Rydon, the construction company that refurbished Grenfell Tower prior to the fire last June that cost so many innocent lives, enjoyed a 50% increase in profits last year to £19 million and increased the salary of its highest-paid director by 8% to £459,000.
Its accounts show directors decided not to set aside any funds to cover potential losses or expenses related to the fire, after considering the company’s position. Accounting rules require companies to include a note highlighting the potential for any significant charges they may face in future, such as fines or payouts related to litigation.
Rydon’s sales rose 3% to £280 million for the year to the end of September, including a three-month period following the fire on 14 June. The salary of the company’s highest-paid director, who was not named in the accounts, went up from £424,000 to £459,000. The company said it had been helped by low interest rates and several government initiatives aimed at increasing housebuilding.
A government-backed inquiry in December said the cladding system appeared to have accelerated the spread of the fire but Rydon did not make any financial provision for costs relating to Grenfell, despite lawyers for the victims’ families saying they are considering legal action against the local government body that owned Grenfell Tower and the companies involved in procuring and fitting the external insulation system.
Ministers have said the polyethylene cladding used in the refurbishment did not comply with regulations, although Labour said that the government’s chief fire safety adviser has approved similar material as safe for tower blocks.
In its accounts, Rydon said;
“Given the limited nature of the work commissioned, the approvals received in relation to it and the inter-relationship with work undertaken by other parties, no provision has been made in the accounts for any matters arising from these tragic events”.
In December, lawyers said social housing landlords that have been forced to remove dangerous cladding from housing blocks could sue the companies responsible if they can prove the work did not comply with regulations.
We gratefully acknowledge Rob Davies of The Guardian, from whose article of Thursday 8 March this blog is derived.