Govt Criticised For Failing To Protect Sub-Contractors Over Carillion's Collapse

The Government has been criticised for failing to protect sub-contractors in the wake of Carillion's collapse.

The multi-billion industry services firm collapsed into compulsory liquidation in January while still owing millions of pounds to sub-contractors in unpaid fees and cash retentions.

Sinn Féin Senator and member of the Oireachtas Finance Committee, Rose Conway-Walsh, has questioned why the Government didn't enact article 71.3 of Directive 2014/24/EU into law, which would have seen sub-contractors paid directly by the contracting authority.

"The failure of Government to include this in Irish legislation when the directive was transposed into Irish Law is utterly negligent," she said.

"This combined with it's failure to carry out proper due diligence when selecting the main contractor during the procurement process means it cannot now ignore the plight of these sub-contractors who are left without payment for the work they have carried out and the equipment they have supplied to the schools concerned.


"These sub-contractors have been robbed of millions of euro and their businesses, many of which are second and third generation small and medium businesses, have been left in precarious positions with uncertain futures."

Continuing, Ms Conway-Walsh said that losses such as those affected by the collapse of Carillion and Sammon "have become a regular feature of the Irish Construction Sector over the past ten years".

"Questions need to be answered: Why did the Irish government not chose to include the provision for sub-contractors to get paid directly by the contracting authority when the directive was transposed into Irish law?," she said.

"Were they not concerned about the risks to these businesses which form the back bone of our economy or the hundreds of job losses that could arise from exposure to such risks?"

Ms Conway-Walsh also urged the Government to look into holding KPMG, the auditing company of Carillion, to account for assessing the company as financially sustainable.

"We cannot go into a situation in September where students will be using buildings and equipment that has not been paid for," she said.

"This is not morally acceptable. Putting students, parents, teachers and communities in this position is unthinkable. The Department of Education, NDFA (National Development Finance Agency) and Government have to ensure payment for outstanding works and equipment.

"Certification of works to meet Building Regulations must involve those who have carried out the works and supplied the building products."

(LM)