Should HM Gov' Bail Out Carillion?
Comments
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The Seven Principles of Public Life
Selflessness
Holders of public office should act solely in terms of the public interest. They should not
do so in order to gain financial or other material benefits for themselves, their family, or
their friends.
Integrity
Holders of public office should not place themselves under any financial or other
obligation to outside individuals or organisations that might seek to influence them in the
performance of their official duties.
Objectivity
In carrying out public business, including making public appointments, awarding
contracts, or recommending individuals for rewards and benefits, holders of public office
should make choices on merit.
Accountability
Holders of public office are accountable for their decisions and actions to the public and
must submit themselves to whatever scrutiny is appropriate to their office.
Openness
Holders of public office should be as open as possible about all the decisions and actions
that they take. They should give reasons for their decisions and restrict information only
when the wider public interest clearly demands.
Honesty
Holders of public office have a duty to declare any private interests relating to their
public duties and to take steps to resolve any conflicts arising in a way that protects the
public interest.
Leadership
Holders of public office should promote and support these principles by leadership and
example.
Standards of Conduct in
Local Government
in England, Scotland and Wales
Summary of the Nolan Committee's Third
Report on Standards in Public Life
I guess this doesn't apply at government level.0 -
bompington wrote:Strange, I haven't heard quite so much just recently about how PFI is a licence to extort unimaginable wealth from the taxpayer :?
Here you go
http://www.bbc.co.uk/news/business-427249390 -
FishFish wrote:OK so you are not a Great Professor.
I'm struggling to find an example where any organisation was stupid enough to buy pension fund there is an anecdotal example of Kaiser Willhelm's grandson buying an insurance company because he could not insure his car whilst he was a student (at Cambridge - one of my almas mater). But I defer to your Great Knowledge of the pensions industry.
Google is your friend - but to speed things up concentrate on "EMI Group pension buy-out"
You can argue all that you like that you can not value pension fund liabilities but I sit in meetings where actuaries have done exactly that.
I have no idea what "Great Professor" refers to so you are wasting your time0 -
I've never disagreed that you can value liabilities with an assumption on bond yields - your argument is on pricing them - a sale issue. The point made by EMI and the banks involved.
...but you do know all about wasting your time....take your pickelf on your holibobs....
jeez :roll:0 -
mamba80 wrote:The Carillion thing is just yet another example of corporate greed allowed to go unchecked, under the smoke screen of private business is more efficient than state.
Why havent we got workers on boards? a tory manifesto promise.... then broken, this would at the very least have stopped some of the excesses of Carillion....
The more you post the more you expose that you have little understanding of the real world.
Ignoring the tory manifesto pledge, let's explore your worker on the board scenario.
So a worker on £30k gets moved onto the board. Now how do you think that 'worker' is going to be persuaded to follow the views of the board? Yes, the board will remunerate that person for the extra responsibility they now have, let's say a small amount for a director of a company the size of Carillion, and double their pay to £60k.
What worker is going to risk jeopardising this pay rise to look out for the workers? Yes, their views would be sought, but they will be voting the way the board wants them to otherwise if that 'worker' risks blocking the company going forward the way it wants to, they will be replaced with someone more 'compliant'0 -
Coopster the 1st wrote:mamba80 wrote:The Carillion thing is just yet another example of corporate greed allowed to go unchecked, under the smoke screen of private business is more efficient than state.
Why havent we got workers on boards? a tory manifesto promise.... then broken, this would at the very least have stopped some of the excesses of Carillion....
The more you post the more you expose that you have little understanding of the real world.
Ignoring the tory manifesto pledge, let's explore your worker on the board scenario.
So a worker on £30k gets moved onto the board. Now how do you think that 'worker' is going to be persuaded to follow the views of the board? Yes, the board will remunerate that person for the extra responsibility they now have, let's say a small amount for a director of a company the size of Carillion, and double their pay to £60k.
What worker is going to risk jeopardising this pay rise to look out for the workers? Yes, their views would be sought, but they will be voting the way the board wants them to otherwise if that 'worker' risks blocking the company going forward the way it wants to, they will be replaced with someone more 'compliant'
Whose real world is that bud?
