Government-owned Royal Bank of Scotland is cutting 880 IT staff in London, including 650 permanent and 230 contract workers, as the bank scales down its operations to become a smaller UK-focused business.
The latest cuts will add up to a 40% reduction in RBS’s London-based operation by 2020.
Since the 2008 financial crisis, which saw RBS rescued by the government and nationalised, the bank has been cutting staff numbers across the business. In May this year, the bank announced it was cutting more than 300 UK IT jobs and trade union Unite suggested at the time that RBS was planning to offshore more roles.
At the time, RBS said in a statement: “As RBS moves towards becoming a simpler, smaller, UK-focused bank, we’re continuing to restructure our back-office support and reducing its size so it’s a better fit for our business.”
Unite national officer Rob MacGregor said RBS was continuing with its “savage” job cuts. “The decade of slashing jobs has done nothing to boost morale, increase consumer confidence or improve the bank’s performance,” he said.
“By 2020, just a fraction of the RBS IT function will remain, leaving this organisation operating a skeleton service, with the customers and remaining staff paying the price.
“RBS’s fixation with cutting employee numbers, restructuring and offshoring work that could reasonably be done by displaced staff within the RBS IT community is unacceptable. This British taxpayer-funded bank should be concentrating on investing in jobs here in the UK, rather than wholesale cuts.”
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RBS did not confirm the number of job losses, but a spokesperson said: “Inevitably, as RBS becomes a simpler, smaller bank focused on the UK and Ireland, our technology function will undergo reorganisation and will reduce over time.
“As we develop long-term plans for our technology business, we have, in the interests of transparency, started to share our emerging proposals on a future operating model with Unite. We have not consulted on any headcount reduction, instead sharing a direction of travel with Unite which is subject to change.
“Our proposed plans are designed to reduce the number of contractors we employ and strengthen our permanent workforce and while we are downsizing in London, we are reinvesting in other UK hubs.”
It is not just IT staff who are being affected by the RBS cuts, but also frontline staff as a result of the bank’s adoption of digital services. In May last year, RBS said it was cutting hundreds of jobs as it shrinks its branch network in response to customer demand for digital services.
And in March 2016, RBS’s adoption of automated financial advice technology, dubbed robo-advice, also led to job losses. The bank cut 220 of its face-to-face adviser roles in a bid to cater to increasingly digital customers.