Carillion: Contractors hit by firm's collapse helped by £100m in government-backed loans

Contractors hit by the collapse of Carillion will be able to apply for government-backed loans as part of a £100 million support package.

The state-owned British Business Bank will support high street lenders in giving loans to small and medium-sized businesses (SMEs) and individuals owed money by the failed construction giant, Business Secretary Greg Clark announced.

The move comes after three high street banks agreed to provide "tailored support" worth almost £250 million to those affected by the company's collapse last month.

On Friday, it was announced that 377 Carillion staff would be made redundant, although 919 had been saved as new employers took on their contracts.

Mr Clark said: "We want to signal very clearly to small and medium-sized businesses who were owed money by Carillion that they will be supported to continue trading.

"The banks have responded to my request by agreeing to support businesses and individuals affected.

"This further guarantee will help those businesses who may not be able to provide the usual security for a loan."

The previous support package announced by Lloyds Banking Group, HSBC and RBS was dismissed as a "sticking plaster" at the time by industry representatives.