Works well across across europe but we are in a select group of countries that have no formal arrangements... also you can pck and chose which tory manifesto promises you want upheld.
There are only ten countries without legislation or other agreed arrangements providing for board level representation. These are Belgium, Bulgaria, Cyprus, Estonia, Italy, Latvia, Lithuania, Malta, Romania and the United Kingdom
why exactly would an employee on a board have a 100% pay rise? what world do you inhabit0 -
mamba80 wrote:Coopster the 1st wrote:mamba80 wrote:The Carillion thing is just yet another example of corporate greed allowed to go unchecked, under the smoke screen of private business is more efficient than state.
Why havent we got workers on boards? a tory manifesto promise.... then broken, this would at the very least have stopped some of the excesses of Carillion....
The more you post the more you expose that you have little understanding of the real world.
Ignoring the tory manifesto pledge, let's explore your worker on the board scenario.
So a worker on £30k gets moved onto the board. Now how do you think that 'worker' is going to be persuaded to follow the views of the board? Yes, the board will remunerate that person for the extra responsibility they now have, let's say a small amount for a director of a company the size of Carillion, and double their pay to £60k.
What worker is going to risk jeopardising this pay rise to look out for the workers? Yes, their views would be sought, but they will be voting the way the board wants them to otherwise if that 'worker' risks blocking the company going forward the way it wants to, they will be replaced with someone more 'compliant'
Whose real world is that bud?
Works well across across europe but we are in a select group of countries that have no formal arrangements... also you can pck and chose which tory manifesto promises you want upheld.
There are only ten countries without legislation or other agreed arrangements providing for board level representation. These are Belgium, Bulgaria, Cyprus, Estonia, Italy, Latvia, Lithuania, Malta, Romania and the United Kingdom
why exactly would an employee on a board have a 100% pay rise? what world do you inhabit
A single worker on a board won’t change the weighting of shareholder dividends to company pension fund contributions.
HMG still has to act regarding BHS. Green took the cash as dividends, maxwell took the cash from the company pension fund. Greens action were legal. How can that be right and how can a worker on a board remedy that situation?“Give a man a fish and feed him for a day. Teach a man to fish and feed him for a lifetime. Teach a man to cycle and he will realize fishing is stupid and boring”
Desmond Tutu0 -
Slowmart wrote:mamba80 wrote:Coopster the 1st wrote:mamba80 wrote:The Carillion thing is just yet another example of corporate greed allowed to go unchecked, under the smoke screen of private business is more efficient than state.
Why havent we got workers on boards? a tory manifesto promise.... then broken, this would at the very least have stopped some of the excesses of Carillion....
The more you post the more you expose that you have little understanding of the real world.
Ignoring the tory manifesto pledge, let's explore your worker on the board scenario.
So a worker on £30k gets moved onto the board. Now how do you think that 'worker' is going to be persuaded to follow the views of the board? Yes, the board will remunerate that person for the extra responsibility they now have, let's say a small amount for a director of a company the size of Carillion, and double their pay to £60k.
What worker is going to risk jeopardising this pay rise to look out for the workers? Yes, their views would be sought, but they will be voting the way the board wants them to otherwise if that 'worker' risks blocking the company going forward the way it wants to, they will be replaced with someone more 'compliant'
Whose real world is that bud?
Works well across across europe but we are in a select group of countries that have no formal arrangements... also you can pck and chose which tory manifesto promises you want upheld.
There are only ten countries without legislation or other agreed arrangements providing for board level representation. These are Belgium, Bulgaria, Cyprus, Estonia, Italy, Latvia, Lithuania, Malta, Romania and the United Kingdom
why exactly would an employee on a board have a 100% pay rise? what world do you inhabit
A single worker on a board won’t change the weighting of shareholder dividends to company pension fund contributions.
HMG still has to act regarding BHS. Green took the cash as dividends, maxwell took the cash from the company pension fund. Greens action were legal. How can that be right and how can a worker on a board remedy that situation?
