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Carillion To Go Into Liquidation
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1000's of jobs at risk....I wonder if this will finally kill off HS2 ?
1000's of jobs at risk....I wonder if this will finally kill off HS2 ?
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// Cassa........who wants a bet that Carillion paid its executives £m's, right up until the last minute ? //
FAO Mikey, see below..
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FAO Mikey, see below..
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It may be anecdotal (ie just my personal experience) but all my dealings with Carillion employees have been defined by a callous disregard for anyone except themselves.
This includes patronising and offhand replies to polite enquiries about the impact of work being done on HS2 (from both 'Customer Service' and board level contacts) and ghastly rudeness from their staff working on a couple of other railway projects when asked to have more consideration for other people using the local road network.
I'm not surprised they went broke - arrogance and incompetence should have that result.
I'm glad they weren't bailed out, I hope a lot of banks/investors lose a lot of their speculative investments (many of which were only made because they thought Carillion was 'too big to fail').
I hope that as much as possible of the work that still needs to be done is brought under Government control and the private profit element is stripped out of the costs.
This includes patronising and offhand replies to polite enquiries about the impact of work being done on HS2 (from both 'Customer Service' and board level contacts) and ghastly rudeness from their staff working on a couple of other railway projects when asked to have more consideration for other people using the local road network.
I'm not surprised they went broke - arrogance and incompetence should have that result.
I'm glad they weren't bailed out, I hope a lot of banks/investors lose a lot of their speculative investments (many of which were only made because they thought Carillion was 'too big to fail').
I hope that as much as possible of the work that still needs to be done is brought under Government control and the private profit element is stripped out of the costs.
//1000's of jobs at risk//
Nothing like a bit of dramatic posturing is there? In reality there will be some jobs left but the vast majority of people will remain employed doing pretty much the job they are doing now. The Liquidators will try to recoup as much as possible by moving/selling contracts to others. The problem will be the same as the Government had, there are really not that many companies capable of taking on such big pieces of work.
//I wonder if this will finally kill off HS2 ?// No, why would it? Along with other funded projects the money will be shifted to another company to do the work.
It does appear the directors have a clawback clause in their personal contracts for pay and bonuses so it would appear the Liquidator should be able to recover a small amount. I wont hold my breath but I do hope they will do something.
The Government is 100% correct not to bail out, it sends an excellent message to other companies.
I too will be looking to understand why civil servants were still dishing out contracts to this company given the profit warnings. However I do strongly suspect they will come back with the fact there a few companies to do the work.
Nothing like a bit of dramatic posturing is there? In reality there will be some jobs left but the vast majority of people will remain employed doing pretty much the job they are doing now. The Liquidators will try to recoup as much as possible by moving/selling contracts to others. The problem will be the same as the Government had, there are really not that many companies capable of taking on such big pieces of work.
//I wonder if this will finally kill off HS2 ?// No, why would it? Along with other funded projects the money will be shifted to another company to do the work.
It does appear the directors have a clawback clause in their personal contracts for pay and bonuses so it would appear the Liquidator should be able to recover a small amount. I wont hold my breath but I do hope they will do something.
The Government is 100% correct not to bail out, it sends an excellent message to other companies.
I too will be looking to understand why civil servants were still dishing out contracts to this company given the profit warnings. However I do strongly suspect they will come back with the fact there a few companies to do the work.
"will it kill off HS2"?
on its own, no. the contract with which Carillion is involved is a Joint Venture (with Eiffage and Kier, among others). it was let to try and reassure Carillion backers, but has been structured so that Carillion's partners take on their share, if they were to fail.
a more effective way of killing HS2 would be the exchequer's plan to end the tax discount afforded to the users of "red" diesel, including the railways. this will effectively kill off the rail freight sector and provide the extra capacity the rail network is so desperately short of.
on its own, no. the contract with which Carillion is involved is a Joint Venture (with Eiffage and Kier, among others). it was let to try and reassure Carillion backers, but has been structured so that Carillion's partners take on their share, if they were to fail.
a more effective way of killing HS2 would be the exchequer's plan to end the tax discount afforded to the users of "red" diesel, including the railways. this will effectively kill off the rail freight sector and provide the extra capacity the rail network is so desperately short of.
Ludwig.....a phrase with Pigs and Troughs and Snouts comes immediately to mind.
YMB....I agree that the Government shouldn't bail out Carillion, but as lots of the jobs are in the public sector, that may have to, in the interim at least. The Pension Protection Scheme is going to have take a big hit, as existing pensioners will need bailing out. A bit tough on the members of the various Pension Schemes that have yet to retire though.
Let the shareholders take a hit and how about getting some of that bonus back from the fat cats ?
YMB....I agree that the Government shouldn't bail out Carillion, but as lots of the jobs are in the public sector, that may have to, in the interim at least. The Pension Protection Scheme is going to have take a big hit, as existing pensioners will need bailing out. A bit tough on the members of the various Pension Schemes that have yet to retire though.
Let the shareholders take a hit and how about getting some of that bonus back from the fat cats ?
