We hadn’t signed ring road deal with Carillion, say Leeds council bosses

Unions are wanting answers after the collapse of Carillion.
Unions are wanting answers after the collapse of Carillion.

A Yorkshire council today insisted it had not signed off a contract for a vital £115m ring road with Carillion after the stricken construction firm went into liquidation.

Leeds City Council was among the authorities to hand out projects to the company, which has been struggling under £900 million of debt and has issued a string of profit warnings in the last six months.

The tram-train project in Rotherham and Sheffield was being carried out by Carillion.

The tram-train project in Rotherham and Sheffield was being carried out by Carillion.

The contractor has a host of public sector contracts across Yorkshire, including the much-delayed scheme to enable trams to run on existing train tracks as well as on tram lines in Rotherham and Sheffield, which is due to be completed this year.

It was also one of the firms involved in the construction of the Great Yorkshire Way link road to Doncaster Sheffield Airport and a project to replace the existing dual carriageway with a new three lane motorway on the A1 in North Yorkshire.

Carillion: Why did it collapse and what happens next?

It was reported this week that Carillion had secured the first phase contract for the £115m East Leeds Orbital Route, one of the most important infrastructure projects in the city. Leeds City Council had a deadline of December 28 to award the contract.

We are looking at the impact the news about Carillion will have on the council and wider city.

Tom Riordan, Leeds City Council Chief Executive

As part of the deal, the firm was deliver three roundabouts worth around £7m and enter into an early contractor involvement deal for the £80m contract to deliver 7.5km of dual carriageway.

Carillion was also the contractor for the Leeds City Centre Cycle Superhighway, due to finish this year, and the Tower Works development in Holbeck, on land owned by Homes England.

Tom Riordan, Leeds City Council Chief Executive, said: “We are looking at the impact the news about Carillion will have on the council and wider city.

“We know Carillion’s situation is not just affecting Leeds, and we are liaising with central government to see how we can help ensure services and contracts are still delivered successfully. We have been monitoring Carillion’s situation and planning accordingly and are now implementing those plans.”

Mr Riordan added: “We also know this will affect many people who work for Carillion directly and indirectly, and we will want to see how Government can make sure any arrangements take account of the impact on them of what has happened.

“While Carillion were the preferred bidder for the ELOR (East Leeds Orbital Road) work, a final contract had not been signed off. The contingency plans in place reflect the fact that we have been monitoring Carillion’s situation and planning accordingly.”

Politicians in Yorkshire have told of their concerns for workers in the region and the future of high-profile projects after the news of Carillion’s collapse emerged today.

Rotherham MP Sarah Champion urged the Government to ensure that the launch of the Rotherham-Sheffield tram-train link is not further delayed.

She said: “The delivery of the tram – train link has been disastrous from start to finish.

With repeated failures to meet deadlines and costs having quadrupled, the scheme now faces further uncertainty with the collapse of its main construction contractor.

“Carillion’s collapse is yet another blow to the delivery of the project and the Government must provide reassurance that it will not result in further delays in service starting operation.”

Sheffield Central MP Paul Blomfield said:“The collapse of Carillion is a potential disaster for 250 workers at their city centre offices and raises concerns over current and future pension arrangements.

“I’ve spoken to the Minister who has given me assurances on the position of Carillion staff for the foreseeable future and I will continue to press their case.

“I’m also seeking to ensure that the reallocation of contracts will not delay the tram-train project or essential flood protection work in Don Valley.”