Highways England Hold Sub-Threshold Claim Data

28/11/2018 – FoIA response 766898, subsequently Ref 767723 (U05B457) & 768326 Area 9 20/11/2016 incident.


WHY SEEK THIS INFORMATION?


We have repeatedly been advised that Highways England do not hold sub-threshold (£10,000) information.  However, it transpires information is sent on every claim, see: sub-threshold data supplied to HE that is is a requirement under ‘Annex 19‘.

For each claim Kier must submit a report to their client / supplier, Highways England, setting out data relating to demands made of Third Parties (driver, fleet, haulier or insurer) and what they received, specifically:

  1. the amount claimed from third parties,
  2. a calculation of Defined Cost and resulting Third Party Claims Overhead,
  3. the amount recovered,
  4. an explanation of any differences between any of these amounts, and
  5. explanation of why any loss greater than Defined Cost has been claimed.

To demonstrate, contradicting previous HE statements, we made the request of a claim that we had reviewed, a closed matter.  In confirmation the information was provided by Kier and held by Highways England, we received the specific information.

  • However, it appears the data is false – click here

If so, then as many as 3,000 such false reports are made each year.  This could have an effect on the lump sum Kier receive (could cause it to be reduced i.e. they may have been overpaid tax-payers money.  If correct, it would also suggest Kier are misleading the Public Authority as well as Third Parties and the Courts with regard to their charging.


FoIA Request


25/10/2018 To: FOI Advice @ Highways England
Subject: FoIA request re Information Submitted following 20/11/2016 incident

On 20/11/2016, a collision occurred in Area 9, the following references are available:

HE IRF completed (number illegible – possibly 7630?)
Incident Log 1626
HETO epaulette 1243
IRF incident time 03:33 hrs, attendance 03:48 hrs

Kier advise occurred at about 09:00 hrs
M42 S/B 61/2
Kier ref GC27509
Incident 25595
Damage to beams
Attended by AIW’s Jason Hayden & Kevin Wood

Repair 20/11/2016 involved:
LX64OVG barrier truck
YB65XJN IPV

Repair 20/11/2016 involved:
LX64OVG barrier truck
WP14XJE TM truck

The repair cost was NOT sought form Highways England, this is a sub-threshold claim.

I ask to be provided all information held by Highways England about the incident. In particular I am seeking the information provided as routine, electronically.

The request will also include the report compiled in accordance with the Conditions of Contract, Clause 43 (ASC for Area 9) which states:

The Provider keeps detailed records relating to the Area Network, the Traffic Technology Systems (Midlands) and the Services (including performance levels in the Area Network and the Traffic Technology Systems (Midlands), the Defined Cost of Providing the Services and records relating to Subcontractors) in the format and containing the details and for the period specified in the Service Information. The Provider makes the records available to the Employer and his representatives (including the Service Manager) on request.

The report received is as required by Annex 19:

Third Party Claims handled by the Provider Service Information Chapter 1.9 & Annex 23 Report detailing, for each claim:

• the amount claimed from third parties,
• a calculation of Defined Cost and resulting Third Party Claims Overhead,
• the amount recovered,
• an explanation of any differences between any of these amounts, and
• explanation of why any loss greater than Defined Cost has been claimed.

 


FoIA REPLY FROM HIGHWAYS ENGLAND


28/11/2018 HE Reply – 181128 Highways England Response 766898 re Annex 19

The above indicates Highways England DO receive information on each sub-threshold incident.


29/11/2018 – response to Highways England

Thank you for the information. Could you please clarify the response by providing the following:

1. On what date did you receive the information
2. What further breakdown / information do you receive; date, reference, etc
3. Are you provided a breakdown of the ‘DEFINED COSTS’, a make-up of the total
4. What is your reference for the incident / claim
5. On the date of the loss, 20/11/2016, what is the DEFINED COST of an AIW*
6. Please confirm the defined cost of an item is the same to Highways England and a Third Party
7. What reconciliation, checking and auditing of the figure occurs?

It may assist to be aware that information was released 05/2018 in respect of defined costs however, the data is for 2014 to 2016 and concludes 11/04/2016, the defined cost being £23.71 / hour.


