There is plenty elsewhere on the not-so-swift demise of this huge UK corporate that the Government trusted with some very large infrastructure projects.
- The Government awarded them contracts last year because, according to the Govt advisers, not to do so would have sent them under sooner. HELLO!! Does anyone speak capitalism - if a comnpany is rocky, giving them more business creates a bigger hole for you down the road when it collapses. They are called profits warnings for a reason.
- Much criticism there is of outsourcing, but actually I wonder the role here of Government pushing for too harder a bargain and crazy contractors signing up in the belief that somehow they can deliver to the budgets. They can't and instead we have this. There is a lot of this in the building sector at the moment, Mace has seen profits turned into losses, Lang O'Rourke managed to lose £141 million last year. These are private sector companies doing private deals, but the market has really turned against them. Companies and Government want cheap builds and the greedy company directors are either not walking away or are too afraid of foreign competition.
- Brexit does have impacts, falling investment has reduced the number of projects in the UK, with more competition for those that are left on the table (some big ones like Crossrail are ending).
- The Construction industry is a lot less healthy than the markets think, even house building is coming off what have been an amazing run - inflation costs and a slowing housing market are taking the margins right off the sell prices and the land banks were all acquired at market peaks of late.
- Finally, the siren labour call will be for this kind of work to be done direct by the Government, I really don't see how that helps with the price controls or quality control for the government. It will only stop the projects failing, because, umm, the Government can throw more money at it. So trying to move this work into the public sector will simply create a big moral hazard problem.