Outsourcing after the collapse of Carillion "dizzying", unions say business

Unions have accused the government of not having learned lessons from the collapse of Carillion, and instead of getting more money pumped into outsourcing companies, a year after the company's high-profile demise.

The lifetime value of outsourcing contracts awarded in 2017/18 increased by 53% from £ 62bn to £ 95b last year, according to the GMB union, which is close to £ 2bn Contracts to Capita and Interserve pointed out, although both issues were awarded profit warnings.

The GMB said that this demonstrates a government "hellish" attitude in privatization, despite the warning signals given by the collapse of Carillion, which manages public procurement to provide services such as prison maintenance and school lunches.

GMB Secretary of State Rehana Azam said, "What other explanation is there for the huge increase in outsourced contracts in the year Carillion went bankrupt and when other outsourcing giants look like they need a livelihood?"

Commenting on the GMB's criticism of the first anniversary of Carillion's failure, it cost the taxpayer an estimated £ 150 million and significantly delayed £ 2 million worth of hospital construction in Liverpool and Birmingham.

Unite, Britain's largest union, lamented the lack of action against the former Carillion directors, who were accused by a committee of "ruthless, hubris and greed" MPs, and called for a criminal investigation.

Unite Deputy Secretary-General Gail Cartmail said: "It is amazing that one year after the biggest corporate failure in the history of the modern United Kingdom, the government has acted as if it were normal.

"The fact that no one involved in Carillion has been against them shows either that regulators are failing to perform their duties or that existing laws are too weak. When it comes to the latter, we need better, stricter laws.

"One year after the collapse of Carillion, the government must stop flogging and take effective measures to displace the capitalism of British bandits. "

The Government has taken measures to encourage companies in charge of major public sector contracts to set up "Living Wills" to ensure the smooth operation of the services they provide in the event of financial failure.

However, Unite said that the measures did not go far enough to reform the public procurement system.

A spokeswoman for the Cabinet Office, which managed the outsourcing of public contracts and had been criticized for its role in managing the bust of Carillion, said the government had taken steps to prevent it from happening again.

She said, "This government has made great efforts to improve cooperation with the private sector, including requiring companies to provide immediate payment to suppliers and testing vital contracts for critical contracts so that contingency plans can be established quickly when needed can . "

The Financial Watch Council (FRC), which has been criticized by MPs for having made the audits of Carillion companies, including KPMG, "chronically passive," is still investigating the circumstances of their failure.

The Bankruptcy Service, a branch of the Business, Energy and Industrial Policy Department, is also investigating the matter and began interviewing former directors of the company last year.