§ Mr. Spearingasked the Chancellor of the Exchequer what is the practice of Her Majesty's Government in paying fees of consulting engineers, directly or indirectly, when the cost of a project increases because of inflation but after most of the work of the consulting engineer is complete and his initial bill is paid.
§ Mr. Denis HowellI have been asked to reply.
Although the practice varies in detail, Government Departments normally commission consulting engineers on the basis of the Association of Consulting Engineers' Conditions of Engagement 1963. These conditions, and those used for architects and surveyors, recommend scale fees related to the cost of the project. As the cost of the project increases, increased fares are payable, including fees for design stages already completed.
The problems associated with ad valorem fees will be reviewed in the light of the conclusions of the Monopolies and Mergers Commission which is now examining the fees scale system in relation to architects and surveyors.
Meanwhile negotiations are taking place with the Association of Consulting Engineers about the assessment of fees where a scheme is postponed, after design work has started, and resumed later.