24/12/2018 – Ref 767723

Thank you for your request for information which we received on 29 November 2018, following our previous response sent to you on 28 November 2018, ref 766898. We are unable to provide you with our response to your request at this time. I would like to apologise for any inconvenience this may cause you. We will continue to look into your request and will endeavour to provide you with a response as soon as possible.


27/12/2018

An explanation for the delay would be appreciated as would an anticipated date of information response / supply.


07/01/2019 – reply from Highways England – 190107 Mr Swift FOI 767 723 Defined Cost

We have now completed our search for this information and I can confirm that we hold some of it.

1. On what date did you receive the information

The information was requested following receipt of your request and received on 23 November 2018

2. What further breakdown / information do you receive; date, reference, etc

Highways England has no further information, all the information received was provided in our original response.

3. Are you provided a breakdown of the ‘DEFINED COSTS’, a make-up of the total

No, as stated above all the information received was provided in our original response.

4. What is your reference for the incident / claim

We do not have a reference for this incident/claim.

5. On the date of the loss, 20/11/2016, what is the DEFINED COST of an AIW*

We do not hold this information. The Defined Cost for an AIW will be calculated on a case by case basis in accordance with the contractual definition.

The definition can be found in the Area 9 Asset Support Contract, in T&C’s (Area 9 ASC Conditions of Contract Rev 5.doc), section 11 Identified and defined terms, sub section 31. A copy of the Area 9 Asset Support Contract is available here
https://data.gov.uk/data/contracts-finder-archive/contract/1238249/

6. Please confirm the defined cost of an item is the same to Highways
England and a Third Party

The Defined Cost is a defined term in the contract. We confirm that the definition is applied to Highways England and third parties in the same way in accordance with the contract.

7. What reconciliation, checking and auditing of the figure occurs?

Highways England does not verify individual below threshold claims.


08/01/2019 to Highways England

Thank you for your email, the response of 07/01/2019.  I believe there has been a misunderstanding about the information I am seeking and am hopeful the following will explain this.  I am appreciative of your willingness to clarify.

Q1. On what date did you receive the information 

A: The information was requested following receipt of your request and received on 23 November 2018

Query / clarification:

I understand you are sent the information by way of an Annex 19 report i.e. it is not necessary for you to have sought the information from Kier Highways, rather there is a contractual obligation to send this to you i.e. it was (or should have been) in your possession when I made the request.

More about Annex 19 can be found here:

https://www.englandhighways.co.uk/3597-2/

https://www.englandhighways.co.uk/sub-threshold-information/

  1. Is my understanding (above) correct?
  2. From whom did you request and receive the information following receipt of my request which you received on 23 November 2018 i.e. was this a request of Kier Highways, an internal (Highways England) request or other?

You will appreciate, from my understanding, it does not appear it would be necessary for you to seek information from Kier Highways as it appears this would already have been provided.

Q3.  Are you provided a breakdown of the ‘DEFINED COSTS’, a make-up of the

total

A: No, as stated above all the information received was provided in our original

response.

  1. Are you able to request and be provided this?

I understand, the information being collected on your behalf, seeking the data from the contractor is possible.

Q5. On the date of the loss, 20/11/2016, what is the DEFINED COST of an AIW* 

A; We do not hold this information.  The Defined Cost for an AIW will be calculated on a case by case basis in accordance with the contractual definition.  The definition can be found in the Area 9 Asset Support Contract, in T&C’s (Area 9 ASC Conditions of Contract Rev 5.doc), section 11 Identified and defined terms, sub section 31. A copy of the Area 9 Asset Support Contract is available here https://data.gov.uk/data/contractsfinderarchive/contract/1238249/

Query / clarification:

I am asking for the ‘£’ charge to you for an AIW, the defined cost of the AIW, as at the date of loss, 20/11/2016.  Your answer is not understood.  In 2018, Highways England released rates for AIW’s in Area 9 which can be found here: https://www.englandhighways.co.uk/aiw-rates-2014-to-2016/.  The information relates to the period 14/07/2014 to 11/04/2016.  It does not extend to the date of the loss about which I am enquiring, 20/11/2016.

Highways England hold and disclosed the information relating to 11/04/2016.

