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Scots staff lost pension value after Carillion collapse

written by Bella Palmer
scottish-trades

Scottish Trades Union Congress (STUC) now calls for a public inquiry on Carillion debacle

The construction and services giant Carillion went bust in January 2018, with thousands of workers losing their jobs overnight and 30,000 small businesses loosing £2billion in bills that were never paid.

Despite all of this, every worker lost 10 per cent of their pension value overnight.

Nearly three years on, no one has been held to account for the catastrophe.

The head of the unions in Scotland, the STUC’s Roz Foyer, says it looks like the regulators, who are supposed to police big business and the banks, have turned out to be “lap-dogs, not watchdogs”.

She told the Record: How can it be that nearly three years after Carillion’s downfall, the directors have laughed all the way to the bank and the workers are still waiting for justice. It is a scandal that no one at the top has been held to account.

The STUC (Scottish Trades Union Congress) is now calling for a statutory public inquiry where people called have to give evidence on oath.

It seems this is now the only way the tens of thousands who suffered at the hands of the Carillion directors have a chance of getting the truth and justice, she said.

The SNP’s leader in the House of Commons, Ian Blackford MP, says it is entirely appropriate that the Westminster Business Secretary, Alok Sharma MP, should be pressed to call a public inquiry on the Carillion debacle.

Blackford says it is undeniable that the Carillion directors got rich by plundering the public purse. At the end, they were up to their eyeballs in debt and the collapse was only a matter of time. It’s time Carillion directors were really held to account for the catastrophe they are responsible for.

There are on-going Carillion inquiries by at least three business watchdogs – the Insolvency Service, the Financial Conduct Authority and the Pensions Regulator.

Asked when they would be finished, The Insolvency Service told the Daily Record: The Insolvency Service has a three-year period from the date of insolvency within which to issue disqualification proceedings, should there be evidence of wrongdoing.

The other two said their inquiries were “ongoing”.

A new book, Bandit Capitalism – Carillion and the corruption of the British State – was published this week.

It outlines in detail how several key figures became very wealthy through Carillion before it collapsed leaving workers on the scrapheap.

One “Carillionaire” is former finance director Richard Adam.

In December 2016, he left “to spend more time with his family”. His salary and bonuses for his last year came to £1.1million.

He told a parliamentary inquiry everything was fine at Carillion when he left.

But the first chance he got – in March the next year – Adam flogged his company shares for £535,000. In May 2017, he cashed in further share options for £240,000.

In the July after his shares bonanza, Carillion declared there was an £845million hole in the books. By the end of that year, it had become a £1.2billion hit on what the company was supposed to be worth.

The Carillion directors, including Adam, told the UK Parliament that no one could have seen it coming.

When the Carillion ship eventually went down, there was £29million in the bank and total debts of £6.9billion.

GMB leader in Scotland Gary Smith recalls that on January 15, 2018, when he heard Carillion had collapsed, he thought thousands of jobs would go, the taxpayer would have to foot the bill and “the top people will walk away without a hair on their head out of place”.

However, Carillion isn’t a one-off.

In March 2019, Interserve, the construction and services company, collapsed into administration with debts of £735million and a hole in its accounts touching £100million.

Interserve Accounts showed the salaries of the top two directors, Debby White and Mark Whiteling, totalled £1.3million between them, on top of £656,000 bonuses.

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