RECEIVERS of collapsed courier City Link denied yesterday that the company had failed to pay subcontractors before its demise, despite MPs hearing evidence to the contrary.

Hunter Kelly, of City accountants Ernst and Young, was appearing before a joint hearing of the Commons Scottish and business committees.

Last week, the committees grilled City Link majority owner Better Capital about the firm’s deferral on December 19 of regular payments to some subcontractors and “bogus self-employed” workers — five days before receivers were called in.

Mr Kelly insisted that payments were instead expected on December 17 and said it would be of “great interest” if some smaller firms had not received funds.

Better Capital stands to benefit from the deferral when receivers divvy up City Link’s assets.
MPs savaged the administrator for the botched plan which saw workers discovering their redundancy from the television.

After initially denying the existence of any plan to inform workers of their fate, Mr Kelly said that he had been “confused” and that Ernst and Young planned to travel to each workplace to tell workers in person.

“It was going to break on the news at some point before all staff were contacted. Was there not a better way?” asked Airdrie and Shotts MP Pamela Nash.

And to the gaffaws of MPs, Mr Kelly claimed that data protection laws had prevented him from passing employees’ details to government redundancy support services.

He said that workers had received detailed leaflets on how to access such support, but committee-member Ann McKechin replied that workers had only been handed “a badly photocopied claim form.”

The hearing continued as the Star went to press.

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