” The parliamentary select committee report pulls no punches in blaming the greed of the Carillion executives, who gouged out millions from the business up to the moment of collapse, with £1.5bn owed to creditors and £0.5bn to the pension fund (Carillion fall blamed on hubris and greed, 16 May). The wider issue, for all financial institutions, is the greed of the “big four” auditors, paid £72m, who colluded with the directors, gave no warnings and signed clean certificates. Surely the executives and auditors should pay all the creditors in full. At what point does the “cosy relationship” become a criminal fraudulent conspiracy? As Polly Toynbee argues, the people want their money back from the fat cats, not slippery apologies. Are the supine regulators part of the conspiracy or will they bring charges?
Tax Reconciliations, Oxford
• We in the west criticise Putin’s Russia as a “kleptocracy”, but the damning report into the collapse of Carillion shows that something similar exists in too many of the boardrooms of British companies. Time and again we read reports of chief executives and their boardroom cronies, to quote Frank Field, “stuffing their mouths with gold”, while their companies go to rack and ruin with thousands thrown out of work and pension schemes impoverished. There is a word for people who appropriate other people’s money: “thief”. If boardroom larcenists can steer clear of the law and go unpunished, it is surely time that the law was changed.
• A simple solution is to ban the auditors of all public companies from undertaking any consultancy or other non-audit work. We need specialist audit firms and totally separate consultancy organisations so that audit opinions are not influenced by potential consultancy fees.
The government’s culpability and responsibility for the collapse of Carillion and its consequences is broader and deeper than your article and the select committee’s report suggest: the government’s insistence that its estate be constructed and managed through prime contract procurement strategies increases the risk of prime contractor default and its disastrous consequences, as well as increasing the cost of everything it purchases. There was a time when local builders or suppliers would deal direct with their local government client: now we must go through a pyramid of consultancies, all adding 20% and “retaining” 10%.
• If a benefits claimant makes a fraudulent claim they may end up in court for their abuse of public funds. When I read about the way in which public money has been handled by Carillion, I find myself wondering when we can expect the court appearances of the directors and their accountants.