Northern Electric sheds 800 jobs in plan to save pounds 20m a year

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The Independent Online
NORTHERN Electric will shed 800 jobs in a reorganisation of its distribution business expected to produce annual savings of pounds 20m by 1997.

The company is the latest to announce big redundancies after the industry regulator's price review.

Northern, which has already reduced staff by 1,000 to 4,700 since privatisation four years ago, said the latest cuts would be on a voluntary basis over three years.

The company said it would reduce prices to tariff customers averaging 5 per cent from 1 December. It would also pursue a 'strong, progressive dividend policy, moving towards a more equal sharing of earnings, between dividend payment and retention within the company'.

This month Midlands Electricity said it would shed 1,200 jobs over the next three years, and Manweb said 500 jobs would go. Last month, Norweb announced 1,200 jobs would be lost over five years. And Yorkshire Electricity said in July that 1,000 staff, nearly a fifth of its workforce, would be cut over three years.

Northern said the cuts would 'be evenly spread across all levels, from managers to the engineers and the men who dig the trenches'. Unions said the job losses were evidence that electricity supply companies were putting the interests of shareholders above those of customers and staff.

'One supply company after another is now laying off its workers to save money that can be passed on in dividends to shareholders,' Paul Gallagher, general secretary of the Amalgamated Engineering and Electrical Union, said.

In June, Northern announced a 16 per cent rise in profits to pounds 128.7m, and a total dividend of 24.85p, also up 16 per cent. Last month it was disclosed that Northern directors were awarded thousands of share options less than a week before its share price soared after Offer's price review.