Network Rail is activating contingency plans following the news that one of its main framework contractors, Carillion, is to enter liquidation.
A spokesperson said that it will be working closely with administrators and Carillion’s management team to ensure the news “has as little impact as possible” on its projects.
This includes ensuring that rail projects that Carillion is currently working on – which amounts to around £150 million to £200 million – continue and that the supply chain is maintained.
There are a number of major contractors who could take over Carillion’s projects.
Carillion is not involved in the day-to-day running of Britain’s railways and Network Rail reassured passengers that services will be operating as normal.
It is however a major rail contractor, working on such projects as Crossrail, HS2 and electrification schemes around the country.
In 2016-17, Carillion received 5.1 per cent of Network Rail’s total spend on suppliers – that’s around £372 million – making it the infrastructure manager’s second biggest supplier after Costain.
Carillion’s services to the rail industry cover track, signalling, telecommunications, overhead line equipment, civil engineering and building projects.
It also provides facilities management services to the London Overground network.
Carillion has said that the government will be providing the necessary funding to maintain the public services carried out by its staff, subcontractors and suppliers. The government has urged Carillion staff to go work as usual following the news of liquidation, promising they will be paid.