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Question reference: S6W-41134

Date lodged: 9 October 2025
Current status: Answered by Ivan McKee on 27 October 2025

Question

To ask the Scottish Government which organisations that have contracts with it to provide services are subject to performance-related penalties.

Answer

Scottish Government contracts and frameworks which include clauses pertaining to Liquidated Financial Damages, KPIs and/or Service Credits are listed in the following table.

It is not common for contracts to include provisions that set out specific financial consequences for failure to perform as it can be difficult to quantify in advance an expected loss from such a failure. However, standard terms and conditions used when awarding Scottish Government procurement contracts do contain a number of important provisions. This includes provisions whereby, if the contract is terminated - including as a consequence of a material breach by the supplier, then the Scottish Government may deduct any costs incurred to complete the services from any amount due to be paid. If this exceeds amounts already paid, then provisions include that those sums can be recovered.

Additionally, for regulated procurements, the Scottish Government’s standard terms and conditions contain indemnity clauses requiring the supplier to indemnify the public sector body in respect of any loss suffered through that supplier’s negligent or wrongful act, or omission or defect in any goods/services supplied. Regulated contracts are currently those valued at £50k and above. Levels of indemnity are set appropriately and proportionally for each procurement exercise.

I have attached extracts from Scottish Government Terms and Conditions that pertain to repatriations as a result of termination, default and indemnities.

To underpin good practice, the Scottish Government sets out guidance for all public bodies on how to Manage and Improve the Performance of Contracts in the Procurement Journey, a national tool to support consistency of practice across Scotland. This includes appropriate use of KPIs, Service Levels, Incentives and Sanctions where it is proportionate and relevant to do so, for example, in regulated contracts.

Extracts from Standard Scottish Government Terms and Conditions that pertain to Performance Related Damages

26.6 The Service Provider indemnifies the Purchaser and any replacement service provider against all actions, suits, claims, demands, losses, charges, damages, costs and expenses and any other liabilities which the Purchaser or replacement service provider may incur in respect of the emoluments and outgoings referred to in clause 26.5.

52 Indemnity

52.1 The Service Provider shall indemnify the Purchaser against all claims, proceedings, actions, damages, costs, charges, expenses and any other liabilities which may arise out of, or in consequence of, any Default of the Service Provider.

52.2 The Purchaser shall indemnify the Service Provider in respect of all claims, proceedings, actions, damages, fines, costs, expenses or other liabilities which may arise out of, or in consequence of, a breach of the Data Protection Laws where the breach is the direct result of the Service Provider acting in accordance with the Purchaser’s specific written instructions. This indemnity provision shall not apply if the Service Provider-

1.acts on the Purchaser’s specific written instructions but fails to notify the Purchaser in accordance with clause 14.12(c) of this Contract;

2.fails to comply with any other obligation under the Contract.

53. Limitation of Liability

53.1. Neither Party is liable to the other Party under the Contract for any:

53.1.1. loss of profits, business, revenue or goodwill; or

53.1.2. indirect or consequential loss or damage.

53.2. But clause 53.1 does not exclude any liability of the Service Provider for additional operational, administrative costs or expenses or wasted expenditure resulting from the Default of the Service Provider.

53.3. The liability of either Party under the Contract for Defaults is limited to [x].

53.4. But neither Party excludes or limits liability to the other Party for:

53.4.1. death or personal injury caused by its negligence;

53.4.2. misrepresentation;

53.4.3. any breach of any obligations implied by section 12 of the Sale of Goods Act 1979 or sections 2 or 11B of the Supply of Goods and Services Act 1982; or

53.4.4. any breach of any obligations under Data Protection Laws

59. Termination Rights

59.1. The Purchaser may terminate the Contract by notice to the Service Provider with immediate effect if the Service Provider commits a Default and:

59.1.1. the Service Provider has not remedied the Default to the satisfaction of the Purchaser within 20 Working Days, or such other period as may be specified by the Purchaser, after issue of a notice specifying the Default and requesting it to be remedied;

59.1.2. the Default is not in the opinion of the Purchaser, capable of remedy; or

59.1.3. the Default is a material breach of the Contract.

59.2. «F68: The Purchaser may also terminate the Contract in accordance with any provisions of the Schedules.»

59.3. The Purchaser may terminate the Contract in the event that:

(a) the Contract has been subject to substantial modification which would have required a new procurement procedure in accordance with regulation 72(9) (modification of contracts during their term) of the Public Contracts (Scotland) Regulations 2015; or

(b) the Service Provider has, at the time of contract award, been in one of the situations referred to in regulation 58(1) (exclusion grounds) of the Public Contracts (Scotland) Regulations 2015, including as a result of the application of regulation 58(2) of those regulations, and should therefore have been excluded from the procurement procedure.

