{"id":14519,"date":"2018-01-29T16:22:37","date_gmt":"2018-01-29T16:22:37","guid":{"rendered":"http:\/\/unitelive.org\/?p=14519"},"modified":"2020-11-12T12:59:10","modified_gmt":"2020-11-12T12:59:10","slug":"carillion-pensions-scandal","status":"publish","type":"post","link":"https:\/\/unitelive.test.igniteamt.com\/?p=14519","title":{"rendered":"Carillion pensions scandal"},"content":{"rendered":"
<\/div>\n

Carillion\u00e2\u20ac\u2122s pensions blackhole is at least \u00c2\u0141990m, the firm\u00e2\u20ac\u2122s former chair of trustees has revealed \u00e2\u20ac\u201c nearly twice previously thought.<\/p>\n

 <\/p>\n

Following the revelation, Unite called for all possible legal avenues to be explored to recoup money and for the introduction of stronger laws to prevent future scandals.<\/p>\n

 <\/p>\n

A letter from the firm\u00e2\u20ac\u2122s pension trustee chairman Robin Ellison to MPs suggests Carillion<\/a>\u00e2\u20ac\u2122s pension deficit is much bigger than the \u00c2\u0141590m previously estimated.<\/p>\n

 <\/p>\n

Ellison\u00e2\u20ac\u2122s letter suggests the pensions black hole could in fact be nearly \u00c2\u01411bn \u00e2\u20ac\u201c with some estimates even placing the figure at \u00c2\u01412.6bn<\/a>.<\/p>\n

 <\/p>\n

As a result of the company\u00e2\u20ac\u2122s collapse, Carillion\u00e2\u20ac\u2122s pension schemes will be transferred to the Pension Protection Fund.<\/p>\n

 <\/p>\n

This will result in existing pensioners having lower increases in future, while other members of its schemes will see the value of their pension<\/a> fall by about 15 per cent.<\/p>\n

 <\/p>\n

‘Greed’<\/strong><\/em><\/p>\n

Unite assistant general secretary Gail Cartmail said, \u00e2\u20ac\u015bThe scale of the deficit is astronomical; it is disgraceful that the company continued to pay shareholders dividends and to pay bonuses to its senior staff, while the pension black hole was allowed to spiral out of control.<\/p>\n

\u00e2\u20ac\u015bMembers of Carillion\u00e2\u20ac\u2122s pension schemes will pay for the greed of the directors and the shareholders for the rest of their lives, with vastly reduced retirement incomes.\u00e2\u20ac\u0165<\/p>\n

That greed is manifested in the actions of former chief executive Richard Howson<\/a> who received \u00c2\u01416m in pay and perks in the five years before resigning in July 2017, when Carillion was first forced to issue a profit warning. Howson also received a whopping 40 per cent of his salary as pension contributions.<\/p>\n

 <\/p>\n

However, despite his resignation Howson continued to be paid a basic wage of \u00c2\u014155,000 a month.<\/p>\n

It has also emerged that in 2016 Carillion changed its pay policy making it far more difficult for director\u00e2\u20ac\u2122s bonuses to be repaid if the company then ran into financial problems.<\/p>\n

\u00e2\u20ac\u015bEvery legal avenue needs to be explored to discover if money can be reclaimed from directors and shareholders and if those responsible can be prosecuted.\u00c2\u00a0It is outrageous that those responsible, who were lining their pockets while Carillion collapsed, could escape scot-free,\u00e2\u20ac\u0165 Cartmail said.
\n <\/p>\n

Pension raid<\/strong><\/em><\/p>\n

The Pensions Regulator is also being scrutinised, after it was revealed that it sanctioned a raid last autumn on the firm\u00e2\u20ac\u2122s pension fund by Carillion executives, who were attempting to shore up its failing finances.<\/p>\n

 <\/p>\n

With the regulator\u00e2\u20ac\u2122s approval, Carillion pension trustees \u00e2\u20ac\u015bnegotiated away\u00e2\u20ac\u0165 payments to reduce the massive deficit to allow the firm to keep borrowing.<\/p>\n

