James Moore: RBS playing the offshoring game

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The Independent Online

Outlook Barely a week goes by without yet more job losses at Royal Bank of Scotland. Another 3,500 posts were trimmed yesterday. The total (as estimated by the Unite union) is at 21,500 since 2009. Some of the latest batch come as a consequence of the forced sale of more than 300 branches to Banco Santander. But many more are part of a continuing programme of lay-offs as Stephen Hester grapples with the wreckage left by his predecessor, Sir Fred Goodwin.

Several hundred in the latest tranche are going because they are being "offshored". Yes, that game is still being played. They will be "non-customer facing" roles. But one has to wonder how long it will be before RBS starts looking at whether it really needs to be boasting about UK-based customer-facing calls centres. Shifting roles from high-cost western economies to low-cost eastern ones has become an easy way for executives to cut their cost base and make themselves look good. So it's no wonder RBS is at it. It really needs to be looking good because the Government wants to be shot of the shares it owns as quickly as possible. It doesn't matter that the practical benefits of offshoring in terms of an efficiently running business look debatable. And when the roles are customer-facing it's hardly anything other than downright disastrous. Still, given the way the economy is growing in India (the favoured location for offshoring), it won't be too long before all those jobs start flowing back. And new ones with them.

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