Jobs under threat after contractor collapses



Thousands of South London jobs are at risk following the collapse of builder and schools, rail, police station and prison contractor Carillion.

The company went into liquidation on Monday with the government vowing to pay staff and asking them to turn up to work as normal.

But at the minimum, thousands of cleaners in prisons, police station clerical staff, cooks in schools, builders and road and rail contractors will have a new employer in the coming weeks.

Carillion’s many hundreds of suppliers are also likely to be under serious threat of closure.

The firm runs building cleaning and maintenance at Brixton, Wandsworth and Belmarsh prisons plus the kitchens of scores of schools across the area, and is the second biggest contractor for both Network Rail and Highways England.

Hundreds of non-cop staff at Deptford and Lewisham police stations are also employed by the company, which also has the contract for the upkeep of the buildings.

That includes office staff, custody assistants, property officers and typists, plus cleaning, catering, security and building maintenance workers.

It worked on the Tate Modern and the £300million phase one Circus West developments at Battersea power station.

The company won the £120million contract to build a Lambeth College Skills Centre at Vauxhall 20 months ago but this was put on hold nine months ago. A spokesman for the college said it was unable to comment.

The national secretary of union GMB,  Rehana Azam, said: “First and foremost, workers’ jobs must be protected.

“This is a company with an abysmal track record when it comes to protecting workers.

“Government needs to urgently consider a public sector vehicle for taking on this vital work, just as it has when private rail companies have walked away and failed the taxpayer.”

Federation of small businesses chief executive Brian Berry said: “Carillion’s liquidation is terrible news for all those who work for the company and it will have serious knock-on effects for the many smaller firms in its supply chain, some will be in financial danger as a result of Carillion’s demise.”

Philip Green, chairman of Carillion, said: “Over recent months huge efforts have been made to restructure Carillion to deliver its sustainable future.

“In recent days, however, we have been unable to secure the funding to support our business plan, and it is therefore with the deepest regret that we have arrived at this decision. We understand that HM Government will be providing the necessary funding required by the Official Receiver to maintain the public services carried on by Carillion staff, subcontractors and suppliers.”

A statement by Carillion said: “An application was made to the High Court for a compulsory liquidation of Carillion before opening of business today (Monday) and an order has been granted to appoint the official receiver as the liquidator of Carillion.

“We anticipate that the official receiver will make an application to the High Court for PricewaterhouseCoopers LLP to be appointed as special managers, to act on behalf of the official receiver, and we further anticipate that an order will be granted to that effect.”

Cabinet Office minister David Lidington told Radio 4’s Today programme yesterday the Government would fund jobs until new contracts were given to other firms.

Carillion ran into difficulties last year after issuing three profit warnings in five months and writing down more than £1billion from the value of contracts.

It had debts of about £1billion and a £600million pension deficit. The firm maintains 900 schools and constructs and repairs BT’s telephone and data networks across England, as well as 50,000 homes for the Ministry of Defence.­

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