Government must intervene to prevent huge job losses following Carillion collapse

Unite, the UK’s largest union, is calling on the government to take immediate and decisive action to prevent further job losses following the collapse of Carillion.

Government support should include direct financial support for sub-contractors and Carillion’s supply chain that have been left with huge financial losses due to the company’s collapse.

Unite assistant general secretary, Gail Cartmail, said: “The government needs to stop passing the buck, it can’t sit idly by and allow companies to go to the wall.

“The government has a moral duty to provide direct financial assistance as well as other support in order to ensure that sub-contractors and suppliers don’t needlessly go to the wall, with thousands of workers potentially losing their jobs.

“Pressure also needs to be applied to the banks, to give breathing space to affected sub-contractors so that they can continue to operate. The banks were bailed out when they were in trouble and similar support needs to be given to companies affected by Carillion’s collapse.”

Since Carillion was placed into liquidation on Monday (15 January), it has emerged that the company owed in excess of £1 billion to 30,000 subcontractors. They have been told by the administrators that they will receive just 1p in the pound on money owed before the company went under.

It has also emerged that at least £1 billion worth of Carillion construction projects have been stopped, with absolutely no certainty when this work will restart.

Unite is also calling on construction clients to take action to minimise the damage suffered by construction sub-contractors, by ensuring that contracts are restarted as swiftly as possible and that sub-contractors previously employed on stalled sites are guaranteed work when construction projects are restarted.

Gail Cartmail added:

“Construction clients were happy to accept the lowest bids tabled by Carillion and now have a moral imperative to ensure that the damage done to sub-contractors as a result of these actions is minimized. If decisive action is not taken by the government and clients, then thousands of workers employed by sub-contractors and in its supply chain face losing their jobs, with vital skills and expertise being lost from the industry.”