Daisy Read

Said the following about Network Rail Carillion Response Team:

“Earlier this year, Network Rail successfully managed the sale and transition of Carillion rail contracts, saving over 1000 jobs and ensuring the continuity of work for hundreds of smaller suppliers across the rail industry, while maintaining the continued safe operation of the railway and delivery of major projects across the country.

On 15 January 2018, Carillion plc entered compulsory liquidation, putting thousands of skilled jobs and the stability of numerous key rail suppliers at risk. As Network Rail’s second largest supplier, the liquidation also threatened the delivery of high profile projects and had the potential to seriously impact the rail industry’s reputation.

In keeping with a response plan developed prior to Christmas, a Network Rail taskforce was quickly established to work alongside the Official Receiver and Special Managers (PWC) to protect both people and projects by providing assurance and support for continuity of works delivery. The purpose of the taskforce was to deploy pre-planned contingent transition plans to maintain continuity of the works, support rail employees and suppliers and assist in the sale process of the rail division of Carillion plc. In parallel, the team needed to ensure the continued safe delivery of projects, avoid any potential disruption to operational services and balance the needs of the workforce and dependant suppliers with value for money for the taxpayer.

To stabilise the workforce and supply chain, the team implemented a bespoke funding agreement with PWC, which guaranteed employee salaries until 14th April 2018 and put in place mechanisms to administer the contracts and payments to the supply chain during the same period which was vital to ensuring continuity and protection to our smaller rail suppliers.

On the 22nd February 2018 a sale of a significant number of contracts to Amey Rail Limited (‘Amey’) was successfully completed, securing the transfer of approximately 600 jobs. Amey’s acquisition of the Network Rail contracts operated by Carillion included the North West Electrification Programme (NWEP), London to Corby track, civils and support contracts, Crossrail (OOCPA) and plain line track north. Dedicated teams were also set up in collaboration with Amey to facilitate the transition, alongside twice weekly Exec level steering groups, to make sure those transferring to Amey were adequately supported.

A number of contracts weren’t included in the sale to Amey, including projects from Western & Wales, Scotland North East (SNE), Route Services Track Welding and two joint ventures. Each of these contracts enacted their respective approved transition plans and were monitored and supported by Network Rail’s response team. Carillion’s health and safety performance was also continually monitored throughout the transition process, with weekly updates from Carillion section directors as well as weekly conference calls with regional Heads of Safety.

The final contracts were transferred at the end of April 2018, with no significant safety or delivery impacts to our projects. Most notably, over 1000 jobs were preserved, ensuring that peoples livelihood in the railway and essential skills were protected.

The potential impact of the Carillion liquidation to the rail network, our passengers and the tax payer was very significant. The highly focussed approach taken by the team led to a stabilised supply chain, provided much needed reassurance to Carillion employees and ensured the protection of people and projects.

“This is a brilliant outcome at the end of a very difficult process. You and your team have been outstanding. Well done and thank you” – Mark Carne, former Network Rail CEO.

The Network Rail response team was made up of employees from across the business who were taken from their usual roles and locations to support the delivery management and transition process during 16 intense weeks. For many of the team, this meant making personal sacrifices over a number of months and temporarily leaving their ‘day jobs’, but their commitment and determination to protect jobs and projects did not waver. None of this would have been possible without the continued commitment shown by the Carillion staff, who delivered throughout despite uncertainty. The outcome is testament to the professionalism of Network Rail and its endeavours to do the right thing in difficult circumstances and is a credit to the industry.

Sentiment with regards Network Rail’s behaviours and priorities from across the rail supply chain has been very positive:

“In one of the most challenging situations that industry has faced in recent times, Network Rail’s response to the liquidation of Carillion was first class. Our members were looking for clarity, confidence and certainty at a time when all were in short supply. Network Rail stepped up with a considered and co-ordinated response that addressed industry concerns promptly and secured the future of smaller businesses. We have since used this response as an example of best practice when engaging with Ministers and others in terms of how client organisations can and should act under such a scenario.” Alasdair Reisner, Chief Executive, Civil Engineering Contractors Association

“Network Rail handled a difficult situation in a pro-active and professional way. Its communication with suppliers and representative bodies and its willingness to help where possible, made a challenging and unfortunate set of circumstances as operationally painless as possible for the supply chain. NR should certainly be commended for this.” Peter Loosley, Policy Director, Rail Industry Association

“The team listened with outstanding empathy and helped us all to deal with the issue humanely, quickly and effectively. They understood our corporate and personal positions with great skill” Andrew Belcham, ARUP“