Councils scramble to plan for Connaught collapse

Three councils with Connaught framework agreements have been making continguency plans following the suspension of the firm’s shares this morning.

Connaught has housing contracts with Norwich, Renfrewshire and Gosport.

The company is one of four contractors on a housing improvement framework with Renfrewshire council.

The council said that if the firm went into administration Apollo, Wates and Carillion would take on the extra work on the contract, which started earlier this year and is worth around £59m.

Fourteen houses were being worked on by Connaught employees today, according to the council, and were said to be “almost finished”. The council said that it would not lose money because contractors were paid on completion of work.

In a statement the council said: “Connaught is one of four contractors taken on to carry out improvements. Each contractor has only been awarded one package of work at a time. No payments are made or further packages of work given until work is finished to the council’s satisfaction in each house.”

Norwich City Council said it had not received any reports of Connaught stopping work but said it had contingency plans in place if the firm went into administration.

A spokesperson for the council said it would be releasing a statement later today about Connaught. In April the council began a £17.5m services contract with Connaught after fighting off a legal challenge from rival bidder Morrison who claimed the bid was “abnormally low”.

Gosport Borough Council has convened a meeting to discuss their contract with Connaught.