Eleanor Smith MP : My view of the Carillion collapse

When Carillion announced last week that it was going into liquidation with debts in excess of £1billion, I was shocked and saddened. The four hundred Wolverhampton people employed in its HQ and their families, as well as the contractors and other local companies who did business with Carillion, have been dealt a heavy blow and face uncertainty and financial insecurity.

My thoughts are with all of those people who are now worrying whether they are going to get paid in the coming days, whether they will be able to afford to pay their rent or mortgage this month, keep up with repayments and all the other essential family bills. Anyone that needs help, please contact me – by emailing me or by calling my office. I will work with anyone who can help save those jobs within my constituency and I will do everything I can to help anyone who has been affected.

There are lessons to be learnt from this crisis – it does bring in to sharp focus a broken economic model and a failed system of privatisation of public services. But above all else it's the effect on ordinary people's lives that concerns me the most and it’s those people who Labour would always think about in the first instance, but the Tories think about in the last.

For me; the Government should bring the crucial public sector contracts held by Carillion back in-house - back into public control. The Government cannot outsource its responsibility. They should act quickly to bring these public sector contracts back in-house to protect public services and ensure employees, supply chain companies, taxpayers and pension fund members are protected. I truly hope that Theresa May’s Government will step forward and accept its responsibility.

While normal working people are left without a job and wondering if they are going to be paid there is a huge question mark looming over those at the top of Carillion. Carillion went into liquidation with debts of around £1 billion and yet the company was still paying out dividends to shareholders at the very last moment and increasing those payments year on year and paying huge bonuses to its directors. Reportedly Carillion recently rewarded a £1.5 million package to its former CEO.

Carillion issued three profit warnings since July last year – and in that time they were awarded nearly £2 billion in government contracts – including nearly £1.5 billion for HS2. According to government records no Ministers from the Department for Transport or the Department for Defence (the departments that signed those contacts) met with Carillion from July to September.

The public deserve an explanation - they need a full, independent and transparent investigation into the actions of Carillion and all those linked to the company and the Government's actions.

At times of crisis – people naturally want someone to blame. I have been accused of letting Wolverhampton down by not speaking out. Like many others I was aware of the profit warnings that had been published. But I did not know the company was on the brink of collapse. If I had known that the company was facing imminent liquidation - as the local MP – of course I would have spoken up and demanded answers. Given that the Government continued to award billions of pounds of contracts to Carillion, we must demand answers about what they knew, and when. Was Theresa May’s Government negligent or simply incompetent? That is why we need a full investigation.

This week myself and the two other Labour MPs in Wolverhampton – Pat McFadden and Emma Reynolds - will meet with the Secretary of State for Business. There are serious questions that must be answered around the economic issues behind Carillion’s collapse, as well as demanding answers on jobs and the pension scheme.

I will be asking him the following questions:

1. Will he bring Carillion public sector contracts back in house - if so, when and how.

2. What protections will he put in place for employees’ pensions and will the Government have a meeting with Union pensions officers to address the many issues arising from the liquidation.

3. What guarantees can he give to employees who are directly affected by the Carillion collapse and what programmes will be put in place to assist any of those who lose their jobs in this crisis.

4. In view of the national significance of Carillion, will the Government set up a task force to deal with its collapse and all of the associated fall-out and will that body include Union involvement.

I will keep you updated about that meeting – I’ll issue my response to the Express & Star and will post regular updates on my social media feeds.

Above all we need an economy that is balanced – that ensures the security and stability of everyone, not just those shareholders and chief executives at the top.

A Labour Government would do things differently. We will scrap PFI and deliver pubic services in a transparent and efficient way that offers the best value for the many and not just the privileged few.