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Carillion: More jobs go but 10,000 have now been saved

By Simon Penfold | Business | Published:

Another two dozen Carillion workers are facing redundancy this week, but the number of jobs saved since the company’s collapse has now topped the 10,000 mark.

Around 200 people are still working at Carillion's Wolverhampton head offices as the long drawn out liquidation process continues

A further 179 former Carillion staff have been transferred to new employers taking over contracts from the failed Wolverhampton-based construction and services group.

But 23 have been told they are “no longer required” and will lose their jobs this week.

So far 10,125 jobs have been saved and 1,825 jobs have been made redundant through the liquidation. The future of more than 5,000 former Carillion staff still hangs in the balance, including more than 200 still working at the company’s headquarters in Wolverhampton.

The city centre office block itself, which was owned by a private property company, is now up for sale for around £3 million.

A spokesperson for the Official Receiver said today: “More than 10,000 of Carillion’s pre-liquidation workforce have now found secure ongoing employment, following the transfer of 179 staff to new employers.

“Regretably 23 employees whose positions are no longer required as Carillion’s business transfers to new suppliers will leave the business later this week.

“I am continuing to talk with potential purchasers for Carillion’s remaining contracts and will keep staff, elected employee representatives and unions to keep them informed as these arrangements are confirmed.”

The totals of jobs saved and lost does not include those attached to contracts where a potential buyer has declared an intention to purchase but the deal has yet to be formally sealed.

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Carillion had 450 contracts with Government departments and the public sector, from school meals and cleaning prisons to maintenance of thousands of Armed Forces homes and sites across the UK.

It also had hundreds more private sector contracts, including its work on the £700m Paradise Birmingham redevelopment. That contract has now been taken over by construction group BAM.

But work remains at a standstill at the Midland Metropolitan Hospital at Smethwick, where Carillion had been employing 70 people. All the company staff on the £350m Midland Met project have lost their jobs since Carillion was put into compulsory liquidation by the Official Receiver in January.

Talks are understood to be going on with a possible new contractor but no deal has yet been sealed and the future of the hospital – two thirds complete – remains under a cloud.

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The 5,000 employees who are currently being kept on by PwC – the accountants acting as special managers for the Insolvency Service to run the wind-up of Carillion – have been retained to enable the business to keep delivering the remaining services it is providing for public and private sector customers until decisions are taken to transfer or cease these contracts.

Meanwhile Britain's big four accountancy firms will face fines of up to £10 million as part of new regulatory powers aimed at clamping down on "seriously poor audit work".

The changes comes amid mounting criticism of the Financial Reporting Council (FRC) regarding its oversight of the accounting profession following the collapse of construction firm Carillion.

MPs savaged the big four and accused them of "feasting on the carcass" of Carillion by collecting more than £70 million in the decade before its demise.

KPMG, PwC, Deloitte and EY make up the four biggest accountancy firms in the UK.

New rules governing auditors, accountants and actuaries will see rogue operators excluded from the profession for a minimum of 10 years for dishonesty, greater use by the FRC of non-financial penalties and the imposition of sanctions that "reflect the level of co-operation by respondents".

The most stringent change is an increase in fines to "£10 million or more for seriously poor audit work by a Big 4 firm".

Simon Penfold

By Simon Penfold
Business Editor - @SPenfold_star

Business Editor based at the Express & Star's head office in Wolverhampton, looking for stories big & small.

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