A union chief said the response for at least 8,500 private sector workers who face losing their jobs today is “wholly inadequate and frankly inept”
Here’s the Jobcentre
The government has been branded “scandalous” after it was accused of telling stricken Carillion workers: “Here’s the Jobcentre”. A union boss said the response for at least 8,500 private sector workers at the collapsed firm – who face losing their jobs today – was “wholly inadequate and frankly inept”.
The outsourcing giant plunged into liquidation on Monday, threatening 20,000 jobs and leaving the taxpayer on the hook for a reputed hundreds of millions of pounds. While the government has stepped in to fund the public services that were 38% of Carillion’s trade, employees on private contracts face the sack today because their pay was only guaranteed for 48 hours. GMB union general secretary Tim Roache hit out at advice on the Cabinet Office website.
Under the heading “I’m worried about my job”, the website states simply: “JobCentre Plus, through its Rapid Response Service, stands ready to support any employee affected by this announcement.”
Mr Roache, who met Business Secretary Greg Clark yesterday, told BBC Radio 4’s Today programme: “The government response so far has been wholly inadequate and frankly inept. “What they’ve said is if you haven’t been picked up by another private sector company by close of play today, then here’s the Jobcentre Plus address. “That’s frankly scandalous.”
New hope emerged last night that the company could be kept temporarily open for business. According to The Times, individual private firms that use Carillion have been asked if they wish to continue with its services to maintain the “brain” of the operation. But Mr Roache said all GMB members in Carillion, which had around 20,000 UK staff, were “extremely vulnerable”.
Mr Roache said there were still questions over how long the government will fund the public sector work. And there is the risk of more redundancies as the knock-on effects spread to other businesses in the supply chain.
Grounds maintenance firm Flora-tec said it was owed almost £1million for work on hospitals and has had to lay off 10 of its 90 staff. “People were in tears, colleagues we worked with for a long time. But as soon as we knew what happened we had to cut our cost base,” Managing Director Andy Bradley said.
Labour has called for a full public inquiry after Tory ministers granted Carillion more than £1billion in new contracts even after a profit warning last year. And the firm faces questions over why its chief executive Richard Howson – who owns a six-bedroom ski chalet in the Alps – was being paid £660,000 for a year after he quit.
The Institute of Directors accused Carillion of “highly inappropriate” behaviour in making it harder to claw back executive bonuses barely a year before its collapse. Business Secretary Greg Clark has asked the Official Receiver to “fast-track and expand” its investigation to probe whether current or former directors’ behaviour caused the firm’s collapse. He said: “Any evidence of misconduct will be taken very seriously.”
Mr Roache said the culture of outsourcing itself must end. “These public sector contracts should never have been awarded to the private sector. This has been the GMB’s line for 30 years,” he said. “We didn’t agree with the Labour Party then and neither do we agree with the Conservative Party continuing that trend.”
Today there were fresh fears as shares in another outsourcing giant, Interserve, briefly plunged 14% on reports it had been put under a close watch by the government. The shares later rallied.
The Financial Times reported that the Cabinet Office had pulled together a team to watch over Interserve, which employs 80,000 staff worldwide and issues a profit warning in October. Neil Wilson, ETX Capital’s senior market analyst, insisted: “Interserve has had its problems for sure, but it’s no Carillion.”
Mr Roache told the BBC: “It’s a blooming shame the government weren’t putting Carillion under special watch all these months and years ago.”