Carillion plc

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How and why Carillion failed: Carillion repeatedly pulled forward £hundreds of millions on profits expected from future work, and paid that cash out to shareholders. Since the huge profits it was booking did not exist, it had to borrow the cash it paid out to shareholders – and the debt was secured against goodwill: its brand name, relations with customers and staff. However hard such things are to value, Carillion reckoned that they were worth a tidy £1.57bn. As MPs discovered to their amazement in Jan.2018, “goodwill” was Carillion’s single biggest asset. It was like an internal Ponzi scheme aided and abetted by ministers such as the hapless Chris Grayling who shut their eyes to the profit warnings and chucked ever more contracts the way of Carillion. Of Britain’s 5 biggest outsourcers, Capita has an even higher proportion of goodwill on its books when set against its assets. Back in Feb.2018, Professor Adam Leaver observed that were the firm’s executives to write down just 25% of the value of that goodwill, they “would wipe out the firm’s equity”. As they have grown, the giant outsourcers’ business model has relied more and more on the public sector playing the role of useful idiot – talking up the importance of private-sector efficiency and never batting an eyelid when the likes of Capita tap them up for some expensive loophole in the contract. Thankfully, that is clearly changing.[1]


People

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Government Contracts

What government contracts did Carillion hold?[2]

NHS
Managed facilities including 200 operating theatres and 11,800 beds
Made more than 18,500 patient meals per day
Helpdesks dealt with 1.5m calls per year
Engineering teams carrying out maintenance work
Transport
Built 'smart motorways' – which ease congestion by monitoring traffic and adjusting lanes or speed limits – for the Highways Agency
Major contractor on £56bn HS2 high-speed rail project
Upgraded track and power lines for Network Rail
Major contractor on London’s Crossrail project
Roadbuilding and bridges
Defence
Managed infrastructure and 50,000 homes for Ministry of Defence
Education
Designed and built 150 schools
Catering and cleaning contracts at 875 schools
Prisons
Maintenance and repairs at about half of UK prisons
Libraries
Managed several public libraries in England
Energy
Built substations, overhead cables and other works for National Grid

Articles

  • Nov.19.2018: Public service providers will have to draw up 'living wills'. The Cabinet Office proposals set out to limit potential collapse damage post-Carillion. Companies that provide critical public services will have to draw up “living wills”, to prevent taxpayers being saddled with the cost if another major outsourcer such as Carillion collapses, under plans outlined by the govt. Carillion's failure has cost the taxpayer an estimated £150m to date. They involve greater transparency by public services providers and a promise that outsourcing will act as a “force for good”, with the government required to consider social and economic benefits when awarding contracts. Labour said the plans had come too late. Shadow cabinet office minister Jon Trickett said: “This is too little too late from a government more concerned with defending outsourcing than protecting the hundreds of millions of taxpayers’ money that has gone down the drain in failed outsourcing projects. The Guardian revealed that the govt knew of a plan that could have retrieved more than £360m from Carillion, limiting the cost of its collapse to taxpayers and sparing pension scheme members from cuts to their retirement payouts, but did not encourage directors to pursue it (article link). The plan would have involved breaking up the company, selling the profitable parts and placing the rest into liquidation, avoiding an involuntary collapse. Rob Davies, The Guardian.
  • Jun.07.2018: Carillion's accountants and lawyers will get £70m to manage collapse. Accountants and lawyers will earn £70m managing the fallout from the collapse of Carillion, according to the National Audit Office, with taxpayers expected to foot a bill of more than £150m. The NAO estimated that Carillion would end up costing the Cabinet Office at least £148m but warned the overall cost borne by taxpayers was “likely to be higher”. Accountancy firm PriceWaterhouseCoopers, which earned £17m in fees from Carillion in the decade before its demise, is expected to earn a further £50m from managing the insolvency. Lawyers will pick up a further £20m slice of costs that are projected to reach £566m, offset by an estimated £317m in income, including from ongoing public and private sector contracts being managed by the Insolvency Service and PwC. Business committee chair Rachel Reeves said the share of total costs made up by PwC’s bill was further evidence of a lack of competition among the so-called big four accounting companies. Reeves’ and Frank Field’s work and pensions committees urged the govt to consider breaking up the Big 4 accountants in a joint report into Carillion’s collapse published last month. Field, also a Labour MP, said: “More money for PwC is less money for sub-contractors and the Pension Protection Fund.” The PPF, the UK’s pensions lifeboat, will take over Carillion’s retirement schemes, which have a collective liability of £2.6bn. Rob Davies, The Guardian.
