DVTA incurred additional overtime and related costs

2.16  Because DVTA had to respond to the increased customer waiting times by introducing, among other things, additional levels of overtime, it incurred extra costs, partly as a result of its problems with the MOT2 contract. Actual overtime costs incurred from 2002-03 to 2004-05 exceeded those forecast in DVTA's successive business plans, by a total of £1.8 million (see Figure 3). Of this figure, DVTA has estimated that at least £0.68 million was incurred as a result of operational problems with MOT2 in 2002-03 and 2003-04.

2.17  We note, however, that DVTA's estimate is based on a comparison of outturn with business plan forecasts. As the business plan forecasts were set at higher levels than the PFI contract requirements (see paragraph 2.10), these estimates do not represent the full costs incurred as a result of the inability to achieve the 18-minute test specified in the contract between 2002-03 and 2004-05. We estimate that, when compared with the requirements of the contract, the extra costs could be in the region of £2 million.

Figure 3: DVTA overtime costs 2002-03 to 2004-05 (planned and actual)

Source: DVTA

2.18  In addition to the significant overtime costs incurred, extended-day working costs amounted to £682,000 between 2002-03 and 2004-05, compared to £413,000 estimated in the business plans for this period. DVTA told us that much of this expenditure resulted from the increase in demand for vehicle tests rather than the failure to achieve an 18-minute test.