NSORC National Scandal of Rogue Contractors

Highways England’s 01/2016 audit of Kier presented by Tim Reardon (HE’s General Counsel), indicated the Authority believed moving away from ‘composite’ rates to more ‘granular’ figures was a good thing.  Yet here we were, 24/06/2019, full circle; presented composite figures again.  Sadly, unlike 07/2014, no one has provided the breakdown.  We have gone backwards!

The use of ‘composite rates’ is unhelpful where the composition is unknown.  06/2019, we asked for this and were assured the breakdown would be supplied.  We spoke to Tim 07/2019, explaining we need to know the composition and where these rates have come from.  Encouragingly,  Tim agreed, believing this was a useful thing for everybody to know.

Whilst we have received many claims using the NSORC process, an explanation was not forthcoming.  We were unable to make an informed comment but initial consideration suggested the charges were excessive.

We turned to FoIA to obtain the information but this too, in breach of the Act, has been ignored.  Submitted 12/08/2019 – 20 working days have long since passed!

NSORC appears to be a hurriedly concocted set of rates (we are already on the 3rd version) for ‘planned’ works with a simplistic, unexplained doubling for ‘reactive’ rates.

It appears the rates have been presented without care, designed to ‘do a Kier’; mask state-enabled exaggeration and fraud on an industrial scale.  By presenting a new process, the Authority will likely claim to be putting its house in order whilst brushing under the carpet a process that was wrong and which they failed to identify or permitted for many, many years.

In 2013, you could expect attendance at an emergency to attract a £125 fee from Kier Highways. Subsequently, this became £1,500 but as of 07/2014, the cost was £2,700 plus £2,000 admin’ … the starting cost was £4,700.

07/2014, Kier utilized their ‘1153’ process that was not contract-compliant and saw £millions demanded from and paid by drivers, fleets, hauliers and insurers (Third Parties).  We understand they have yet to be reimbursed. 

Highways England failed to identify this or turned a blind eye. We put pay to the process, Kier admitting ‘it was a time bomb’ and blaming it on an employee now with Amey.

10/2015, Kier introduced their ‘defined cost’ process – exaggeration in another guise and again, contract non-complaint.  Brushing a defective process under the carpet by instigating another … sound familiar? 

Highways England also failed to address the ‘defined cost’ methodology despite us clearly, unequivocally, setting out the concerns.  Third Parties were being abused, overcharged not just by the use of excessive rates, but by costs that were never incurred – the ‘multipliers’ on operative rates. Even Courts were misled by the contractor, in the name of Highways England. Then …

01/2017, Kier erred.  They left a small contract extract on the end of a Court exhibit … a document neither they nor the Authority had ever referred to … Appendix A to Annex 23.  The cat was out of the bag; the equation by which a Third Party was to be charged ‘no more than’ revealed.  Kier was clearly not complying with this. 

06/2017, we met the Authority and set out documentary evidence detailing:

  • contract non-compliance
  • exaggeration
  • fraud 

But the process continued (continues) with rates being kept from us.  These rates for ‘Damage to Crown Property’ (DCP) were repeatedly said to be ‘HELD’ but ‘commercially sensitive’ (a FoIA exemption to disclosure) … at least until 11/2018 when a HE employee said ‘not sensitive’.  The next request (2019) returned ….

  • ‘NOT held’.  

A U-Turn by the Agency; the very schedule of rates, the price list, used to bill a Third Party and the Authority did not exist.  One of the basics associated with a contract, what you are going to be charged, had been overlooked!  How, over the years, could Highways England:

  1. ensure Kier’s charges to them were correct?
  2. know whether the cost/recovery data supplied by Kier was true? 

How did the National Audit Office (NAO) reconcile costs and recoveries, one of the few areas of ‘income’ for the Agency?

The answers were obvious; Highways England could not.  It appears: 

  1. at best the Authority could hold a finger in the air and say ‘looks about right’
  2. a contractor was providing false information – why? 

But there are schedules of rates.  However, disclosing them could create serious problems for the Authority and their contractor:

  • the extent of the overstatement practised for years would be realised
  • the Authority’s failure to spot and stop the conduct (or that they had permitted the behaviour) would be understood, questions asked:
    • why?
    • is Highways England compromised, fit for purpose?
    • who is benefitting and how?
  • repayment to Third Parties could be calculated – 1,000’s of invoices reviewed

It seems the Authority concluded it was best to stick to the ‘not held’ story … the lesser embarrassment?

Is it any wonder the Authority panicked and instigated ‘NSORC’, that it is a mess?