Carillion Collapse: One Year On

January 20, 2019

One year on from the collapse of Wolverhampton based construction and outsourcing firm Carillion, and former senior managers, along with the accountants who covered up the extent of the company’s problems, are still laughing all the way to the bank. Meanwhile taxpayers are forced ot pick up the £150m plus tab resulting from Carillion’s insolvency, with hospital construction projects in Smethwick and Liverpool delayed even further thanks to the Tories’ and Blairites failed strategy of privatisation.

Below we republish a recent article from The Socialist, newspaper of The Socialist Party, describing the extent of the scandal.

The story of the catastrophic collapse of Carillion took an even more shocking turn recently.

It has emerged that the private construction giant’s two flagship projects – the Midland Met Hospital in Sandwell and the Royal Liverpool University Hospital – went ahead without any oversight whatsoever from the industry watchdog, the Infrastructure and Projects Authority.

Even more outrageously, the Guardian reported last week that this complete lack of accountability happened after senior civil servants working for Jeremy Hunt when he was health secretary in 2015, successfully lobbied the Cabinet Office to specifically exempt the hospitals’ construction from public oversight.

In other words, Hunt and the Tories trashed the rulebook to make sure that their fat-cat pals in Carillion could do whatever they wanted with our hospitals without us knowing anything about it. No wonder the Carillion crisis has demonstrated some of the worst consequences of privatisation and capitalism.

The much delayed Midland Metropolitan Hospital in Smethwick, a victim of the collapse of Carillion

For masterminding its demise, Carillion’s former CEO Richard Howson got a hand-out of £688,000 plus a benefits package for a year after he left. And the interim CEO has been on an even higher salary of £750,000.

Meanwhile, over 2,000 workers have lost their jobs, construction of the much-needed hospitals remains at a complete standstill and the taxpayers are set to foot the £150 million bill to kick-start construction.

Carillion has also had to apologise for disgracefully blacklisting its workers for trade unionism.

This latest revelation rubs salt in the wound and shows how the bosses’ representatives in government and big business will always collude to exempt themselves from any rules that limit their reckless exploitation and profiteering. They cannot be trusted for a minute longer.

We need a different system now, not when the current contracts expire. We need to nationalise the major construction companies, with compensation paid only on the basis of proven need, i.e. not to the fat cats.

Only a socialist society – based on democratic workers’ control and management of all major industry – will be able to put these injustices right for good.

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