On its own,oOf course it wont, its about changing culture, legislation can only go so far, as im sure you ll agree.
the point is, it works very well across europe and i do believe its more than one worker.
totally agree on the Maxwell/Green comparison, its one reason i ve not gone over board on my current pension provision.0 -
Why would a worker want to be a director? Too risky for me.0
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TheBigBean wrote:Why would a worker want to be a director? Too risky for me.
But isn't that the attraction for those that advocate workers on the board? They want the benefit without the responsibility and risk.0 -
Ballysmate wrote:TheBigBean wrote:Why would a worker want to be a director? Too risky for me.
But isn't that the attraction for those that advocate workers on the board? They want the benefit without the responsibility and risk.
"I spent most of my money on birds, booze and fast cars: the rest of it I just squandered." [George Best]0 -
Ballysmate wrote:TheBigBean wrote:Why would a worker want to be a director? Too risky for me.
But isn't that the attraction for those that advocate workers on the board? They want the benefit without the responsibility and risk.
All directors hold corporate risk irrespective of them being exec, non, exec, worker representative. They would be remunerated by way of a fee and would have training and independent access to funded legal advice. They would be subject to risk and be held responsible. My guess is that they would be non-exec directors.
They would hold more risk because they would be out of their depth....take your pickelf on your holibobs....
jeez :roll:0 -
Is the argument here worker board representationwould have saved Carillion?
What you need to ask is why there was a surge of shorts (about a 5th of all shares) in 2014 which held pretty steady and that the hole in the balance sheet only appeared last year.
That story has not played out yet.0 -
Rick Chasey wrote:Is the argument here worker board representationwould have saved Carillion?
What you need to ask is why there was a surge of shorts (about a 5th of all shares) in 2014 which held pretty steady and that the hole in the balance sheet only appeared last year.
That story has not played out yet.
I think the argument is worker board rep might make it harder to rinse the pension funds in the same way.
This is based on the idea that directors might find it personally harder to line their own pockets whilst under finding the pension scheme if they have to commit to those decisions in front of someone who would potentially suffer the consequences.You live and learn. At any rate, you live0 -
Company Directors of a listed company don't decide their own renumeration package.
Renumeration is decided by a separate committee and invariably linked to performance across a board range of metrics or specific goals. Their performance, strategy and behaviours should be monitired by the non exec directors appointed within the business.“Give a man a fish and feed him for a day. Teach a man to fish and feed him for a lifetime. Teach a man to cycle and he will realize fishing is stupid and boring”
Desmond Tutu0 -
Slowmart wrote:Company Directors of a listed company don't decide their own renumeration package.
Renumeration is decided by a separate committee and invariably linked to performance across a board range of metrics or specific goals. Their performance, strategy and behaviours should be monitired by the non exec directors appointed within the business.
Exactly and I guess there would be a shareholder value add in one of the performance metrics and a comparitor with similar industries including comparison with their share price. The state of the DB pension funds are such that over half are in serious defecit and of those some (I don't know how many - but know a few examples) have recovery plans. The directors would not be allowed to release all of the cashflow to the PF - and let us be honest none of the PF are being asked for restitution where they have failed the investment objectives.
I have not heard of any company reducing payment of company contributions to a DC fund.
Have faith that the shop floor rep - or director would have to juggle all stakeholder obligations and not just the HR stuff....take your pickelf on your holibobs....
jeez :roll:0 -
Jez mon wrote:Rick Chasey wrote:Is the argument here worker board representationwould have saved Carillion?
What you need to ask is why there was a surge of shorts (about a 5th of all shares) in 2014 which held pretty steady and that the hole in the balance sheet only appeared last year.
That story has not played out yet.
I think the argument is worker board rep might make it harder to rinse the pension funds in the same way.
This is based on the idea that directors might find it personally harder to line their own pockets whilst under finding the pension scheme if they have to commit to those decisions in front of someone who would potentially suffer the consequences.
Right.
I don't think that, necessarily, you need a worker representative to look at that.
Things like the board re-writing the rules around protecting exec comp in the event of failure is plainly bad governance, and I'm surprised the Remco singed it off. In the (rightly) much more highly regulated FS sector, the regulator would have come down extremely hard on the firm if that had happened.
