Debate on the House of Commons pulls together outcomes of various committees and looks to the future.
On Thursday 12th July the House of Commons debated the collapse of Carillion and lessons to be learned from such a major business failing.
The subject for this debate was determined by the Backbench Business Committee, in response to a request from Rachel Reeves MP. In her bid to the committee, she noted that it is now some six months since the collapse of Carillion and that five select committees have looked into this area.
The reports from the committees are:
• The National Audit Office’s Investigation into the government’s handling of the collapse of Carillion (June 2018) examines issues including the government’s contingency planning for Carillion’s possible failure, the government’s response to Carillion’s request for support and Carillion in liquidation.
• The Work and Pensions Committee and the Business, Energy and Industrial Strategy Committee held a joint inquiry into the collapse of Carillion, exploring the management and governance of Carillion, its sponsorship of its pension funds, and the implications for company and pension scheme law, regulation and policy.
They published their report, Carillion, in May 2018
• The Library briefing Carillion Pension Schemes looks at the position of the pension schemes, the regulatory framework, the role of the trustees and the role of the Pensions Regulator.
• The Public Administration and Constitutional Affairs Committee looked into the implications for public sector procurement – publishing a report After Carillion: Public sector outsourcing and contracting (9 July 2018).
• The Library briefing The collapse of Carillion (March 2018) discusses the causes and immediate consequences of Carillion's collapse.
• The Library briefing Corporate insolvency: consultations on reform examines three government consultations on insolvency and corporate governance. These seek views on improving arrangements, ensuring that lessons are learned from large company failures.
So you could conclude there has been much discussion and report writing but with what outcome?
The debate outlines how much work has gone into safeguarding some 12,000 of the 18,000 jobs that were at risk and significant number of apprenticeships have been transferred to other business.
The debate makes interesting reading. Yet again the Pensions Regulator is criticised for not being involved and aware sooner (hence the raft of new regulatory powers that are currently being consulted on – with much bigger fines and imprisonment for those found culpable). The BHS and Carillion collapses are partly due to the huge pension deficits and clearly these deficits were not adequate managed. The result, well for Carillion members is that there are 9 separate schemes in the assessment period with the Pension Protection Fund. And the BHS members narrowly escaped the PPF by a payment from Philip Green.
There is huge amounts of criticism by the House of the role of the auditors, advisers and company boards in the run up to the business collapsing. The Pensions Regulator has taken some serious criticism of its failure to protect members. The role of the regulator is certainly changing in response to these events. The TPRs report and accounts published on 12th July headlines with The Pensions Regulator (TPR) has evolved into a more visible and proactive regulator and is working in a clearer, quicker and tougher way.
Watch this space.
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