  • May.14.2018: Carillion used suppliers to prop up business: MPs. Carillion executives used suppliers to "prop up their failing business model" according to MPs investigating the collapse of the construction and outsourcing firm. They said evidence from lender Santander showed the company had used its early payment facility (EPF) to conceal its true level of borrowing. The facility allowed suppliers to Carillion - described as "notoriously late payers" - to receive their money earlier via the bank, but at a discount, documents supplied to two parliamentary committees revealed. This was effectively a line of credit that should have been described as "borrowing" in annual accounts but was instead presented as liabilities to "other creditors", the MPs said. more Press From.
  • Apr.01.2018: Fury at Carillion fees charged by PwC. Clients of collapsed outsourcer hit out at liquidator’s charges. Accountancy giant PwC is heaping surcharges of more than 20% on to contracts set up by the defunct outsourcing company Carillion — piling pressure on cash-strapped councils and private finance initiative (PFI) investors. PwC, which is handling the winding up of the failed construction giant, has also been accused of failing to supply employee details to companies trying to take over former Carillion contracts. The accountancy firm has raked in more than £20m in fees from the liquidation, since being appointed by the official receiver in January. Carillion’s clients are having to pay PwC more fees for the work than stipulated in their contracts with the outsourcer. One company said PwC has heaped premiums of up to 50% on to its contracts — a level denied by the govt's Insolvency Service. "We're not happy to pay 20% for the benefit of having PwC standing there," said another investor. "They are raking in huge amounts of fees and holding everyone to ransom". Carillion paid £6.4m to companies including accountants KPMG, EY and PwC, investment bank Lazard and law firm Slaughter and May just days before it collapsed. John Collingridge, The Sunday Times. See Comments section.
  • Mar.17.2018: Former Carillion finance directors expected to face investigation. The Financial Reporting Council's conduct committee is understood to have agreed that there are sufficient grounds for a probe into the conduct of Richard Adam and Zafar Khan. Frank Field and Rachel Reeves, the MPs leading a Joint Select Committee inquiry into Carillion’s failure, welcomed the regulator’s decision. The FRC chief executive, Stephen Haddrill, told MPs the watchdog was examining whether an investigation was required into any misconduct by “members in business”, rather then a mere breach of regulations. The FRC can prevent a finance director who is a member of a professional association from practising. It can also table significant fines. The Insolvency Service is already investigating the conduct of directors employed at the point at which the outsourcing giant collapsed, but "also of any individuals who were previously directors", following a request from Business secretary Greg Clark. Work and Pensions Select Committee chair Frank Field welcomed the FRC's decision to widen its probe to include directors but said regulators should have acted sooner. Daniel Boffey, Rob Davies, The Guardian.
