Scottish Affairs committee says it will now examine penalties including possible ban on tendering for public sector work

Houses of Parliament

Source: Berto Garcia

An influential committee of MPs investigating blacklisting in the construction industry has questioned the evidence it heard under oath from three of the major contractors involved - Balfour Beatty, Sir Robert McAlpine and Skanska.

The interim report of the Scottish Affairs select committee鈥檚 inquiry into construction industry blacklisting, published today (16 April), said blacklisting caused financial hardship to its victims, disrupted people鈥檚 lives and sometimes 鈥渞uined鈥 them.

The report said the committee was 鈥渦nconvinced鈥 that Balfour Beatty regretted its involvement with The Consulting Association (TCA), the blacklisting firm exposed and closed down in 2009.

It also said it was concerned by the failure of firms including Balfour Beatty and Skanska 鈥渢o hold any individual to account鈥 for wrongdoing and said it was not persuaded by Sir Robert McAlpine director Cullum McAlpine鈥檚 claim that he had a 鈥渉ands off鈥 role as the founding chairman of TCA.

The report was responding to evidence given in recent months by a number of witnesses including Cullum McAlpine, Balfour Beatty UK Construction Services chief executive Mike Peasland and Harvey Francis, executive vice president of human resources at Skanska.

Responding to Peasland鈥檚 evidence last month, the committee criticised his decision not to provide the committee with the company鈥檚 internal review on blacklisting on the grounds of legal privilege.

鈥淲hile we are sure that Balfour Beatty regrets being caught, we were less convinced that management regretted its involvement with TCA,鈥 the report said.

鈥淥n the second point, we cannot comment on the robustness or extent of the internal review until we see a copy of the document. We encourage Balfour Beatty to engage with us in a spirit of openness and honesty.鈥

It added that the committee found it 鈥渄ifficult to accept鈥 that no one at Balfour Beatty had been sacked or made redundant as a result of the company鈥檚 wrongdoing.

On Skanska, the report noted Francis鈥 claim that Skanska鈥檚 involvement with TCA was dependent on one individual who has now left the firm 鈥 Stephen Quant.

The report said: 鈥淲e have no evidence to contradict this, though it seems implausible that no one else in the company had the slightest inkling that potential employees or subcontractors were being systematically checked against a database.鈥

It continued: 鈥淲e remain concerned by the failure of Skanska to hold any individual to account for the wrongdoing which it has acknowledged 鈥 the fact remains that thousands of workers may have had their employment prospects blighted and their lives significantly disrupted.鈥

Turning to Sir Robert McAlpine, the report said that Cullum McAlpine鈥檚 position as founding chairman of TCA and as director of one of the biggest spenders on its services 鈥渟uggests his involvement may have been rather more substantial than he suggested鈥.

It also criticised the 鈥渆vasive wordplay鈥 of the argument made by witnesses including McAlpine that because not everyone on TCA鈥檚 database was refused employment, the files did not constitute a blacklist.

The report thanked witnesses but said the committee was 鈥渇ar from certain that all of our witnesses have told us 鈥榯he truth, the whole truth and nothing but the truth鈥, despite many of them being under oath鈥.

It also criticised watchdog the Information Commissioner鈥檚 Office, which uncovered TCA, saying it had not taken sufficient action to notify individuals on the blacklist and calling for the contents of the database 鈥渟uitably redacted鈥 to be published.

The report said the committee intends to continue with its inquiry, calling other firms to give evidence and examining four further topics. These are whether blacklisting is continuing, what level of compensation should be provided to victims, what punishment should be imposed on firms involved - including a possible bar to public sector contracts - and whether changes to the law are still required.

A spokesperson for Balfour Beatty said the firm had expressed its 鈥済enuine regret鈥 over its use of TCA.

The spokesperson added: 鈥淔or Balfour Beatty this is a historic issue鈥e have since taken action to ensure it does not happen again. Since 2009, our company code of conduct prohibits the checking of references for job applicants without first obtaining their consent and prohibits the use or support of databases of 鈥榖lacklisted鈥 people and the supply of information to such databases.

鈥淲e co-operated fully with the ICO鈥檚 investigation and continue to co-operate with the Scottish Affairs select committee inquiry.鈥

A spokesperson for Skanska said it welcomed the committee鈥檚 report and said it had made 鈥渇undamental changes鈥 to its working practices and culture since 2009.

鈥淪kanska remains committed to working with the committee, as it continues its investigation, and addressing the issues raised in the report,鈥 the spokesperson added. 鈥淎t the committee hearing, Skanska addressed the areas of concern raised by the committee members and apologised for its past actions, saying it was 鈥渢ruly sorry for its involvement鈥.

A spokesperson for Sir Robert McAlpine said it had 鈥渘ever operated a blacklist,鈥 adding that it is 鈥渁nd had always been wholly committed to maintaining good relationships with our workforce and to responsible trade unionism.鈥