I think there ought to have been more scrutiny of the make up of the board from shareholders, and a closer look at how the company was being run; shareholders continuing to receive dividend when the accounts made it quite clear the firm ought not to have been. From the little I know about some of the board members , if Carillion were my client, I'd be letting them know what the rest of the market thought of some of them.
The board also ought to have been looking more closely at their risk management and asking better questions; quite clearly they were not pricing in the risk of extra costs wiping out margins into their bids. The overall strategy set by the exec and approved by the board was plainly the wrong one; over stretching for market share.
Finally, it also seems that, with new evidence, PFI is not as successful as it was once thought to have been, according to the NAO. So perhaps there needs to be a re-think of the costs-benefits, and if different regulation/market structure can address those costs.0 -
Coopster the 1st wrote:Ignoring the tory manifesto pledge,1985 Mercian King of Mercia - work in progress (Hah! Who am I kidding?)
Pinnacle Monzonite
Part of the anti-growth coalition0 -
Slowmart wrote:Company Directors of a listed company don't decide their own renumeration package.
Renumeration is decided by a separate committee and invariably linked to performance across a board range of metrics or specific goals. Their performance, strategy and behaviours should be monitired by the non exec directors appointed within the business.
Your faith in the current system is rather touching.0 -
Slowmart wrote:A single worker on a board won’t change the weighting of shareholder dividends to company pension fund contributions.
Dividends would not flow to a Pension Fund unless the PF held shares. The PF is funded by agreement to an actuarial cost projection relating to future liabilities and taking into account defecit or surplus. I think it is mandated to have a valuation and liquidity analysis for a PF done every 5 years....take your pickelf on your holibobs....
jeez :roll:0 -
Rick Chasey wrote:Jez mon wrote:Rick Chasey wrote:Is the argument here worker board representationwould have saved Carillion?
What you need to ask is why there was a surge of shorts (about a 5th of all shares) in 2014 which held pretty steady and that the hole in the balance sheet only appeared last year.
That story has not played out yet.
I think the argument is worker board rep might make it harder to rinse the pension funds in the same way.
This is based on the idea that directors might find it personally harder to line their own pockets whilst under finding the pension scheme if they have to commit to those decisions in front of someone who would potentially suffer the consequences.
Right.
I don't think that, necessarily, you need a worker representative to look at that.
Things like the board re-writing the rules around protecting exec comp in the event of failure is plainly bad governance, and I'm surprised the Remco singed it off. In the (rightly) much more highly regulated FS sector, the regulator would have come down extremely hard on the firm if that had happened.
I think there ought to have been more scrutiny of the make up of the board from shareholders, and a closer look at how the company was being run; shareholders continuing to receive dividend when the accounts made it quite clear the firm ought not to have been. From the little I know about some of the board members , if Carillion were my client, I'd be letting them know what the rest of the market thought of some of them.
The board also ought to have been looking more closely at their risk management and asking better questions; quite clearly they were not pricing in the risk of extra costs wiping out margins into their bids. The overall strategy set by the exec and approved by the board was plainly the wrong one; over stretching for market share.
Finally, it also seems that, with new evidence, PFI is not as successful as it was once thought to have been, according to the NAO. So perhaps there needs to be a re-think of the costs-benefits, and if different regulation/market structure can address those costs.
Yea, I think the principles behind "workers" on boards is generally a good idea, from a more holistic view of you know, all pulling together as a company, rather than tending towards industrial relations from the 70s. But I think that you do not necessarily need them for good governance, in fact I would say they offer no guarantee of good governance.
I also think that in the case of Carillon, where those effectively at the bottom of the pyramid were (apparently) not even employed by Carillon, but another company, the definition of "worker" might become clouded...You live and learn. At any rate, you live0 -
rjsterry wrote:Coopster the 1st wrote:Ignoring the tory manifesto pledge,
I was ignoring it from the argument as mambo likes divert from the main issue raised, just like you are looking to do0 -
Ultimately, some companies will be badly run and they will go under. Some companies will be so big that when they fail, it makes headlines, and cause a lot of job losses.
You can strengthen rules around governance, etc sure. The UK is probably further along the curve compared to most comparable nations when it comes to the balance between allowing firms to be competitive (which ultimately means some losers) and nudging firms to engage in best practice. Diversity in senior management is behind some smaller developed countries, but it's rapidly improving.
