GovWire

In September 2023, the SSRO made a determination on a matter referred to it by a defence contractor. This determination was made using a power given to the SSRO by the Defence Reform Act 2014. The referral concerned the extent to which specific staff and storage costs incurred by the contractor in relation to the COVID-19 pandemic were allowable costs to be included in the price of a firm-priced contract with the Secretary of State for Defence. The costs had not been included in the original estimate of costs used in pricing the referred contract.

The SSROs determination was made by a Referral Committee, appointed by the SSROs Chair, which took account of evidence presented by the parties to the contract, the requirements of the regulatory framework and the SSROs statutory guidance on the requirements of allowable costs.

The determination makes clear that, under the regulatory framework, the allowable costs to be included in the price of a firm-priced contract are those which are estimated at the time of agreement unless a provision of the contract or a pricing amendment permits otherwise. In this case, the SSRO determined that only a small am

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