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Damien 11-01-2018 22:40

Carillion Crisis
 
Carillion, a major contractor in the public sector, is close to collapse.

https://news.sky.com/story/regulator...epens-11203432

https://www.ft.com/content/1b4ab6aa-...5-e94187b3017e

Quote:

Senior ministers from across most of Whitehall gathered on Thursday to discuss the plight of Carillion amid fears the ailing contractor is close to collapse.

David Lidington, Cabinet Office minister, convened the afternoon gathering of senior figures including Greg Clark, business secretary, Jo Johnson, transport minister, Liz Truss, chief secretary to the Treasury and justice minister Rory Stewart to discuss the possible demise of the construction and services group.

Also present were ministers from the culture, health, education and communities departments as well as the Foreign Office.

The scale of the meeting reflects the importance of Carillion to the government given its contracts with numerous departments, and in particular justice, transport and defence. These will need to be replaced — or taken in-house — if the company collapses.

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.

Ministers also discussed the wider ramifications of potential job losses at the company, which employs 43,000 staff worldwide — of which 19,500 are in the UK.
This could be quite bad...

1andrew1 11-01-2018 22:45

Re: Carillion Crisis
 
Quote:

Originally Posted by Damien (Post 35932084)
Carillion, a major contractor in the public sector, is close to collapse.

https://news.sky.com/story/regulator...epens-11203432

https://www.ft.com/content/1b4ab6aa-...5-e94187b3017e



This could be quite bad...

Carillion are like a bank. Too big to fail! Will be interesting to see how this is resolved, it's been going on for some time now but because it's not public-facing it doesn't get the attention that retailers and car companies get.

Maggy 12-01-2018 12:21

Re: Carillion Crisis
 
I wonder how much this is going to cost the taxpayers?

Paul 12-01-2018 17:23

Re: Carillion Crisis
 
If they have so much govt work then why are they in trouble, surely they must be doing something wrong ?

pip08456 12-01-2018 17:25

Re: Carillion Crisis
 
Quote:

Originally Posted by Paul M (Post 35932218)
If they have so much govt work then why are they in trouble, surely they must be doing something wrong ?

Exactly.

Damien 12-01-2018 17:28

Re: Carillion Crisis
 
Quote:

Originally Posted by Paul M (Post 35932218)
If they have so much govt work then why are they in trouble, surely they must be doing something wrong ?

Happens all the time with tenders. The companies bid at an unsustainable number, the government accepts the lowest bid, the companies attempts to make that number work fall flat on their face.

1andrew1 13-01-2018 10:38

Re: Carillion Crisis
 
Quote:

Originally Posted by Paul M (Post 35932218)
If they have so much govt work then why are they in trouble, surely they must be doing something wrong ?

1) Pension deficit from final-salary scheme
2) Over-borrowing.

denphone 13-01-2018 19:17

Re: Carillion Crisis
 
Quote:

Originally Posted by Damien (Post 35932221)
Happens all the time with tenders. The companies bid at an unsustainable number, the government accepts the lowest bid, the companies attempts to make that number work fall flat on their face.

Apparently the government were still awarding them contracts when ministers knew they were in deep trouble.

https://www.theguardian.com/business...k-to-carillion

denphone 15-01-2018 08:14

Re: Carillion Crisis
 
Carillion goes into liquidation.

https://www.theguardian.com/business...-business-live

Not good at all sadly as big questions will need to be answered in these coming days by the government.

Maggy 15-01-2018 10:00

Re: Carillion Crisis
 
Quote:

Originally Posted by denphone (Post 35932555)
Carillion goes into liquidation.

https://www.theguardian.com/business...-business-live

Not good at all sadly as big questions will need to be answered in these coming days by the government.

Government(s)..Successive ones..

heero_yuy 15-01-2018 10:27

Re: Carillion Crisis
 
Governments only set the general direction. It's Whitehall civil servants not party's that actually do the contracts and they adhere to the "Nobody ever got sacked by buying IBM" philosophy. Thus Carillion having been on the "approved" list would continue to be given the contracts irrespective of the city feedback on it's parlous financial state.

It's the same philosophy that allows the "approved" suppliers to charge an arm and a leg for basic supplies and services. Even if the civil servants had the will to go out and find bargain supplies they would be prevented from taking them up. This culture wastes £Billions. :(

denphone 15-01-2018 10:48

Re: Carillion Crisis
 
Quote:

Originally Posted by Maggy J (Post 35932559)
Government(s)..Successive ones..

Indeed Maggy but don't expect any proper answers as we know what governments are like for obfuscating the real truth..

Maggy 15-01-2018 12:34

Re: Carillion Crisis
 
Quote:

Originally Posted by heero_yuy (Post 35932564)
Governments only set the general direction. It's Whitehall civil servants not party's that actually do the contracts and they adhere to the "Nobody ever got sacked by buying IBM" philosophy. Thus Carillion having been on the "approved" list would continue to be given the contracts irrespective of the city feedback on it's parlous financial state.

It's the same philosophy that allows the "approved" suppliers to charge an arm and a leg for basic supplies and services. Even if the civil servants had the will to go out and find bargain supplies they would be prevented from taking them up. This culture wastes £Billions. :(

However the buck stops with the Government of the day..

Osem 15-01-2018 13:33

Re: Carillion Crisis
 
IIRC the company is owed some £500m by 2 middle east states and that's more than half their debts.

Also I can just hear the outcry from Labour and the unions had HMG not awarded those contracts some months ago and thereby and put job at risk then. Rock and a hard place...

Mr K 15-01-2018 15:56

Re: Carillion Crisis
 
Quote:

Originally Posted by Maggy J (Post 35932582)
However the buck stops with the Government of the day..

Apparently the buck always tops with Labour, whatever the subject, for one poster Maggie ! ;)

I don't only blame this govt, but the privatised rail companies (inc. the bankrupt Railtrack), the privatised Energy Utilities and now Carillion, have all served the the public badly.

Public services in the private sector occasionally make sense, but they are after one thing only, profit for their shareholders. Providing a public service will be low down the list. When they miscalculate and get too greedy for contracts, they go bust hoping we'll bail them out.

Looks like the Govt. are going to have to re-nationalise some areas to keep services going. It will stick in their throats and cost us dear no doubt.


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