Outsourcing giant Serco to axe up to 500 jobs but Scots escape cull

By DOMINIC JEFF
Published on Saturday 28 January 2012 03:48

MORE than 800 job cuts were announced yesterday as outsourcing giant Serco consolidated functions following a series of acquisitions and administrators of Thamesteel cut most of its workforce.

Serco, which delivers back-office support for a range of industries including banking, insurance, travel and healthcare, is merging its business processing operations into a single global division.

The move will be combined with an overhaul of its UK management structure.

Its Scottish operations, which include Kilmarnock prison and a joint venture with Glasgow City Council that covers IT and property management, are likely to be unaffected as the axe falls mainly at the group’s headquarters near Basingstoke.

Chief executive Christopher Hyman said the changes would allow the FTSE 100 company to provide the kind of office operations that customers were demanding while improving “innovation and efficiency in our management structure”.

Serco’s recent acquisitions include the Listening Company in the UK, Intelenet in India and Excelior in Australia, taking its global staff to some 100,000.

The firm has previously warned that its divisions in the UK and US were facing “challenging conditions” in the face of central and local government cutbacks. Almost half of sales already come from outside the UK.

Serco also yesterday unveiled a £55 million contract with the British Army to provide training and support to military personnel prior to deployment on operations around the world.

It will involve training soldiers in essential language, culture and operational environment skills.

Meanwhile, about 350 workers at Thamesteel’s site in Sheerness, Kent, were yesterday told they would be made redundant in a “disastrous” blow to the steel industry.

Joint administrator Rod Weston, of accountancy firm Mazars, said: “Production at Thamesteel’s Sheerness plant ended several weeks ago and the company voluntarily entered administration. The administrators, unfortunately, had to inform the workforce that a large number of redundancies need to be made.”

Fifty workers are being kept to maintain the plant in full working order while the administrators work to try and find a buyer for the business.

The steel manufacturer, owned by a Saudi industrial group, operated from a 50-acre site in Sheerness, on the Isle of Sheppey, and had employed more than 400 full-time workers.