The business, which employs 14,400 people, has already cut 1,200 jobs as part of a plan set out August, to generate annual savings of £100m by 2014 – or ‘regain competitive edge’, as chief exec Paul Geddes puts it. The new round of redundancies will increase savings to £130m a year by 2014, its management said today.
The cost-cutting is part of conditions set out by the government: when it bailed out Royal Bank of Scotland to the tune of £45bn, it said the bank had to sell off its insurance business along with some other assets.
Consequently, in October RBS floated part of the business, following it up by floating another tranche of shares in March, which cut its shareholding to just under 50% .
‘It’s clear that we need to become more efficient to deliver the good service and value our customers expect,’ Geddes said today.
‘We have not made these proposed changes lightly and understand the impact they will have on our people.’
Most of the job cuts (which amount to 14% of the workforce) will be at the company’s head office in Bromley. Although the timing of this particular announcement was interesting: a call centre in Teeside, where 500 of the original 1,200 jobs are being lost, is shutting its doors this week. There’s an irony there somewhere…