Derby Homes' maintenance contractors in administration
A FIRM, being put into administration after racking up massive debts, had signed a multi-million-pound deal with Derby Homes only four months ago.
Connaught provides maintenance and improvements across 14,000 Derby Homes properties.
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Phil Davies, Chief Executive of Derby Homes
It also has lucrative contracts with Amber Valley Housing and Derwent Living.
But, last night, the stricken repair and maintenance specialist said it was "saddened" to announce it was appointing KPMG as administrators.
Earlier it had suspended its shares after lenders refused support.
No one from the firm was available to comment on the future of its 10,000 workers.
Connaught had been in turmoil since its June warning that Government spending cuts could blow a £200 million hole in revenues.
Last night, Derbyshire housing providers were making contingency plans.
Phil Davies, chief executive of Derby Homes, said: "We will do our very best to keep services going for our tenants. We will focus on the most urgent work, gas repairs.
"We all know there have been local government cutbacks – it must have suffered because of those."
Steve Croft from Amber Valley Housing told tenants the situation with Connaught would not affect work to improve homes but there may be "some delay" in works to be carried out. He said: "We are ready to mobilise to deal with our immediate priorities – homes where work is ongoing and those where tenants are waiting for works to begin.
"This affects just 23 homes. We will be visiting those homes where work is under way.
"Our contingency plan includes working with other contractors that will be able to move in to complete works so that these homes are not left unfinished."
Mr Croft said the "good news" was that excellent progress had already been made in improving homes, with more than 99 per cent now reaching the required standard.
A spokesman for Derwent Living echoed his comments. "We are aware of the situation at Connaught but we have not officially heard that Connaught has gone into administration," he said.
"However, we are fully prepared.
"When the situation becomes more clear we can put into action our contingency plans and will be reassuring our customers that our service to them will be maintained."
Derby Homes and Connaught announced new contracts potentially worth more than £19 million in May.
Valued at £1.4 million in the first year, then £2.8 million for subsequent years, the contract was to provide gas servicing, maintenance and safety inspection works.
New heating systems were planned for installation in 2011, with new PVCu windows due to be fitted from this summer, according to Connaught's website.
Each contract was scheduled for three years, with an option to extend for a further two years to March 2015.
At the time the contract was announced, Tony Billingham, programme maintenance manager at Derby Homes, praised Connaught. "We are looking forward to working with Connaught to ensure that we continue to maintain a high standard of gas safety checks in Derby Homes properties," he said. "We are confident that Connaught will deliver a quality service that will provide us with excellent value for money."
And Bradley Groves, Connaught regional director, said: "With over 25 years' experience Connaught will offer the very best in efficiency and service."
Connaught, which started life in 1982 as a concrete repair specialist in Sidmouth, provided services to the environmental, social housing and public sector.
It is expected that rival firms such as Mears will look to take on work.
Connaught's debts were estimated to be around £220 million, while its share price had dropped by 90 per cent.
10 Comments
by Confused, Derwent
Thursday, September 09 2010, 10:04PM
“Adrian, you are missing the point. You stated in your original post about the Gateway Centre, the Racecourse and the Revive Centre. failing with their connection to Derwent Living. That is not true because Derwent Living is a commercial organisation which as nothing to do with these projects.
Just because it has the word Derwent in it doesnt mean it is part of the Derwent NDC.”
by adrian, Derby
Thursday, September 09 2010, 1:08AM
“Ok Confused I Am Right About Derwent Living Has Quecoted In The storey Above "Connaught provides maintenance and improvements across 14,000 Derby Homes properties.
It also has lucrative contracts with Amber Valley Housing and DERWENT LIVING"
Ok Thank You. I Am Just Pointing Out The Connection And Not Blaming Then Ok. It`s Just Strange Thats All Ok.”
by Bob The Builder, Privatisation Precinct
Thursday, September 09 2010, 12:53AM
“Another case of 'Let the private sector sort things out' . This is exactly what happens when another of 'Dodgy Dave from No 10' stategies pans out. The only way the private sector can run what is essentially a 'public sector' maintenance contract is to tender such low bids to gain a contract, that when they take their 30% profit out, it is just unsustainable, so they sub contract the work outand never pay for the work. Shame,shame, shame on all you Toriy voters. Even more shame on you lilly livered Liberals, Shame, shame and more shame on you. This country wil be implode within a year of post Thatcher and 'Dodgy Dave' financial ideology. all Dave can say is "let them eat cake".
Where's New Dragon - nothing to say ?”
by Phil, Derby
Wednesday, September 08 2010, 9:40PM
“Don't spill too many tears for Connaught. A major part of their problem is their own doing by running out of sub-contractors to screw. Word gets around the industry when a company doesn't pay it's bills.
Save the tears for all the little guys who are going to be taken down with them, still waiting for payment that they did months ago.
The Directors must have known for quite some time that they were trading insolvent and should face being struck off so that they are not allowed to take up the same positions in the future. Don't be surprised if the administrator sells whatever assets there are to a new company set up by the same directors.”
by Confused, Derby
Wednesday, September 08 2010, 5:41PM
“Here We Go Again It Seems Anything That is Connected To Derwent Living Goes Under,
The Racecourse, The Gateway, Revive
`Great Job Again
Adrian, stop showing your ignorance. What as the above got to do with Derwent Living. Derwent New Deal for the Community has no connection with this company but you just assume that the New Deal is to blame for everything, and as it as Derwent in the name then it is all one.
This is typical of the chinese whispers that go round making things worse for the area by blaming others when you dont know full story”
by burtonftw, derby
Wednesday, September 08 2010, 1:09PM
“ratepayer is quite right actually - connaught has become the lowest cost supplier over the lax debt years, probably hoping it'd wipe out all competition and then be able to up it's contracts.
unlucky that the whole ponzi scheme got uncovered for them though. i wouldn't bet against a bailout for them though, unlike the football club in the other story.”
by adrian, Derby
Wednesday, September 08 2010, 11:17AM
“Here We Go Again It Seems Anything That is Connected To Derwent Living Goes Under,
The Racecourse, The Gateway, Revive
`Great Job Again`
I Have Only Been Waiting 14 Years For My House Too Be Up Datered, I`ll Have Too Wait Again. What`s Another 2 Years Or So Then
Yes You Are Right `Ratepayer` Keep It In House Or Are You`re Workman Not Up To The Job Or Want To Much
Money?. Nice One.”
by G Reaper, Pride Park
Wednesday, September 08 2010, 10:51AM
“The services provided by Connaught to Derby Homes have never!! (for at least 15 years) been provided by the council's own employees. But why let ignorance spoil a good tale??”
by Angela, Derby
Wednesday, September 08 2010, 10:05AM
“Perhaps they would have been better to use the council workmen who were employed to do the repairs on their housing stock. Don't they have any left, or did they get rid of all of them? Private is not always cost effective, nor is the quality of work always better either.”
by ratepayer, spondon,derby
Wednesday, September 08 2010, 9:50AM
“Whenever anyone offers a cut price deal that is too good to be true it almost always is. Derby Homes has
again gone for the bottom price from those who bid for the maintainance contract. The real costs involved are well known by the cities inhouse providers and they gave a realistic estimate of actual costs involved. So now the ratepayers and Derby Homes Tenants will pay for the lack of professional competence at the top. Amber Valley Housing and Derwent Living have also been swept up in the con trick. When will they realsie that Glossy brochures brandished by salesmen are not a substitute for a properly costed contract. Conaught at least got the CON part of their name right and they have also delivered NOUGHT to those who pay the bills.”