The UK government is to bring in tougher contract terms for outsourcers following the collapse of Carillion earlier this year, according to reports.
Carillion went bust in January after racking up large debts and losing money on contracts, which included building part of the HS2 high speed railway line and providing 32,000 school meals every day.
READ: Carillion collapse confirmed
Its demise left the government scrambling to find alternate option to cover the services which Carillion should have provided.
To avoid that happening again, MPs want to force those doing critical work for government departments to provide a “living will” agreement that would pass their work on to another supplier in an emergency.
Reuters also reported that the government will demand a number of key performance indicators be published, such as how much the contractor has paid suppliers, delivery times and feedback from customers.
The idea is to make taxpayer-funded services more transparent.
It’s not just Carillion that has struggled in recent years, fellow outsourcers Capita PLC (LON:CPI) and Mitie Group PLC (LON:MTO) have had to deal with stringent private and public sector budgets which has squeezed margins.