600 days since Carillion’s collapse hospitals remain unbuilt and guilty unpunished
- Monday 2 September 2019
This week (Friday 6 September) marks 600 days since the collapse of Carillion on 15 January 2018 when the construction and outsourcing giant was forced into compulsory liquidation with liabilities of £7 billion and thousands of workers lost their jobs. Yet no action has been taken against the company’s directors or senior managers responsible for its collapse.
Government 'business as normal'
As a result Unite, the UK and Ireland’s largest union has criticised the government for a ‘business as normal approach’ and the failure of action to be taken against the guilty.
This is despite several regulators launching investigations into the circumstances of the company’s collapse.
The Official Regulator is undertaking an investigation into whether there was any criminal wrongdoing by Carillion’s directors prior to the company’s collapse. The investigation is not expected to be completed until early 2021.
Meanwhile the Financial Reporting Council is undertaking several investigations into the company’s financial reporting and the accuracy of its auditing processes. No date has been given to when this investigation will be concluded.
At the same time Carillion’s two flagship hospital projects the Royal Liverpool hospital and the Midland Metropolitan hospital are years behind schedule with work not yet restarted or only just getting underway.
The Royal Liverpool hospital was originally due to be completed by March 2017 and was officially 85 per cent complete when Carillion collapsed. However since then it has emerged that there were serious structural problems with the hospital’s concrete beams and the cladding on the building was a fire risk.
No Completion date
Work on the hospital only began to restart in July and the local NHS Trust is no longer prepared to provide an estimate of a completion date or when the hospital will be operational.
The Midland Metropolitan hospital being built in Smethwick in the West Midlands was half built when Carillion collapsed. The hospital was due to be completed by October 2018. The contract to renew construction work remains unsigned although it is expected that Balfour Beatty will undertake the work. The hospital will not be finished before late 2021.
Workers who lost their jobs following Carillion’s collapse are also seeking justice for the failure of the company to consult them before making them redundant. Unite is representing around 220 of these workers and the employment tribunal case which is being vigorously defended by the Official Receiver is scheduled to be heard in late 2020.
Lessons not learned
Unite assistant general secretary Gail Cartmail said: “As we approach 600 days since the collapse of Carillion it is totally apparent the government has failed to learn any lessons from this debacle.
“The guilty directors and senior managers remain unpunished and are free to pursue new lucrative roles while the innocent workers have a long battle ahead of them in their battle to secure compensation in the courts.
“Flagship hospital projects are years away from being completed, meanwhile patients and staff have been left to struggle on in facilities that are no longer fit for purpose.
“Government ministers have clearly washed their hands of the whole mess and now pretend it is no longer their problem.
“It is quite clear that their needs to be a root and branch reform of company law to prevent similar collapses in the future and the creation of effective regulators with real teeth who are able and willing to tackle bandit capitalism.”
Notes to editors:
- Earlier this year Unite published the report Ending Bandit Capitalism: Learning the lessons following Carillion’s collapse which contains 22 recommendations of reforms needed following the company’s collapse.
For more information please contact Unite communications officer Barckley Sumner on 020 3371 2067 or 07802 329235. Email: [email protected]
- Unite is Britain and Ireland’s largest union with members working across all sectors of the economy. The general secretary is Len McCluskey.