Union boss says ministers have a duty to help firms caught up in Carillion crisis

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Thousands of jobs hang in the balance as the fall-out from the dramatic collapse of construction giant Carillion continues to cast a long shadow over the industry.

Those who are owed money by the business, which went into liquidation at the start of the week, have not been convinced that ministers are doing enough to safeguard those whose fortunes are so closely linked to Carillion’s.

Earlier this week Downing Street sought to reassure businesses and the Insolvency Service has been tasked with examining Carillion’s many contracts – to gauge the likely impact.

A spokesperson said: “Over the past 48 hours all of the company’s private sector service customers have been contacted to determine their ongoing needs.

“The Official Receiver is very pleased with the level of support shown by Carillion’s private sector service customers.”

But trade unions suggest that suppliers will be inexorably dragged into difficulties by the company’s collapse and, indeed, it has been reported that some firms have already started to make redundancies.

Tim Rochard, General Secretary of the GMB trade union, said there was still considerable uncertainty.

“Ensuring most workers get paid beyond today doesn’t go nearly far enough to give the reassurance our members need right now,” he said.

“We need proper guarantees that they will not be left in the lurch and unable to pay the bills within days due to a crisis they did not cause.

“Without assurances as to how long wages are secure for and who will be running these contracts given the company’s spectacular failure, this is not going to help Carillion workers sleep easier tonight.”

Gail Cartmail, Assistant General Secretary of Unite, argued the Government has “a moral duty” to provide direct financial assistance and related support to shore up those sub-contractors and suppliers affected.

The Business Secretary, Greg Clark, was reported to be meeting with banks this morning to urge institutions to ensure that SMEs caught up in Carillion’s demise were given sufficient leeway.

Insolvency accountant Gibson Hewitt can offer expert advice to businesses on a range of issues. For further details about our services please contact us.