COUNCIL bosses have pledged to help firms affected by the collapse of failed construction giant Carillion.

The firm, which employs about 20,000 people in the UK, went into administration on Monday with debts of about £1.5 billion.

About 90 per cent of the company’s work is subcontracted to smaller private sector suppliers and Colchester Council has pledged to help any businesses in the borough which are affected.

Paul Smith, leader of Colchester Council, said: “Carillion’s reliance on sub-contractors has the potential to generate a domino-effect of insolvency along the supply chain and cause some local firms significant financial distress.

"We want those small businesses affected by any fallout to know that, as a council, we are ready and willing to support them.

“I would therefore urge any local firms affected by Carillion’s collapse to contact the council in the coming days and weeks, to see what help we might be able to provide.”

Mr Smith said if any of the companies have completed work for the council and are yet to be paid, those payments will be rushed through.

The council is also willing to offer business rates relief if firms use a premises in Colchester and are experiencing cashflow problems because of the collapse.