  • Mar.11.2018: Capita in £700m fire sale to slash debt pile. Advisers to Carillion were handed £6.4m just before its collapse. Law firms including Clifford Chance and Slaughter and May and the investment bank Lazard were among the firms that were paid fees on Jan.12.2018, an inquiry by MPs has found. Carillion went into liquidation 72 hours later. The Times, John Collingridge
  • Mar.04.2018: Govt let slip chance to retrieve £364m from Carillion. Cabinet Office, responsible for oversight of govt contractors, did not pursue directors to accept proposal that could have cut cost of collapse to taxpayers. The Guardian, Rob Davies
  • Mar.04.2018: Carillion lenders alerted to concerns months before collapse. FTI Consulting accused government contractor of using aggressive accounting to mask underperformance. The Guardian, Rob Davies
  • Mar.02.2018: Carillion directors dismissed plan to secure £218m for pension scheme. Board rejected proposal to break up company and sell profitable assets prior to liquidation, accountancy firm EY says. The Guardian, Rob Davies
  • Feb.27.2018: Carillion whistleblower named. A finance executive has been named as the whistleblower who revealed the “aggressive” accounting that brought down Carillion. Board meeting minutes of the construction company reveal that directors were warned of an impending scandal over its books as early as last May. Frank Field, the Commons Work and Pensions Select Committee co-chairman, said that Emma Mercer, then a new finance director of the construction division, revealed serious reservations about Carillion’s accounting last spring. "Emma Mercer took just six weeks to spot and pull the thread that began the entire company unravelling," Mr Field said. "That she had to go through whistleblowing procedures to get her concerns about accounting irregularities taken seriously by the Carillion board is extraordinary". Ms Mercer was later appointed chief finance director. The minutes reveal that a senior lawyer warned directors that if they did not disclose the accounting issues on the construction of Royal Liverpool Hospital and the redevelopment of Battersea Power Station, they risked being accused of misleading the stock market. The Times, Robert Lea
  • Feb.23.2018: MPs demand answers on 'false market' in Carillion. Shares warning draws advisers into firing line. The Times, Robert lea, Harry Wilson
  • Feb.23.2018: Director chose "preserving cash" over pensions. Carillion’s former finance director Richard Adam claimed that putting cash into the contractor’s pension scheme was a "waste of money". Robin Ellison, chairman of Carillion’s biggest defined benefit pension schemes. The Pensions Regulator told a parliamentary hearing that the bosses could have to hand millions of pounds of their own money to pensioners of the defunct company as they were investigating whether managers should be held personally liable in its collapse. Frank Field, chairman of the Work and Pensions Select Committee, asked whether the regulator would go "after the boss group, who made so much". The payouts to managers in the months before the business’s demise have caused outrage. Richard Howson, former chief executive who stepped down in the autumn, received £1.5m in salary, bonuses and pension last year. Carillion also agreed to keep paying him a salary of £660,000 and other benefits worth £28,000 until Oct. More than 29,000 former Carillion workers are facing cuts to their pensions. On a worst-case "buyout" basis the cost of honouring the pension commitments is estimated at as much as £2.6bn. The Pensions Regulator was already under pressure for failing to protect BHS pensioners after the retailer fell into administration in 2016 following its sale by Sir Philip Green for £1 to Dominic Chappell, a bankrupt former racing driver. The Times, Harry Wilson
  • Feb.23.2018: Carillion wasted £40m on useless audits, say MPs. KPMG and Deloitte accused of providing false assurance to investors and staff. MPs heard evidence from Michelle Hinchliffe, head of audit at KPMG, Peter Meehan, the KPMG partner who audited Carillion, and Michael Jones, who led Deloitte’s internal audit service at the contractor. KPMG was paid £29 million over 19 years by Carillion, and Deloitte £11 million over an unknown period. Rachel Reeves, co-chairwoman of the Work and Pensions and Business Joint Select Committee, said: "These audits appear to be a colossal waste of time and money, fit only to provide false assurance to investors, workers and the public". The Qatar construction project, the £350m construction of the Royal Liverpool Hospital, the Midland Metropolitan in Birmingham and the £700m Aberdeen bypass were all written off on Jul.10, at which point Mr Howson was removed from his post. The Times, Robert Lea
