---
title: "Review of the basis of Network Rail's allocation of costs/recharges to the Scotland route"
ocid: "ocds-b5fd17-7d5a13bd-1c00-441a-8a27-25151f0ce5a4"
canonical_url: "https://d3tenders.com/contract/?ocid=ocds-b5fd17-7d5a13bd-1c00-441a-8a27-25151f0ce5a4"
markdown_url: "https://d3tenders.com/contract/ocds-b5fd17-7d5a13bd-1c00-441a-8a27-25151f0ce5a4.md"
json_url: "https://d3tenders.com/contract/ocds-b5fd17-7d5a13bd-1c00-441a-8a27-25151f0ce5a4.json"
source: "Contracts Finder"
current_stage: "Award"
buyer: "OFFICE OF RAIL AND ROAD"
published: "2018-02-20"
---

# Review of the basis of Network Rail's allocation of costs/recharges to the Scotland route

Buyer: OFFICE OF RAIL AND ROAD  
Current stage: Award  
OCID: ocds-b5fd17-7d5a13bd-1c00-441a-8a27-25151f0ce5a4

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## Summary

The Office of Rail and Road is seeking to commission a report titled "Review of the basis of Network Rail's allocation of costs/recharges to the Scotland route". This procurement process falls under the civil engineering consultancy services industry category and has a contract value of £40,000. The tender period for submissions ended on 30 January 2018, with the contract commencing on 14 February 2018 and lasting until 12 April 2018. The procurement method employed is an open procedure, suitable for both small and medium enterprises.

This tender presents a notable opportunity for businesses specialising in civil and business management consultancy services. Firms with expertise in public sector finance, cost allocation methodologies, or risk assessment approaches will be particularly well-suited to respond. The project requires detailed reporting on the reasonableness and best practice of cost allocations and offers the potential for consultants to engage with an essential aspect of the regulatory framework governing Network Rail's operations in Scotland.

## Notice

The backdrop for this requirement is our PR18 periodic review of Network Rail which needs to take into account: * Network Rail's reclassification as a public sector arm's length body; * a revised funding structure for the CP6 control period ; * our route level approach for PR18; and * the separate funding arrangements and periodic review determination that apply to Scotland. We wish to commission a report that sets out whether Network Rail's allocation of costs to its Scotland route (about 10% of the total) is reasonable, and consistent with best practice. The report will feed into the work of ORR's Regulatory Finance team on the financial framework for PR18. We expect to publish minded to positions on a range of financial issues in spring 2018 and our draft PR18 determination in June 2018. The consultant will be required to produce a report that addresses the following questions: In the context of the separate funding settlement for Scotland - 1. Are Network Rail's cost allocations to Scotland reasonable and consistent with best practice for each type of cost? These costs include overheads (e.g. HR costs), central activities (e.g. timetabling) and central programme costs, e.g. digital railway. 2. How could the Scotland route participate in any company-wide risk fund pooling or self-insurance arrangements? If Network Rail has used an approach, is the calculation of the contribution to be paid by Scotland reasonable? 3. Are there instances where Network Rail uses a top down approach to cost allocation (e.g. allocating HR costs by number of staff) where it could instead use a bottom up approach? For example, what is the cost of providing HR services to Scotland? A further example of this issue would be the allocation of working capital balances in the NR financial model. 4. Where relevant, how robust is NR's bottom up challenge to its top down allocations? How extensive has this been and how does this compare to best practice? 5. Is a policy of allocating some project development costs across all routes, even where the project may not have commenced in some routes (for example trial costs associated with new technology) reasonable with respect to the Scotland route, given its separate funding? 6. Are there any arguments for moving away from a policy under which infrastructure projects costs are always attributed to the route in which the infrastructure is built (for example Carstairs junction). Reference can be made to the question we asked on this issue in our first consultation on the financial framework and the responses received. Reference may also be made to earlier review work commissioned by ORR on this point. Additional information: Prospective bidders are advised to register on to the tender via ORR's eTendering Portal early as all further information regarding this tender will through the portal.Bidders should note the end dates/times for the submission of requests for clarification and proposals as set out in the ITT document.

