Following the collapse of Carillion over the weekend, the response from the Government is once again displaying an acute failure to understand the way in which such companies operate, or perhaps they are intentionally ignoring such understanding. Carillion employed a significant number of people and each of them will be impacted by the collapse. However they are all protected to varying degrees by employment law. Yet the majority of the work carried out to deliver the numerous contracts came from sub contractors who would have greatly preferred to contract direct with the Government. However the Government and its Labour predecessor have a long history in ignoring the opportunity to work in large measure with such companies. They would rather contract with a small handful of large companies than hold much more extensive contracts with a myriad of small companies. Ironically if they were willing to contract directly with SME’s they would get a much better outcome for society. Each contractor would have the opportunity to challenge and inspire their commissioner in a way that will never happen if such inspiration and challenge is filtered out by the main contractor. However when main contractors collapse such has happened this week with Carillion, each sub contractor ends up at the end of the line of creditors behind almost every other organisation that is owed money. It is clear from todays news that the Government claims it had developed a plan to ensure that if the collapse took place, that public services would not be badly impacted. This plan should drill down to such a level that protects the small contractors from paying a price for Carillions failure. To offer a short term guarantee of 2-3 months during which time these contracts would be retained and legitimate payments made for work that has been carried out would give the contractors time to prepare for the impact on their business and give the Government time to assess the value of each contract and then either to renegotiate or retain contracts until they are due to end. Such support would ensure that many companies which are at risk of collapse would be protected which would assist in protecting the communities in which they are based.