Fears for British jobs as Aviva plans Indian call centre with 1,000 staff

Britain's biggest insurer, Aviva, is the latest company to set its sights on India as its chosen location for expansion, saying it would open a 1,000-person call centre and processing unit on the subcontinent.

Aviva, squeezed along with rivals by three years of falling stock market returns, said opening the centre in India would be as much as 40 per cent less expensive than operating a similar claims handling centre in this country.

Aviva, which operates under the Norwich Union banner in the UK, joins Prudential, Lloyds TSB and HSBC in opening substantial new divisions in India, which appeals to UK companies because they can employ English speakers on low salaries.

Amicus, one of the largest financial services unions, has warned that companies' enthusiasm for relocating parts of their businesses to developing countries could reduce jobs in Britain. Dave Fleming, the National Secretary, said: "The recent trend of finance sector companies outsourcing jobs to lower cost employment areas is having a serious impact on UK jobs. I will be continuing meetings senior management so that the company fulfils its partnership agreement with us and undertakes full consultation to send a positive message to its 30,000 UK workers."

Aviva said its decision to open a substantial centre in India would involve some job losses as it transfers operations away from the UK. But it stressed it would try to accommodate as many of its British staff as possible by offering them transfers to different parts of the business.

Prudential, the second biggest UK insurer, announced plans to set up a call centre in India last September, eliminating 850 jobs in Reading.

Lloyds is hiring as many as 250 people in India in new jobs and may transfer British jobs there within two years if the operation is successful.