  1. Please explain Why Highways England do not hold the rate for 20/11/2016 or confirm this is held

I trust this clarifies my request which is for the monetary value of an AIW at the date, as opposed to the definition of a ‘defined cost’.

  1. Please supply the cost to Highways England, the defined cost and DCP Rate (if different – though I understand the terms are synonymous) for an AIW as at 20/11/2016. I assume it will be at or about £23.71[1]

Q6. Please confirm the defined cost of an item is the same to Highways England and a Third Party 

A: The Defined Cost is a defined term in the contract.  We confirm that the definition is applied to Highways England and third parties in the same way in accordance with the contract.

Query / clarification:

I have noted ‘defined cost’ in the contract.  I am not seeking comment with regard to the definition of ‘defined cost’ but your response suggests that the term is used identically to Highways England and Third Parties i.e. over and below threshold (£10,000) in Area 9.

  1. What I am seeking is confirmation or correction the monetary value, the ‘£’ of a ‘defined cost’, is the same to Highways England and Third Parties i.e. over and below threshold (£10,000) in Area 9.

Whilst not wishing to appear pedantic, but seeking to ensure there is no confusion:

  1. Are you saying that, if on a specific date, the defined cost of an AIW to Highways England is £23.71 / hour, on the same date, the cost of an AIW to a Third Party is identical i.e. £23.71 / hour and in turn:
  2. That the difference in the charge for an AIW to Highways England as opposed to a Third Party is the uplift[2] which
    1. To Highways England is understood to have been 7.4% or 6.38% and
    2. To a Third Party is 25.29% (23/07/2018 FoIA disclosure) and therefore:
  3. The cost of an AIW to HE is ‘defined cost’ + fee (7.4%)
  4. The cost of an AIW to a TP is ‘defined cost’[3] + TPCO (25.29%) i.e. the figures are as follows:
HE HE TP
Defined Cost £23.71 £23.71 £23.71
fee 6.38% 7.40% 25.29% TPCO
uplift £1.51 £1.75 £6.00
total £25.22 £25.46 £29.71

Yours Faithfully

[1] early 2016 rate (FoIA disclosure) and by reference to HE112/009/SG830 AIW rate 12/2016 @ £23.71 & £22.63.  My ref: W11D370.

[2] as described by Highways England’s witness to a Court in 2017 – transcript supplied to Highways England.

[3] defined cost in ‘e’ and ‘f’ being identical


05/02/2019 from Highways England:

Thank you for your request for information dated 8 January 2019.  I have dealt with your request under the terms of the Freedom of Information Act 2000.   We have now concluded our search for the information you requested and details are set out below:

In your request you asked:

Q1. On what date did you receive the information

A: The information was requested following receipt of your request and received on 23 November 2018

Query / clarification:

I understand you are sent the information by way of an Annex 19 report i.e. it is not necessary for you to have sought the information from Kier Highways, rather there is a contractual obligation to send this to you i.e. it was (or should have been) in your possession when I made the request.

 Is my understanding (above) correct? 

While there is an obligation to provide the requested information under Annex 19 the obligation is not uniform for all ASCs.  Annex 19 in respect of Area 9 states that the information is provided as required by Highways England.  Therefore, this information was requested following receipt of your FOI request and the information provided accordingly. 

 From whom did you request and receive the information following receipt of my request which you received on 23 November 2018 e. was this a request of Kier Highways, an internal (Highways England) request or other?

 

The request was made to Kier.

 Q3. Are you provided a breakdown of the ‘DEFINED COSTS’, a make-up of the total

A: No, as stated above all the information received was provided in our original response.

 Are you able to request and be provided this?

 The defined cost was stated in the table originally provided there is no further breakdown for this claim.  We have provided the information we are able to request.

