THE collapse of a major building firm and its parent group is having a ‘ripple effect’ through the Island’s economy, the Housing Minister has said.
Deputy David Warr warned of ‘collateral damage’ but also praised Andium Homes for taking on some affected sub-contractors.
He added that he hoped the last of the ‘dominoes’ had fallen following the failure of Camerons as well as the subsequent insolvency of parent company the Garenne Construction Group.
Camerons, one of Jersey’s biggest construction firms, cited spiralling material and labour costs, strains in the supply chain and problematic contracts as well as the impact of the pandemic and Brexit, as the reasons for folding.
Following this collapse, directors determined that Garenne was unable to continue to trade given its financial position.
Accounts shared with businesses owed money by Camerons showed that it had £7.635m of liabilities but only £163,000 available to pay secured creditors, which include staff, Social Security and the Taxes Office – and no money to pay unsecured creditors such as sub-contractors.
Meanwhile, the Jersey Construction Council has said the outfall ‘may be stretching several organisations’ that work in the industry.
Deputy Warr said: ‘There is so much collateral damage from it, not just the impact on the sub-contractors, but then the sub-contractors’ ability to pay for goods and services so it really does have a ripple effect through the whole economy.’
However, he noted that some of the affected sub-contractors had been ‘picked up’ by social housing provider Andium Homes to enable them to continue being paid ‘sensibly and promptly’.
These included some who had already been working under Camerons on Andium’s Cyril Le Marquand Court redevelopment, which will now continue under replacement contracting partner ROK Construction.
Andium chief executive Ian Gallichan said they were ‘delighted to have been able to ensure continuity of employment for former Camerons’ staff at our Ann Court Development’.
He added: ‘We are also pleased that the final phases of the scheme which will see 85 more homes, a new public open space and a public and residents’ car park is on track to be completed within the next 12 months.’
Deputy Warr said: ‘Andium have a massive programme to come through so it is positive that we have a States-owned entity that has been able to help keep things moving.’
In a statement published to its members over the weekend, the Jersey Construction Council said it would shortly be issuing a guidance document with advice and support on operational matters as well as those relating to emotional wellbeing of employees.
It also said it was planning a ‘drop-in support day’ event with representatives of different organisations from government, third and private sectors.
Interim chair of the JeCC, Simon Matthews, said: ‘The JeCC is the voice of the Jersey construction industry. As such, the JeCC are concerned that a series of unexpected events, including the outfall from both the Camerons and Garenne decisions, may be stretching several organisations that work in the industry now and in the future.’
He added: ‘It is vital that organisations in Jersey’s construction industry share and talk openly with the relevant persons about their worries and anxieties as early as possible. By making available and signposting the support that is available to them, they will be able to work with dedicated people to manage and resolve these issues, with the key aim of supporting companies through challenging time.’