RAIL INDUSTRY organisations holding contracts with Carillion have moved to provide assurances to workers and have sought to ensure work under these contracts has continued following the company’s collapse in mid-January.
The Powerlines Group, which holds a 50% stake in the Carillion Powerlines venture delivering some electrification schemes for Network Rail, was quick to highlight that the venture would continue to trade as normal. Electrification projects being delivered by Carillion Powerlines include the Midland main line wiring from Bedford to Corby and the Shotts electrification in the Scottish central belt. In a statement, Network Rail guaranteed Carillion employees working on and supporting its projects wages until at least mid-April. Funding was also secured to ensure any suppliers to Carillion would be paid by liquidator PwC in respect of work relating to Network Rail projects.
As confirmed in our ‘High Speed 2’ report (p93), the activities of the joint venture with Kier and Eiffage in which Carillion was a participant are also continuing, with the two remaining companies taking a 50:50 stake.
One uncertainty surrounds the procurement of the new Wales and Borders franchise, for which the Welsh Government required bidders to join with a construction firm as part of plans to upgrade the Core Valley Lines north of Cardiff. Carillion was Abellio’s bid partner. Abellio said in a statement it remains in the contract letting process, with suggestions as we went to press that Aecom might buy out Carillion’s interest in the bid. Four bidders were originally shortlisted for the franchise, but Arriva withdrew last year. If Abellio’s bid were also to be withdrawn, that would leave only KeolisAmey and MTR in the running for the contract. Final bids were submitted to the Welsh Government in December, with an announcement of the winning bidder expected later this year; the Arriva Trains Wales franchise is due to end in October.
In terms of Transport for London projects, Carillion was one of three bidders for the contract to build the London Overground extension to Barking Riverside; TfL says the company will be removed from the process with no impact on the project’s schedule. Carillion also held some contracts as part of the Crossrail project, but this work has now finished so TfL says there will be no significant issues, ‘except possibly with guarantees and warranties