THE head of Scottish construction and infrastructure giant Robertson Group has declared the collapse of Carillion has brought to an end a period of “over-competitiveness” in the industry.
Speaking as the company unveiled an 18 per cent rise in pre-tax profits to £30.8 million, Bill Robertson said he hopes a more realistic approach to procurement will now prevail in light of the high-profile failure.
The collapse of Carillion brought into focus the procurement model for public service contracts, leading to calls for reform to ensure work is more widely shared among smaller firms and contract decisions are not determined solely on price.
Robertson’s facilities management division has picked up a number of former Carillion projects in recent months, resulting in the group recruiting an additional 570 staff.
Asked if he believes the model has to change in light of the Carillion collapse, Mr Robertson, whose firm sits on a number of major public sector procurement frameworks, said: “Definitely. I think the Carillion event capped off a period of over-competitiveness in the industry, resulting in probably a number of liquidations and difficulties companies got themselves into over that period. And Carillion cannot be exempted from that. As an industry, we are probably in a clear environment and hopefully better sense in terms of procurement and bidding will prevail.”
The latest accounts for Robertson show a 33% hike in turnover to £752.4m in the year to March, with the company revealing that large projects accounted for 56% of that growth.
Robertson, which employs more than 3,000 people across its 22 trading businesses, completed work on the new £140m distillery for single malt whisky The Macallan over the period. It is currently building the new Aberdeen Exhibition and Conference Centre (AECC) as major contractor to Henry Boot, which with a value of about £330m will be the company’s single largest project to date.
Other major projects under way include the construction of an £80m facility for Boeing at Lossiemouth, which will house the new P-8 maritime search planes for the Royal Air Force, and the new Balfour Hospital in Orkney. That project, which has a value of 64m, is in its final stages.
Outside major projects, Robertson’s housing division built 213 private homes over the period, and 315 affordable units. Turnover from affordable homes rose £67m from £40m, reflecting the demand for more housing across Scotland. Mr Robertson flagged the growth opportunity open to its housing division, which he said has not been affected by the recent increase in the interest rate to 0.75%, Reservation rates were said to be “solid.”
And he expects the public sector to continue to be a major source of work for the firm, despite Brexit, pointing to the ongoing investment by the Scottish Government in Scotland’s roads, housing and NHS buildings. “That will continue,” he said. “We’re on a number of long-term frameworks which provide us with work in any event. In the medium term I can’t see us being affected by Brexit, whatever the outcome.”
However, Mr Robertson said the construction industry continues to suffer from a shortage of skilled staff. While the company has benefited in the last decade from an influx of workers from eastern Europe, many of those workers have started to return to their homelands.
Mr Robertson said: “We are beginning to feel the effects of that. The other thing is there is a shortage of good people coming into the industry. We’ve all got a job to do in trying to direct people [into the industry], and I think the Government could maybe play a part and try to reverse their process where everyone leaving school seems to need to go into higher or further education. There is a lot to be learned from the past, where there were schemes where people leaving school could earn as they continued to learn and grow good careers.”
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereLast Updated:
Report this comment Cancel