Variation of Price. (1) The Variation of Price formula shall be used by the Authority in relation to internal Business Case approvals to determine the VOP price. The Authority and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ shall meet to agree a price at or below the VOP price depending on market forces at the time of order impacting indices G6T3 (PPI Output) – Fabricated metal products, except machinery (includes weapons and ammunition) for Items 1-2 or G6T5 (PPI Output) – Computer, Electronic and Optical Products for Domestic Market for Item 3. The base price that applies to any VOP shall be those stipulated for the base period of 1 April 2022 to 31 March 2023. (2) The prices for 1 April 2025 onwards in the Schedule 13 Additional Buys – Additional Systems are FIXED at FY2023/2024 price levels. The prices do not include provision beyond this date for increases or decreases in the market price of the Articles being purchased. Any such variation shall be calculated in accordance with the following formula: V = P (a+b (Oi/O0)) - P Where: V represents the variation of price P represents the FIXED price as stated in the Schedule 13 Additional Buys – Additional Systems - Items 1-3 O represents the index G6T3 (PPI Output) – Fabricated metal products, except machinery (includes weapons and ammunition) for Items 1-2 or G6T5 (PPI Output) – Computer, Electronic and Optical Products for Domestic Market for Item 3 O0 represents the 12-month average OUTPUT Price Index figure for the base period 1 April 2022 to 31 March 2023 (as above) Oi represents the 12-month average OUTPUT Price Index figure for the following periods: 1 April 2024 to 31 March 2025 for the purposes of calculating FY2025/2026 prices 1 April 2025 to 31 March 2026 for the purposes of calculating FY2026/2027 prices 1 April 2026 to 31 March 2027 for the purposes of calculating FY2027/2028 prices a represents the Non- Variable Element (NVE) – 0.1 b represents the Variable Element – 0.9 a+b=1 (3) The Index referred to in Clause 1 above shall be taken from the following Tables: OUTPUT Price Index - e.g., ONS Publication MM22 Table 2 'Price Indices of UK OUTPUT: All Manufacturing and Selected Industries', or, Table 4 'Price Indices of Products Manufactured in the UK'. (4) Indices published with a ‘B’ or ‘F’ marker, or a suppressed value, in the last 3 years are not valid for Variation of Price clauses and shall not be used. Where the price index has an ‘F’ marker or suppression applied to it during the term of the Contract, the Authority and the Contractor shall agree an appropriate replacement index or indices. The replacement index or indices shall cover, to the maximum extent possible, the same economic activities as the original index or indices. (5) In the event that any material changes are made to the indices (e.g., a revised statistical base date) during the period of the contract and before final adjustment of the final contract price, then the re-basing methodology outlined by the Office for National Statistics (ONS, the series providers) to match the original index to the new series shall be applied. (6) In the event the agreed index or indices cease to be published (e.g., because of a change in the Standard Industrial Classification) the Authority and the Contractor shall agree an appropriate replacement index or indices, which shall cover to the maximum extent possible the same economic activities as the original index or indices. The methodology outlined by the Office for National Statistics used for rebasing indices (as in Clause 4 above) shall then be applied. (7) Notwithstanding the above, any extant index / indices agreed in the Contract shall continue to be used as long as it is / they are available and subject to ONS revisions policy. Payments calculated using the extant index / indices during its / their currency shall not be amended retrospectively as a result of any change to the index or indices. (8) The Contractor shall notify the Authority of any significant changes in the purchasing / manufacturing plan on the basis of which these provisions were drawn up and agreed, or of any other factor having a material bearing on the operation of these provisions such as to cause a significant divergence from their intended purpose, in order that both parties may consider whether any change in this provision would be appropriate. (9) Claims under this Condition shall be submitted to the Bill Paying Branch, certified to the effect that the requirements of this Condition 46.p have been met.
