Scottish unions renew calls for public inquiry into the Carillion scandal despite last ditch Government moves to ban 8 former directors. STUC General Secretary, Roz Foyer, says legal action ‘perilously late for sanctions on the former directors ’ which exposes current system of business regulation as ‘totally unfit for purpose’.
On Wednesday 13th the Insolvency Service, which handled the Carillion liquidation, announced that the Business Secretary, Kwasi Kwarteng MP, had launched legal proceedings to disqualify 8 former Carillion directors on the grounds that they were “unfit to manage a company”. The action includes former chief executives Richard Howson and Keith Cochrane and the former finance chief Richard Adam. All the directors could face bans of between 2 and 15 years if the court action is successful.
Roz Foyer, STUC General Secretary stated:
“The Government legal action is to be welcomed. However it is perilously late for sanctions to be taken against former directors. The three year anniversary of the Carillion collapse falls on Friday 15th which is also the deadline for legal action”.
She added: “The three years of silence on Carillion was beginning to look like yet another business cover-up with no-one held to account for the Carrillion catastrophe. The Establishment have a way of circling the wagons in times of crisis. For once, at some point in the future, the relentless looting of government contracts by big business, combined with fiddling the books to cover that up, faces possible legal penalty”.
But the STUC says that the eleventh hour legal moves against the former directors, after three years, exposes the entire system of business control and regulation as ‘unfit for purpose’. It appears that the auditors who signed off Carillion’s accounts for decades, the pension regulators who did nothing about the huge pension deficit, and the Government ministers involved, will all escape sanction. Hence the STUC today renews its calls for a public inquiry.
Roz Foyer said “The STUC is calling for a statutory public inquiry where people who appear have to give evidence on oath. That’s the only chance we have of getting to the truth of what really happened at Carillion. As well as the directors who looted the company for tens of millions facing sanctions, the auditors who permanently looked the other way when the balance sheets became financial fiction, the Regulators who collaborated in cover-ups and the Government ministers who did nothing still have to answer for Carillion. That’s the road to justice for those who have paid the price for what happened.”
In January 2018 Carillion, the construction giant and outsourcer of huge government construction and services contracts, went bust. Thousands upon thousands of jobs were lost on sites the length and breadth of Britain. Thirty thousand small businesses in Carillion’s supply chain, were left out for £2 billion they were owed. In its final accounts Carillion had a turnover of £5 billion. But when it cratered to disaster there was only £29 million left in the bank. The total losses were just south of a staggering £7 billion. Reparations to the deficit on the workers’ pension fund according to a parliamentary inquiry cost the taxpayer £2.6bn.