Theresa May's Cabinet meets as it faces scrutiny over Carillion collapse

Theresa May's Cabinet meets as it faces scrutiny over Carillion collapse

Carillion has many contracts with the Government

Tuesday, January 16, 2018

Theresa May's Cabinet is meeting today (January 16) as the fallout from the collapse of building giant Carillion continues to reverberate through Government.

Top executives face investigation after the firm's demise put thousands of jobs at risk and the Government has been heavily criticised for its role in the debacle.

Jeremy Corbyn has said Carillion's collapse is a "watershed moment" which should bring an end to "rip-off privatisation" of public services.

However cabinet office minister David Lidington has said efforts to deal with the crisis had "gone pretty well" after attending a meeting of the Government's emergency planning committee Cobra yesterday (January 15).

He said: "The message today was that day one had gone pretty well, people were turning up to work, we had not had reports of any serious disruption to service delivery.

"But we also had a report from PwC, who are working as the special managers for the official receiver [the civil servant tasked with overseeing the bankruptcy proceedings], that took us through the advice they are providing to concerned employees and contractors on their website and through their helpline.

"And it was an opportunity for ministers just to test what is going on, what sort of concerns are being expressed and to decide how we should best address those and provide the reassurance people want."

A last-ditch plea from Carillion to the Government to provide it with a £20 million lifeline fell on deaf ears over the weekend, triggering a compulsory liquidation to be overseen by PwC.

Carillion has public sector or public/private partnership contracts worth £1.7 billion, including providing school dinners, cleaning and catering at NHS hospitals, construction work on rail projects such as HS2 and maintaining 50,000 army base homes for the Ministry of Defence.

The group, which employs around 20,000 British workers, has been struggling under £900 million of debt and a £587 million pension deficit.