Government Chose NOT to Protect Subcontractors

Government chose NOT to include an EU directive (article 71.3 of Directive 2014/24/EU) in Irish Law to protect subcontractors with payments directly from the contracting authority. As a result, the collapse of Carillion has exposed numerous Irish businesses to devastating financial exposure.

The failure of Government to include this in Irish legislation when the directive was transposed into Irish Law is utterly negligent.  This was compounded by its failure to carry out proper due diligence when selecting the main contractor during the procurement process. It cannot now ignore the plight of these subcontractors who are left without payment for the work they have carried out and the equipment they have supplied to the Schools concerned.

Subcontractors in Finance Committee
Subcontractors severely impacted by the Carillion collapse relate their stories of financial devastation in the Oireachtas Finance Committee.

These subcontractors have been robbed of millions of euro. Their businesses, many of which are second and third generation SMEs, have been left in precarious positions with uncertain futures.

Losses such as those affected by the collapse of Carillion and Sammon have become a regular feature of the Irish Construction Sector over the past ten years, resulting in multiple losses for some sub-contractors.

Questions need to be answered: Why did the Irish government NOT choose to include the provision for sub-contractors to get paid directly by the contracting authority when the directive was transposed into Irish law?  Were they not concerned about the risks to these businesses which form the back bone of our economy or the hundreds of job losses that could arise from exposure to such risks?

Furthermore, I believe the Irish Government must look to formally hold the auditing company of Carillion, KPMG, to account for assessing the company as financially sustainable.

We cannot go into a situation in September where students will be using buildings and equipment that have not been paid for.  This is not morally acceptable.  Putting students, parents, teachers and communities in this position is unthinkable.  The Department of Education, NDFA (National Development Finance Agency) and Government have to ensure payment for outstanding works and equipment.  Certification of works to meet Building Regulations must involve those who have carried out the works and supplied the building products.