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Dept for Transport

Answer

Mr. Hancock: To ask the Secretary of State for Transport what penalty clauses are available for his Department to invoke should Siemens fail to deliver the computerisation of the MOT test (a) on time, (b) within cost estimates and (c) to the specification. [159595] Mr. Jamieson: This is a PFI contract between my Department's Vehicle and Operator Services Agency (VOSA) and Siemens Business Services (SBS) and SBS bear the risk of late or unsatisfactory delivery of the service. The contract provides that if MOT Computerisation is not delivered: (a) on time--SBS would not receive payments under the contract until the computerised service is available to MOT stations and delay would reduce the term of the contract. Therefore SBS would be penalised by extra costs as well as reduced income and profit; (b) within cost estimates--under the contract SBS would bear the risk of increased development costs. They could also be subject to claims for liquidated and other damages for extra VOSA costs if they are responsible for delays; (c) to the specification--the system will not be rolled out to MOT stations until it has satisfactorily completed field trials against the specification. SBS would bear the cost of corrective action to meet the specification and of consequent delays and would not receive any payments until the service is operational. Under the contract VOSA can withhold some transaction payments from SBS if the operation of the system does not meet specified minimum service levels. As with any PFI contract VOSA has termination rights in specified circumstances.

Secondary information

Type

Written question

Reference

418 c1237-8W;418 c1238-9W; 159595

Session

2003-04

Subjects

Contracts Computers Certification ICT Motor vehicles Private finance initiative Standards Testing Siemens Business Services

Link

View this Written question on www.publications.parliament.uk