Carillion: Devastating report expected from MPs

So far nearly 2,300 former Carillion workers have lost their jobs since the company went into liquidation in January, including hundreds at its headquarters in Wolverhampton.

While 11,500 have transferred to new companies taking over Carillion's public and private sector contracts, the fate of 3,200 workers still hangs in the balance.

Carillion left a mountain of debt, a giant pension deficit and hundreds of millions of pounds of unfinished public contracts with vast costs to the UK taxpayer.

The joint inquiry by the business and pensions select committees has been investigating how a company that was signed off by KPMG as a going concern in spring 2017 could crash into liquidation with a reported £5 billion of liabilities and just £29 million left in the bank less than a year later.

The MPs' report is expected to direct its fire at the executives and directors who ran the company, including former chairman Philip Green.

But there were also reports this weekend that the MPs will call for the scrapping of the UK's pensions watchdog for its failure to step in despite a ballooning pensions deficit – when Carillion collapsed in January the black hole had grown to more than £1billion.

Headed by MPs Frank Field and Rachel Reeves, the joint committee has hauled Carillion bosses, civil servants and leading accountancy firms over the coals in a series of hearings over recent months.

Blamed

The crisis at the company was revealed last summer, with an £850m black hole in the accounts blamed a string of troubled building contracts including the £350m Midland Metropolitan Hospital scheme in Smethwick. Work on the hospital has still to restart and recent reports suggest the Midlands Met, which had been due to open this year, may not now open its doors to patients until 2022.

Carillion's woes left the company starved of cash and weighed down by a huge and growing pile of debt.

Attempts to find new funding to rescue the business all failed, and Carillion bosses hopes of a last-minute Government bailout were dashed when, instead, the Official Reciever was called in and the company put into compulsory liquidation.

Carillion had been working on around 450 Government contracts, on roads and railways, in schools and hospitals and maintaining hundreds of homes for the Armed Services. While work on these continued until new contractors could take over, a string of major construction projects across the country ground to a halt for days and even months.

The MPs' report is also expected to attack The Pensions Regulator (TPR), calling for it to be scrapped and its job handed to a new, more powerful, body that would also include the Pension Protection Fund, or so-called 'pensions lifeboat'.

About 29,000 members of Carillion’s 13 pension schemes face cuts to their benefits after the collapse.