Arguably you could suggest that, for a given size, you add some criminality to poor management, but it's difficult to define what precisely a lot of bad management is. It's all very grey and difficult to pin down. It also has the side effect of putting off a lot of good managers who won't want to run the risk, especially in big firms, where it's almost impossible to have a handle on what everyone is doing each day.0 -
Coopster the 1st wrote:rjsterry wrote:Coopster the 1st wrote:Ignoring the tory manifesto pledge,
I was ignoring it from the argument as mambo likes divert from the main issue raised, just like you are looking to do
we were talking about workers on boards and it was a (broken) tory manifesto pledge, so hardly a divert..... why was it put in? just to make the tories seem more in touch?
Seems to me, you are ignoring it because it doesnt suit your argument.
If as you imply, they are pointless and would have no affect, why are uk companies sooooo against them?
Bad practice doesnt like publicity and surely a well run company has nothing to fear from worker elected representatives on the board.0 -
Coopster the 1st wrote:rjsterry wrote:Coopster the 1st wrote:Ignoring the tory manifesto pledge,
I was ignoring it from the argument as mambo likes divert from the main issue raised, just like you are looking to do
You're reading way too much into one sarky comment. FWIW, I don't think shop floor representation on boards is a solution to poor management. It's a sticking plaster, and about as useful as sending the directors down to the shop floor for a day or two.1985 Mercian King of Mercia - work in progress (Hah! Who am I kidding?)
Pinnacle Monzonite
Part of the anti-growth coalition0 -
rjsterry wrote:Coopster the 1st wrote:rjsterry wrote:Coopster the 1st wrote:Ignoring the tory manifesto pledge,
I was ignoring it from the argument as mambo likes divert from the main issue raised, just like you are looking to do
You're reading way too much into one sarky comment. FWIW, I don't think shop floor representation on boards is a solution to poor management. It's a sticking plaster, and about as useful as sending the directors down to the shop floor for a day or two.
Aside from Italy, the UK is the only major euro eco that has no legislation in this respect.
i dont think i ve read anywhere its a solution to poor management.
but so far, apart from this idea, no one has come forward with alternatives, just negativity.0 -
Jez mon wrote:Rick Chasey wrote:Is the argument here worker board representationwould have saved Carillion?
What you need to ask is why there was a surge of shorts (about a 5th of all shares) in 2014 which held pretty steady and that the hole in the balance sheet only appeared last year.
That story has not played out yet.
I think the argument is worker board rep might make it harder to rinse the pension funds in the same way.
This is based on the idea that directors might find it personally harder to line their own pockets whilst under finding the pension scheme if they have to commit to those decisions in front of someone who would potentially suffer the consequences.
To me the strength of Pension Trustees and workers board representation are linked. In each of these cases the Trustees have not been strong or savvy enough to argue their case and understand the implications at Board level.
People are too dismissive about the quality of these board members and expecting an ordinary Joe to find the hidden problems in the balance sheet and then stand up to the Board is totally unrealistic. The ideal account would need to be Board level themselves with a financial background.0 -
mamba80 wrote:rjsterry wrote:Coopster the 1st wrote:rjsterry wrote:Coopster the 1st wrote:Ignoring the tory manifesto pledge,
I was ignoring it from the argument as mambo likes divert from the main issue raised, just like you are looking to do
You're reading way too much into one sarky comment. FWIW, I don't think shop floor representation on boards is a solution to poor management. It's a sticking plaster, and about as useful as sending the directors down to the shop floor for a day or two.
Aside from Italy, the UK is the only major euro eco that has no legislation in this respect.
i dont think i ve read anywhere its a solution to poor management.
but so far, apart from this idea, no one has come forward with alternatives, just negativity.
So what is it supposed to achieve if not improving management?1985 Mercian King of Mercia - work in progress (Hah! Who am I kidding?)
Pinnacle Monzonite
Part of the anti-growth coalition0 -
Surrey Commuter wrote:
People are too dismissive about the quality of these board members.
I dunno. The company has failed spectacularly.0