180504 Area 6&8 Kier Exaggeration Example

04/05/2018, Friday 9 pm incident

ATTENDANCE

Two AIW’s in a vehicle were notified of an incident and attended the scene.  When notified at 11:30 pm, it will be noted from their IMF (incident management report) they were working, on the A1M when contacted:

AIW’s are understood to work shifts.  However, Kier state these operatives work ‘core hours’ (office hours) 8 am to 5 pm weekdays after which they are charged at an uplift (yet they were on the road at 11:30 pm – above).  The multipliers applied are:

  • 1.5x after 5 pm weekdays
  • 2x of a Weekend

Kier state they pay their operatives these uplifts, the double-time and have charged the insurer accordingly (as below).  AIW’s inform us:

  • they work shifts
  • they are not paid any uplifts
  • even overtime is at a flat rate

The uplift, therefore, appears to amount to fraud, as we explained to Highways England during our 21/06/2017 meeting when we produced an Area 9 example, in a phone call of 15/11/2017 with KPMG  (transcript here) and in a more recent overview.

The above AIW rate of £65.75, to which the multiplier (2x) is added, is not believed to be the ‘defined cost’ (actual cost) but exaggerated.  The heading ‘base rate’ above is misleading.  We expect to see a ‘base rate’ of less than £30 / hour to which an uplift percentage is applied, the TPCO, not exceeding 25.29%.

AIW VEHICLE

An AIW vehicle base rate is £13.20, it has been across Kier Areas for years.  To this we expect to see an uplift percentage added, the TPCO, not exceeding 25.29%.

  • £13.20 – defined cost
  • £3.34 – TPCO uplift (@25.29%)
  • £16.54 – Total

Third Partes are consistently charged (as above) more than double this. 

PLANNING

Why is there any charge for ‘planning’?

As further evidence of contract non-compliance, Appendix A to Annex 23 is specific; ‘Planning repair of damage’ is addressed under ‘Third Party Claims Overhead’ (TPCO) by the uplift percentage, it is NOT an items to be claimed for separately.  Yet Kier have been ignoring the contractually agreed process from agreement inception.  The following are ‘planning’ charges:

COST PRESENTATION

The above layout of charges gives a Third Party no indication that the process applied is that of ‘defined cost’ (base rate) plus an uplift percentage (TPCO).  The presentation further assists the deceit. 

Conversely, when Highways England are billed, they are presented a spreadsheet with the ‘base rate’ and ‘fee’ (uplift) displayed. 

The Highways England spreadsheet has no ‘charge rate’ column – further evidence this is not a cost incurred by the contractor. 

Notes re Appendix A to Annex 23: 

25/01/2019 FoIA response from Highways England:

‘Under Section 21 of the Act, we are not required to provide information, which is
already reasonably accessible to you. Part of the information that you have
requested has been made available through previous FOI responses. Annex 23 for
Areas 2 (previous contract), 3, 9, 10 and 13 have been published via the following
links:

https://www.gov.uk/government/publications/asset-support-contract-annexes-foi 
https://www.gov.uk/government/publications/area-13-third-party-charges-foi
https://www.gov.uk/government/publications/asset-support-contract-foi

We provided a copy of Annex 23 for Area 4 in our reply to your request 752,518
dated 10 October 2017.

Areas 6 and 8 are using the same Annex 23 contract document as Area 9: https://www.gov.uk/government/publications/asset-supportcontract-foi

The missing Area 9 document is now available on-line with the contract notice via
the following link https://www.contractsfinder.service.gov.uk/Notice/aef1f90a-a258-
48f4-a48e-ee5c4993f8f2. The document has previously been available through the
publication of responses to FOI requests on the link above.’

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Documents linked above available on this site:

Area 9 ASC – Area_9_ASC_S_I_Annex_23_Contract_Rev_0