Thomas Cook Plane

Government ‘shutting the door after horse has bolted ‘yet again, with Thomas Cook probe

Unite, the UK and Ireland’s largest union, has described the government’s announcement that the Official Receiver will conduct a ‘fast paced review into the collapse of Thomas Cook as too little too late and accused it of having failed to learn the lessons from the collapse of Carillion.

Lessons not learned

The Official Receiver’s report into the collapse of Carillion is not expected before the beginning of 2021, three years after the company’s collapse.

The collapse of Thomas Cook - which comes on the back of other recent corporate collapses including Patisserie Valerie, British Steel and Interserve - once again demonstrates that the UK’s financial regulatory system is broken beyond repair and needs radical overhaul.

Bandit capitalism

Unite has produced a series of proposals on reforming the UK’s financial regulatory system in its report: Ending Bandit Capitalism: learning the lessons following Carillion’s collapse.

Among the recommendations is a cut in the number of financial regulators, with the creation of new regulators who have reals powers and the ability to intervene before companies collapse.

Auditing concerns

Given the growing concerns about Thomas Cook’s accounts, which included large amounts of “goodwill” on their balance sheet, radical reform of accountancy and auditing practices are also urgently needed.

Lost jobs

Unite assistant general secretary Diana Holland said: “The thousands of workers who yesterday lost their jobs and the hundreds of thousands of people who had their holidays cancelled, will draw no comfort from the announcement of a probe by the Official Receiver.

“Yet again the government is guilty of being asleep at the wheel. It failed to learn the lessons from Carillion’s collapse. If the government had done so the collapse of Thomas Cook may have been avoided.

“The UK financial regulatory system is broken and without proper checks and balances we have no idea if other Thomas Cook’s and Carillion’s are in the pipeline and no ability to prevent them from occurring.

“The collapse of Thomas Cook has not been allowed to happen in other countries as their governments and regulators have mechanisms to stop such a disastrous and immediate collapse as has happened in the UK.

“Radical reform of the UK’s financial regulatory system must be an absolute priority to prevent other workers in the future being dumped on the scrapheap without warning, through absolutely no fault of their own.”

ENDS

Notes to editors:

Thomas Cook Scandinavia is still operating, as is Condor airline. Both were wholly owned subsidiaries, but registered as companies in Sweden and Germany respectively and therefore protected under their legislation.

For more information please contact Unite communications officer Barckley Sumner on 07802 329235 or 0203 371 2067. Email: barckley.sumner@unitetheunion.org

  • Unite is Britain and Ireland’s largest union with members working across all sectors of the economy. The general secretary is Len McCluskey.. 

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