  • Feb.07.2018: Carillion’s deluded chiefs demanded £160m bailout. The directors of Carillion, the failed construction company, have been condemned as “delusional” after details emerged of a desperate plan to save it early this year which involved a demand for a £160 million bailout using taxpayers' money. Carillion was put into compulsory liquidation on Jan.15 after lenders, shareholders and, most crucially, ministers ran out of patience. The Times, Robert Lea, Gurpreet Narwan
  • Feb.06.2018: Carillion's final turnaround plan published by MPs. The 100-page document from January lays bare the uphill struggle Carillion was facing as it attempted to persuade lenders to plug a funding gap believed to be in the region of £300m. City AM, Oliver Gill
  • Jan.26.2018: Tory govt refuses to publish official report on doomed Carillion's performance because it's 'commercially sensitive'. The review was carried out after minister Sam Gyimah said he was "not impressed" by Carillion's prison maintenance work. The Mirror, Dam Bloom
  • Jan.26.2018: MoJ 'renationalises' prison maintenance after Carillion collapse. The Ministry of Justice has created a new facilities management company to take over prison services such as cleaning and building repair work that were previously handled by collapsed construction giant Carillion. The Law Society Gazette, Monidipa Fouzder
  • Jan.26.2018: Carillion collapse triggers loan defaults at projects with HICL. British investment firm HICL Infrastructure said on Friday the collapse of Carillion had triggered loan agreement defaults at projects and management subcontracts with the construction outsourcing company. Reuters, Noor Zainab Hussain
  • Jan.24.2018: Labour just succeeded in using some obscure procedure to force the Tories to release the "risk assessments" of all major contracts with private firms since 2014, including Carillion. The Tories refused to vote. Let us see *exactly* how far they’ll go for their party donors. @Rachael_Swindon
  • Jan.24.2018: The transfer of #Carillion’s public service contracts to companies who not only specialise in outsourcing and subcontracting, but also blacklisting, tax avoidance and attacks on workers’ terms & conditions is totally unacceptable, a mere rearranging of the furniture. @LauraPidcockMP
  • Jan.23.2018: 'Greed and lunacy' as Carillion paid shareholders £500m while pension black hole spiralled out of control Transport Secretary Chris Grayling also handed firm a £62million contract in November – a month after the Ministry of Defence decided to stop awarding it work. The Mirror, Andrew Gregory
  • Jan.23.2018: Ofqual warned of 'adverse effect' of Carillion collapse on apprentices Awarding body NOCN and the CITB pledge to work with apprentices affected by the collapse of construction giant Carillion. TES, George Ryan
  • Jan.23.2018: The questions May needs to answer on Carillion Did Carillion believe it would get a government bailout? If May is serious, she should act. Politics.co.uk, Tim Clark
  • Jan.20.2018: Leaked files reveal Carillion’s payments to blacklisting agency. And far more.. Carillion liaised with the blacklisting agency Consulting Association... The Canary, Tom Coburg
  • Jan.18.2018: Banks extend £225m lifeline to Carillion subcontractors as firms offer jobs. Taskforce of high street banks, trade bodies and businesses draw up measures to limit job losses as unions press government to act, The Guardian, Rob Davies
  • Jan.18.2018: Carillion's boss is also in charge of a tax-avoiding fracking company. And like Carillion, Third Energy] is in financial trouble, with the govt at one point threatening to dissolve it. The Canary, Steve Topple (see Fracking for more on this)
  • Jan.17.2018: Interserve Seesaws as Carillion Collapse Said to Prompt Scrutiny. Bloomberg, Joe Easton
  • Jan.17.2018: Most private customers to keep paying staff; director bonuses stopped - as it happened The Guardian
  • Jan.17.2018: Theresa May branded a 'total hypocrite' after Tories trousered £50,000 from firm that bet on Carillion's failure. Naya Capital Management UK is one of a string of hedge funds that bet on Carillion's share price falling. The Mirror, Vox Political
  • Jan.17.2018: After Carillion, Interserve Shares Hit by Report That Britain Is 'Worried' About Firm. The New York Times, via Reuters
  • Jan.16.2018: Carillion's Govt contracts could have been stopped by a single law. Why wasn't it used? Carillion is part of what is known as "the shadow state" a group of large companies secretively awarded govt contracts to run Britain's public services. There are others. The Independent, Hazel Sheffield
