ISG collapse hits council for £3m

The fallout from ISG’s collapse last year led to a six-month delay to a project in Manchester and cost the council £3m, Construction News can reveal.

Manchester City Council was forced to redo some of ISG’s work on the affected project – believed to be the £16m Orchard House Secondary School – following “winter weather”, according to a Freedom of Information (FOI) response it sent to CN.

The additional work and delay to the project caused a combined £3m hit, it confirmed.

The firm was working on a single contract for Manchester City Council when it went under, the council said in its FOI response.

ISG celebrated completing the steel frame just days before it went under. The school was due to welcome 150 pupils with additional educational needs in the 2025 academic year.

It is unclear whether it will still open for the 2025 academic year, or whether a replacement contractor has been appointed.

CN approached the council for comment.

The council also had to shell out a further £100,000 remediating defects on unnamed projects “recently completed” by ISG, it said in the FOI response.

ISG was the sixth biggest contractor in the UK when it went under, with a £2.2bn turnover. The collapse hit subcontractors, government clients and projects up and down the country as clients scrambled to replace ISG on jobs and minimise the exposure to the supply chain.

Last week, CN revealed that ISG’s collapse caused a £1.5m cost hike on a project to build a sports centre in Chesterfield.

In January, the Ministry of Justice said ISG’s collapse would cost it around £300m on its new prisons programme, and could have an even bigger impact on fire-safety remediation work.