The shock collapse of north-east construction giant Stewart Milne Group led to demands for urgent help at Holyrood today.
Concerned MSPs raised the knock-on impact on jobs and livelihoods across the region and fears for homeowners left living “almost on building sites”.
Administrator Teneo was appointed on Monday for the housebuilder, which has several partly-completed developments across Tayside.
A total of 217 roles are being made redundant at the company and hundreds of other sub-contractor jobs are at risk after an attempt to sell the company fell through.
Trades risk losing livelihoods
North-east MSP Douglas Lumsden said as well as employees of the firm, support must be provided to the contractors and self-employed tradespeople who are “facing the prospect of losing their livelihoods”.
He raised the plight of homeowners who have already moved into developments where construction work is not finished.
“There are also many people who will be waiting and hoping for news about their homes and developments still under construction – some effectively living in the middle of a building site,” he said.
Current projects include Monarch’s Rise in Arbroath and Hunter’s Meadow in Auchterarder.
“There are many more contractors and apprentices who will be in the supply chain -it will be a grim time of year for many of them,” he added.
Former SNP housing minister Kevin Stewart called for “extra effort” to be made to find jobs for the firm’s apprentices.
He said the firm’s loss will have a “significant impact on communities I and others represent”.
‘Every possible support’
Neil Gray, the SNP Government minister responsible for the economy, met Teneo on Tuesday morning and said he wants “every possible support” offered to affected individuals.
He said: “The people affected by this announcement are our immediate priority and the Scottish Government is providing support through our initiative for responding to redundancy situations, PACE.”
The SNP minister said approaches have already been received from potential recruiters for employees who have either lost, or are at risk of, losing their jobs.
In terms of the redundancy payments process, Mr Gray said he ask UK business minister Kevin Hollinrake to “look favourably” on the impact the firm’s collapse will have on sub-contractors.
Teneo said in a statement on Monday that failure to sell the business or secure a “viable” restructure meant the “difficult” decision was made to place Stewart Milne Group and six Scottish subsidiaries into administration.
The administrators said “no further construction is being completed, at this time” and people who have reserved a home but not yet moved in will be contacted.
Founder ‘devastated’ by firm’s collapse
Stewart Milne Group – founded in 1975 – has its headquarters in Westhill, Aberdeenshire, but also has offices in Edinburgh, Glasgow and Manchester.
The firm was up for sale but two offers for the business were rejected by its bank who then withdrew funding.
One of these offers is believed to have come from Stewart Milne, the firm’s 73-year-old owner and founder.
He said he was “devastated” by this “totally unexpected outcome of the sale process”.
Mr Milne added he was “struggling to accept it, given the profound impact it will have on employees, sub-contractors and customers”.
Jane Wood, chief executive of Homes for Scotland, which represents more than 200 members, said she is “very worried” about more firms collapsing.
Speaking on BBC Radio Scotland’s Good Morning Scotland programme on Tuesday, she described being “greatedly saddened” by the announcement.
She added: “Our ask would be that the Scottish Government needs to demonstrate that it does recognise the sector’s concerns and takes urgent action – that the provision of new homes for all tenures for everyone in Scotland who wants to live and work here is prioritised because it is urgent now.
“We can’t keep doing the same thing and expecting the houses that we need to be built and our businesses, like Stewart Milne and other housebuilders, to remain sustainable.”
Conversation