Sign up United Kingdom
Proactive Investors - Run By Investors For Investors

Carillion collapse set to cost taxpayers £150mln, new document reveals

A unit of the Insolvency Service is expected to fork out a further £15mln in redundancy payments to former Carillion employees
Carillion entered compulsory liquidation in January

The collapse of construction firm Carillion is set to cost taxpayers more than £150mln as it emerged that redundancy payments are expected to reach £65mln.

Carillion entered compulsory liquidation in January under a £1.5bn debt pile after it failed to secure a rescue deal with lenders or the government.

READ: Former UK auditor general slams government for handing Carillion "so much work"

A unit of the Insolvency Service has made £50mln in redundancy payments to Carillion workers so far and expects to fork out a further £15mln, according to a freedom of information request by the Unite union.

That comes on top of the legal and accounting bill, which is estimated to hit more than £70mln, and other costs that are expected to top £20mln.

The National Audit Office said earlier this year, the costs related to Carillion’s demise would be £148mln.

Opposition MPS have accused the government of mishandling the company’s failure by realising its financial difficulties too late and making the situation worse by offering new contracts to lift investor confidence. They also slammed the government for leaving taxpayers to foot the bill.

Carillion had more than 190,000 employees, many working on government contracts to build schools, roads and hospitals, at the time of its collapse.

View full CLLN profile View Profile

Carillion Timeline

Related Articles

Office space
June 28 2018
"This has been another successful year in which the group has achieved a 25% uplift in NAV, significant lettings successes across recently completed developments leading to a 21.49% increase in contracted rent and a strong performance across our key metrics," said the CEO, John Arnold.

© Proactive Investors 2018

Proactive Investors Limited, trading as “Proactiveinvestors United Kingdom”, is Authorised and regulated by the Financial Conduct Authority.
Registered in England with Company Registration number 05639690. Group VAT registration number 872070825 FCA Registration number 559082. You can contact us here.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use