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It seems Interserve is about to go the same way as Carillion.

If it does, the Conservative government will force the public to pay the costs again, even though they’re the ones who stupidly employed greedy private contractors who put our money in their bank accounts rather than investing it in the public services they are supposed to be providing (at least, that’s the Carillion model).

I hope that Interserve doesn’t go under, but it occurs to me that any private firm with a contract to provide public services will be in breach of that contract if it ends up in receivership due to poor financial management.

So it should be the government’s responsibility to get our money back from these people, rather than charging the public.

It might be easy to force the poor to cough up for the mistakes of the rich, but it isn’t justice.

Let’s have some justice for a change.

It appears the Tory Government could once again be stretching its pan-palms out to catch the overspill from the potential collapse of another favoured private contractor, Interserve.

Interserve’s debt almost doubled from £274m in 2016 to £513m at the end of 2017. An underestimation of the costs involved in a public-private partnership contract to provide waste-to-energy services, which saw the corporation raise its provision on one such project in Glasgow from £70m to £195m, has badly affected it.

And in further deeply worrying news, the corporation’s share price has plummeted from 717p in 2014 to just 63p in December, leading to serious discussions with its lenders over the firm’s remaining financial options.

Although the corporation issued profit warnings in September and October 2017, it has announced that it reportedly expects that its 2017 performance was in line with expectations. This, along with the partial recovery in its share price might be due to the fact that the corporation’s new chief executive announced cost cutting measures: £15m in 2018 to £50m by 2020.

With the corporation employing 80,000 people worldwide – 25,000 in the UK – and when it is responsible for public contracts including cleaning, healthcare, security, probation and construction, one wonders what cost-cutting measures will actually involve and how these might impact the provision of essential public services.

Source: Another major government contractor on the brink after 90% share price collapse and debt doubling | Evolve Politics

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