Carillion and the Crisis of British Capitalism
By Joseph Adams, RCIT Britain, 23.1.2018, https://rcitbritain.wordpress.com
Carillion, the second biggest construction company, went into voluntary liquidation on 16th January 2018 with debts of over 2.2 billion pounds. It has over 800 million in pension liabilities alone.
Carillion was part of the major infrastructure in Britain. It was involved in over 450 public sector contracts. Since the major privatisation under successive Labour and Tory governments it was heavily involved in the public sector. Its involvement included work on prisons, schools, hospitals libraries and road building. It employed over 20,000 workers in Britain and 23,000 abroad with contracts in Canada and the Middle East. The collapse of Carillion is a blow for Britain’s ruling class as well as its interests abroad.
The Guardian reported: “Carillion, which managed hundreds of public sector projects and vital public services, collapsed into liquidation after last-ditch rescue talks failed, with a team from accountancy firm PwC drafted in to help manage the process. Carillion relies on major contracts, some of which have proved much less lucrative than it thought. Earlier this year it slashed the value of them by £845m, of which £375m related to major public-private partnerships (PPPs) such as Royal Liverpool University hospital. As its contracts underperformed, its debts soared to £900m. The company needed a £300m cash injection, but the banks that lent it money refused to put more in.” (The Guardian: Fears fallout from Carillion collapse will spread to other companies, 15 January 2018)
The development of PFI (Public Finance Initiative) started by the Blair Governments of 1997 and 2005 and continued by their Tory successors meant that the Public sector once in the state’s hands reverted to private companies like Carillion. The stench of corruption has shown that many of these private companies by speculation and the destruction of basic social assets like hospitals and schools were used by hedge fund speculators to destroy what was left of these assets. It has been reported that thousands of pounds of bonuses have been paid secretly to directors of the company with massive pay outs. Meanwhile thousands of workers face dismissal and the sack while the bosses continue to make money out of a major asset.
The inherent crisis of British capitalism is for all to see. Behind this lies, as Marx already foresaw, the tendency of the rate of profit to fall. Capitalism is in deep crisis and it requires a revolutionary solution to the problem.
The RCIT in Britain puts forward the following transitional demands to unite the working class in a struggle against social inequality and the stench of corruption that surrounds the bosses in Carillion.
* Cancel all debts and cancel all PFI contracts!
* Nationalise all social assets currently under private hands (including Carillion), which have been privatised and outsourced to private companies without compensation and under workers control.
* For a Sliding scale of wages!
* Call on the leaders of Unite, the GMB and PCS in Carillion to organize strikes and occupations where dismissals or redundancies are threatened against the workforce!
* People assemblies to be built in every area to organise and support any form of strikes or occupations that take place!
* Call on Jeremy Corbyn and the TUC to organise and lead an indefinite general strike to bring down this weak and discredited May Tory government.
* For a Workers Government.
We call on anyone who supports our programme to join the RCIT in BRITAIN as the first step in building a Revolutionary Party as part of the Fifth International World party of the Socialist Revolution