 Q5. On the date of the loss, 20/11/2016, what is the DEFINED COST of an AIW*

A; We do not hold this information. The Defined Cost for an AIW will be calculated on a case by case basis in accordance with the contractual definition. The definition can be found in the Area 9 Asset Support Contract, in T&C’s (Area 9 ASC Conditions of Contract Rev 5.doc), section 11 Identified and defined terms, sub section 31. A copy of the Area 9 Asset Support Contract is available    here    https://data.gov.uk/data/contractsfinderarchive/contract/1238249/

 Query / clarification:

I am asking for the ‘£’ charge to you for an AIW, the defined cost of the AIW, as at the date of loss, 20/11/2016. Your answer is not understood. In 2018, Highways England released rates for AIW’s in Area 9 which can be found here: https://www.englandhighways.co.uk/aiw-rates-2014-to-2016/. The information relates to the period 14/07/2014 to 11/04/2016. It does not extend to the date of the loss about which I am enquiring, 20/11/2016.

Highways England hold and disclosed the information relating to 11/04/2016.

  1. Please explain Why Highways England do not hold the rate for 20/11/2016 or confirm this is held 

As previously stated this information does not form part of the contract. The Defined Cost for an AIW will be calculated on a case by case basis in accordance with the contractual definition, there is no schedule including rates. 

I trust this clarifies my request which is for the monetary value of an AIW at the date, as opposed to

the definition of a ‘defined cost’. 

  1. Please supply the cost to Highways England, the defined cost and DCP Rate (if different – though I understand the terms are synonymous) for an AIW as at 20/11/2016. I assume it will be at or about £23.711

 The Defined Cost is calculated using the contractual definition as previously advised and varies on a case by case basis. Highways England does not hold a schedule of Defined Cost or DCP rates. The information available for provider claims has been provided in the original response.

 Q6. Please confirm the defined cost of an item is the same to Highways England and a Third Party A: The Defined Cost is a defined term in the contract. We confirm that the definition is applied to Highways England and third parties in the same way in accordance with the contract.

Query / clarification:

I have noted ‘defined cost’ in the contract. I am not seeking comment with regard to the definition of ‘defined cost’ but your response suggests that the term is used identically to Highways England and Third Parties i.e. over and below threshold (£10,000) in Area 9.

 What I am seeking is confirmation or correction the monetary value, the ‘£’ of a ‘defined cost’, is the same to Highways England and Third Parties e. over and below threshold (£10,000) in Area 9.

Whilst not wishing to appear pedantic, but seeking to ensure there is no confusion:

  1. Are you saying that, if on a specific date, the defined cost of an AIW to Highways England is

£23.71 / hour, on the same date, the cost of an AIW to a Third Party is identical i.e. £23.71 / hour and in turn:

  1. That the difference in the charge for an AIW to Highways England as opposed to a Third Party is the uplift2which
    1. To Highways England is understood to have been 4% or 6.38% and
    2. To a Third Party is 29% (23/07/2018 FoIA disclosure) and therefore:
  2. The cost of an AIW to HE is ‘defined cost’ + fee (7.4%)
  3. The cost of an AIW to a TP is ‘defined cost’3+ TPCO (25.29%) e. the figures are as follows:

 1 early 2016 rate (FoIA disclosure) and by reference to HE112/009/SG830 AIW rate 12/2016 @ £23.71

& £22.63. My ref: W11D370.

2 as described by Highways England’s witness to a Court in 2017 – transcript supplied to Highways England.

3 defined cost in ‘e’ and ‘f’ being identical

 

  HE HE TP  
Defined

Cost

 

£23.71

 

£23.71

 

£23.71

 
fee 6.38% 7.40% 25.29% TPCO
uplift £1.51 £1.75 £6.00  
total £25.22 £25.46 £29.71  

 The Defined Cost is a defined term in the contract.  We confirm that the definition is applied to Highways England and Third Parties in the same way in accordance with the contract.   

As previously explained:

  • There is not a dedicated resource on standby to undertake the role of an AIW.
  • The defined cost of the AIW for a particular incident on any day is established from the availability of a resource to attend an incident.
  • The service undertaken by a AIW is by a suitably trained resource or resources available to attend the scene of the incident in good time. This can be any resource on the network undertaking any role or office based staff or call outs when out of hours.
  • This can mean a wide range of cost is incurred to provide the AIW service. For example in winter much of the routine AIW resource is required to undertake winter treatment, keeping the network clear of ice and snow, and hence more expensive resources may have be utilised.
  • Above and below threshold defined costs attract different overheads
  • Highways England (HE) do not currently charge for some of its own internal costs (eg Traffic Officers and internal administration)
  • For larger DCP incidents it is insurance companies and not HE that benefit from the incident work better reflecting that typical in the contract design eg planned work, economies of scale, optimised resource utilisation and not recovering HE internal costs.

