Two dozen Carillion workers axed at Midland Met site as rumours swirl over new contractor
More than two dozen Carillion workers are being axed at the Midland Metropolitan Hospital site in Smethwick this week as rumours swirl that a Swedish construction firm is being lined up to take over building work.
Already nearly two years behind schedule, the scheme has been at a standstill since Carillion crashed into liquidation in mid-January.
Announcing another 78 jobs losses among Carillion staff nationwide, the Insolvency Service has confirmed 27 employed on the Midland Met site were "not required" and would not be transferring to a new contractor.
At the same time industry reports suggest the UK arm of Swedish building giant Skanska is in pole position for the contract to finish the two-thirds built hospital. The company is already working in the Black Country on the expansion of Walsall Manor Hospital's critical care unit.
The Midland Met was due to cost £350 million but the delays and problems that helped drag down Carillion are likely to add millions to its final price tag.
It was one of a toxic handful of loss-making construction contracts that pushed debt-laden Carillion over the edge.
Originally due to open in the autumn of this year, the hospital could be delayed beyond 2020, local health chiefs have warned.
Problems at the Midland Met centred on a complex mechanical and electrical (M&E) services system. Former Carillion chief executive Richard Howson told a Parliamentary inquiry: “The building services design was delivered six months late and then didn’t work, adding to the cost.”
Skanska is said to want to bring in their own M&E team to work on the Midland Met if it secures the the contract.
A company spokesman said: "We only comment on signed contracts."
The Sandwell and West Birmingham Hospitals NHS Trust has also declined to confirm the Skanska reports, saying only that talks are under way with unnamed firms. Trust chief executive Toby Lewis said: “We understand that our contractor, Hospital Company, are part way through a competition for an interim contract, and look forward to confirming details during March of that arrangement to get work restarted.”
Meanwhile the number of jobs lost in the Carillion collapse has now passed the 1,500 mark, the Government's Insolvency Service has revealed.
In an update on the liquidation of the Wolverhampton construction and services group, it was announced that another 78 people will lose their jobs this week, taking the total since the company collapsed in mid-January to 1,536.
But jobs with new suppliers, taking over Carillion contracts, have been found for 305 people working on facilities management, defence sites and construction. That takes the total saved to 8,521 – nearly half Carillion's UK workforce before its collapse.
The future of another 7,300 remains uncertain. They have been kept on to work on existing Carillion contracts with public and private sector customers while new companies are sought to take over. They include around 400 people working at the company's Wolverhampton city centre headquarters, who are assisting accountants PwC – the special managers of the insolvency.
They also include around 2,500 people working on contracts with hospitals, the education sector, justice, transport and emergency services that were to be transferred to Canadian facilities management group BGIS until it pulled out of the deal last week.
A spokesperson for the Official Receiver said: "Discussions with potential purchasers for Carillion’s remaining contracts are continuing."