  • Jan.15.2018: The winners of the Carillion scandal - making £300m from the govt contractor's collapse. Marshall Wace - whose co-founder Sir Ian Marshall was a major leave backer in the Brexit campaign, was the biggest winner as Carillion's shares tumbled last July after a profit warning. Its bet made a tidy profit of £19.1 million. Another big winner is investment giant BlackRock, which recently hired former chancellor George Osborne on an annual salary of £650,000 for one day a week. The world's biggest fund manager made £16m across its funds. Other UK hedge funds that coined it from Carillion's decline include Thunderbird Partners - £14.5m, and Immersion Capital - £11.4m. Sadly, the Govt weren't as quick off the mark as the hedge funds were. The London Economic, '
    • Jan.15.2018: The winners of the Carillion scandal – making £300m from the Govt contractor’s collapse. The London Economic, Ben Gelblum
  • Jan.16.2018: Carillion crisis: Theresa May rules out bailout as Labour accuses ministers of collusion. The Guardian
  • Jan.16.2018: Carillion held just £29m in cash when it collapsed. Document shows construction group owed £1.3bn to banks as government demands fast-track probe of directors. Financial Times, Gill Plimmer, Miles Johnson, Jim Pickard, Martin Arnold
  • Jan.15.2018: Carillion liquidation: 'Unsettling time' for hospital staff as firm goes bust. The company held contracts with hospital trusts on our patch :: It has gone into liquidation with immediate effect. Gazette Live, Bethany Lodge
    • Jan.16.2018: '#Carillion was left with £29m in cash when it collapsed. It owed £1.29bn to the banks. As the Government is left to pick up the pieces of Carillion’s undelivered contracts, these banks will be carving up Carillion to claw back every penny.' Carillion's Missing Millions, https://medium.com/@graceblakeley/carillions-missing-millions-9090a6ee84d8
    • Jan.15.2018: There are 2 Philip Greens - both Tory supporters who bankrupted their companies while paying themselves millions. One from BHS, the other from Carillion. Philip Green BHS was Tory adviser on gov't spending and Philip Green of Carillion was Tory adviser on Corporate Responsibility.@ThomasPride
    • Jan.16.2018: Labour started the PFI process. BBC journalist Nicholas Watt reminds gloating Labour MPs they are to BLAME for reliance on Carillion Daily Express
  • Jan.16.2018: PwC’s multiple roles with Carillion come under scrutiny. "Bad optics" cited as PwC acts for liquidator, pension trustees and govt. Financial Times, Madison Marriage, Barney Thompson
  • Jan.16.2018: 14 trusts start contingency plans after Carillion collapse. Contingency plans are in operation across 14 NHS trusts after the collapse of construction and facilities management company Carillion. HSJ, Nick Carding
  • Jan.15.2018: Carillion: Why did it collapse and what happens next? Carillion – which reported half-year losses of £1.15bn – was struggling under nearly £900mn of debt. Express & Star, '
  • Jan.15.2018: Carillion set to go into liquidation after last-ditch talks collapse. Premises & Facilities Management Online, '
  • Labour-controlled Leeds City Council picked crisis-hit Carillion for a £14m road-building contract just SEVEN DAYS ago The Sun
  • Dave was close to Carillion. Very close. @Rachael_Swindon
  • (Cameron) He seems to spend more time visiting Carillion than a paid director... @Rachael_Swindon
  • Carillion's Philip Green was a major donor to the Tory Party - The more business Govt gave him, the more he donated - No correlation of course. @DiligentTruth
  • David Lidington hits back at Labour’s Jon Trickett, pointing out a third of Carillion contracts were signed by the Labour govt - when Trickett was working in Brown’s No.10 @MattChorley
  • Jan.15.2018: The winners of the Carillion scandal – making £300m from the Government contractor’s collapse The London Economic
  • UK govt seeks to limit damage after Carillion collapses Reuters
  • Vince Cable keeps popping up offering his wise advice about Carillion. Advice from the man that orchestrated the crony Capitalism sale of 497-year-old publicly-owned Royal Mail, which lost the taxpayer hundreds and hundreds of millions of pounds? Jog on, Mr Cable. @Rachael_Swindon
  • Carillion's pension scheme trustees estimate the hit to the PPF from the retirement schemes at "up to £900mn". @JosephineCumbo
  • Fury as fatcat Carillion boss trousers £660,000 for a year AFTER leaving collapsed firm The Mirror
  • Carillion appear to have undercut others to secure contracts but then often failed to complete projects on time or run satisfactory services. But still the govt handed them contracts. @GeorgyBradders
  • "Theresa May needs to consider whether it is time that this transport secretary left the station."
