Management of Liability in Special Police Service (SPS) Agreements

This paper proposes the approval of an indemnity of £1,000,000 as the standard in Special Police Services (SPS) Agreements. Where a risk assessment indicates higher risk or the value of the SPS is greater than £7, 500,000 the indemnity will be held at £7,500,000.

That the Deputy Mayor for Policing and Crime (DMPC) approve of an indemnity of £1,000,000 in SPS Agreements excluding those Agreements assessed as higher risk or with an annual value of more than £7,500,000.

Introduction and background

The provision of Special Police Services (SPS) is a discretionary service. The standard SPS Agreement template includes a Liability Clause with an indemnity of £7,500,000. The Clause protects the MOPAC and the Commissioner from claims from third parties during the provision of SPS.

Earlier iterations of the clause had made no reference to the monetary amount of the required indemnity. The inclusion of the £7,500,000 being the level of the MPS’s general self-insurance excess, has raised some concern for third parties in that they have difficulty in obtaining insurance cover for the indemnity.

Issues for consideration

The evidence to date is that the likelihood of a claim under the clause is rare.

The Metropolitan Police Service (MPS) legal team advice is that an indemnity of £7,500,000 is not warranted as the standard in all SPS Agreements. It is proposed that an indemnity of £1,000,000 would be sufficient to protect the MOPAC from the legal cost of successfully defending a claim for damages even if the claim was significant or required the appointment of Counsel to represent the MOPAC on such matters.

The exceptions to this proposal are where the SPS Agreement : -

1. value is above £7,500,000 such as in the case of Palace of Westminster, Transport for London etc.;
2. is in respect of sporting stadia where the potential for a claim, which although rare, is viewed as a higher risk due to the higher number of officers providing SPS and the volatility of public order situations; or
3. is with regard to an event such as a music festival where a risk assessment has established that there is a higher risk of disorder due to the amount of patrons at the event, the availability of alcohol, the artists performing etc. thereby increasing the potential for a claim.

The proposal is that the level of indemnity in these instances cited above should remain at £7,500,000 in line with the MPS self-insurance excess limit. The level of indemnity will align with any future corporate changes to the excess limit.

Financial Comments

The indemnity of £1,000,000 is viewed as less onerous and provides greater opportunities to reach agreement with third parties on the provision of SPS in both the renewal of existing SPS Agreements and the management of future requests. It provides the necessary balance in ensuring the MOPAC has the appropriate protection if a claim arises and mitigates the potential for the MOPAC to lose contracts due to third parties being unable to obtain insurance cover.

Legal Comments

Section 3(6) of the Police Reform and Social Responsibility Act 2011 provides that the Mayor’s Office for Policing and Crime must (a) secure the maintenance of the Metropolitan Police force, and (b) secure that the Metropolitan Police force is efficient and effective.

Equality Comments

There are no Equality and Diversity issues identified with this proposal.