Part 2

Single source contracts

Pricing of contracts

Final price adjustment
21
1
Single source contract regulations may provide for adjustments to be made to the total price payable by the Secretary of State under a qualifying defence contract.
2
The regulations must specify the procedure to be followed in determining the amount of any adjustment.
3
Provision made under subsection (2) must include provision for the amount of any adjustment to 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.
4
Provision under this section may be expressed so as to apply—
a
to particular kinds of qualifying defence contracts;
b
to qualifying defence contracts the value of which is of or above the amount specified for the purposes of this paragraph.
5
The Secretary of State may direct that provision under this section does not apply in relation to a qualifying defence contract the value of which is—
a
of or above the amount specified for the purposes of subsection (4)(b), but
b
less than the amount specified for the purposes of this paragraph in the regulations.
6
The regulations may specify matters to which the Secretary of State must have regard in deciding whether to make a direction under subsection (5).