Skanska hangs onto furlough cash despite handing out £16m dividend last year

Skanska has said it has no plans for a rethink on paying back furlough cash – despite handing over more than £16m in dividend payments to its parent last year.

The figure was disclosed in the firm’s report and accounts for Skanska UK which were filed at Companies House earlier this month.

The issue of whether firms in receipt of taxpayers’ cash should pay the money back ahead of paying dividends has divided opinion with several firms including Morgan Sindall, Galliford Try, Balfour Beatty and Travis Perkins confirming they handed the money back before resuming dividend payments.

Morgan Sindall boss John Morgan has been a persistent critic of firms paying out dividends ahead of paying back taxpayers’ cash. “Taking government money because you need it is one thing,” he told Building in 2020. “Taking it and giving it to shareholders isn’t what it’s designed for. If you’re doing that, the company probably didn’t need the money.”

Another firm which decided to pay back the money it received was listed ground engineer Keller and asked about its decision earlier this year, chief executive Michael Speakman said: “It was just the right thing to do.”

But some have decided not to pay the money, despite handing out dividends with one, architect BDP, paying its Japanese parent a £16m dividend – despite claiming £700,000 in furlough cash.

Skanska has claimed £4.3m over two years in furlough cash, including £300,000 last year, paying £16.1m in dividends to its Swedish parent last year and, according to its 2020 accounts, a further £35m in dividends across 2019 and 2020.

The firm told Building its position “in respect of furlough monies remains unchanged” – a reference to a previous statement it issued last July which said: “We are not planning to return the government’s furlough contribution.”

In that statement, it added that it had provided “extra paid dependants leave for those who have needed to take time to support their families; giving an extra day’s holiday to all employees to recognise their efforts during the pandemic; and topping up the government’s furlough contribution for all affected employees, including a top up to 100% for our lower paid people”.

Officially called the Coronavirus Job Retention Scheme, the furlough scheme finished at the end of last September with 11.7 million jobs furloughed. The number of people on furlough peaked in early May 2020 at 8.9 million. It is estimated to have cost the government £70bn, according to figures published by HMRC.