Section 4 - Partnering Services Costs Rates

1. Subject to paragraph 2, these rates and prices shall be index linked, with an annual adjustment to be made on each anniversary of the Commencement Date (reflecting movements in RPI to the month preceding the month in which the anniversary of the Commencement Date occurs).

2. Additionally the rates and prices shall be reviewed by hubco on a date not earlier than three (3) months before the second anniversary of the Commencement Date (and annually thereafter) by reference to RPI, to other relevant local and national trends and to the rates and prices actually paid by hubco for similar services (where hubco has used Good Industry Practice to secure best value in respect of those services) and taking into account relevant reductions and targets set out in the Key Performance Indicators. On completion of this review and in any event no later than one (1) month before the second (and each subsequent) anniversary of the Commencement Date, hubco shall provide to the Participants a report on such review confirming whether hubco proposes an increase or decrease of, or no change to, these rates and prices (taking into account any adjustment which would fall to be made pursuant to paragraph 1) and demonstrating that any such proposal (taken together with the effect of paragraph 1) represents value for money and continuous improvement in value for money, for approval by the TPB.

3. Following agreement by the TPB to any proposal submitted by hubco (or agreement on other terms between the Parties), the table below (as updated from time to time) shall be updated to reflect the agreed rates. In the absence of such agreement, the annual adjustment pursuant to paragraph 1 above shall continue to be made.

4. For the purposes of the calculation of any Partnering Services Costs where any component of the rates or costs included in the calculation are not included in the rates below (as updated from time to time) (such rates or costs being "Non Scheduled Costs"), the Participants and hubco shall seek to agree the relevant rates for the Non Scheduled Costs. Failing such agreement, the Non Scheduled Costs shall be market tested in accordance with the provisions of paragraph 5 (Market Testing) of Schedule Part 6 (New Project Pricing Report) which shall apply mutatis mutandis in relation to the market testing thereof (subject to any amendments to such provisions as may be necessary to reflect the particular circumstances).

The table below (as updated from time to time pursuant to paragraphs 1 to 3 above) shall be updated to include the rates agreed or produced by such market testing.

[Completed Table to be inserted from Preferred Tenderer's Final Tender Submission]