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Jobs lost as Carillion RBS maintenance deal ends early

Carillion has exited a long-term support services deal for the Royal Bank of Scotland two years early, resulting in a number of job losses.

The contractor confirmed to Construction News that its five-year support services and maintenance contract with RBS, signed back in 2014, had ended early, with services rival ISS taking over.

It comes just over a month after the firm revealed it was setting aside an extra £200m provision for problem support services contracts, as well as posting a half-year loss of £1.15bn.

“Carillion has jointly agreed with RBS a managed exit from the contract,” a Carillion spokesperson said. 

“This has now been carried out on mutually acceptable terms.”

The deal with RBS covered operation, maintenance and repair of the bank’s 1.5m sq m estate across the UK with offices in London, Manchester and Edinburgh, and had been due to come to an end in 2019.

Carillion confirmed to Construction News that staff working in regional offices across the country were transferred to ISS last week, and would continue to work on the contract as ISS staff.

However, a number of staff, including operation managers, regional managers and support staff, were made redundant as part of the transfer.

It is understood by CN that this included staff that had worked at Carillion for more than a decade.

Carillion set aside an extra £200m to cover 23 problem services contracts identified by KPMG in a review of all of the company’s contractual commitments.

At the announcement of its half-year loss, interim chief executive Keith Cochrane told analysts that Carillion needed more “checks, balances and discipline” when it came to bidding for projects, and that the contractor would be willing to walk away from jobs if appropriate. 

Mr Cochrane added that the group’s restructuring programme was “about doing less with less”, with the company simplifying its management structure to “increase efficiency and reduce cost”.

The RBS deal was one of three contract wins announced by Carillion in March 2014 worth £370m.

These also included a support services deal for Canadian Natural Resources at its Horizon mine in Alberta, Canada, and a contract with communication firm Arqiva for hard and soft facilities management across its estate.

ISS and RBS declined to comment.

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