail to respond to requests for information during the claims handling process, in respect. Having exhausted the claims route, I turned to FoIA in respect of each matter and was provided information – 12/12/2019 INTERNAL REVIEW Highways England & Kier Highways Exchanges. However, the problem continued and I was again forced to engage FoIA. The Authority volt-faced and refused to provide the information sought, the history can be found here. The matter is with the ICO as of 23/07/2020.
23/12/2020, the Authority’s head of Green claims, Julie Turner @ highwaysEngland.co.uk, wrote:
The provision of information which relates to a claim for damage to network property falls into the BAU process in name only. Our Network Claims teams will respond, as far as it is appropriate to do so, within the 15 days where possible but as you are fully aware the nature and volume of the information that we need to gather, and the source that it may come from, means it is likely to take a longer period of time.
Given this approach, we do not believe it is appropriate for your requests to be treated under FOIA. If we are unable to respond within 15 days to then ask that it is treated under the Act is not the manner that the legislation was established to be used in, and therefore such requests are considered to be an abuse of the legislation.
In the future, such requests will be treated as vexatious if you do choose to submit them via that route.
The same day I responded. The full Authority email and my reply can be read here.
It is a trademark of the Authority that they fail to provide accurate responses and in the event they are ‘caught out’ perform u-turns without hesitation. The examples are multiple and some can be found here. Their conduct is unashamed.
Third Parties, adjusters and the Courts are misled without compunction.
The Tribunal judgement 13/12/2018 – APPEAL: EA/2018/0088, saw the judge find against the Authority and their appeals were subsequently quashed, another Judge advising the Authority should comply with the law. But the Authority had another trick up their sleeve; the last resort of a scoundrel (in FoIA terms)? …
Unbeknown to the Judges finding against the Authority, it mattered not what the Tribunal ultimately decided, Highways England had no intention fo releasing the rates. despite 175 requests for rate-related information, many to which the Authority responded ‘held’, when backed into a corner, when required to release the information, the Authority turned to ‘not held’.
The FoIA is treated with contempt by the Authority, the ICO/Tribunals played:
- if the Judge had found against me, the Authority would have utilised the decision to obstruct/refuse every subsequent request, relying upon the finding.
- if the judge found for me, they would simply say ‘oops … sorry … we erred … there are no rates to disclose’
From the outset, mine was destined to be, at best, a pyrrhic victory – the FoIA ‘war’ being waged by Highways England
Despite not knowing the Authority was toying with me, intended to claim ‘not held’ the Tribunal saw through their attempts to keep me from important, relevant information.
This request is no less significant.
Area 10 Request
I asked to be provided;
The audit/investigation/enquiries of Area 10 / Balfour Beatty Mott MacDonald (BBMM) subsequent the judgement of HH Godsmark, Case No: C08YP765 and the contradictions arising/conveyed. The information will extend but not be restricted to, exchanges with the contractor following my attempts to obtain information from BBMM.
You may wish to cross-reference this to FoI 100162 ‘Area 10 BBMM Above Threshold Rates & Subsidy’.
Work commitments have taken their toll on the time I have available to respond to this aspect of the request but, in brief:
I became aware of a Judgement BBMM (the Authority contractor in Area 10) obtained that prepared to favour their pricing approach, save that they were to remove a 10% fee uplift – which they subsequently failed to do.
However, the judgement was important for a number of reasons, mainly the evidence given by the Authority/BBMM’s witness, Luke Ellis. As will be gleaned from the judgement (which can be found here), Mr Ellis convinced a Court:
- there was a set of DCP rates for above threshold (£10,000) emergency incident attendance/repair
- these rates were subsidised by the monthly lumpsum payment BBMM received from Highways England and as a result:
- this schedule of DCP rates was not appropriate to utilise when pricing sub-threshold claims
On the face of it, the above, interlinked, arguments appear reasonable, sound. Mr Ellis managed to convince a Juge they were accurate. However, the address each briefly:
a. there was a set of DCP rates for above threshold (£10,000) emergency incident attendance/repair
I agree. there is a set of rates, of course there is. Their existence was also confirmed by BBMM’s own lawyers who cited commercial sensitivity for non-disclosure.
However, Highways England subsequently states this is untrue. Who is to be believed, why is there such a stark contradiction?
b. these rates were subsidised by the monthly lumpsum payment BBMM received from Highways England
This sounds plausible but I have been making enquiries of rates for years. I was aware the Authority provides a lump sum monthly payment but this subsidies, covers, incidents where a culprit is UNIDENTIFIED. Clearly, this is not the case where a claim is pursued against a Third Party – the driver, fleet, haulier or their insurer must be identified for an approach for reimbursement to be made.
But, wishing to ensure my understanding was correct, I made an FOIA approach to the Authority about the lumpsum payment and subsidy of above-threshold rates. An extract from the FoIA request (which can be read in full here) is:
1. I am seeking the schedule of Damage to Crown Property (DCP) rates for above threshold works held and used by BBMM when pricing DCP matters in Area 10. The schedule of rates was used in the ASC pre-04/2019 when the contract concluded. This is the schedule of DCP Rates by which BBMM charge / charged Highways England where incident costs exceed £10,000, a schedule of rates that are apparently subsidised by the lump-sum payment.
2. Please ensure the date the schedule was produced and the period to which it relates is provided. It would assist to be advised when and how often the schedule is revised.
3. The subsidy should also be explained, to the extent that I am able to reverse engineer the charges and establish the actual rate i.e. cost pre-subsidy.
Highways England responded ‘not held’ to ‘1’ and ‘2’ above. To ‘3’ they replied ‘There is no subsidy‘.
This was my understanding. it appeared the court had been duped.
c. this schedule of DCP rates was not appropriate to utilise when pricing sub-threshold claims
If not subsidised, the rates were precisely what HHJ Godsmark was seeking to make a comparison. Indeed, what better set fo rates to utilise that those being charged to the Authority. After all, as HHJ Gosdsmark explained in his judgement at para. 25:
It would be odd if a tortfeasor was liable to Highways England for diminution in value of a damaged chattel in one sum if sued by Highways England itself and in a different sum if sued by Highways England via BBMM (a contractor).
But if BBMM could not exclude the above-threshold rates, if these were utilised, seen as reasonable (and why not – they were good for the goose, why not for the gander), the claim value would be substantially reduced – the rates to Highways England were much lower, the contractor stood to reprice or reimburse on 1,00’s of claims – they had been appointed to the Area (10) from 2012.
Once again, claims were being pursued against Third Parties in the name of Highways England. It appears the Authority may be liable for £millions in overstated, misrepresented claims – I had already established that BBMM’s use of CECA (industry) rates, that saw substantial uplifts not applied to the Authority, were not agreed with Highways England.