## Key Details

| Field | Value |
| --- | --- |
| Publication source | Contracts Finder |
| Latest notice | https://www.contractsfinder.service.gov.uk/Notice/779455a6-618f-4a15-b800-d133e380411c |
| Notice type | Award Notice |
| Procurement type | Standard |
| Procurement category | Services |
| Procurement method | Open |
| Procurement method details | Open procedure (below threshold) |
| Tender suitability | SME |
| Awardee scale | Large |
| All stages | Tender, Award |

## Dates

| Field | Value |
| --- | --- |
| Publication date | 20 Feb 2018 |
| Submission deadline | 30 Jan 2018 |
| Future notice date | Not specified |
| Award date | 20 Feb 2018 |
| Contract period | 21 Feb 2018 - 12 Apr 2018 |
| Recurrence | Not specified |

## Values

| Field | Value |
| --- | --- |
| Tender value | £40,000 |
| Lots value | Not specified |
| Awards value | £39,780 |
| Contracts value | Not specified |

## Status

| Field | Value |
| --- | --- |
| Tender status | Complete |
| Lots status | Not specified |
| Awards status | Active |
| Contracts status | Not specified |

## Buyer

| Field | Value |
| --- | --- |
| Main buyer | OFFICE OF RAIL AND ROAD |
| Locality | LONDON |
| Post town | Central London |
| Postcode | WC2B 4AN |
| Country | England |
| ITL 1 | TLI London |
| ITL 2 | TLI3 Inner London - West |
| ITL 3 | TLI35 Westminster and City of London |
| Local authority | Westminster |
| Electoral ward | St James's |
| Westminster constituency | Cities of London and Westminster |
| Delivery location | Not specified |

## Supplier

| Field | Value |
| --- | --- |
| Number of suppliers | 1 |
| Supplier names | CAMBRIDGE ECONOMIC POLICY ASSOCIATES |

## CPV Codes

### Divisions

- 71 - Architectural, construction, engineering and inspection services
- 79 - Business services: law, marketing, consulting, recruitment, printing and security

### Codes

- 71311000 - Civil engineering consultancy services
- 79400000 - Business and management consultancy and related services

## Release History

- 20 Feb 2018 at 10:40 - Award - Award Notice - https://www.contractsfinder.service.gov.uk/Notice/779455a6-618f-4a15-b800-d133e380411c
- 9 Jan 2018 at 15:35 - TenderAmendment - Tender Notice - https://www.contractsfinder.service.gov.uk/Notice/9a7a85b9-c3fc-4a3e-9f39-0ffd1bbdcfe0
- 9 Jan 2018 at 15:34 - Tender - Tender Notice - https://www.contractsfinder.service.gov.uk/Notice/9a7a85b9-c3fc-4a3e-9f39-0ffd1bbdcfe0

## Documents

- https://www.contractsfinder.service.gov.uk/Notice/779455a6-618f-4a15-b800-d133e380411c
  20th February 2018 - Awarded contract notice on Contracts Finder
- https://www.contractsfinder.service.gov.uk/Notice/9a7a85b9-c3fc-4a3e-9f39-0ffd1bbdcfe0
  9th January 2018 - Opportunity notice on Contracts Finder
- https://www.contractsfinder.service.gov.uk/Notice/Attachment/b52f13eb-27c5-406b-abaf-93a21632dff4
  ITT
- https://www.contractsfinder.service.gov.uk/Notice/Attachment/179cbe73-6cd9-4317-9d49-6b7c6b7df21a
  Form of Agreement
- https://www.contractsfinder.service.gov.uk/Notice/Attachment/93de84a4-129a-47c3-890b-681ad6f86801
  Form of Tender
- https://www.contractsfinder.service.gov.uk/Notice/Attachment/df47f70b-8ab2-4674-bdc1-1a6b03b6eae3
  Disclaimer
- https://www.contractsfinder.service.gov.uk/Notice/Attachment/70e7bc11-f611-4ed5-a698-cf8056c7dfce
  Joining instructions for ORR's eTendering Portal
- https://www.contractsfinder.service.gov.uk/Notice/SupplierAttachment/dda012ff-8594-434e-b6c7-a144eee51a9c
  Signed Contract

## Provenance

This Markdown file is an alternate public rendering of the D3 Tenders contract record. The canonical page is https://d3tenders.com/contract/?ocid=ocds-b5fd17-7d5a13bd-1c00-441a-8a27-25151f0ce5a4. The underlying structured data is available as OCDS JSON at https://d3tenders.com/contract/ocds-b5fd17-7d5a13bd-1c00-441a-8a27-25151f0ce5a4.json.