British Prime Minister Theresa May's government faced growing criticism from opposition lawmakers over its dealings with the construction and services group Carillion after the corporation announced its immediate liquidation.

The British government's emergency response committee, known as COBRA, reportedly met for around an hour on Monday evening to discuss the Carillion's collapse. The meeting was attended by ministers from all departments affected by Carillion's collapse, including Finance Minister Philip Hammond.

Carillion, a group which held a plethora of private and public service contracts in Britain, went bust on Monday after the heavily-indebted company failed to secure a financial rescue deal from banks. The company is believed to have accumulated some £900 million in debt (€1.01 billion, $1.24 billion) and a pension deficit of £590 million.

May's government has agreed to pay the company's private sector employees' salaries until Wednesday, Cabinet Office minister David Lidington said. The government will also foot a bill to continue paying the company's 19,500 staff in public sector jobs that could cost hundreds of millions of pounds in taxpayer money.

'Watershed moment'

Questions quickly arose from Britain's Labour and Liberal Democrat parties about why the government continued to award Carillion £1.3 billion in new contracts after the company issued its first profit warning last July.

"Why was it apparent to everyone except the government that Carillion was in trouble?" Labour's Cabinet Office spokesman Jon Trickett said in a debate in parliament.

He also noted that it is government policy to deem a company "high risk" if it issued a profit warning.

Labour Party leader Jeremy Corbyn argued that public service contracts should have never been awarded to private companies in the first place.

In a video posted on Twitter, Corbyn called Carillion's collapse a "watershed moment," adding that it was time to "end the rip-off privatization policies that have done serious damage to our public services and fleeced the public of billions of pounds."

Contracts awarded after warning

One week after issuing its initial profit warning in July last year, Carillion was named as one of the contractors working on Britain's new high-speed rail line to connect London with northern England.

The day after that contract was announced, the company also won part of a £158 million contract with the Defense Ministry to provide catering and accommodation services to 233 military facilities.

Among its other contracts, Carillion's contracts include providing school lunches, cleaning, and catering services at public hospitals and maintaining 50,000 army base homes. Its construction contracts include London's Royal Opera House, the Channel Tunnel, the Copenhagen Metro, the Suez Canal road tunnel and Toronto's Union Station.

The 200-year-old business employs 43,000 people worldwide, including 20,000 in Britain.

rs/rc (AFP, Reuters)