Too Big to Fail. That was what they thought; however experience has proven quite how wrong things can go. While the demise of the construction giant Carillion will take some time to unfold, the results are already devastating – thousands of hard working people have lost their jobs, smaller contractors are unsure if they will get paid, and the government is struggling to clean up the mess. When Carillion went into liquidation it had amassed £1.5bn in debt, including a £600mn pension deficit. It held 450 public contracts including providing school meals, hospital beds and prison services. A range of issues have already emerged from the crisis – the silent privatisation of key public services; the influence that chief executives seem to hold at Whitehall; irresponsible financial management; a lack of monitoring from the government; and a failure to see the warning signs. People are rightly angry about the levels of executive pay received by those responsible, as well as the poor treatment of small subcontractors (it seems that Carillion used its suppliers like a bank – paying on 120-day terms, while being paid themselves on 30-day terms by the government). As Simon Jenkins has written – big companies like these should not exist.
Centralisation is clearly convenient. Lumping together public sector contracts into larger and larger tenders makes things easier for a procurement officer, but it does not deliver better value for money or better outcomes for real human people receiving services. It is highly likely that the 218 school lunch contracts Carillion managed would have been better delivered with an army of 218 separate community-led organisations who care about the impact in their own communities, creating healthy local food for children. Multiple small tenders would have created a wealth of other benefits – for example through contracting social enterprises who employ people furthest from the job market and reinvest 100% of their profit. As member of the public commented in the Guardian at the time ‘More is not always better. Million, billion, trillion… Carillion.’
And yet, the government persistently chooses the big guy over the small guy. Here in Scotland, public procurement is (in theory) under reform. But in September 2017, when Fair Start Scotland contracts worth £96million were tendered, the sector faced yet another disappointment. Bids
 Rick Barker; Stocksfield, Northumberland; as quoted in The Guardian, 16th January 2018; https://www.theguardian.com/business/2018/jan/16/lessons-to-be-learned-from-carillions-collapse