Part 2Single source contracts
Pricing of contracts
I1I216Pricing of contracts: supplementary
1
Single source contract regulations may specify circumstances in which, if the Secretary of State and the primary contractor so agree—
a
the price determined in accordance with section 15 is to be taken as a target price, and
b
the total price payable under the contract is subject to adjustment by reference to any difference between—
i
the amount of the primary contractor's actual allowable costs under the contract F2or, where relevant, a component of that contract, and
ii
the amount of the estimated allowable costs used for the purpose of determining the target price.
2
The amount of any adjustment by virtue of subsection (1)(b) must be determined—
a
by agreement between the Secretary of State, or an authorised person, and the primary contractor, or
b
by the SSRO, where the matter is referred to it by the Secretary of State, an authorised person or the primary contractor.
3
Section 21 (final price adjustment) does not apply to a contract in a case where an agreement of a kind mentioned in subsection (1) has effect.
F14
Single source contract regulations may provide that the SSRO—
a
must, on an application by a person within subsection (5), determine whether the method used to determine the price payable under a qualifying defence contract or a component of that contract was appropriate;
b
may, in consequence of a determination under paragraph (a), determine that the price payable under the contract is to be adjusted by an amount specified by the SSRO.
5
The following persons are within this subsection—
a
the Secretary of State,
b
an authorised person, and
c
the primary contractor.