Calls grow for Carillion action one year after collapse

Aaron Morby 6 months ago
Share

The collapse of construction giant Carillion should be subject to a criminal investigation.

Unite says either regulators are failing to do their jobs or that existing laws are too weak

That is the call from union Unite, which has accused the government of failing to take action to ensure there is not another “corporate meltdown” on the first anniversary of the group going out of business.

Despite the scale of Carillion’s collapse, no action has yet been taken or recommended against any of Carillion’s directors or senior managers.

This is despite longstanding investigations by the regulator into accountants and auditors, the Financial Reporting Council and the Insolvency Service.

The Government’s pension regulator has also failed to deliver any recommendations from its investigation into the £800m shortfall left in the firm’s pension, which leaves thousands of former employees out of pocket.

So far, the Government has only come up with a pilot policy to require major outsourcing companies with public sector contracts in financial difficulties to produce a ‘living will’ detailing how services can continue to be run following a company’s demise.

The delay in action has led Unite to call for an immediate criminal investigation into Carillion’s collapse.

Unite assistant general secretary Gail Cartmail: “It is staggering that a year after the biggest corporate failure in modern UK history the government has carried on as though it is business as normal.

“The government’s failure to take action to ensure that there cannot be similar collapses in the future is a betrayal of workers, who still face being cast on the scrapheap without warning because of irresponsible directors who place profits and shareholder dividends before people.

“The fact that no one involved in Carillion has yet had any form of action taken against them, demonstrates either that the regulators are failing to do their jobs or that existing laws are too weak. If it is the latter then we need better stronger laws.”

She added: “A year on from Carillion’s collapse the government needs to stop prevaricating and start taking effective action.”

Carillion went into compulsory liquidation on 15 January 2018, with a reported £7bn of liabilities and just £29m left in the bank.

Experts believe that Carillion could have been trading while insolvent for several years prior to its collapse.

As a result of Carillion’s collapse nearly 3,000 staff were made redundant with many other workers in its supply chain also losing their jobs. Many of Carillion’s subcontractors were also forced out of business.

So far £50m has been paid to accountants PwC to act as special managers to break up the company. A further £65m has been paid out to make workers redundant and smooth the transfer of outsourced contracts to new providers.

The extra final bill for Carillion’s two flagship construction projects – the Royal Liverpool hospital and the Midland Metropolitan hospital – has yet to be quantified although much of the financial hit has been shouldered by the financiers of the PFI schemes.

The cost of both projects has now rocketed and both hospitals will be at least three years late before they are operational.

Latest news

More contractors suspended from Prompt Payment Code

Galliford Try, Ferrovial and Alun Griffiths among firms not paying on time
7 hours ago

Lendlease names new London construction chief

Claire Pettett has over 11 years experience at Lendlease mostly on the finance side
7 hours ago

Construction restructure costs Galliford Try £10m

Average group net debt rises to £187m after year of writedowns
11 hours ago

Six climate activists arrested at concrete plant

Police chief warns construction companies they will be targeted during week of action
12 hours ago

Civils and concrete specialist OHOB delivers £27m profit

O’Halloran & O’Brien builds revenue to £300m after expanding from south east base into the Midlands
12 hours ago

Worker killed on Asda extension site

Victim "hit by digger bucket" in site tragedy
21 hours ago

Leeds Merrion Centre 17 storey office block approved

New office block in shopping centre will cost over £50m to build
12 hours ago

£17m Blackpool hotel project out to bid

Muse invited bids for Talbot Gateway scheme Holiday Inn
13 hours ago

Countryside wins £400m London Camden Lock estate rebuilds

Work could start on 700-home estate rebuild late next year
1 day ago

Contractor fined for ignoring site welfare order

Manchester firm failed to provide decent facilities for workers
13 hours ago

Murphy suffers £5.8m loss

Revenue up 4.4% to £781m driven by transport and power projects
1 day ago

London Mayor uproots Tulip Tower plan

Sadiq Khan blocks 305m skyscraper plan despite city planners' approval
2 days ago

Third Van Elle board director exits

John Foster, group commercial director, departs six months after joining piling specialist
2 days ago

Hunt starts for partner to deliver £1.5bn Wales schools plan

Welsh Government is looking for partner for new public private schools delivery model
2 days ago

HS2 unveils plans for “people mover” on new viaduct

2.3km route will transport people to Birmingham Airport
1 day ago

Manager merry-go-round causing mayhem for contractors

Construction bosses walk-in to new jobs no matter how poor their track record is
2 days ago

Contractor hunt starts for new £1.7bn Stonehenge route

Highways England hopes to attract bids from "some of the world’s best construction companies"
2 days ago

29 arrests in immigration raid on BAM King’s Cross site

Illegal Albanian, Indian and Lithuanian workers detained during swoop on flagship London job
3 days ago

Call to delay VAT changes as chaos looms for contractors

Industry leaders demand six month delay to October deadline as contractors unaware of tax changes
3 days ago

Hull contractor C Spencer back in profit

Specialist records £1.8m profit after revenue cut to £54m in year of consolidation
3 days ago

ISG wins £23m Cardiff Uni science building

Six-storey maths and computer block will be built on the Cathays campus
3 days ago

Local civils firm lands £17m London Airport job

East London civils contractor Kilnbridge wins biggest contract this year
5 days ago

Tolent starts £34m Leeds rental flats job

12-storey block is being built for Grainger as part of the Holbeck Urban Village
3 days ago

Boost your online presence – join the Enquirer Directory

Site for suppliers and buyers showcases products, services and latest stories
1 year ago

Foundations specialist Aspin goes into administration

All staff sent home as ground engineering firm goes under
6 days ago

HPL cladding to be stripped from Oxford tower block

Housing associations and councils are now planning to remove HPL cladding following new Government guidance
5 days ago

HS2 forced to rebid £435m Curzon Street station

Poor interest from contractors forces risk transfer rethink
6 days ago

Mott MacDonald names new UK and Europe chief

Cathy Travers will be in charge of 7,500 staff generating £824m revenue
5 days ago

Galliford Try Infrastructure chief exits

Nick Salt leaves as construction chief Bill Hocking takes over infrastructure
6 days ago

Interserve appoints Alan Lovell as new chairman

Industry veteran pledges to help "continue delivering Interserve’s transformation"
5 days ago

Contractor services