Carillion

Do you think they are all going to go at once, in order to try and hide their mismanagement.
I think May will find somewhere else to go to from China; stay out of the country as long as possible.

Think Carillion was bad? Wait until you hear about the financial scandal engulfing our children’s academies

Taking a short train journey across almost anywhere – in my case east London – and keeping an eye out for corporate signs is the best way to understand how dependent we’ve become on outfits like Carillion. As Carillion’s collapse continues and it reels from fresh allegations of dodging pension obligations while dishing out dividends, many will say the firm was just one rotten apple.

But another story broke this weekend: six of the 10 largest academy trusts have issued warnings over pay, short-staffing, building safety and financial risks. The trusts cover hundreds of English schools. There’s a disturbing whiff of Carillion about this. Inadequate state investment? Check. Unaccountable, profiteering management? Check. The lines between private and public provision relentlessly blurred, leaving both sides over-exposed? Check.

Agreed, whitewave.

With serious questions over Capita, Carillion gone, the rail franchises in serious difficulties, it is clear that this model of outsourcing is not longer for for purpose.

Core activities in particular, where there is no market should be stopped, and all taken back under the government umbrella.

What do you think about the people inspecting KPMG's auditing of Carillion?

These people have had or have jobs at the top of Barclays Retirement Fund, PWC, Barclay's Commercial, DWP, Deloitte and, believe it or not, KPMG.

Nothing like jobs for the boys.
I think I'd have more faith in someone from Deutsche Bank.

"The answer, which Frank Field’s Commons work and pensions committee will try to elicit this week, is that the trustees saw trouble coming and warned their board – which did next to nothing. They warned the Pensions Regulator, which “expressed concern”. The fund had apparently been in trouble for 10 years. Yet the auditors KPMG continued to give Carillion’s accounts a clean bill of health.

This was for a firm £5bn in debt, owing almost £1bn to its pensioners, and with just £29m in the bank. These are the same accountants as were criticised in reports following the Co-operative bank scandal. What on earth was the Financial Reporting Council doing? The council will now investigate KPMG to see whether any rules were broken during the audit. KPMG has said it will cooperate with the investigation, but has defended its role.

The trouble with Carillion remains size. It grew too big to be called to account. Its debts became so awesome, its directors so greedy, its Whitehall contacts so close, that no one dared admit it was bust. No company, least of all one supplying public services, should ever get into that position."

We should also be worried about the Pensions Protection Fund, particularly those who have not retired yet.

www.pensionprotectionfund.org.uk/Pages/PPF7800.aspx

From the Guardian.

You're right Jen! They are seriously raking it in. Years of banking a significant profit from their members. Over 20%. I missed that totally - well spotted!
So why didn't they pay tax on the profit of their stocks and shares, property disposals etc?
Even after their extravagant expenses, they booked a profit. That takes some work.
So they're avoiding tax. Actually, just on their surplus over the last few years, it seems they've paid less than 2% tax.

Fat cats indeed. The private sector has got nothing on the unions - loads of companies would love a corporation tax rate of 2% of profit and a profit margin of 20% after you've bought the boss a London flat. The unions don't need any lessons on how to exploit the proletariat!

Interesting to hear discussion of Carillion this morning where they were saying that the point those looking into it will be looking at are the dividends they paid. Apparently the bonuses paid depended on the level of dividend paid.

I thought this thread was about Carillion not about the lies, damned lies and fake news about those in the Labour Party. Just saying as this 'going off thread deliberately' has been an accusation thrown around elsewhere. Whatever anyone else, in any party, at any time has done I always thought two wrongs didn't make a right. Mind you the Tories may finally have managed to change basic morality; nothing would surprise me with this pathetic crew pretending to be in control.

Orwell on writing Animal Farm.

"...I saw a little boy, perhaps ten years old, driving a huge carthorse along a narrow path, whipping it whenever it tried to turn. It struck me that if only such animals became aware of their strength we should have no power over them, and that men exploit animals in much the same way as the rich exploit the proletariat."

By the way, it's Carillion who are being investigated for pension fraud.

www.gov.uk/government/uploads/system/uploads/attachment_data/file/622928/795T_2016.pdf

Page 18
Funds at end of year 205,110,000

I taught Animal Farm, primrose.

They didn't have 200 million in 'funds' after they had paid all their expenses Jen. I think you need to learn how to read accounts!
If they had those funds, they would have paid tax, which they didn't. Or are they avoiding tax as well?
I'm afraid all your assumptions are wrong - ballot costs are accounted separately and clearly shown.

