Once again the mystic eye is pointed at management. It appears that nowadays we have a bunch of numpties drawing large salaries but without any real experience and knowledge. Doing a management course at the the local college does not make you a manager.
Dear god when will British Industry learn.
I see from the BBC that Mick Cash is calling for Carillion staff working on rail projects to be transferred to Network Rail, if Carillion fails.
A JV at least usually gives time to sort out refinancing without everything collapsing in the mean time and also issues are usually reported earlier in a JV.Unfortunately it gets a little complicated if a partner gets into financial difficulty - specifically with regard to liquidity and solvency related clauses that would have implications for the JV not just the party that falls into difficulties.
This is a major issue for the UK cutting across numerous government departments.
The immediate problem has debt servicing costs at it's root; something I expect we will see hitting other rail business that have been making over optimistic assumptions in this area - including possibly two or three of the recent new franchises.
Interesting that once again Euler Hermes is involved - something like the fifth time it has been mentioned in connection with a business going under in the last month or so.
And £0.5bn on a middle east contract.Losses in its "construction services" division in the UK and Canada.
My perception is that the rail business is not involved, though you never know how much cross-subsidisation is going on.
Although they won some HS2 work, the NR cutback on renewals and electrification can't help.
The irony is that Carillion bid for Balfour Beatty when BB were in trouble, and although the bid was rebuffed, they picked up several BB rail contracts.
Now the boot seems to be on the other foot.
Carillion are due to build (with others) the middle section of HS2 northwards from the Chiltern Tunnel portal.
The BBC are very late to the party, it has been looking bad for 18 months (if you read the FT) so the BBC are now running to catch upThe BBC are making much of the HS2 contracts, but Carillion is one of 3 CEK JV contractors working on 2 mid-section packages out of the 7 contracts let.
This is the stretch between the Chiltern and Long Itchington tunnel portals (which includes the East-West route crossing and connections).
So the exposure to Carillion alone is around 8% of the overall contract, and the other partners have said they will cover any Carillion default.
They are not involved in any of the tunnelling works which are the ones which start early, so it's by no means critical yet.
They are of course involved in existing electrification projects, notably the MML Bedford-Corby line and the EGIP Shotts route in Scotland.
These are joint ventures with SPL Powerlines of Austria.
They also have some role in the Manchester-Blackpool scheme, but they are not the only electrification contractors.
The BBC reports on the situation seem to be increasingly doom-laden.
A JV at least usually gives time to sort out refinancing without everything collapsing in the mean time and also issues are usually reported earlier in a JV.
There is a reason Euler Hermes are the biggest credit insurers, they are very good at knowing when to call time
No they haven't, that is CarillionAmey which is a separate legal entity. They also haven't failed in their maintenance of accommodation of military personnel. It is much more complicated than that. I would love to hear about the substandard work by the way because it is done by lots of subcontractors also used throughout the country by other companies (ISS, Mitie etc).They have also failed on their maintenance of accommodation of military personnel. Sub-standard work. I would n't mind seeing HS2 go up the wall, though
Plenty of contractors waiting in the wings to take over. If they go into administration that’s when the competitors will start placing their bids. No one in their right mind would take them over as a going concern not with all their debt and liabilities.
Unfortunately it will be another case where the good are brought down by a mess they didn't create. In Scotland I think they have been in charge of the Shotts line Electrification, and as far as I am aware that is progressing without hiccups.
HMRC wont get paid first as they are no longer a preferential creditor, they have to take their chances with all of the other creditors.
That's right they Will.Whether or not HMRC have priority over other creditors, they are the ones most likely to take a company to court if VAT or PAYE does unpaid for too long and if the court decides the company is insolvent they'll place it in to administration.
Correct, but HMRC are not quick on the trigger in my experience,they will allow time for a solvent solution for as long as that seems a realistic option.That's right they Will.
If the government start paying direct, the only guarantee is that they will pay more in the end.Well the contractors/suppliers I would hope, get paid direct by the banks/government rather than the middleman.
Yes, atrociously. My claims are dealt with an average of four months after submission. Completely inadequate.They even run the Delay Repay for Northern in Sheffield. Very badly in my experience.
The BBC are very late to the party, it has been looking bad for 18 months (if you read the FT) so the BBC are now running to catch up
Which seems to the the sole thing keeping May from dumping it. The phrase "cut your losses while you can" springs to mind. If it resulted in a lot of people being permanently barred from holding public or private office ever again, I wouldn't say that it was all for nothing.I wouldn't smile about that prospect. "IF" HS2 goes up the wall in those circumstances, a lot of taxpayers money would also have gone up the wall with nothing to show for it.
Construction giant Carillion has gone into liquidation, threatening thousands of jobs.
The move came after talks between the firm, its lenders and the government failed to reach a deal to save the UK's second biggest construction company.
Carillion ran into trouble after losing money on big contracts and running up huge debts.
Its failure means the government will have to provide funding to maintain the public services run by Carillion.
Looks like you the taxpayer will be paying for that dividend they paid out in May as they were obviously so flushed.
Looks like you the taxpayer will be paying for that dividend they paid out in May as they were obviously so flushed.
Compulsory liquidation too which means the financials are truly horrific.
Upto £900million in debt
Net worth -£968.2 million
Now being reported by BBC & ITV. The political mudslinging has already begun with some labour person on BBC putting the boot in.