Carillion collapse cost Notts taxpayers a quarter of a million pounds

Carillion
Carillion

Taxpayers in Nottinghamshire are out of pocket to the tune of almost £250,000, following the Carillion collapse in January.

The outsourcing firm went into liquidation in January, with huge unpaid debts to businesses, individuals, pension funds and councils.

However, the council said there was no interruption to services.

In Nottinghamshire, a new firm has been brought in to run a contract which had been awarded to Carillion in East Leake, but Nottinghamshire County Council has had to write off almost £250,000 in unpaid bills.

The relationship between Carillion and the county council is complex.

Originally, Nottinghamshire County Council (NCC) brought in Infrastructure Managers Limited (IML) to run three sites in East Leake – the academy, Lantern Lane Primary School and East Leake Leisure Centre.

IML then awarded part of the contract it had won to Carillion.

Carillion then contracted NCC to provide school meals at the school – a part of the contract which NCC had initially offered to IML.

So NCC ended up doing some of the job which it had originally asked, and paid for, another company to do.

For providing the school meals, NCC was paid in arrears (paid after the meals were provided).

This is usual in these sort of contracts, but when Carillion went into liquidation in January, it meant the council was owed £234,982.30 in unpaid invoices.

The council has said it is “very unlikely any of this will be paid off,” and is in the process of writing off that  debt.

Derek Higton, service director for communities and place at Nottinghamshire County Council, said: “Like hundreds of other local authorities and businesses across the country, the county council was impacted by the collapse of Carillion at the start of the year.

“In the short term, working with Infrastructure Managers Ltd (IML), who ultimately manage the academy, primary school and leisure centre sites, our top priority was to ensure that it was business as usual for employees, children and other service users, whilst a new supplier was found to replace Carillion.

“I am pleased that we have been able to achieve that, without adversely impacting service provision.

“Today’s report confirms that Mitie have been appointed by IML and that we are in discussions with them about continuation of the catering and facilities management delivered by the county council.

“Under these new arrangements, there will continue to be tight control over the process of obtaining orders, issuing invoices on time, and ensuring they are paid in line with contractual terms.

“Additionally debt recovery and the relevant service managers will take appropriate and proportionate action in the event of any issues.”

Kit Sandeman , Local Democracy Reporting Service