Sent: 08 March 2019 10:12
To: ‘TPC HAIL’ <tpchail@highwaysengland.co.uk>
Subject: INTERNAL REVIEW REQUEST: FOI Response 768 326

Your Ref: FOI 768 326

Dear Sirs,

INTERNAL REVIEW REQUEST

I am seeking

  1. the information you receive routinely
  2. The rates you are charged for above threshold DCP works, the schedule of rates used for above and below works.

I asked on what date you received the information.  Your response is not accepted in light of the evidence. Your witness has informed a Court that the information is provided monthly.  Your witness has made a statement:

 

In terms of the operatives’ time sheets every month every person completes such time sheets which we have to then send to Highways England

 

And when asked before a Judge:

 

  1. How often do they complete these time sheets?

 

Replied:

 

  1. They have to do them. Some, well, it depends on the person. Some of them do it every day. They have to do them at a minimum of every week, so we have to submit them to our client every month.

 

I am seeking all information that has been provided in respect of this specific matter.  To date I have but a brief overview, not the detail that the contractor (according to the above statement) sends, the Annex 5 codes. A Court was informed:

 

this annex 5 breakdown and there’s thousands of codes that people have to do and submit a timesheet against that goes to our client every month that they sign off.

 

When undertaking the Review, please explain the contradiction and provide a copy of Annex 19 from the contract in support of the statement made.  I also expect to be provided the information your received, routinely in accordance with the contract, from your contractor.

 

I am advised that the ‘base rate’ costs (a.k.a. DCP Rates, Defined Costs, Nominal Rates, Notional Rates) to HE and a TP are the same, that the difference to the parties is the uplift.

 

The ‘base rate’ charge to HE and TP’s in NOT the same.  I am being misled.

 

The charge for some aspects, is clearly by reference to a schedule as the contractor does NOT change on a case by case basis but are consistent in their pricing as rates are calculated by use of averaging.  Your witness has made a Statement of Truth:

 

  1. By way of further explanation if that is required, although it is largely contained in the  insurer’s guide document, the costs under “planning” are put together as result Of averages across the previous 12 month period..

 

I ask that the review consider how this applies to charging on a case by case basis, without a pricing schedule

 

It is stated that:

 

the Defined Cost for an AIW will be calculated on a case by case basis in accordance with the contractual definition, there is no schedule including rates.

 

This is believed to be false.  It is understood costs are necessarily compiled on a case by case basis.  However, that this is undertaken by reference to an agreed schedule of rates OVER threshold and should occur UNDER threshold. To suggest otherwise flies in the face of the evidence and commons sense:

 

  1. It contradicts the consistent costs we have seen throughout periods on above and below threshold claims.  For example, for over a year the cost of an AIW to a TP in Area 9 was £73.05 where as to HE it was £23.71

 

  1. Is undermined HE’s General Counsel stating, in late 2015, HE were charged £70.32 (the Area 3 rate charged to TP’s for many months)

 

  1. The lack of a schedule would mean that any claim received by HE could not be reconciled pre-payment against an agreed price list to ensure the figures presented were correct.

 

  1. Would call into question, with regard to 170+ requests and reviews between 2013 & 2018, HE ‘s response that requests for the rates were:

 

    1. Commercially sensitive:
  1. What public interest test could be undertaken of non-existent material?
  2. To what was the contractor objecting unless a schedule exists
    1. Vexatious; who is the vexatious party, the one seeking information that seemingly does not exist or HE for failing to advise any requestor in a 5 year period, in connection with over 170 items of correspondence, that said rates are not held because they do not exist

 

  1. What are HE seeking to withhold when presenting arguments to the ICO? Currently, a request for rates deemed ‘vexatious’ by HE has seen no mention that said schedule is mythical, that the entire request is pointless because, no matter what the outcome, the schedule does not exist, rather:

 

    1. HE defended their ‘vexatious’ exemption with the ICO and received support
    2. The matter was appealed and HE engaged Government Legal Department
    3. The request was presented to a Tribunal who found the request was NOT vexatious
    4. HE sought to challenge this and engaged a Barrister
    5. The Tribunal denied the appeal

