After Carillion end outsourcing in FE statement

College unions at the Capital College City Group have put out this statement and sent it to their employers demanding that all outsourcing of services should stop and be brought in–house.

After Carillion – bring back services in – house.

The high risk to the public sector – including CCCG – of relying on profit-maximising high-risk taking private contractors to deliver our services has been thrown into stark prominence by the shocking collapse of Carillion with debts of over £900 million and a pension black hole of £580 million. As Jeremy Corbyn MP said , ‘this is a watershed moment for profit providers of public services.’

While Carillion’s shareholders and directors have continued to receive dividends and 6-figure salaries since profit-warnings were first issued in July, and while short-sellers including Blackrock have pocketed profits from betting on the fall in the value of Carillion shares according to the Guardian (17 January), thousands of workers employed directly by Carillion, or by their contractors and suppliers, now face unemployment and/or not being paid for their work, and £ millions [or should that be billions?] of public sector projects now face disruption and derailment.

The revelations in the Guardian that KIER have been involved in a number of joint ventures with Carillion, and are therefore likely to be affected by the collapse of Carillion, raise the concern that CCCG – and the staff employed by or through KIER to deliver FM Services here – could be drawn into fallout from the collapse of Carillion. This in turn calls into question whether KIER will be able to deliver on the terms of its FM hard and soft services contract with the Group, both in terms of its service commitments and its commitments as an employer, including payment of the London Living Wage as the minimum hourly rate.

The CCCG unions believe that the risks from outsourcing to CCCG, to the students we serve and the workers who deliver our services, are unacceptable and we call for an urgent review and reconsideration of the strategy of outsourcing FM services and for our FM Services to be brought in-house.

Staff were given assurances that the City & Islington College Facilities team transferring to Kier would be able to remain as members of the Local Government Pension Scheme (LGPS) with its defined and guaranteed pension benefits, and employer contributions of 12.54%. UNISON was hugely disappointed to learn in the Autumn that Kier had withdrawn its application for LGPS-admitted status and that the staff would only be able to join the Kier Savings Retirement Plan (a BlackRock scheme), where they are invited to invest their contributions in the stock market (and where staff therefore bear the risk), and where the employer contributes only match employee contributions up to 7.5%.

The CCCG unions deplore the failure by KIER to provide a matching pension scheme for our Facilities staff transferring from the LGPS. Staff employed by KIER and the other private contractors in the Group must be able to look forward to financial security in retirement. This is not possible under the Kier Savings Retirement Plan as we have recently seen with the collapse of Carillion.

This is also a company  who In May 2016 KIER had to pay out millions of pounds in compensation to more than 1,000 workers to settle legal action against blacklisting of workers brought by the GMB and Unite unions. The blacklisting scandal came to light in 2009 following a raid by the Information Commissioner’s Office on an organisation called The Consulting Association which was based in Worcestershire.

KIER was revealed as a key subscriber to The Consulting Association and it’s then-employee Danny O’Sullvan (now retired) was named last month in High Court Proceedings brought on behalf of over 70 construction workers by the Unite Union against four ex-Chairmen of the Consulting Association for breach of privacy, defamation and Data Protection Act offences arising from their alleged involvement in blacklisting. Although the industry including Kier claim to have put such “vetting” practices behind them, concerns were recently raised in an Early Day Motion tabled by Labour MP Chuka Umunna over blacklisting on the Crossrail Project (in which Kier participates as a contractor) (see LRD Fact Service, 79 (36) – 7th September 2017).

Awarding the contract to KIER to run our facilities puts the colleges integrity at risk. The colleges that make up the group maintain the highest education standards , ethics and values which KIER clearly do not up hold. We need to return to a model that is not broken and has a proven track record of providing good services and value for money. We must bring facilities back in house.

CCCG Unison branch committee

Sean Vernell, Coordinating Committee Secretary on behalf of City and Islington College UCU

 Carly Grundle, Coordinating Committee Secretary on behalf of Westminster Kingsway UCU



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