Birmingham City Council (BCC) and their road fiasco continues after the termination of Amey’s contract and appointment of Kier Highways (Kier).

Concerns about BCC and Kier’s conduct when billing for damage-repairs to highways stem from an FoIA response in 2020; the response said Kier were not using their high schedule of rates to bill Third Parties, the documents said otherwise!

Kier was previously caught out failing to comply with an Authority contract when billing drivers, fleets, hauliers or their insurers (Third Parties) instead profiteering using a variety of processes.  Currently Kier are using KsoR’ (Kier Schedule of Rates) in Birmingham to bill Third Parties unfortunate enough to cause damage to the road or ‘street furniture’.

Why would BCC permit Kier to apply KSoR and are the Council paying such high prices; or have they looked after themselves, possibly at the expense of Third Parties?  Surely BCC agreed that they and Third Parties would be charged using the same price list (it would be ‘odd’ if this were not the case – HHJ Godsmark, para 25)?

The Council’s response to an FoIA (18993085) explained:

  • Kier Highways applies for payment against actual costs incurred for staff, labour, plant, materials and subcontractors (or Third Parties) in delivering the works.
  • For delivering the works, Kier Highways are paid a fixed Management Fee.
  • Kier Highways do not use CECA rates and the costs for staff and labour are predominantly those of the TUPE workforce.

So there you have it; actual costs are charged (these are clearly known), Kier receive a fee for the work and they do not use CECA rates.  But all is not as presented:

  • KSoR is NOT ‘actual costs’ and Third Parties will also be presented a claim for:
    • interest
    • costs ‘to be advised’
  • If Kier are paid a management fee, why are they also profiting from the rates used (KSoR)?
  • Kier IS using CECA … KSoR are based upon CECA and bear the CECA logo!

The council then u-turned, writing:

  • ‘Kier price Third Party damage claims using a fixed schedule of charges derived from first principles using the Construction Industry Joint Council (CIJC) Working Rule Agreement and Civil Engineering Contractors Association (CECA) Schedules of Equipment Rates. Kier Highways have agreement to adopt this approach.
  • The invoices they send will be accompanied by a statement detailing the resources and associated rates which have been applied – source 09/04/2021 FoIA response

The council appear keen to avoid a question we have posed on a number of occasions:

‘are the rates Kier charge Third parties (KSoR) those being charged to the Council for damage events?’

Oh … and the invoices ‘they’ send … who sends?  The Council fail to mention that the invoices are despatched by Kier’s (and Highways England) lawyers, Shakespeare Martineau / Corclaim.  Expect the costs to include reference to ‘interest’ from the ‘inflating costs to make a profit‘ lawyers.

The invoices will be accompanied by scant information, insufficient to corroborate the resources engaged and enable an informed decision to be made.  It appears Kier do not wish their invoices to be scrutinised, wish to prevent this.  Beware the contractor Demanding Without Due Care & Attention.

So much for the assured transparency about the charging methodology!

Further reading – the continuity & evidence of contradiction.


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