The Work and Pensions Committee inquiry into the collapse of outsourcer Carillion has turned its scrutiny on the 'big four' professional services companies, and has published the consultancies' responses to queries about their involvement.
KPMG, PwC, Deloitte and EY earned £71.6m in fees for advice provided to Carillion, its subsidiaries and the government in relation to Carillion contracts since 2008, documents published by the select committee reveal.
PwC received £6.1m for advice provided to Carillion's pension schemes, and as the only non-conflicted member of the big four was appointed as 'special manager' when the company became insolvent. The Insolvency Service said no fee has been agreed yet for the special manager position.
The joint inquiry of the Work and Pensions Committee and Business, Energy and Industrial Strategy Committee has reserved its fiercest criticism for KPMG, which was responsible for auditing Carillion's accounts and giving what the committees described as a "clean bill of health".
In a letter to the committees, KPMG chairman and senior partner Bill Michael said: "We have no reason to believe that the 2016 accounts showed other than a true and fair view."
Rachel Reeves, chair of the BEIS Committee, remained unimpressed: “Either KPMG failed to spot the warning signs, or its judgment was clouded by its cosy relationship with the company and the multi-million pound fees it received."
Frank Field, chair of the Work and Pensions Committee, said: "The image of these companies feasting on what was soon to become a carcass will not be lost on decent citizens."
He highlighted the difference between the fortunes of the big four companies and the plight of Carillion's former employees and pensioners.
Representatives of the four companies will give oral evidence to the committees on Thursday. The Pensions Regulator will also be questioned by MPs.
