It is common practice to include annual caps on the amount that the Authority will be able to deduct for Performance Deductions (i.e. deductions which do not relate to the key Performance Standard). The value of the cap should be established during the competitive bid process and should be sufficient to ensure that the Contractor has a strong incentive to rectify performance failures. Further guidance on the calibration of caps is provided in Section 7.5 of SoPC4. If bidders propose multiple capping options, which all reduce the Unitary Charge payable then Authorities may wish to consider which option provides best value for money.