  • Another Chris Grayling privatisation disaster alongside Virgin bailout and Carillion HS2 disaster. This man is the epitome of Tory free market ideological failure. @AnnaTurley
  • Jan.14.2018: Carillion lenders consider appeal to save firm from collapse The Guardian
  • Carillion crash means public may have to subsidise Tory privatisation yet again VoxPolitical
  • Private PFI infrastructure Company Carillion is collapsing. Banks that lent money to Carillion, RBS, Barclays, HSBC and Lloyds are now begging for a Government bail out > Carillion Bankers and PFI Bailouts People-vs-PFI
  • Carillion in final appeal to lenders after UK refuses rescue Reuters > Sky News
  • Carillion protected bosses’ bonuses before running into financial crisis. Vox Political
  • Questions over how ailing Carillion won new jobs @FT
  • Carillion protected bosses’ bonuses before running into financial crisis Vox Political
  • The company that runs Britain is near to collapse. Watch and worry | Aditya Chakrabortty @AnnPettifor >> The Guardian
  • The major shareholders in Carillion are also major shareholders in Carillion’s main competitors. The system never loses, just the workers and patients that could be impacted from any fallout. @ToryFibs
  • Carillion becoming another tragic case study in what happens when we privatise profits when things go well and nationalise risks so the taxpayer picks up the bill when things go wrong. Vulture capitalism underwritten by the taxpayer. And don’t forget hedge funds made millions too @DavidLammy
  • In July 2017 Carillion call in HSBC to advise them. In Sept (?) 2017, HSBC sells over a million shares. @MrEthical
  • Union Blasts Carillion's 'Reckless Corporate Irresponsibility' Amid Last-Ditch Rescue Talks HuffPost
  • 'Disaster': Hundreds of businesses at risk if Carillion fails, analyst warns The Telegraph
  • Carillion secretly protected bosses’ £4m bonuses just months before £600m accounting crisis This is Money
  • Carillion collapse raises big questions about Chris Grayling awarding them contracts long after they were in. > http://www.bbc.com/news/business-42680585 @Andrew_Adonis
  • In just 2 weeks time the Tories will bailout Carillion with £3bn from the Magic Tory Money Tree, whilst taking £3bn from the disabled Have you seen all this before? @EtonOldBoys
  • Unions blasts Carillion's reckless corporate irresponsibility amid reports of £300m taxpayer bail-out for construction giant @SocialistVoice >>
  • (Carillion) This could be very bad for workers and services @BobEllard1 >> The Telegraph
  • Carillion crisis: UK govt locked in last-ditch rescue talks The Guardian
  • “The govt has to be ready to intervene and bring these crucial public sector contracts back in-house in order to protect Carillion’s employees, pension holders and British taxpayers.” @BillEsterson >> The Guardian
  • Looking at Carillion's 2016 report and accounts, it's clear that the company was already in trouble then. Look at the rise in current liabilities. Trade payables increase indicates Carillion was squeezing suppliers to limit short term borrowing. @FrancesCoppola
  • Govt to hold Carillion talks on Sunday. UK construction and management group could go into administration as early as Monday. Financial Times
  • If #Carillion collapses, the vast majority of the financial burden should remain with its private shareholders & the banks. It would be morally reprehensible for the public to bail this company out. We need to fund public services & the #NHS, not bankers & wealthy shareholders @CPeedell
  • To be clear, Carillion does not run prisons, it has contracts to do repairs, but has failed, leaving windows broken, plumbing overflowing @FrancesCrook
  • Carillion: 'Matter of days' to stop collapse @PageChord > BBC News
  • The company that runs Britain is near to collapse. Watch and worry, Aditya Chakrabortty The Guardian
  • Carillion isn't too big to fail. But much of what it is running is too important to fail - which is why it was too important to be run by profiteers @FisherAndrew79
  • Why did the govt cont. to hand contracts to carillion AFTER they knew they were failing?? Blind dogma? > @JonTrickett > Carillion crisis looms for govt as time runs out for refinancing deal The Guardian
  • There are urgent questions about how PFI contractors managing risk and what means for public sector if they go bust the Govt has to address - Carillion got a £20m PF2 contract just 2 years ago >> @StellaCreasy >> The Guardian
  • So @Carillionplc, holder of extensive govt service/infrastructure contracts, is in danger of folding. How should the govt react? Please RT for wider sample size. #Carillion @TheBlankSimon
  • UK ministers hold crisis talks over Carillion @FTWestminster
  • Sky News has learned construction company Carillion which is contracted to build the government's HS2 high-speed rail link project is trying to find new funding within weeks as it seeks to avoid collapse @SkyNews
  • Carillion in ‘high-risk’ contracts row: The Times The govt has come under fire after Carillion continued to win new contracts, despite Whitehall rules designed to limit taxpayer exposure to “financially distressed” companies. It has been relisted as a possible provider of school buildings by the Education and Skills Funding Agency
  • Carillion is on govt radar: @BBCNews > @AlOnlineNI I think there are a lot of ex ministers involved in that enterprise. Share holders.
