The official receiver in charge of the remains of collapsed government contractor Carillion has announced 452 former staff will be made redundant.
It is the second wave of redundancies to be confirmed and takes the number of job losses to 829 from a 19,500-strong UK workforce. Small businesses have expressed concern that more could follow in Carillion’s sprawling supply chain.
The receiver, part of the Insolvency Service, has found new employers for 100 more staff who were working on private sector contracts, taking the number of jobs saved so far to 1,019.
The latest update comes the day before seven former Carillion directors give evidence to a committee of MPs about how a company with billions of pounds worth of contracts announced a profit warning in July and was in liquidation by the end of the year.
Witnesses include the former chief executive, Richard Howson, who stepped down after the July profit warning, and the ex-chairman, Phillip Green, an adviser to Theresa May on corporate responsibility.
Weeks after the company’s failure, 17,562 former Carillion staff are yet to learn of their future.
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
Hundreds have been temporarily transferred to other employers to ensure they continue to be paid and to keep vital public services running.
The receiver said the latest jobs to be saved were in the public sector, while those being made redundant are “connected with private and public contracts across different parts of the country, as well as back-office functions”.
Carillion relies on major contracts, some of which have proved much less lucrative than it thought.
Earlier this year it slashed the value of them by £845m, of which £375m related to major public-private partnerships (PPPs) such as Royal Liverpool University hospital.
As its contracts underperformed, its debts soared to £900m.
The company needed a £300m cash injection, but the banks that lent it money refused to put more in.
The government also refused to step in and bail the firm out.
That left the company unable to continue trading and forced it to go into liquidation.
“We appreciate this will be a difficult time for those who have lost their jobs,” said a spokesperson.
“Jobcentre Plus’ rapid response service stands ready to support any of these employees by providing advice and information so people can move into a new job as quickly as possible.
“People who have been made redundant will also be entitled to make a claim for statutory redundancy payments.
“Our efforts are focused on the smooth transfer of Carillion’s contracts to new providers and we will continue to keep Carillion’s workforce updated as these arrangements are finalised.”
