The former finances director of Carillion today denied being ‘asleep at the wheel’ as the construction giant veered toward collapse.
Zafar Khan, who was replaced as finance director shortly before the firm fell apart last month, insisted he did everything he could have done in the post.
He insisted to MPs at a tetchy session with a joint meeting of the Business, Energy and Industrial Strategy Committee Work and Pensions Committee that Carillion had been destroyed by a series of blows in 2017.
Mr Khan told the MPs the 2016 accounts had been properly scrutinised and denied claims of aggressive accounting.
Keith Cochrane, Carillion’s chief executive, confirmed Mr Khan was removed from his position and given a £425,000 pay off.
He admitted the business ‘clearly’ had issues before its collapse and said he ‘absolutely’ did ‘wish we had done something about it sooner’.
Zafar Khan (pictured today in Parliament), who was replaced as Carillion finance director shortly before the firm fell apart last month, insisted he did everything he could have done
Mr Khan insisted to MPs at a tetchy session with a joint meeting of the Business, Energy and Industrial Strategy Committee Work and Pensions Committee (pictured) that Carillion had been destroyed by a series of blows in 2017.
Under a sustained grilling by the MPs, he said he did not expect the company to collapse.
‘Yes, I was surprised at the outcome that eventually came to pass,’ Mr Khan said.
‘No, I don’t believe I was asleep at the wheel because as soon as I came into the role, we were looking to tackle the issues and the key focus of my time in the role was to bring net debt down.’
He added: ‘I believe I did everything that I could have done, essentially.’
Mr Khan said uncertainty around Brexit had been ‘amplified’ by the snap general election and hurt the business during 2017.
And he said a series of major contracts in the Middle East were heavily delayed in further blows to Carillion’s balance sheet.
Mr Khan was removed from his post with immediate effect in September, just months before the giant firm collapsed in January.
He was replaced by Emma Mercer, who also gave evidence to today’s hearing.
Carillion had issued a shock profit warning in July, sending its share price tumbling.
Mr Cochrane has been criticised by MPs for saying ‘the business got itself into this position’, referring to the financial difficulties that eventually led to its collapse.
When pressed about his responsibilities, Mr Cochrane said: ‘From my perspective as non-executive director during this period of time, the role of the board was to challenge on the basis of information that was provided from management, that is what we sought to do.’
Keith Cochrane (pictured at today’s hearing), Carillion’s chief executive, confirmed Mr Khan was removed from his position and given a £425,000 pay off
Business committee chairwoman Rachel Reeves (pictured at today’s meeting) lashed the Carillion executives for failing to take the necessary action to protect the business
He added: ‘Clearly the business did have issues – undoubtedly. And clearly, do I wish we had done something about it sooner? Absolutely. I recognise that.
‘Again with the benefit of hindsight but at the time, I can assure you that all the decisions I took in seeking to do the best thing for the business at that juncture.’
Carillion was struggling under nearly £900 million of debt and last year reported a £587 million pension deficit.
It was also forced to issue a string of profit warnings in 2017, after a review of its construction contracts found them to be much less valuable than previously thought.
The firm then failed to gain further funding from lenders and collapsed last month.