Struggling Carillion gets millions more in public cash as provincial experiment with costly privatization continues
The Alberta government has made an additional $3.1 million available to Carillion Canada to ensure it can continue its highway maintenance obligations in the province, bringing the total amount provided to the struggling company to $12 million.
Carillion Canada is responsible for maintaining 43 per cent of Alberta''s highway network. The company is currently for sale after its parent arm, Carillion PLC, filed for insolvency in January.
"The Alberta government continues to shovel money into Carillion''s coffers, which makes it clear that the government doesn''t have faith the company is stable enough to continue these vital public services on its own," said AUPE Vice-President Mike Dempsey.
The province had previously made $8.9 million available to the company in March, a sum that was meant to last until April 30. When that date came and passed with no clarity about the future financial viability of Carillion, the province took the step in May of making the additional money available to ensure services continue.
"We''re glad these funds are being used to ensure Carillion''s contractual and payroll obligations are met, but it begs the question: if the government is already helping to fund these operations, why doesn''t the government simply take back Carillion''s contracts and provide highway maintenance as a direct government service?"
AUPE President Guy Smith recently sent a formal letter to Transportation Minister Brian Mason on behalf of the union urging him to seize the opportunity to bring the highway maintenance services covered by Carillion back under government control.
In the letter, Smith argued such a move would provide some stability for AUPE''s 450 members employed by Carillion and the rest of the public that rely on Alberta''s highways to get from point A to point B.
Mason had not responded to the letter as of press time.
According to media reports, the department justified the influx of additional cash to the company by saying it will provide "peace of mind" for Albertans that their highways are well maintained.
"Unfortunately, the government''s lack of leadership on this issue has left many AUPE members without any peace of mind about the future of their jobs or the service they provide on the highways," Dempsey said. "The government could achieve real peace of mind for Albertans by bringing highway services back under provincial control,
instead of investing public money into a private company."
At the very least, Dempsey said the Alberta government should make its contracts with Carillion public to determine if the company''s services are cost efficient and whether the province is justified in providing public money to prop it up.
Editor's note:Following the publication of this article in Direct Impact this summer, AUPE President Guy Smith met with Alberta Transportation Minister Brian Mason regarding the future of Carillion Canada's highway maintenance services in the province. The provincial government has indicated that Alberta Transportation is currently in discussions with Carillion Canada and an unnamed third party to assign the highway maintenance contracts currently handled by Carillion. For full details, please read this member update.