  • The govt need to keep a very close eye on 'horror show' Carillion: The Express
  • Carillion changed rules to safeguard CEO’s £multi-million bonuses shortly before crisis @EvolvePolitics + Evolve Politics
  • The chairman of Carillion, Philip Green, is an adviser to the Prime Minister Theresa May on corporate responsibility. It's unlikely that you'll read anything more emblematic of the national pageant than that this week. @MrJamesOB
  • Why did Carillion collapse? @PickardJE explains the issues to #AfternoonLive @BBC-SimonMcCoy
  • Virgin made £8m annual profit from NHS + paid no corp tax . Virgin also bailed out by the govt for failing w/ East Coast Rail. The state keeps the risk, the companies take the profits. #Carillion bailed out with govt contracts, but still failed #PublicOwnership @MtCjRams
  • No, Carillion is not being “bailed out”, taxpayers are not “picking up tab”. All shareholders & creditors will lose ££. Pension fund will go to industry-funded PPF, services will revert to gov & be re-tendered/contracts sold on. This is not a “bailout”. It’s called “going bust” @CitySamuel
  • Jan.15.2018: Why did Carillion continue to get contracts when it was already in trouble? Why did G4S continue to get contracts after being found guilty of fraud over tagging? Why did ATOS continue to get contracts after giving up the work capability assessment in disgrace? @EdDWilson
  • Jan.15.2018: I’ve already clarified this (6 hours ago in the tweet immediately after the one you just replied to). Very keen to establish when this was put in the public domain. Any help appreciated. @JamesOB
  • Jan.15.2018: Blame Tory negligence and ideology for Carillion’s collapse The Independent
  • Jan.15.2018: The Transport secretary’s decision to award lucrative contracts to an ailing Carillion is only the latest worrying misjudgment to come to light The Times
  • Jan.15.2018: Carillion chairman signed this in support of the Tories before 2015 election @BillEsterson >> Political Scrapbook
  • Jan.15.2018: It's only a matter of time before the collapse we witnessed today of an outsourcing giant, is the collapse of a giant private health firm we handed £bns of contracts to. Think about that. @ToryFibs
  • Jan.15.2018: Tory govt lauded #Carillion deal as ‘key’ in ‘economic plan’ SkwawkBox
  • Jan.15.2018: Taxpayers shouldn’t bale Carillion out but it’s a great opportunity to buy PFI assets back cheaply and take outsourced jobs back into the public sector @KevinPascoe
  • Jan.15.2018: Watch HoC live: Minister forced to explain why govt handed over £1bn of public contracts to stricken company The Mirror
  • Jan.15.2018: In last 4 years Carillion part of PFI projects which made nearly £1bn in profits - Pfi sold as worth cost as a less risky way to borrow. Given this time for a windfall tax to recoup some of these excessive profits from Pfi companies that can be put into public services affected! @StellaCreasy
  • Jan.15.2018: Carillion - Tories In Deep Shit Zelo Street
  • Jan.15.2018: Carillion blames Whitehall upheaval after Brexit vote for orders fall. The Guardian
  • Jan.15.2018: Remarkable that the former chief exec of Carillion has a deal to be paid for 12 months after he resigned. He stood down after Carillion issued a shock profit warning and is still being paid his £660,000 salary and £28,000 benefits. @ShehabKhan
  • Jan.15.2018: What we see in the #Carillion collapse is the lethal combination of privatisation and limited liability. The shareholders take the profits - in spades - but pick up neither the debts nor the risk of collapsing services. @GeorgeMonbiot
    • One of the key brexit donors has done very very well indeed out of it. Carillion crisis: hedge funds rake in tens of millions The Guardian
  • Jan.15.2018: Carillion liquidation: Taxpayers face 'raw deal' as staff urged to keep working - live updates The Guardian
