14.1.3  Calculating actual service fee

For any given period, the service fee should be calculated in accordance with a formula commencing with the pre-agreed amount payable for the full performance of the Contracted Services (plus or minus any volume adjustments in the period), less amounts for:

(a)  Quality Failure, Availability Failure and Incident Failure abatements;

(b)  Repeated Failure abatements;

(c)  Reporting Failure abatements;45 and

(d)  Any volume adjustments.46

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45  These failure types are defined and discussed further in Chapter 12 (Service requirements and Services Specifications).

46  Some jurisdictions restrict this to utility volume adjustments.  Other jurisdictions approach it more widely, for example, in the case of catering and the provision of meals, it may be preferable on a value for money consideration, to pay on a fee for service basis.