The Federation of Master Builders

Carillion’s demise raises concerns about Government’s reliance on large contractors

Published date: 15 January 2018

The Government must learn from Carillion’s demise and assess its over-reliance on major contractors, according to the Federation of Master Builders (FMB).

Commenting on this morning’s announcement that Carillion is to enter compulsory liquidation, Brian Berry, Chief Executive of the FMB, said: “Carillion’s liquidation is terrible news for all those who work for the company and it will have serious knock-on effects for the many smaller firms in its supply chain, some of which will be in serious financial danger as a result of Carillion’s demise.”

Berry concluded: “Carillion’s liquidation raises serious questions for the Government, not least about its over-reliance on major contractors. The Government needs to open up public sector construction contracts to small and micro firms by breaking larger contracts down into smaller lots. That way, it can spread its risk while also reaping the benefits that come from procuring a greater proportion of its work from a broad range of small companies. Construction SMEs train two-thirds of all apprentices and are a sure-fire way of spreading economic growth more evenly throughout the UK.”

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