Capita Confirms 400 British IT Jobs At Risk

Capita, one of the UK’s principal business process outsourcing companies, has confirmed that 400 British jobs within its IT division are under threat.

The firm said that some of the jobs are to be axed and others moved overseas to India, as part of its cost cutting drive and to remain competitive.

Possible Strike?

“In order to maintain its competitive position in the marketplace, optimise operational efficiency and maintain and improve service delivery to its clients, Capita’s IT services business has concluded that a revised delivery model is necessary,” the company told TechWeekEurope in an emailed statement.

“As a result, on 30 March 2012  we commenced a series of consultation exercises involving our employees and their representatives, some focused on moving elements of our work activity to our existing IT services operation in India, and others focused on achieving headcount efficiencies on a function or location basis in the UK.”

“At this stage we believe this may lead to approximately 400 redundancies,” Capita confirmed, but its admission that some of the jobs would be outsourced to India was slammed by the Unite Union.

“Unite has refused to rule out an industrial action ballot as a result,” said David Fleming, Unite National Officer.“Our members will be angry and concerned at the prospect of losing their jobs in the current economic climate. Capita is a highly profitable company and to treat loyal and highly skilled workers in this way is deplorable.”

“We will work to protect our members’ interests during the 90 day consultation period but strike action will inevitably be on the agenda as we talk to members in the coming weeks about how the union should respond to this attack on their livelihoods,” he said.

Government Work

Capita is actively involved in many government projects and earlier this month it signed a 10-year deal with the armed forces.

As part of the £440 million Recruiting Partnering Project (RPP), one of the largest contracts of its kind in the industry, Capita will provide an IT recruitment platform for the Royal Navy, Army and Royal Air Force and it is also involved in providing services for The Pension Services, the Criminal Records Bureau and the BBC.

But Capita decision to offshore jobs to India is not uncommon. Indeed, the offshoring British jobs to India has been going on for many years now. Recently the government signed a contract that would mean hundreds of computer technicians in India would develop an IT system for the government’s universal credit welfare programme, despite promises that large data projects would remain in the UK.

India remains a popular destination for services contracts, because of its cheap labour costs. Lloyd’s Banking Group for example recently opted to offshore 593 IT positions to India and in February, the government announced that it was going to allow overseas suppliers to handle certain types of public data on its G-cloud.

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