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Kier boss reveals talks over Carillion jobs

Kier chief executive Haydn Mursell has told Construction News the company is in talks with PwC about the possibility of completing some Carillion contracts.

Mr Mursell said Carillion’s position on Kier JVs had been addressed quickly because his firm was able to talk to the clients involved “immediately”.

“On anything else, whether that’s schools, rail, road, telecoms, I’m engaging with PwC on a number of fronts and we’re very well placed in all those markets to assist in trying to keep those projects going,” he said.

One area in which Kier could assist is the education sector, Mr Mursell said.

“Many of Carillion’s clients are also our clients, and we have very good relationships with them,” he said.

“As an example, where there are potentially schools that are half-built and need finishing on programmes that meet term-time requirements, then we will talk to those clients and assist them.

“We are the largest school builder in the UK, so consequently those are clients we’re talking to anyway.”

Yesterday, Mr Mursell told the Today programme that contractors would be “daft” to take on Carillion jobs under the existing terms and conditions, and he told  CN how Kier would approach any contracts.

“Any contractor will have to come in and discuss with the client what the client’s priorities are,” he said.

“Do they want the contract completed to the current programme or are they still focused on value for money, in which case they’re probably going to have to go out for re-procurement.

“Whichever their priorities are will determine the way forward.”

He added: “But the key thing I think is the preservation of people’s jobs.

”If we can act quickly with the government and PwC, and all Carillion’s clients for that matter, then we’re happy to do so, given the right risk profile.”

Carillion’s collapse has put the construction industry and its practices in the spotlight.

Earlier this week Build UK and other industry bodies called for an end to the current retentions system in the sector.

Mr Mursell said: “I think retentions are an unfortunate inevitability of the contract process.

“The comment from Build UK refers to us as contractors having retentions on our supply chains.

“But it’s worth noting that the clients of course hold a retention on us. So all we’re doing is mirroring the arrangement we’re seeing upstream.”

However, Mr Mursell said he was open to seeing the system change.

“I’m a supporter of something [changing], as long as it flows right up from the supply chain through us and to the client,” he said.

Mr Mursell was speaking to CN following the company’s trading update released this morning.

Kier’s net debt was up 31 per cent for the first six months of its financial year, but the firm said its construction business had “maintained” its margins.

Kier boss reveals talks over Carillion jobs

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