The i Paper revealed this weekend how Balfour Beatty, which is building 55 miles of the West Midlands section of the high-speed rail route, has terminated “all agreements” with Danny Sullivan Group.
The company denies all allegations of tax fraud, and says its own external review found no evidence of “deliberate wrongdoing involving any employees”.
Chief executive Mark Wild, who took over at the start of this year, has already admitted the civils phase of the building work is significantly behind schedule, and Transport Secretary Heidi Alexander confirmed HS2 will not open in 2033 as originally planned.
The i Paper understands bosses believe they can handle the sacking of Danny Sullivan Group with as little disruption as possible by transferring workers to Balfour Beatty or other suppliers.
Rishi Sunak axed HS2 north of Birmingham in 2023
Bosses have contacted all other contractors currently building Phase One between London and Birmingham informing them of developments and requesting “urgent reassurance with regard to any continued employment of Danny Sullivan Group”.
“HS2 Ltd takes its responsibility for managing public money seriously,” a spokesperson said.
“HS2 Ltd is continuing to conduct further investigations into labour supply contracts across the supply chain.
HS2 has faced fraud allegations for a number of years, with several whistleblowers having claimed their warnings of increasing costs were deliberately ignored.
Whistleblowers claim Danny Sullivan Group has been falsely declaring self-employed workers as PAYE (Pay as You Earn) salaried staff and charging an inflated rate for them.
Similar claims were made about a second company, though they were later reinstated.
square NEWS ExclusiveHS2 contractor sacks firm following 'tax fraud' investigation
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Danny Sullivan Group said in a statement: “After extensive discussions on our commercial arrangements and contractual terms, Danny Sullivan and Sons will cease its provision of skilled trades and labour to Balfour Beatty.
“Individuals affected by this decision will continue to work with Balfour Beatty and we are working to mitigate the impact with minimal interruption.
“Our work continues across UK infrastructure projects and we are proud to be operating at a size and scale not seen before in our business with a renewed focus on the highest standards of governance alongside significant operational improvements.”
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