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Sources: Procurement and Support Contract
Variation of Price. (1) The Variation of Price formula shall be used by the Authority in relation to internal Business Case approvals to determine the VOP price. The Authority SoR Items 4 and ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ shall meet to agree a price at or below the VOP price depending on market forces at the time of order impacting indices G6T3 (PPI Output) – Fabricated metal products, except machinery (includes weapons 5 and ammunition) for Option Items 1-2 or G6T5 (PPI Output) – Computer, Electronic 7,8,9,10 and Optical Products for Domestic Market for Item 3. The base price that applies to any VOP shall be those stipulated for the base period of 1 April 2022 to 31 March 2023.11)
(2) a. The prices for 1 April 2025 onwards stated in the Schedule 13 Additional Buys – Additional Systems SoR for Lines Items 4, 5, 7, 8, 9, 10 and 11 are FIXED at FY2023/2024 November 2021 price levels. The prices do not include provision beyond this date for increases or decreases in the market price of the Articles being purchased. Any such variation shall be calculated in accordance with the following formula: V = P (a+b (Oi/O0)) - – P Where: V represents the variation of price P represents the FIXED price as stated in the Schedule 13 Additional Buys – Additional Systems - Items 1-3 of Requirements O represents the index G6T3 (PPI Output) – Fabricated metal products, except machinery (includes weapons and ammunition) for Items 1-2 or G6T5 (PPI Output) – Computer, Electronic and Optical Products for Domestic Market for Item 3 O0 represents the 12-month average OUTPUT Price Index figure for the base period 1 April 2021 to March 2022 to 31 March 2023 (as above) Oi represents the 12-month average OUTPUT Price Index figure for the following periods: 1 April 2024 2025 to 31 March 2025 2026 (for the purposes of calculating FY2025/2026 prices 1 variation on SOR item 4) April 2025 2026 to 31 March 2026 2027 (for the purposes of calculating FY2026/2027 prices 1 variation on SOR item 5) April 2026 2027 to 31 March 2027 2028 (for the purposes of calculating FY2027/2028 prices variation on SOR item 6) April 2028 to March 2029 (for the purposes of calculating variation on SOR item 7) April 2029 to March 2030 (for the purposes of calculating variation on SOR item 8) April 2030 to March 2031 (for the purposes of calculating variation on SOR item 9) April 2031 to March 2032 (for the purposes of calculating variation on SOR item 10) April 2032 to March 2033 (for the purposes of calculating variation on SOR item 11) a represents the Non- Variable Element (NVE) – 0.1 b represents the Variable Element – 0.9 a+b=1a+b=1 2.
(3) b. The Index referred to in Clause 1 above shall be taken from the following Tables: OUTPUT Price Index - e.g., e.g. ONS Publication MM22 Table 2 'Price Indices of UK OUTPUT: All Manufacturing and Selected Industries', or, Table 4 'Price Indices of Products Manufactured in the UK'.
(4) c. Indices published with a ‘B’ or ‘F’ marker, or a suppressed value, in the last 3 years are not valid for Variation of Price clauses and shall not be used. Where the price index has an ‘F’ marker or suppression applied to it during the term of the Contract, the Authority and the Contractor shall agree an appropriate replacement index or indices. The replacement index or indices shall cover, to the maximum extent possible, the same economic activities as the original index or indices.
(5) d. In the event that any material changes are made to the indices (e.g., e.g. a revised statistical base date) during the period of the contract and before final adjustment of the final contract price, then the re-basing methodology outlined by the Office for National Statistics (ONS, the series providers) to match the original index to the new series shall be applied.
(6) e. In the event the agreed index or indices cease to be published (e.g., e.g. because of a change in the Standard Industrial Classification) the Authority and Contract Pricing - Variation of Price Commercial Policy Statement the Contractor shall agree an appropriate replacement index or indices, which shall cover to the maximum extent possible the same economic activities as the original index or indices. The methodology outlined by the Office for National Statistics used for rebasing indices (as in Clause 4 above) shall then be applied.
(7) f. Notwithstanding the above, any extant index / indices agreed in the Contract shall continue to be used as long as it is / they are available and subject to ONS revisions policy. Payments calculated using the extant index / indices during its / their currency shall not be amended retrospectively as a result of any change to the index or indices.
(8) g. The Contractor shall notify the Authority of any significant changes in the purchasing / manufacturing plan on the basis of which these provisions were drawn up and agreed, or of any other factor having a material bearing on the operation of these provisions such as to cause a significant divergence from their intended purpose, in order that both parties may consider whether any change in this provision would be appropriate.
(h. Prices shall be adjusted taking into account the effect of the above formula as soon as possible after publication of the relevant indices or at a later date if so agreed between the Authority and the Contractor. Where an index value is subsequently amended, the Authority and the Contractor shall agree a fair and reasonable adjustment to the price, as necessary. 9) . Claims under this Condition shall be submitted to the Bill Paying Branch, certified to the effect that the “requirements of this Condition 46.p Clause 4.3 have been met.
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