59.4. The Purchaser may also terminate the Contract in the event of a failure by the Service Provider to comply in the performance of the Services with legal obligations in the fields of environmental, social or employment law.

59.5. The Purchaser may also terminate the Contract where, at any time before the term of the Contract, the Service Provider or any person falling within the description set out in paragraph (2) of regulation 58 of the Public Contracts (Scotland) Regulations 2015 commits an offence referred to in paragraph (1) of that regulation.

60. Termination on Insolvency and Change of Control

60.1. The Service Provider shall notify in writing immediately, and the Purchaser may terminate the Contract with immediate effect by notice, where in respect of the Service Provider:

60.1.1. a proposal is made for a voluntary arrangement within Part I of the Insolvency Act 1986 or of any other composition scheme or arrangement with, or assignation for the benefit of, its creditors;

60.1.2. a shareholders’ meeting is convened for the purpose of considering a resolution that it be wound up or a resolution for its winding-up is passed (other than as part of, and exclusively for the purpose of, a bona fide reconstruction or amalgamation);

60.1.3. a petition is presented for its winding up (which is not dismissed within 14 days of its service) or an application is made for the appointment of a provisional liquidator or a creditors’ meeting is convened pursuant to section 98 of the Insolvency Act 1986;

60.1.4. a receiver, administrative receiver or similar officer is appointed over the whole or any part of its business or assets;

60.1.5. an application order is made either for the appointment of an administrator or for an administration order, an administrator is appointed, or notice of intention to appoint an administrator is given;

60.1.6. it is or becomes insolvent within the meaning of section 123 of the Insolvency Act 1986;

60.1.7. being a “small company” within the meaning of section 382 of the Companies Act 2006, a moratorium comes into force pursuant to schedule A1 to the Insolvency Act 1986;

60.1.8. a debt relief order is entered into; or

60.1.9. any event similar to those listed above occurs under the law of any other jurisdiction.

60.2. The Purchaser may terminate the Contract by notice with immediate effect within 6 months of:

60.2.1. being notified that a change of Control has occurred in accordance with clause 33.1 (Change of Control); or

60.2.2. where no such notification has been given, the date that the Purchaser becomes aware of the change of control.

60.3. But the Purchaser may not terminate the Contract under clause 60.2 where approval of the change of control has been granted by notice by the Purchaser.

