Carillion redundancy pay-outs to cost £65m

Taxpayers are expected to pay around £65m to cover the cost of redundancy payments to former Carillion workers made redundant following the contractor’s January collapse.

Some £50m has already been paid out based on claims received, with the final total expected to reach £65m according to a response from the Redundancy Payments Office (RPO) to a Freedom of Information request to the Insolvency Service by the Unite union.

Because Carillion entered compulsory liquidation rather than administration, all of Carillion’s workers were entitled to make a redundancy claim from the RPO, including staff who transferred to a new employer.

The figures apply only to former Carillion staff and do not include workers at companies in Carillion’s supply chain that also failed as a result of Carillion’s demise.

The Official Receiver transferred the last of 278 contracts provided by Carillion to new service providers in August this year, ending the trading phase of its liquidation.

By that stage, 2,787 people (15%) of the workforce had been made redundant. A total of 13,495 jobs were saved.

Meanwhile, the taxpayer will also have to pay for the completion of several Carillion projects including the Royal Liverpool Hospital and the Midlands Metropolitan Hospital.

Speaking at the Labour party conference, Unite assistant general secretary Gail Cartmail said: “These latest figures demonstrate that the taxpayers have had to pick up the tab for the greed and recklessness which led to Carillion’s collapse.

“These revelations further underline why the government must order a full public inquiry into Carillion’s collapse to not only understand who was responsible for the greatest corporate failure in UK history but also the total cost to the taxpayer.

"Additionally the police need to undertake an immediate criminal investigation into those responsible for Carillion’s collapse. If no laws were broken then we need better, stronger laws to prosecute the guilty.”