Mark Whitehead 16 May 2018

'Recklessness and greed' at heart of Carillion collapse say MPs

Recklessness and greed at heart of Carillion collapse say MPs image

MPs have condemned the demise of outsourcing construction company Carillion as 'a story of recklessness, hubris and greed'.

In a scorching report, two House of Commons committees say the company's board presided over a 'rotten corporate culture', and was to blame for its collapse in January with debts of £1.5bn.

The multi-national had extensive contracts with public sector organisations including schools and local councils which were left to find alternative provision.

The report by the work and pensions committee and the business, energy and industrial strategy committee calls for the big four audit firms to be broken up after they 'waved though' the indebted firm's accounts.

They attack the Government for lacking 'decisiveness and bravery' in tackling corporate regulation failures and call for Carillion's directors to be banned from other company boards.

In their 100-page report, the MPs say the company's collapse exposed systemic flaws in corporate Britain and showed regulators were toothless.

They warn that 'Carillion could happen again, and soon.'

Rachel Reeves, chair of the business committee, today accused Carillion's directors of a 'relentless dash for cash' by taking on low-margin contracts which would not make money.

A Cabinet Office spokeswoman said: 'We have recently announced a number of measures to support government suppliers - strengthening our commitment to prompt payment; protecting staff, businesses and small suppliers from irresponsible directors.

'We welcome the report from the joint select committee and will respond fully in due course.'

Read our feature exploring if there is a crisis in local government outsourcing.

SIGN UP
For your free daily news bulletin
Highways jobs

Head of HR/OD

Babergh & Mid Suffolk
£60,000 circa
The role will involve working closely with the Senior Leadership Team and Chief Executive to lead our People Strategy and... Ipswich, Suffolk
Recuriter: Babergh & Mid Suffolk

School Crossing Patrol Operative x2

Sandwell Metropolitan Borough Council
£17,711 - £18,426 pro rata
You will need to be available for work Monday to Friday during term time. It would be an advantage if you live in... Sandwell, West Midlands
Recuriter: Sandwell Metropolitan Borough Council

Customer Feedback Co-ordinator

Sandwell Metropolitan Borough Council
£34,788 - £39,782 per annum
An Exciting opportunity for a Customer Feedback Coordinator, taking responsibility for the overview and monitoring of customer feedback within the... Sandwell, West Midlands
Recuriter: Sandwell Metropolitan Borough Council

Tutor

Sandwell Metropolitan Borough Council
£25,594 - £29,780 per annum
This position is a Fixed Term Contract covering Maternity Leave until 31 October 2020. Sandwell, West Midlands
Recuriter: Sandwell Metropolitan Borough Council

Site Support Officer

Telford & Wrekin Council
£9.36- £9.55 per hour
For further information on the role please click. Telford, Shropshire
Recuriter: Telford & Wrekin Council

Local Government News

Latest issue - Local Goverrnemnt News

This issue of Local Government News explores what impact the increase to the Public Works Loan Board rate have on councils’ capital schemes and why adopting AI will not just improve customer service response times for councils.

This issue also finds out how local government pension funds are backing infrastructure projects and calls on local government to get better value from its technology spend.

Register for your free magazine