7.2.5 Reporting

The Authority's Contract Management Team can only manage the Contract effectively if it has relevant, accurate and up to date information about all aspects of the Contract including in relation to the Contractor's performance. Therefore a comprehensive reporting system should be devised early on in the Transition Period by the Contract Management Team. The Contract Manager should ensure the team is mindful of the entire range of data requirements they will need to satisfy the need to report to:

•   the Contractor, under any relevant contractual provisions;

•   the Authority's members; 

•   the Contract Management Board; 

•   other senior management bodies in the Authority;

•   the partner WDAs if it is a joint project;

•   the Waste Collection Authorities;

•   Defra via WasteDataFlow;

•   WIDP (which has designed its reporting system to incorporate the requirements of HM Treasury); and

•   the requirements of the external auditor to the Authority.

An important obligation in the Contract is the duty on the Contractor to provide regular performance reports to the Authority. Typically the Contract will define, in some detail, the key information that the Contractor is obliged to report. 

These reports for the Authority will normally include:

•   waste flow information; 

•   achievement of milestones against timetables;

•   action taken to address problem areas; and

•   performance indicators in relation to collection (if in scope).

The Contract Management Manual should set out how the Contract Management Team will review and interpret the performance reports supplied by the Contractor.  The Contract Manager will need to ensure that there is no mismatch between the information that is required for its internal and external reporting requirements and the Contractor's monitoring information. 

The Contractor's performance should be reported to the Contract Management Board every time it meets through the completion of a standardised report template.  As waste contracts normally set annual performance targets in relation to the treatment of the waste there should also be an annual report to the Contract Management Board setting out the performance relative to the contractual target and the reasons for any variances from the target performance.  For complete transparency these report should be shared with the Contractor and, if necessary, discussed at the Liaison Committee. If required the Contractor's plans for rectifying any under-performance situation should also be discussed at the Liaison Committee meeting.

The Contract Manager should also be aware that poor performance by the Contractor resulting in a loss of revenue for the Contractor will have an impact on the Contractor's financial position. This, in isolation, is unlikely to threaten the Contractor's financial robustness as the loss of revenue will usually be passed down to the Operating Sub-Contractor. However if combined with other financial downsides e.g. lower Third Party Income and restrictions on the Contractor's ability to pass down such losses there may be a threat to the Contractor's financial stability.  The Contract Manager should be mindful of this possibility and ensure that there are processes in place designed to detect this scenario at the earliest possible opportunity. One simple process is to ensure that the Contractor's financial accounts are reviewed by the Authority's Finance Department to assess the company's financial status. Under the WIDP Contract (Clause 54.8.2), the Contractor is obliged to send a copy of its newly published annual report and accounts to the Authority within twenty business days of their publication.    

The PFI/PPP Contract is likely to be one of the Authority's largest contractual commitments. The Authority may be required to disclose details relating to the Contract and/or the performance of the services in public documents or in specific reports to other public bodies.  Given the increasing emphasis on transparency in government it is likely these requirements will increase over time. The Contract Management Manual should incorporate a log of all such requirements and a process for updating the log when new requirements emerge.