6% spent on members.

Why not reduce the subs instead of spending it all on themselves. Have you read Animal Farm?

I didn't say it did, Jen!
If facts and evidence make you angry, shout at Len McCluskey, not the messenger. He's the one squandering the money of the low paid workers, not me. Try Le Bar Américain, in Hotel de Paris in Monte Carlo. I know he enjoys a drink there sometimes.

Did you read down to the bottom of the accounts?
Stationery, etc, 3 million.
Members benefits only needed 6% or nearly 10 million spent on them for the year.
They have over 200 million in funds at the end of the year.
You give the impression in your selective choice of information that they spend all the money on themselves, without saying it in so many words.

I assume the money spent on admin includes having to print ballot papers when they have a ballot.
The man who lost last year is taking his own union to court and wanting a rerun. Perhaps you ought to be more annoyed about that as a waste of money.

BUT IT DOESN'T MAKE WHAT THE GREEDY BOSSES ARE DOING RIGHT, DOES IT?

Shouting on purpose.

It's happening now too Jen.

Take a look at the accounts of Unite. 6% of the subscription money goes to members benefits. They spend more on stationary and 'sundry' expenses than their members.

How the hell do you manage that? Tell me how you can spend more on stamps and pieces of paper in administration - in this digital age - than legal representation, members training and journal publications combined.

Sorry, primrose, but you really cannot go on saying that Labour used to do it, so there.

Don't you want anything to improve? Don't you want greedy people to be called to account, because I certainly do.

Carillion's auditors going to be inspected by the Financial Reporting Council.
Sounds good, however one on the board is a director of KPMG.
Here's the rest.

www.taxresearch.org.uk/Blog/2018/01/29/is-the-financial-reporting-council-the-fit-and-proper-body-to-investigate-kpmg/

Trouble is GG, Labour do exactly the same.
I know posters here are shocked that Carillion changed the rules the year before they went bust, so that people would get big payouts.
Ken Livingstone did exactly the same thing 10 years ago when he was mayor of London, to make sure his personal political appointments got big payouts when he lost the election. He changed the rules a year beforehand and it cost millions to pay them off. It was well reported in the press at the time.
"Tony Travers, London government expert at the LSE, said: "I think most people will be shocked. I don't think people inside the system understands how this merry-go-round of excess looks to outsiders"

Of course, Ken made sure he had a significant payout too.

Greed and manipulation are not Tory vices, they are human ones.

How are they allowed to get away with this? I can't imagine it improving after Brexit.

I certainly can't Jen. If you think that the main drivers of Brexit in the government are neo-liberals who want as close to no rules as possible I find I am listening to this mornings news about the debt in the pension scheme being so much worse than originally projected, while the paying out large dividends and huge salaries continued, it is with a sinking heart. I feel that Carillion is almost certainly only the tip of the iceberg.

What makes me really despair is the noises off we will still hear from those who try and frighten others with the idea that a labour government - who would need to get to grips with an unfettered capitalism - will "spend, spend, spend" without any perception of why spending is bound to go up after our recent style of Conservative government whose only aim seems to be to kill off benefits - and the people receiving them, kill of the NHS and those who need it and kill off the idea that companies and government should have responsibility for those who work for them although in this instance they also seem to have managed to kill off the companies they use for outsourcing as well as the decent jobs for people working in these areas.

Similar to the Independent thread above, Maizie.
I love the phrase "The auditors expressed some concern..."
What the hell were they doing, who let them do it and why?

Tweet from economist, Frances Coppola

In the five years from 2012 to 2016, #Carillion paid out £217 million more in dividends than it generated in cash from its operations." (Parliamentary briefing paper). Imaginary profits don't provide hard cash. Carillion borrowed to pay those dividends....

Her thread is worth reading:

mobile.twitter.com/Frances_Coppola/status/957728136782860288

This sounds extraordinarily like a fraudulent activity to me...

kittysjones.wordpress.com/2018/01/28/government-criticised-for-lack-of-diversity-lack-of-transparency-and-poor-fiscal-management/

If it's our money being spent, we ought to have the right to see how and where it is being spent.

Transparency is more important than commercial confidentiality.

Transparency will also show us that this government is rubbish at the economy, whatever they pretend.

www.independent.co.uk/news/business/news/carillion-made-500m-in-revenue-from-pfi-projects-with-annual-returns-of-up-to-39-research-finds-a8180986.html

Ever feel you've been had?

A report into Carillion's running of prisons will not be released because of commercial confidentiality.
What? What's confidential now?