Scottish Civil Servants Knew Risk To Firm

Civil servants were informed a courier firm was at risk two weeks before City Link's collapse - although their requests for the company's name were rejected.

The Insolvency Service was first notified about the situation of a national logistics firm'' on December 9, 2014, and passed the details to the Department for Business, Innovation and Skills (Bis) on December 10, Matthew Hancock said.

But the Business Minister added: Requests for the company name were rejected as the information was commercially sensitive.''

He said it was not uncommon for Bis to receive commercially sensitive information about companies at risk in strict confidence.

Bis was contacted by Better Capital on December 23 to inform the department they intended to put City Link into administration on December 24, Mr Hancock said.

Coventry-based City Link stopped accepting new parcels on December 24 and called in administrators after years of substantial losses''.

Many workers found out they were at risk of losing their jobs on Christmas Day.

The administrators at EY announced 2,356 redundancies on New Year's Eve, saying that an offer made for the company had not been acceptable.

Labour former minister Ann McKechin (Glasgow North) asked ministers whether Bis received any direct or indirect information from people or organisations other than City Link or the administrators before December 23 over the possibility of the firm being placed in administration.

Conservative front-bencher Mr Hancock, replying to a written parliamentary question, said: The Insolvency Service first received information that a national logistics firm was at risk via email on December 9 and passed this to the Department for Business, Innovation and Skills on December 10.

Requests for the company name were rejected as the information was commercially sensitive.

On the basis of the available information, officials worked with the Department for Work and Pensions and Jobcentre Plus to be ready to provide support should a failure actually materialise.

It is not uncommon for Bis to receive commercially sensitive information about companies or facilities at risk in strict confidence, though not all of these result in a company or site closure or significant job losses.

Bis treats any such information with the utmost discretion in order to avoid precipitating a failure, which we would all wish to avoid.''