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<\/p>\nEmployees on public sector contracts will continue to be paid.<\/p>\n
A helpline is being set up for those staff affected, with ministers also aiming to assist sub-contractors of Carillion.<\/p>\n
Cabinet Office minister David Lidington chaired a meeting of the emergency COBRA committee on Monday night following the collapse of the major public service provider.<\/p>\n
Speaking after Monday night\u2019s meeting, Mr Lidington stressed the Government is battling to ensure the firm\u2019s demise \u201ctakes place in an orderly manner that does not disrupt public services\u201d.<\/p>\n
Carillion, which employs 20,000 workers across Britain, held multi-million pound contracts across the work of Government before banks pulled the plug on the 200-year-old firm.<\/p>\n
These included work on the HS2 railway, the construction of new schools and hospitals, the building of the Aberdeen bypass and catering contracts with both schools and the Ministry of Defence.<\/p>\n
Ministers were forced to respond after the crisis-stricken firm plunged into liquidation early on Monday morning amid \u00a3900m of debt and a \u00a3587m pension deficit.<\/p>\n<\/div>\n
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But Mr Lidington was also forced to defend the Government\u2019s actions amid anger at ministers\u2019 relationships with Carillion.<\/p>\n
Downing Street has revealed eight new contracts were signed with Carillion since July last year, when the firm issued a profits warning, which sparked a sustained share price fall.<\/p>\n
Mr Lidington insisted \u201cextra protection\u201d was built into the \u201cvery small number of contracts\u201d and did not represent a high-risk strategy.<\/p>\n
\u201cMany companies\u2026 do issue profit warnings from time to time and on most occasions they work through the difficulties and recover from them,\u201d he added.<\/p>\n
\u201cCertainly Carillion were saying to us they were very confident they could get a deal with their bankers and their creditors.\u201d<\/p>\n
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Labour leader Jeremy Corbyn has branded the collapse of Carillion a \u201cwatershed moment\u201d as his party vows to end private finance initiative (PFI) contracts for public services.<\/p>\n
He said they had \u201cfleeced the public of billions of pounds\u201d.<\/p>\n
But Mr Lidington denied Carillion\u2019s failure would spell the end of PFI, insisting the \u201cprinciple\u201d of such contracts is right, as it removes the risk from taxpayers of public service investment.<\/p>\n
However, he added ministers will \u201cneed to look at whatever lessons there are to be learned\u201d.<\/p>\n
The Government has assured Carillion workers they will continue to be paid for providing public services, although those employees on private sector contracts will only be paid for 48 hours and will not be offered the same protection as those in the public sector.<\/p>\n
A helpline is being set up for those staff affected, with ministers also aiming to assist sub-contractors of Carillion.<\/p>\n
The Government has also told former Carillion workers already receiving their pensions that they will continue to receive payments.<\/p>\n
Speaking in the House of Commons earlier on Monday, Mr Lidington insisted Carillion\u2019s shareholders and lenders \u201cwill bear the brunt of the losses\u201d.<\/p>\n
\u201cTaxpayers should not and will not bail out a private sector company for private sector losses or allow rewards for failure,\u201d he said.<\/p>\n
Major banks HSBC, Barclays, Santander and Royal Bank of Scotland are reportedly set to lose an estimated \u00a32bn as a result of Carillion\u2019s failure, while shareholders are expected to receive nothing.<\/p>\n
Mr Lidington revealed Carillion\u2019s former and current bosses will be investigated as he warned of possible \u201csevere penalties\u201d.<\/p>\n
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Questions have been asked about continuing salary payments to executives who had already left the firm.<\/p>\n
Departed chief executive Richard Howson received \u00a31.5m in pay, bonuses and pension payments in 2016, with Carillion having agreed to keep paying him a \u00a3660,000 salary and \u00a328,000 in benefits until October.<\/p>\n
Similarly, ex-finance chief Zafar Khan, who left the company in September, will receive \u00a3425,000 in salary for 12 months; while interim chief executive Keith Cochrane will be paid his \u00a3750,000 salary until July, despite leaving Carillion in February.<\/p>\n
Mr Lidington said he could \u201ccompletely understand\u201d the \u201csense of unfairness\u201d as MPs called for Carillion bosses to be made to hand back their \u201cexorbitant bonuses\u201d.<\/p>\n
Labour\u2019s shadow Cabinet Office minister Jon Trickett accused the Government of being \u201crecklessly complacent\u201d by attempting to lay sole blame for Carillion\u2019s collapse on the company.<\/p>\n
He said: \u201cThe House will conclude it was recklessly complacent in seeking to avoid responsibility for the Government and placing the whole responsibility on the company.<\/p>\n
\u201cAfter all Carillion provides 450 separate taxpayer funded contracts to the public.\u201d<\/p>\n
Rail, Maritime and Transport union general secretary Mick Cash said: \u201cThe blame for this lies squarely with the Government who are obsessed with outsourcing key works to these high-risk private enterprises.\u201d<\/p>\n
Labour peer Andrew Adonis, who quit as chair of the Government\u2019s National Infrastructure Committee last month, attacked ministers over Carillion\u2019s collapse and raised questions about the role of Transport Secretary Chris Grayling in the awarding of HS2 contracts to the firm.<\/p>\n<\/div>\n<\/div>\n