Ballast subbies urge DTI to investigate 'missing' cash

Ballast plc's unsecured subcontractors have called for a DTI investigation to what happened to millions of pounds that is alleged to have disappeared in the three months prior to administrator Deloitte & Touche being called in.

At a packed creditors' meeting near Heathrow yesterday (Tuesday), a spokesman for NG Bailey said: "A big wodge of money has disappeared. The changes started from May/June onwards when Ballast tried putting subcontractors onto 42-day and 60-day terms, but the projects were still being run on normal [30-day] contracts. So where did the money go? A lot has gone somewhere. We believe it went to Holland."

Ballast Nedam NV, the Dutch group that owned the failed UK construction group, came under further attack. "NV needs investigating to see if it was trading properly," said the NG Bailey representative.

There was widespread dismay when figures produced by Nick Edwards, joint administrator, showed that it was virtually certain that Ballast plc's unsecured creditors would get absolutely nothing.

The company's reported policy of holding money back and only paying its most demanding subcontractors is thought to have created a pot with a total value of around £16m. Where it has gone is a mystery. Edwards' replies were interpreted as indicating that the matter had not been investigated.

The part played by Hans Schoonderbeck, Ballast's finance director who resigned in September, came under attack. "Why did he resign? And why is he still employed by Ballast Nedam?" asked one creditor.

Another said: "Ballast's projects were all cash positive, but that money has disappeared, while there was also a £16m slush fund. I think all of that has gone to Holland."

Several creditors pressed for Ballast to be pushed from administration and into liquidation on the grounds that this would speed up the possibility of putting the heads of individual directors at Ballast Nedam NV on the block.

"We want to get to a position where someone with money and assets is found to be accountable," said one creditor.

A five-man creditors' committee was formed. The first place was offered to the Ballast pension fund's trustees, owed £86m. Major creditors took the remaining places after Doug Gillan, Ballast's head of personnel, declined an invitation to stand. "I've been well and truly shafted once," he explained.

NV's claims against Ballast plc run to £128m.