Thames Water has varied the terms of its AMP6 Infrastructure Alliance contract awarded in January 2015 to Kier Integrated Services Ltd, Clancy Docwra, J Murphy and Sons and Morrison Utility Services Ltd.

The Alliance has now been running for 3 years of AMP6 - the variation follows a review of how the Alliance operates in line with the key Alliance principle to seek continuous improvement in the way it operates.

Thames Water has decided to make variations to the detailed arrangement set out in the 2 related Alliance contracts with each of the Alliance members.

The following variations are to close out year 3, and for years 4 and 5 of AMP6, are being implemented:

1. clarification on how the Head of Networks works for the Alliance Board;

2. using a schedule of rates for payment in Developer Services to better fit with Thames Water’s published new charging arrangements for Developer Services. The rates are still based on actual cost and the same management fees included in the original contact. The rates are reviewed each year against actual cost and management fee. New service levels have been set to meet developers' expectations on service delivery;

3. revision of budget levels for clean water networks following a review of the Costed Needs from the business plan - changes to the Costed Needs were envisaged in the original Alliance Agreement;

4. revision of programme-level pain / gain mechanism linked to Thames Water’s performance across Outcome Delivery Incentives (ODIs) and Service Incentive Mechanism (SIM) to more closely reflect the individual measures the Alliance Members can directly influence; and to incentivise timely performance of leakage jobs service levels have been included;

5. updating of the contracts for changes in law including CDM Regulations, GDPR, Modern Slavery Act and Part 3 of Criminal Finances Act.

Thames Water considers that the variations do not affect the nature or scope of the original Alliance agreement and contracts and they do not render the contract materially different in character from the one initially concluded.

The water company also said it had considered the original procurement and was satisfied that the variations do not introduce conditions which may have affected the outcome of the original procurement. In addition, the variations do not collectively alter the economic balance of the contract in favour of the contractors.