Risks that the Agency identified would be priced and included in a PPP contractor's bid | Expected impact of risk/£ | |
| High Demand | Base Case |
Construction Risk |
|
|
Cost increases due to condition of the Agency's existing assets | 5,531,422 | 4,425,137 |
Cost of upgrading and extending the telecommunications network are higher than forecasted | 7,533,234 | 4,971,934 |
Completing the initial works takes longer than the planned two years | 4,113,298 | 4,113,298 |
The contractor's loss of potential profits following termination of the contract as a result of a Force majeure event | 127,240 | 63,620 |
Sub-contractor default | 2,672,037 | 1,336,019 |
Industrial action affecting the contractor and/or its sub-contractors | 470,787 | 235,394 |
The contractor is not ready at the relevant date to take on responsibility for delivering the existing services | 1,236,151 | 1,236,151 |
The delay in the contractor's readiness to take on responsibility for delivering the existing services can be attributed to other contractors employed by the Agency | 733,046 | 733,046 |
Interfaces between the contractor and third parties are more difficult than expected | 839,783 | 419,892 |
Sub-contractors provided incorrect cost estimates for the pre-priced additional works | 305,376 | 0 |
Responsibility for site and safety costs more than expected | 381,720 | 190,860 |
Delays encountered in planning approval | 190,860 | 190,860 |
The Agency causes delays to construction related activities | 1,147,375 | 98,892 |
Unforeseen ground/site conditions are encountered | 2,720,036 | 1,360,018 |
The contractor's project management is poorer than expected | 3,295,512 | 1,644,923 |
Protestor action | 1,412,362 | 704,967 |
Dealing with environmental damage | 917,085 | 917,085 |
Design Risk |
|
|
Costs associated with an outside body hacking, or attempting to hack into the NRTS systems | 190,860 | 95,430 |
One, or more, of the designs for aerial masts is found to be deficient | 477,149 | 0 |
One, or more, of the designs for camera masts is found to be deficient | 0 | 0 |
One, or more, of the contractor's design submissions is delayed by the design approval process | 2,793,638 | 2,793,638 |
The contractor fails to translate the Agency's requirements into one, or more, of the designed solutions | 1,023,867 | 337,876 |
One, or more, of the contractor's designed solutions does not function correctly | 2,201,005 | 2,017,588 |
A member of the contractor's consortium becomes insolvent | 890,679 | 293,924 |
Legislative Risk |
|
|
The Agency avoids the costs of third party claims by exercising the indemnities provided by the contractor | 2,035,838 | 1,017,919 |
General changes in law adversely impact on assumptions relied on by the contractor in preparing its prices | 1,526,878 | 503,870 |
Obsolescence |
|
|
The contractor has to upgrade its chosen design to provide the contracted capacity as the Agency's demand for services increases | 363,867 | 181,934 |
The contractor has to upgrade its assets because the provided technology does not meet contractual requirements | 400,254 | 200,127 |
Operating Costs |
|
|
Actual costs of maintaining the assets are higher than forecasted | 699,819 | 2,519,349 |
Actual costs of maintaining the assets are higher than forecasted because of the presence of asbestos | 381,720 | 381,720 |
Cost of providing the specified services was incorrectly estimated | 7,459,040 | 7,160,679 |
The contractor is liable for failures in the compatibility between the NRTS systems and applications designed by third parties | 267,204 | 133,602 |
The cost of repairing damage caused by others to uninsured property for which the contractor is responsible during the course of the contract | 381,720 | 190,860 |
Performance Risk |
|
|
The contractor suffers payment deductions as a consequence of latent defects materialising in new and existing assets | 5,801,664 | 3,807,283 |
The contractor suffers payment deductions and has to correct performance shortfalls caused by poor build quality | 7,195,418 | 3,597,709 |
The contractor suffers payment deductions because it is delayed in reaching full service status | 1,730,839 | 1,730,839 |
The contractor suffers payment deductions because its sub-contractors take longer than estimated to complete ordered additional works | 346,671 | 0 |
In circumstance where the Agency has provided early and clear notice of its programme of road works, the contractor is unable to meet its assumed efficiency levels for executing its additional works in order to meet the Agency's wider works programme | 2,290,317 | 0 |
In circumstance where the Agency's programme of road works as been in flux before the start of the notice period for ordering additional works, the contractor is unable to meet its assumed efficiency levels for executing its additional works in order to meet the Agency's wider works programme | 7,818,485 | 0 |
The contractor has underestimated the performance capability of the Agency's existing fibre optic cables | 5,098,483 | 3,364,999 |
The contractor has underestimated the performance capability of the Agency's existing copper cables | 4,299,310 | 2,837,544 |
The contractor suffers payment deductions because the NRTS network is not sufficiently resilient to prevent otherwise avoidable outages | 254,480 | 127,240 |
The contractor suffers payment deductions because general performance standards are below those required by the Agency | 6,380,243 | 3,190,121 |
The contractor suffers payment deductions because performance of services to roadside devices connected to the NRTS through ordered additional works is below contracted standards | 2,035,838 | 0 |
In its management of disruptions to services caused by road works, the contractor is not as efficient as it assumed it would be | 1,119,711 | 559,855 |
Regulatory Risk |
|
|
The contractor incurs costs in meeting requirements flowing from the introduction of new British and/or international design standards | 349,910 | 115,470 |
Residual value Risk |
|
|
The contractor has to compensate the Agency for degradation of the NRTS assets beyond that permitted under the contract | 1,154,495 | 577,247 |
Interface Procurement Risk |
|
|
The contractor incurs costs because it has had to correct errors in the scope of the contracts awarded to its sub-contractors | 4,453,395 | 1,781,358 |
The contractor incurs costs resolving disputes with its sub-contractors | 827,059 | 330,824 |