The former directors of Carillion are being put under more pressure to further explain their testimonies over how the UK's second largest construction firm collapsed.

A joint inquiry into the company's demise is being led by the The Work & Pensions and the Business, Energy & Industrial Strategy select committees.

Despite being grilled by MPs during four hours of oral evidence in Parliament last week, the former directors are now being asked to provide more detail or in depth explanations of points in their oral testimony, particularly where it appeared to contradict other evidence.

For example, former Chief Executive Officer (CEO) Richard Howson is being asked for more detail over whether the firm was insured against concrete beam failures at the Royal Liverpool Hospital, whose design flaws and rising costs contributed towards the firm's demise.

He is also being asked for further details surrounding the payment schedule on claims for work in Qatar, which is also outlined as a major factor in the company's collapse.

In addition, former Chief Financial Officer Zafar Khan is asked to clarify again the terms of his departure, including whether a non-disclosure agreement was attached to it, while former Chairman Philip Green is asked about the "surprise" deterioration in the company's cash flow shown in the September 2017 presentation, which Mr Khan stated had "spooked" the board and led to his dismissal.


Former interim Chief Executive Keith Cochrane is asked about his change to the "provision", to clarify his interaction with the institutional investors who were offloading (and in at least one case, shorting) their shares in Carillion, and also about an apparent contradiction over negotiations with the main pension schemes' trustee. One of the questions asked is: "You told us "I think I only met two or three investors post 10 July". Which, please, were those investors? Did other investors request a meeting? Did you offer to meet them?"

Also Richard Adam, who was finance director between April 2007 to December 2016, is asked to explain what he thinks happened to the "healthy" company he left at the end of 2016, for it to go into compulsory liquidation a year later, and about acquisitions like Alfred McAlpine, which added £650m "goodwill" to Carillion's books but otherwise held net liabilities of £50m.

The Committees have also contacted the Federation of Small Business offering them the opportunity to respond to the dismissal by the Carillion directors of their evidence that Carillion were "notorious late payers" who "abused their dominant position" and left suppliers waiting for payment even beyond their extraordinarily long contracted payment terms.

Commenting on the evidence heard in Parliament, Committee Chairs Frank Field and Rachel Reeves called the former directors "a series of delusional characters" who maintained that "everything was hunky dory until it all went suddenly and unforeseeably wrong".

"We heard variously that this was the fault of the Bank of England, the foreign exchange markets, advisers, Brexit, the snap election, investors, suppliers, the construction industry, the business culture of the Middle East and professional designers of concrete beams," Mr Field and Ms Reeves said.

"Everything we have seen points the fingers in another direction - to the people who built a giant company on sand in a desperate dash for cash."

(LM/MH)