Table 1: Contracts and Frameworks that contain Clauses pertaining to Liquidated Financial Damages, KPIs and Service Credits
Area	Supplier	Provision	Liquified Financial Damages	Key Performance Indicatiors	Service Credits
ICT	HP Inc. UK Limited	Desktop Client Devices	No	Yes	no
	HP Inc. UK Limited	Mobile Client Devices	No	Yes	no
	HP Inc. UK Limited	Managed Print Solutions	No	Yes	no
	XMA Limited	Web Based and Proprietary Devices	No	Yes	no
	XMA Limited	Technology Peripherals and Infrastructure	No	Yes	no
	XMA Limited	Managed Print Solutions	No	Yes	no
	Softcat Ltd	Technology Peripherals and Infrastructure	No	Yes	no
	Insight Direct (UK) Ltd	Technology Peripherals and Infrastructure	No	Yes	no
	Computacenter (UK) Ltd	Technology Peripherals and Infrastructure	No	Yes	no
	Agilico (Scotland) Limited	Managed Print Solutions	No	Yes	no
	Canon UK	Managed Print Solutions	No	Yes	no
	Epson	Managed Print Solutions	No	Yes	no
	Konica Minolta	Managed Print Solutions	No	Yes	no
	Ricoh	Managed Print Solutions	No	Yes	no
	Workflo Solutions	Managed Print Solutions	No	Yes	no
	Xerox	Managed Print Solutions	No	Yes	no
Area	Supplier	Provision	Liquified Financial Damages	Key Performance Indicatiors	Service Credits
NCPD	23 Media Audits	Media Auditor	No	Yes	No
NCPD	Carat	Media Planning and Buying	No	Yes	Yes
NCPD	Republic Of Media	Media Planning and Buying	No	Yes	Yes
NCPD	Mediacom Edinburgh	Media Planning and Buying	No	Yes	Yes
NCPD	The Media Shop Scotland	Media Planning and Buying	No	Yes	Yes
NCPD	Spiritmedia Scotland	Media Planning and Buying	No	Yes	Yes
NCPD	Penna	Recruitment Ads and PINs	No	Yes	No
NCPD	The Leith Agency	Marketing Services	No	Yes	No
NCPD	Walk in the Gate Ltd	Marketing Services	No	Yes	No
NCPD	The Union Advertising Agency	Marketing Services	No	Yes	No
NCPD	Stand Ltd	Marketing Services	No	Yes	No
NCPD	Story UK lTd	Marketing Services	No	Yes	No
NCPD	Dentsu Creative ( a trading division of Dentsu UK)	Marketing Services	No	Yes	No
NCPD	Union Direct Ltd	Marketing Services	No	Yes	No
NCPD	Bright Digital Marketing Ltd	Marketing Services	No	Yes	No
NCPD	The Lane Agency Ltd	Marketing Services	No	Yes	No
NCPD	John Doe Group	Marketing Services	No	Yes	No
NCPD	Drummond Central	Marketing Services	No	Yes	No
NCPD	Smarts (NI) Ltd	Marketing Services	No	Yes	No
NCPD	Stripe PR and Communications Ltd	Marketing Services	No	Yes	No
NCPD	3x1 Ltd ( known as 3x1 Group)	Marketing Services	No	Yes	No
NCPD	Muckle Media	Marketing Services	No	Yes	No
NCPD	Jump Research Ltd	Marketing Services	No	Yes	No
NCPD	Progressive Partnership Ltd	Marketing Services	No	Yes	No
NCPD	Ipsos (Market Research) Ltd	Marketing Services	No	Yes	No
NCPD	BMG Research Ltd	Marketing Services	No	Yes	No
NCPD	Trinity McQueen Ltd	Marketing Services	No	Yes	No
NCPD	Northstar Media ltd	Marketing Services	No	Yes	No
NCPD	Metro Production Group Ltd	Marketing Services	No	Yes	No
NCPD	Speakeasy Productions Ltd	Marketing Services	No	Yes	No
NCPD	CTM	Travel Services	No	Yes	No
NCPD	Lyreco	General Office Supplies	No	Yes	No
NCPD	APS Group Scotland	Publishing, Printing, Design and Associated Services	No	Yes	Yes
NCPD	Barr Printers Ltd	Print and Associated Services	No	Yes	Yes
NCPD	Harlow Printing Ltd	Print and Associated Services	No	Yes	Yes
NCPD	J Thomson Colour Printers Ltd	Print and Associated Services	No	Yes	Yes
NCPD	Mackay and Inglis Ltd	Print and Associated Services	No	Yes	Yes
NCPD	MBM Print SCS Ltd	Print and Associated Services	No	Yes	Yes
NCPD	McAllister Litho Glasgow Ltd	Print and Associated Services	No	Yes	Yes
NCPD	Pandaprint	Print and Associated Services	No	Yes	Yes
NCPD	Printwell Ltd	Print and Associated Services	No	Yes	Yes
NCPD	Sterling Press Ltd	Print and Associated Services	No	Yes	Yes
NCPD	Sciamed Ltd	Print and Associated Services	No	Yes	Yes
NCPD	Streamline Corporate	Print and Associated Services	No	Yes	Yes
NCPD	The Evolve Group (Scotland) Ltd	Print and Associated Services	No	Yes	Yes
NCPD	Winter and Simpson Ltd	Print and Associated Services	No	Yes	Yes
NCPD	Enterprise Rent a Car UK	Vehicle Hire	No	Yes	No
Area	Supplier	Provision	Liquified Financial Damages	Key Performance Indicatiors	Service Credits
Heat in Buildings	Warmworks	Warmer Homes Scotland	No	Yes	Yes