 

  1. Time and time again, Green Claims staff have withheld the pricing schedule claiming it is ‘commercially sensitive’

 

  1. Costs are agreed with HE, if a case-by-case- agreement were required, the contractor would necessarily need to explain their rates applied on each claim, a laborious process that would require a calculation of the costs, at the time of the asset’s (staff, plant, materials) engagement:

 

    1. The date of incident / attendance would involve one set of calculations
    2. The date of repair another set of calculations

 

  1. 20/06/2017 your General Counsel wrote:

 

‘What is important is that the recovery rates and costs being charged to insurers are reasonable. We believe they are …’

 

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.

 

  1. This is a ‘Cost reimbursable service: the service provider is reimbursed the actual costs they incur in carrying out the works, plus an additional fee’.  The actual costs are maintained on a schedule which ‘in accordance with the contracts, the prices are adjusted by the contract price adjustment for inflation on an annual basis’  The existence of the schedule is evidenced by:

 

  1. To date I have collated numerous responses that support the existence of a schedule of rates, to include contractors refusing to supply them; acknowledging their existence.  These can be found at:

 

https://www.englandhighways.co.uk/defined-costs-the-responses-evidencing-their-existence/

 

https://www.englandhighways.co.uk/area-10-dcp-exist/

 

I have noted that since at least 2016, you have sought to keep the rates secret, for example:

 

06 July 2016

… we do hold information that is relevant to your request 04 June 2016 but regret to inform you of my decision not to disclose this information.

 

In your request of 04 June 2016 you asked: I originally asked for –

 

How many pricing methodologies has Kier Highways Ltd used over the past 5 years when charging Highways England for ad hoc work or when repairing damage to the highway, barriers or signage?

What were the pricing methodologies?

When did they come into effect?

What increases in charges have been agreed year on year?

  • There have been annotations made and I am asking what increases in charges have been agreed year on year with Kier Highways Ltd?
  • The specific values agreed and that have occurred.

It seems the contacts have been in place for years. For each contract what was agreed and what has occurred, the actual percentages or sums.

 

The information you requested 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).

 

Price adjustment factors and discounts are set out under the specific contracts, though I

believe your question is framed with regard to Damage to Crown Property by third

parties. With regard to the latter, as stated above, this is claimed upon either CECA

rates or the principle of Defined Costs using Notional Rates. The latter, in essence, are

the average costs of a person, plant or equipment captured over a time period to

provide an average hourly cost. Given the rolling nature, the costs will vary over time

though and this should not be confused with price fluctuation flowing from discount or

inflation. As stated, the principles and rationale behind Defined Cost plus Fee is freely

available on the internet.

 

Information is available online, such as:

The Contractor provides forecasts of the total Defined Cost of the service for each Financial Year, updated at the intervals (probably monthly) set out in the Contract Data.

file:///C:/Users/PSwift/Downloads/Notes%20for%20Guidance%20(PDF,%2049pages,%201MB)%20(updated,%20July%202015).pdf

It appears that, for 5 years, HE sought to keep DCP rates secret by claiming the costs were ‘commercially sensitive’ or requests ‘vexatious’.  However, following an HE witness 11/2018, informing a Tribunal that said rates were NOT commercial sensitive, HE now say ‘not held’.

 

As DCP rates, or ‘base rates’ are said to be the same to HE and TP’s disclosing these figures would enable Third Parties to:

 

  1. Correctly calculate a claim against them
  2. Understand that they are NOT being charged in accordance with a contractual arrangement as
    1. The contractor claims
    2. a Court has been advised
  3. realize Highway England have failed to act upon this and permitted

I understand the sub-threshold claims include an additional third party claims overhead because the Service Provider is pursuing the case the whole way through (rather than the claim being pursued against the insurer by Highways England) and therefore incurring additional costs – the ‘additional’ amount is supplementary to the base rates.

Asset Support Contracts (ASC) are the subject of schedules of rates; ASC and DCP and likely fall within Contract Data Part 2.  It is the DCP Rates to which I am referring and expect the rates to be reconciled with.