  • Jan.15.2018: Hedge funds are the winners out of Carillion’s collapse. They saw the demise coming and laid bets that it would happen and they have cleaned up. This is grotesque and no way to conduct public sector contracts. @AndyMcDonaldMP
  • Jan.15.2018: Carillion collapse raises job fears BBC News
  • Jan.15.2018: @JennieUnite
  • Jan.15.2018: @AndyMcDonaldMP
  • Jan.15.2018: Carillion goes into compulsory liquidation, putting 20,000 jobs at risk. iNews
  • Jan.15.2018: HMG has big questions to answer. Why were they awarding contracts to Carillion after the exposure of its problems in July? What contingency planning did they do for the collapse? 20,000 jobs & huge projects at stake! More Brexit-induced Whitehall paralysis & incompetence. @AndrewAdonis
  • Jan.15.2018: Carillion crisis: hedge funds rake in tens of millions The Guardian
  • Jan.15.2018: Carillion protected bosses’ bonuses before running into financial crisis Vox Political
  • Jan.15.2018: Gwynne calls for Council service support as Carillion collapses Andrew Gwynne
  • Jan.11.2018: Carillion recently had a market value of £2bn. Since then its share price has collapsed > 90% after a profit warning. It is holding crisis talks with creditors. Crucially, it employs 43,000 people - 19,500 in the UK. Today it emerged there'll be a meeting tomorrow Sky News between Cabinet Office officials, the company, the Pensions Regulator, pension scheme trustees and the Pension Protection Fund to discuss the future of the company's pension scheme, which has a £580m deficit. Our scoop @FT is that David Lidington (de facto PM) held a crisis meeting of (loads of) ministers this afternoon to discuss the implications on Whitehall of a possible Carillion collapse. Cabinet Office secretary Lidington, business secretary Greg Clark, chief secretary to the Treasury Liz Truss, transport minister Jo Johnson, Justice minister Rory Stewart. And ministers from the culture, health, education and communities depts as well as the Foreign Office. Alongside work on the HS2 rail link, Carillion provides facilities management for schools as well as services for the armed forces and on smart motorways for the Highways Agency. I look back at the coverage from months ago and wonder why many of us hardly noticed it, eg. @FT. @PickardJE
  • Jan.11.2018: Govt ministers called to meeting on Carillion's future in scramble to prepare for collapse. The Telegraph, Hannah Boland
  • Jan.11.2018: Concerns about Carillion putting thousands of jobs and vital services at risk. Bring contracts back in-house. @LenMcCluskey1 >> Govt must consider all options as concerns grow on Carillion’s future. @UniteTheUnion >> Govt must consider all options as concerns grow on Carillion’s future Unite, the UK’s largest union, is calling on the govt to “consider all possible options” including bringing contracts in-house, as doubts continue to grow over the future of Carillion the troubled construction and outsourcing giant. Carillion employs over 20,000 workers and there are many more workers reliant on the company’s future in its supply chains. Unite represents over 1,000 workers at the company and has many more members in the supply chain. Aside from its construction business the company has a plethora of outsourced public sector contracts in health, education, the prison service and local authorities. It also has contracts in many other industrial sectors. Unite also believes that if the govt provides any financial assistance or guarantees loans to Carillion, there must be an assurance that workers in the supply chain are protected. Carillion is understood to have debts and a pension deficit of £1.5bn but only has a stock market value of £100m. It is possible that the company’s banks will refuse to lend any further money. Unite The Union

2017

References

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  2. ^ Taxpayers to foot £200bn bill for PFI contracts – audit office. Rajeev Syal, The Guardian, Jan.18.2018.