Blueprint To Tackle Bandit Capitalism And Stop Carillion-Style Collapse
Unite, has launched a blueprint to tackle bandit capitalism in the UK economy and stop future Carillion-style collapses. The documentâs publication is especially timely given the growing fears that outsourcing giant Interserve could suffer a Carillion-style collapse.
The document Ending Bandit Capitalism : Learning The Lessons Following Carillion’s Collapse contains a package of measures designed to introduce better regulations and stricter rules to prevent companies being able to embellish their accounts and provide an entirely false trading position, which had disastrous consequences for Carillion and its workforce.
The comprehensive report for the first time details the sorry saga and circumstances of Carillionâs collapse and the role played by the directors, the government and its auditors, in the companyâs demise. There are further chapters which examine the outsourcing of public sector contracts and how the construction industry is organised, which were both major contributory factors in Carillionâs demise.
The document also studies the circumstances which resulted in Carillionâs pension fund being bailed out by the pension protection fund and the legal consequences as a result of the company entering compulsory liquidation, making it particularly challenging for the thousands of workers who lost their jobs to seek compensation.
The recommendations in the 36 page document include:
â˘ Requiring directors to focus on the long-term welfare of the company rather than short-term profits
â˘ New rules which bar companies from prioritising dividends, bonuses and directorâs pay over reducing pension deficits
â˘ The government should not award contracts to companies in financial difficulties
â˘ If a major company collapses government support for sub-contractors and its supply chain should be for the long-term
â˘ The entire financial regulatory system requires radical reform with the number of regulators being reduced and those that remain being given real power and teeth
â˘ The current outsourcing culture must be ended with contracts being brought back in-house at the earliest opportunity
â˘ A transformation of employment laws to ensure unions have access to workforces to organise workers and prevent exploitation
â˘ The number of legal hurdles that must be cleared before cases taken for workers, who were employed by a company in compulsory liquidation can go forward, must be reduced.
Since Carillionâs collapse Unite, which had over 1,000 members at the company, has led the way in calling for action to be taken to bring those responsible for the companyâs collapse to justice. Unite has called for a public inquiry into Carillionâs collapse and an immediate criminal investigation into those responsible.
Unite assistant general secretary Gail Cartmail said: âThis document is designed to set out the many factors that led to Carillionâs collapse and to ensure that the bandits are chased out of UK plc.
âWhat is too often forgotten when companyâs collapse is that thousands of workers both directly employed by the company and in their supply chain lose their jobs, through absolutely no fault of their own. The untold human misery of being dumped out of work without warning must be tackled once and for all.
âThe reforms that Unite has set out provide a clear blueprint of what is needed to begin tackling the worst excesses of the financial and corporate culture which currently exists.
âWith the revelations that Interserve which has a very similar structure to Carillion, is also in severe financial difficulties these reforms cannot be introduced a minute too soon.
âIt is a damning indictment that nearly a year after Carillionâs collapse no one has been charged with doing anything wrong, yet thousands of workers lost their jobs and millions of pounds of taxpayersâ money has been spent on clearing up the mess.
âPerhaps the most worrying factor concerning Carillionâs collapse is that the government is still acting as though it is business as normal, which is potentially exposing thousands more workers to a Carillion style meltdown.â
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