Eleanor Smith apologises for Carillion silence as PM says Government is 'just a customer'

Labour's Wolverhampton South West MP Ms Smith was accused of letting the city down after admitting she had not raised the firm's troubles in Parliament through fear she would cause 'a state of panic'.

Following her comments, which were said in a BBC interview, she tweeted: "Following my radio interview and the Express & Star article, I wanted to explain that I heard about Carillion in passing and I apologise that I did not follow it up."

Carillion, which went bust on Monday after building up debts of around £1.5 billion, was the focus of a heated exchange during today's Prime Minister's Questions.

It saw Jeremy Corbyn accuse the Government of being 'deeply negligent' by handing out contracts to Carillion, despite knowing that the firm was in trouble.

Meanwhile Mrs May prompted a furious response from the Labour leader after she insisted the Government was simply 'a customer' of Carillion.

Asked to offer greater help for workers and apprentices at Carillion, Mrs May told the Commons that she recognised concerns over jobs, public services and pensions.

She said workers on Carillion's public service projects should continue turning up to work, 'confident in the knowledge that they will be paid for the work they are providing'.

But she added: "The Government is not running Carillion.

"The Government is a customer of Carillion, and our focus has been on ensuring that we are providing the public services – they are continuing to be provided uninterrupted – to reassure workers on those public services that they will get paid, to reassure the pensioners and ensure support is there for them."

Mr Corbyn said the Government's handing out of contracts to Carillion as its finances worsened suggested ministers were either trying to keep the company afloat or were 'deeply negligent'.

He said: "Between July and the end of last year the share price of Carillion fell by 90 per cent, three profit warnings were issued, unbelievably some contracts were awarded by the Government even after the third profit warning.

"It looks like the Government was handing Carillion public contracts either to keep the company afloat, which clearly hasn't worked, or it was just deeply negligent of the crisis that was coming down the line."

He also demanded to know why there was no permanent crown representative in place at Carillion as it fell into difficulties.

"Why did the position of crown representative to Carillion remain vacant during the crucial period of August to November, when the profit warnings were being issued, the share price was in freefall and many people were very worried?"

Mrs May insisted that the Government chief commercial officer and the Cabinet Office's director of markets and suppliers took over the responsibilities while the position was vacant.

"It was not the case that there was nobody from the Government who was looking at these issues," she said.

That was a 'standard procedure' and 'ensured there was oversight of Carillion's contracts with the Government', she said.

Mr Corbyn said that the Carillion affair showed there was 'one rule for the super-rich, another for everybody else'.

The Labour leader called on Mrs May to ensure that 'not a single penny more will go to the chief executive or directors of this company'.

In response Mrs May said she understood that a number of private sector contractors had reached agreement with the Official Receiver to ensure former Carillion workers on private projects continue to be paid.

The Receiver has powers to recover 'unlawful or unjustified' payments made to Carillion executives, she said.

Mrs May said that the Government had protected taxpayers from 'an unacceptable bailout of a private company'.

And she said that Business Secretary Greg Clark had held round-table meetings with banks, small businesses, trade bodies and unions on Wednesday to discuss the fallout from Carillion's collapse.

A spokesman for the Insolvency Service said: "The Official Receiver is very pleased with the level of support shown by Carillion's private-sector service customers.

"Over the past 48 hours all of the company's private-sector service customers have been contacted to determine their ongoing needs.

"Over 90 per cent of these customers have indicated that they want Carillion to continue providing services in the interim until new suppliers can be found and will provide funding which enables the Official Receiver to retain the employees working on those contracts.

"Work has paused on construction sites, pending decisions as to how and if they will be restarted."