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How the Carillion collapse will affect Devon – including jobs, Exeter Prison and broadband

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The rollout of broadband to some of Devon’s more remote communities should escape impact from the collapse of construction giant Carillion.
But there are fears that around 200 workers could be directly affected across the county.
And the impact could be felt more widely along the supply chain, an Exeter insolvency expert has warned.
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An extra 80,000 rural homes and businesses in Devon and Somerset are due to be connected to ultrafast broadband in a new £200million deal by broadband specialist Gigaclear who awarded the contract to Carillion telent.
Now Gigaclear has said it still aims to complete the work on time and on budget.
A spokesman for Devon County Council, said: “We are confident that Devon has minimal exposure to Carillion’s collapse.
“The company is currently a named joint venture partner delivering some civil engineering elements of the full-fibre Gigaclear broadband network roll-out for the Connecting Devon and Somerset partnership. We have been assured that Gigaclear has a range of options available to it to deal with any change in circumstances affecting its contractors. Gigaclear is working to ensure that the publicly-funded broadband network is delivered on time and on budget.”
Carillion is involved in a wide range of major projects across Devon – including the maintenance of Exeter Prison and Dartmoor Prison.

Exeter Prison in New North Road (Image: JOHN FFOULKES)
Cllr Rob Hannaford, Leader of the County Council Labour Group said that he understands that the corporate folding could affect around two hundred staff in Devon.
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He said: “That’s an important economic consideration. I will be putting down some formal report requests to make sure that we are kept up to date locally with this fast changing situation and also its impact on some of our key partners such as NHS, Prison Service, and the Armed Forces.

Dartmoor Prison
“Yet again this situation really challenges the wisdom and propriety of out sourcing vital public services to private companies , often with worse pay and condition and poorer pensions, rather than keeping them in house. Indeed I really do hope that this will trigger a full national debate on reconfiguring how the public sector is generally set up and run in favour of more progressive options.”
He said council officers are double checking any dormant matters , such as historic minor service agreements over maintenance.
Carillion Civil Engineering has a base in Exeter and runs projects involving roads, railways, airports and telecommunications.
CarillionAmey provides infrastructure and housing services to the armed forces and has a contract for military bases in the South West.
Carillion was previously involved with the Exeter PFI schools contract but has not been for some years after the maintenance contract was awarded to Sodexo in 2015.
Subcontractors are likely to be the hidden victims in the collapse of construction giant Carillion, insolvency practitioner David Kirk predicts.
The affect could be felt far wider through the supply chain and the companies hired by Carillion to carry out its public sector or public/private partnership contracts, including providing school dinners, cleaning and catering at NHS hospitals and prison maintenance.
Mr Kirk, of Exeter-based Kirks Insolvency, said: “This is a very complex case and the largest company in recent years to go into liquidation. The last one was around eight years ago with the loss of Rok.
“The losses are likely to be far higher than initially anticipated because Carillion uses a lot of subcontractors who may not ever get paid. Even if, say 20% can be recovered by creditors, it can be months if not a year plus before the creditors see that money.“The knock on effect can mean lots of contractors who worked for Carillion, with no special rights like employees, not receiving any money at all or very little which could well put them into financial difficulty.”
Source: Devon live