Carillion Crisis

[denphone]

Outsourcing firm Interserve in rescue talks.

https://www.theguardian.com/business...-new-contracts

The heavily indebted group, which employs 75,000 staff worldwide, said on Sunday night that the talks with lenders would probably leave shareholders nursing big losses as the company drifts into the hands of the banks that have loaned it more than £600m.

Investors have been fretting that the debts could send the company into a death spiral similar to that suffered by Carillion, Interserve’s former rival, which collapsed in January despite it running huge government projects including building Merseyside’s £335m Royal Liverpool University hospital.

Capita next...

[denphone]

If the foundations are made of sand rather then hard rock the outcome is pretty predictable.

[heero_yuy]

Quote from Hugh:


Capita next...

I fear that may be wishful thinking. I wonder who would employ a knuckle dragging TVL Bozo?

[Stuart]

I think that we as a society are overcomplicating things because it appears cheaper. I say appears because if you look purely at normal outgoings , it is cheaper, but most people don't bother the factor in the costs of either not having the work done, or employing people (or a competing company) if the company providing your service goes t*ts up. It's also introducing more stuff to potentially go wrong.

For example, a school has a need for cleaning staff. These staff are a fixed cost, and will need storage space and equipment, all of which must be budgeted for. OK, so an outside cleaning firm will provide their own equipment, their own staff if the staff are based centrally, can service several schools with the same equipment and staff. Fair enough. That is cheaper. What if the company goes bankrupt? The school still needs cleaning, and it's unlikely the school will have the budget required for cleaners and equipment, even if they have the space required for storage. At least if the school goes bankrupt, they won't need any cleaners anyway.

I work in IT, and we are doing the same with systems, except it's worse because when you outsource a company critical system, you introduce not only the potential problems of what happens if the company hosting your critical system(s) goes bankrupt, but also miles of communications infrastructure than can go wrong, potentially taking out important systems for days. Most companies are unlikely to survive long without their critical IT systems.

The problem with outsourcing (especially IT) is that people think they are discharging the responsibility and oversight of the work being done, when in fact they are only outsourcing the transactional element of the work.

When it goes wrong, it’s still their responsibility, not the outsourcers (although the outsourcer gets the blame/a good kicking).

You can’t outsource a problem, it just ends up costing you more in the end.

[denphone]

And it seems HMG has not learned anything from the Carillion collapse at all.

https://www.theguardian.com/business...ing-unions-say

Trade unions have accused the government of failing to learn lessons from the collapse of Carillion, instead pumping even more money into outsourcing companies, a year on from the firm’s high-profile demise.

The lifetime value of outsourcing contracts awarded in 2017-18 “rocketed” by 53% from £62bn to £95bn in the past year, according to the GMB union, which pointed to nearly £2bn in contracts awarded to Capita and Interserve despite both issuing profit warnings.

[Carth]

Makes you wonder how much the 'backhander' was . . and who to

[denphone]

Originally Posted by Carth

Makes you wonder how much the 'backhander' was . . and who to

Being a intelligent man l will leave that to your imagination.

Well no one in Whitehall apparently reads Private Eye because if they did maybe,possibly they could count up how many times Carillion,GS4 and Capita have appeared for providing seriously poor service over and over and over again. So one has to wonder just who does benefit from this government/civil service inability to find anyone remotely good at the jobs provided.

[Carth]

Originally Posted by denphone

Outsourcing firm Interserve in rescue talks.

https://www.theguardian.com/business...-new-contracts

3 months on and the dance continues . . Interserve: Key UK contractor faces crunch vote on rescue plan

https://www.bbc.co.uk/news/business-47575123


General Secretary of the RMT Union, Mick Cash, said bringing the contracts in-house would "avoid a repeat of the Carillion chaos."

"‎Once again we see the reality of bandit capitalism and its toxic impact on our public services. The time has come to end this obsession with the private sector speculators and return to the principles of public services run and owned by the public, free from this corrosive nonsense," he said.

[denphone]

No surprise at all sadly Carth.

[Carth]

Yep, I sometimes wonder about the people that 'invest' in these things . . and whos money they are investing.

I hope it isn't part of my pension plan that's going down that hole . .

[denphone]

Originally Posted by Carth

3 months on and the dance continues . . Interserve: Key UK contractor faces crunch vote on rescue plan

https://www.bbc.co.uk/news/business-47575123


General Secretary of the RMT Union, Mick Cash, said bringing the contracts in-house would "avoid a repeat of the Carillion chaos."

"‎Once again we see the reality of bandit capitalism and its toxic impact on our public services. The time has come to end this obsession with the private sector speculators and return to the principles of public services run and owned by the public, free from this corrosive nonsense," he said.

The die is cast now...

https://www.theguardian.com/business...deal?CMP=fb_gu

[denphone]

Interserve given 'public contracts worth £660m in run-up to collapse'

https://www.theguardian.com/business...up-to-collapse

Interserve, the troubled government contractor which collapsed last week, was handed £660m worth of public contracts in the run-up to going into administration, in an apparent repeat of the Carillion fiasco, the GMB union has claimed.

But as the “new” company starts its first week, the GMB has cited figures from Tussell, a data provider, that show Interserve was handed public contracts worth hundreds of millions of pounds in the run-up to its collapse, despite announcing a series of profit warnings.