Carillion

Lord Elystan-Morgan Excerpts

Monday 15th January 2018 Lords Chamber

[Lord Young of Cookham]

That is quite a complicated question. One can make a good argument for having subcontractors—namely, people who specialise in a particular discipline and compete against each other for contracts, rather than one company trying to cover the whole spectrum of services. Many very successful industries are built on a structure of contracts and subcontracts. Noble Lords need look only to the airline industry to see a whole range of contracts: companies lease the aeroplanes and subcontract baggage handling and catering and so on, and, on the whole, it is a satisfactorily run industry. I would not want to get drawn into conclusions about what structure is the right one for a particular industry. On the question of accounting, I should have said that the FCA and the FRC are both conducting their respective inquiries—one, I think, into audit, and the other into statements that were made or not made about the company’s prospects. These particular aspects are being looked at by the relevant authorities.

[Lord Elystan-Morgan (CB)]

On the issue of pensions, is it not the case that the statutory body that will be reimbursing loss will do so not to the tune of 90% but 85%? If I am wrong in that, I am very happy to be corrected. However, in any event, and whatever the figure, do the Government accept a moral responsibility in this matter to ameliorate so far as they possibly can the loss that many people will feel in respect of quite modest pensions?