Promoting Children and Families Wellbeing Unit	APS	Scotlands Baby Box	No	Yes	Yes
Area	Supplier	Provision	Liquified Financial Damages	Key Performance Indicatiors	Service Credits
Example -MPIP	IBM	SPM delivery	No	No	Yes
SGPT	University of Strathclyde	Provision of Host Body for the Anti-Racism Observatory for Scotland	No	Yes	No
SGPT	Santa Fe Relocation Services Limited	Provision of UK International and Domestic Relocation Services	No	Yes	No
SGPT	Ipsos Mori UK	Evaluation of Cancer Care Strategy for Scotland	No	Yes	No
SGLD	Keith Mitchell Law Accountants	Law Accountancy Services	No	Yes	No
Marine	Cammach Bryant Ltd	Temporary Crewing Framework	No	Yes	No
Marine	Intermarine UK Ltd	Temporary Crewing Framework	No	Yes	No
Human Rights	Inspiring Scotland	EHRF & DES Fund Management	No	Yes	No
Education and Justice	Aberlour Child Care Trust	Independent Child Guardians Service	No	Yes	No
SGPT	Big Partnership	CyberScotland Partnership –	No	Yes	No
SGPT	Big Partnership	Marketing and Communications Management and Co-ordination	No	Yes	No
SGPT	Ipsos Market Research Ltd	Scottish Household Survey (SHS)	No	Yes	Yes
SGPT	Sign Solutions	Contact Scotland BSL	No	Yes	No
SGPT	Inspiring Scotland	Autistic Adult Support Fund and Learning Disabilities Support Fund Administrator	No	Yes	No
SGPT	Impact Funding Partners	Bairns Hoose Fund Administrator	No	Yes	No
SGPT	Inspiring Scotland	Outdoor Community Play Fund Administrator	No	Yes	No
SGPT	Scottish Women's Aid	Scotland’s Domestic Abuse and Forced Marriage Helpline	No	Yes	No
SGPT	IPSOS Market Research	Whole Family Wellbeing Funding Year 3 and 4 Evaluation	No	Yes	No
SGPT	Quality Health Limited	Health And Care Experience Survey 2025-26	No	Yes	No
SGPT	Advice Direct Scotland Ltd	Test and Learn Prevention Pilots	No	Yes	No
SGPT	Grant Thornton UK Advisory & Tax LLP	USA Export Plan	No	Yes	No
SGPT	Energy Savings Trust	Provision of Heat in Buildings Loans and Grants Administration Service	No	Yes	No
SGPT	Energy Savings Trust		No	Yes
Area	Supplier	Provision	Liquified Financial Damages	Key Performance Indicatiors	Service Credits
Example -MPIP	IBM	SPM delivery	No	No	Yes
Utilities	EDF	Supply of Electricity	No	Yes	Yes
Utilities	Total Energies Gas and Power	Supply of Gas	No	Yes	Yes
Utilities	Business Stream	Water and Waste Water Billing Services	No	Yes	Yes
Area	Supplier	Provision	Liquified Financial Damages	Key Performance Indicators	Service Credits
NCPD	Press Data Ltd	Media Services	No	Yes	No
NCPD	Access Intelligence Communications Ltd	Media Services	No	Yes	No
NCPD	The Royal Bank of Scotland	Banking Services	No	Yes	No
NCPD	Venesky Brown Recruitment Ltd	Temp & Interim Staff Services	No	Yes	No
NCPD	Harvey Nash Ltd	Temp & Interim Staff Services	No	Yes	No
NCPD	Pertemps Recruitment Partnership Ltd	Temp & Interim Staff Services	No	Yes	No
NCPD	ASA International Ltd t/a ASA Recruitment	Temp & Interim Staff Services	No	Yes	No
NCPD	Lorien Resourcing Ltd	Temp & Interim Staff Services	No	Yes	No
NCPD	Blue Arrow Ltd	Temp & Interim Staff Services	No	Yes	No
NCPD	Brightwork Ltd	Temp & Interim Staff Services	No	Yes	No
NCPD	Harper MacLeod LLP	Legal Services	No	Yes	No
NCPD	Anderson Strathern LLP	Legal Services	No	Yes	No
NCPD	DWF LLP	Legal Services	No	Yes	No
NCPD	Brodies LLP	Legal Services	No	Yes	No
NCPD	Morton Fraser MacRoberts LLP	Legal Services	No	Yes	No
NCPD	Addleshaw Goddard LLP	Legal Services	No	Yes	No
NCPD	CMS LLP	Legal Services	No	Yes	No
NCPD	National Westminster Bank (Royal Bank of Scotland)	ePurchasing Card (Scotland Excel call off/cluster via CCS Framework)	No	Yes	Annual rebate
NCPD	Global Connections (Scotland) Ltd	Interpreting, Translation & Transcription Services	No	Yes	No
NCPD	DA Languages Ltd	Interpreting, Translation & Transcription Services	No	Yes	No
NCPD	Global Language Services Ltd	Interpreting, Translation & Transcription Services	No	Yes	No
NCPD - ICT Networks	Vodafone Ltd	Mobile Voice & Data Services Framework	No	Yes	No
Area	Supplier	Provision	Liquified Financial Damages	Key Performance Indicatiors	Service Credits
MPIP	The Wise Group, People Plus, Start Scotland, Remploy, and Falkirk Council ( 8 contracts)	Fair Start Scotland	No	Yes	Yes

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