 <\/p>\n

The company had already claimed poor finances had prevented it making higher pensions contributions in 2011 and 2013, although money was found to pay shareholders \u00c2\u014170m in dividends for both years.<\/p>\n

 <\/p>\n

Cartmail said, \u00e2\u20ac\u015bThe Carillion crisis demonstrates once again that existing pension laws are far too weak. The actions of the pension regulator need to be urgently reviewed and if necessary its powers strengthened.<\/p>\n

\u00e2\u20ac\u015bYet again the government has been caught sleeping on the job and its processes have been found not fit for purpose. New laws must be introduced which mean that bosses who benefit at the expense of pension members are suitably punished.\u00e2\u20ac\u0165<\/p>\n

 <\/p>\n

TUPE<\/strong><\/em><\/p>\n

Meanwhile, on Friday it was revealed that former Carillion contractors will not be covered under Transfer of Undertakings (Protection of Employment) (TUPE<\/a>) regulations, meaning their previous pay and conditions are not guaranteed and maybe downgraded.<\/p>\n

 <\/p>\n

Union representatives were informed of the developments in a letter from auditors PWC, who have been involved in Carillion\u00e2\u20ac\u2122s liquidation.<\/p>\n

 <\/p>\n

Following Carillion\u00e2\u20ac\u2122s collapse two weeks ago, the government announced that staff working on the firm\u00e2\u20ac\u2122s 450 public sector contracts will retain their jobs.<\/p>\n

 <\/p>\n

The Insolvency Service then said workers on 90 per cent of Carillion\u00e2\u20ac\u2122s private sector contracts for cleaning and maintenance will continue to be paid until long term arrangements are found.<\/p>\n

 <\/p>\n

However, the PWC letter confirms that TUPE will not apply for workers that move company.<\/p>\n

 <\/p>\n

It states, \u00e2\u20ac\u015bIn this situation staff will not automatically transfer under TUPE because a winding up order has been made against each of the Carillion companies.\u00e2\u20ac\u0165<\/p>\n

 <\/p>\n

PWC said possible transfers of staff may need to take place in a \u00e2\u20ac\u015bmatter of days \u00e2\u20ac\u201c perhaps less\u00e2\u20ac\u0165 and that some could take place before January 31.<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bThis is a further slap in the face for Carillion workers and demonstrates the hollowness of the government\u00e2\u20ac\u2122s initial promises,\u00e2\u20ac\u0165 said Cartmail.<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bEven if the jobs of workers are preserved they now face the prospect of being transferred to new companies without warning with potentially far lower rates of pay and poorer conditions.<\/p>\n

 <\/p>\n

\u00e2\u20ac\u015bThe government and its task force needs to immediately get a grip of this issue and to ensure that companies taking on Carillion workers respect their existing pay, conditions, pensions and length of service.\u00e2\u20ac\u0165<\/p>\n

 <\/p>\n

Cartmail said the union will use all available legal avenues to prevent employers attempting to enrich themselves \u00e2\u20ac\u015bby picking up contracts and slashing workers\u00e2\u20ac\u2122 pay\u00e2\u20ac\u0165.<\/p>\n","protected":false},"excerpt":{"rendered":"

Carillion\u00e2\u20ac\u2122s pensions blackhole is at least \u00c2\u0141990m, the firm\u00e2\u20ac\u2122s former chair of trustees has revealed \u00e2\u20ac\u201c nearly twice previously thought.   Following the revelation, Unite called for all possible legal avenues to be explored to recoup money and for the introduction of stronger laws to prevent future scandals.   A letter from the firm\u00e2\u20ac\u2122s pension […]<\/p>\n","protected":false},"author":2,"featured_media":14387,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":[],"categories":[17],"tags":[855,167,647,270],"wps_subtitle":"Pension black hole at least \u00c2\u0141990m","_links":{"self":[{"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/posts\/14519"}],"collection":[{"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=14519"}],"version-history":[{"count":2,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/posts\/14519\/revisions"}],"predecessor-version":[{"id":26430,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/posts\/14519\/revisions\/26430"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=\/wp\/v2\/media\/14387"}],"wp:attachment":[{"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=14519"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=14519"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/unitelive.test.igniteamt.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=14519"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}