4.1 In January 2002, shortly after the problems with achieving the 18-minute test time specified by the PFI contract became apparent (see paragraph 2.6), DVTA wrote to the contractors to notify them of the difficulties being experienced. In response, the contractors:
• denied that their equipment was responsible for the problems, and said it was capable of delivering an 18-minute test;
• indicated that they considered DVTA staff to be responsible for the lower-than-expected productivity; and
• initially argued that they could only be held responsible for the time taken by their equipment to carry out test procedures (i.e. 'machine time'), but not for the overall time taken to complete a vehicle test, which included waiting times caused by a queue of vehicles developing in a test lane, and the amount of time taken by examiners to complete manual inspections at the final test stage, and return to stage 1 to begin testing the next vehicle. (DVTA told us that the contractors have modified this view in subsequent communication, and have indicated that they are responsible for more than machine time.)
4.2 In early 2002, DVTA conducted extensive trials with the MOT2 equipment. These confirmed the extent of problems with long test times, with a full vehicle test (inclusive of smoke emissions and catalytic converters) taking an average of 26.5 minutes to complete. DVTA considered that these trials highlighted problems with the contractors' testing solution, related to equipment provision and layout, which were impacting negatively on test times. Overall, DVTA concluded that, although a combination of improvements was required at both the first and final stages of the test, there was little potential for reducing times significantly at any test stage with the current testing procedures and equipment.
4.3 DVTA estimated that a 27-minute test would halve the vehicle testing capacity that the contractors' solution had been expected to provide. Consequently, to meet future test demand levels, it would be necessary to recruit extra staff, introduce additional overtime and extended-day working, and provide and equip new testing facilities. However, because it considered that it had transferred the risks associated with capacity (see paragraph 1.9), DVTA took the view that the contractors would be liable for the costs associated with these measures, and that the responsibility for identifying and introducing areas for improvement in test processes and methodologies would be theirs. DVTA told us that, while it took this view, it also accepted that the onus would lie with it to demonstrate to the contractors that it had fulfilled all its obligations under the contract.