Why Carillion collapse could lead to more devolved powers for Hull

By Hull Daily Mail | Posted: 17 Jan 2018

The collapse of construction group and services group Carillion underlines the need for greater devolution, it has been claimed.

Lord Haskins, who chairs the Humber Local Economic Partnership, said ministers should heed the lessons of Carillion's dramatic liquidation.

Speaking at the launch of a new 30-year blueprint for transport investment across the north of England, he suggested the company's collapse could mark the start of a major re-think over policies on public funding and contracting.

He said: "I think there is a feeling that with Carillion, they lost their way on how to run a tight ship.

"Maybe people will start to realise they can't run everything from the centre and hope to get away with it."

As well as carrying out major public sector construction projects, Carillion also provided school meal services, ran 50 prisons and provided 11,500 in-patient hospital beds, 200 operating theatres and 300 critical care beds for the NHS as part of its healthcare division.

Carillion: Now in liquidation

READ MORE: 'It's a fraud!': Drama as screaming John Prescott storms out of Hull event

Ministers say the jobs of Carillion staff involved with public sector contracts will be protected.

Lord Haskins said he been lobbying successive governments to devolve more powers such as contracting to local decision-makers for more than 25 years.

He said the network of regional development agencies set up under Tony Blair's Labour government had been the most successful attempt to direct resources away from Whitehall.

The agencies were abolished by David Cameron's coalition government in 2010.

Lord Haskins said the subsequent Local Enterprise Partnerships set up by the coalition were a "poor man's version" of the agencies.

But he claimed former chancellor George Osborne's support for the Northern Powerhouse and Transport for the North had given him renewed hope devolution was again being taken seriously.

"Now George Osborne has gone, there's a question mark as to whether that is still the case but we shall see.

"Transport for the North is a step in the right direction but it's only an aspiration and has no powers, unlike Transport for London.

"Ultimately, we have to devolve responsibility and accountability to the local regions, that is what Transport for the North should be all about."

George Osborne visiting the RB factory in Hull in 2014

Meanwhile, it has emerged that Carillion was included on a list of approved contractors used by Yorkshire councils after the company posted its first profits warning last summer.

The so-called contractors framework was drawn up in a joint project led by East Riding Council and Sheffield City Council.

Companies were invited to apply for inclusion on the list to qualify for the right to bid for civil works contracts worth more than £10m.

According to East Riding Council, Carillion is not carrying out any current projects for the authority and has no outstanding tenders submitted.

"We have enough contractors appointed to the framework for it to remain competitive," said a council spokesman.



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