Ministers 'very worried' about public sector contractor Interserve in wake of Carillion collapse
2 min read
Ministers are said to be "very worried" about the finances of another private sector firm delivering public services in the wake of Carillion's liquidation.
Shares in Interserve tumbled after it issued a profit warning in September following big losses on an energy project in Glasgow.
The firm provides billions of pounds worth of public sector contracts and employs some 25,000 people in the UK alone.
A Whitehall official quoted in the Financial Times said: “Ministers are very worried about Interserve, but the team is small and low-key as they are not wanting to unsettle."
It follows the collapse of contractor Carillion, which was liquidated after amassing around £1.5bn in debt and a £600m shortfall in its pension fund.
However in a statement the Cabinet Office played down the significance of monitoring Interserve, saying it was normal to keep tabs on big contractors.
"We monitor the financial health of all of our strategic suppliers, including Interserve," a spokesperson told Sky News.
"We are in regular discussions with all these companies regarding their financial position. We do not believe that any of our strategic suppliers are in a comparable position to Carillion."
New chief executive Debbie White has outlined a transformation plan aimed at cutting costs by as much as £50m a year by 2020.
An Interserve spokesperson insisted the firm was putting its house in order.
"We expect our 2018 operating profit to be ahead of current market expectations and we continue to have constructive discussions with lenders over longer-term funding.
"We are keeping the Cabinet Office closely appraised of our progress as would be expected."
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