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  1. ITV Report

Carillion collapse: Ex-directors to be investigated over impact on workers and other companies

  • Video report by ITV News Business Editor Joel Hills

Former directors of Carillion look set to be investigated to decide whether they "caused detriment" to workers and other businesses before the construction giant's collapse.

The government has requested a fast-tracked and expanded investigation as it came under pressure for its role in handing public contracts to the private company.

It has said that a bailout is out of the question for the company, leaving thousands of workers reeling along with firms who had been subcontracted work but not been paid.

ITV News Business Editor Joel Hills has seen documents submitted to the High Court as part of the Carillion's liquidation process which suggests creditors may get back less than one pence for every pound they are owed.

Labour leader Jeremy Corbyn said Carillion's demise was a "watershed moment" that should bring an end to "rip-off privatisation" of public services.

Business Secretary Greg Clark asked for the investigation of the company's leading executives past and present in a letter to the Official Receiver, as ITV News Political Correspondent Carl Dinnen reported.

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The letter came after Mr Clark heard Carillion's fall could put firms out of business and damage many specialist suppliers.

Engineering services bodies ECA and the BESA called for maximum support from the government and banks in their meeting with the business secretary on Monday evening.

The leader of the Rail, Maritime and Transport union is also pressing Transport Secretary Chris Grayling and other ministers to clarify who qualifies as a public sector worker and commit to paying worker wages.

It follows an announcement firms working for Carillion on purely private sector deals will only have two days of government support.

"There should be no equivocation from the Government and no attempt to duck and dive around this issue," RMT general secretary Mick Cash said.

Carillion employs around 20,000 people in the UK. Credit: PA

"The Government have known for months that Carillion was in trouble and they should have had plans well in hand for just this situation."

The call came amid growing anger at bumper payouts received by former chief executive Richard Howson.

Richard Howson will receive a £660,000 salary and £28,000 in benefits until October. Credit: Carillion

He received £1.5 million in salary, bonuses and pension payments during 2016 and, as part of his departure deal, Carillion agreed to keep paying him a £660,000 salary and £28,000 in benefits until October.

Carillion entered liquidation on Monday after last-ditch bailout talks ended.

It has seen its shares price plunge more than 70% in the past six months after issuing a series of profit warnings and breaching its financial rules.

The group, which employs around 20,000 British workers, has been struggling under £900 million of debt and a £587 million pension deficit.