Carillionalarm

The demise of Carillion should focus people’s attention on the extreme frugality which the government has forced many in industry to face.

The government’s contracting out (franchising) system for rail operators and PFI bidders forces firms to make bids which are barely economical. And the cost of borrowing for private firms is higher than for government. This is why rail fares in the UK are around three times higher than in Europe.

Carillion is not the only constructing industry firm which may buckle under financial pressures. Brexit makes these pressures worse because we potentially lose the European investment organisation and skilled workers (due to the refusal of the government to be flexible in allocating enough licences for essential immigrants).

Construction industries on a tight budget can’t afford the insecurity which Brexit has brought, yet Theresa May has drawn her line in the sand, showing a clear preference for the chaos of a hard Brexit rather than a soft one. Emanuel Macron has warned that we can’t have a Canada plus plus deal unless we accept the rules of the EU and pay our way. So it is impossible to reassure firms that change can be controlled. The difficulties created by Brexit continue.

ANDREW VASS Corbiehill Place, Edinburgh