//Let the shareholders take a hit//
bear in mind that not all shareholders fall into the category of "fat cats" - the company I work for took on a loss making carillion subsidiary about 10 years ago. they TUPE-ed, their pensions were transferred but many kept their shares - representing a retirement nest egg for many. if they're lucky, they might get 1p in the pound back.
bear in mind that not all shareholders fall into the category of "fat cats" - the company I work for took on a loss making carillion subsidiary about 10 years ago. they TUPE-ed, their pensions were transferred but many kept their shares - representing a retirement nest egg for many. if they're lucky, they might get 1p in the pound back.
Indeed, not all shareholders are filthy rich “fat cats”.
Many small investors – trying to get a decent return in excess of the ludicrously low (and economically unwise) cash interest rates - have seen a chunk of their savings go down the kharzi as a result of this. Carillion shares had already shed more than 90% of their value in the last year so there was not much left for them to lose.
This event will not have the slightest impact on HS2 (any more than it will on the prisons and schools for which Carillion was responsible). Work on HS2 is already well advanced and the other contractors involved will take on the work. I find it strange that critics of the government who harp on that it provides no stimulus for economic growth also complain when it facilitates a project that is due to cost around £50bn.
Apart from the line to the Channel Tunnel (HS1, which opened 13 years after the tunnel whilst France had theirs all ready before the tunnel began operations) the UK has not seen a significant main line railway built since 1900. This is an appalling indictment when considered against the economic and social expansion that has taken place in that time. HS2 is about far more than just “…bringing Birmingham a few minutes closer to London”. It is a major infrastructure project that is designed to increase the rail capacity between the north and south of the country, which is currently under chronic strain. When the motorways were built in the 1960s they were not built to lop off a few minutes of driving time between major cities. They were built to increase the road capacity. Nobody thought otherwise and so it should be with HS2.
Many small investors – trying to get a decent return in excess of the ludicrously low (and economically unwise) cash interest rates - have seen a chunk of their savings go down the kharzi as a result of this. Carillion shares had already shed more than 90% of their value in the last year so there was not much left for them to lose.
This event will not have the slightest impact on HS2 (any more than it will on the prisons and schools for which Carillion was responsible). Work on HS2 is already well advanced and the other contractors involved will take on the work. I find it strange that critics of the government who harp on that it provides no stimulus for economic growth also complain when it facilitates a project that is due to cost around £50bn.
Apart from the line to the Channel Tunnel (HS1, which opened 13 years after the tunnel whilst France had theirs all ready before the tunnel began operations) the UK has not seen a significant main line railway built since 1900. This is an appalling indictment when considered against the economic and social expansion that has taken place in that time. HS2 is about far more than just “…bringing Birmingham a few minutes closer to London”. It is a major infrastructure project that is designed to increase the rail capacity between the north and south of the country, which is currently under chronic strain. When the motorways were built in the 1960s they were not built to lop off a few minutes of driving time between major cities. They were built to increase the road capacity. Nobody thought otherwise and so it should be with HS2.
//Indeed, not all shareholders are filthy rich “fat cats”.
Many small investors – trying to get a decent return...b- have seen a chunk of their savings go down the kharzi as a result of this. //
I'm one such "thin cat". I bought £5,000 worth of Carillion shares about three years ago for future income. Heigh-ho.
Many small investors – trying to get a decent return...b- have seen a chunk of their savings go down the kharzi as a result of this. //
I'm one such "thin cat". I bought £5,000 worth of Carillion shares about three years ago for future income. Heigh-ho.
"I'm one such "thin cat". I bought £5,000 worth of Carillion shares about three years ago for future income."
Bad luck, v_e. About the same time ago - four years ago in fact - I had some spare dosh to invest and I ventured into the infrastructure sector. I tossed up between Carillion and Balfour Beatty. I chose Balfour (for no other reason than I thought they represented better value). I endured them halving in value to about £1.50 and also saw them stave off a takeover bid from Carillion about 12 to 18 months ago. Lucky old me. I'm back to about evens now and hope to make a few bob if BB manage to pick up some of the slack created by this latest fiasco (although they have taken a hit today as they will have to fund some of the joint ventures they were in with Carillion). It's certainly not all beer and skittles for us cats who are not quite so fat.
Bad luck, v_e. About the same time ago - four years ago in fact - I had some spare dosh to invest and I ventured into the infrastructure sector. I tossed up between Carillion and Balfour Beatty. I chose Balfour (for no other reason than I thought they represented better value). I endured them halving in value to about £1.50 and also saw them stave off a takeover bid from Carillion about 12 to 18 months ago. Lucky old me. I'm back to about evens now and hope to make a few bob if BB manage to pick up some of the slack created by this latest fiasco (although they have taken a hit today as they will have to fund some of the joint ventures they were in with Carillion). It's certainly not all beer and skittles for us cats who are not quite so fat.
NJ, and others. That is the choice that you made, by purchasing shares in Carillion. Shares are always a gamble.
But the point being is that our Governments ( of both political persuasions) shouldn't be giving out valuable public sector contracts to any company, let alone ones that are in financial difficulty as Carillion were.
But the point being is that our Governments ( of both political persuasions) shouldn't be giving out valuable public sector contracts to any company, let alone ones that are in financial difficulty as Carillion were.
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