Lloyds axes 300 workers and consigns famous brand to history

Published on Wednesday 29 April 2009 22:41

LLOYDS Banking Group is to axe 50 jobs in Edinburgh after announcing the merger of its Scottish Widows and Clerical Medical sales forces.

From 1 July, the two brands will be known simply as Scottish Widows, and up to 305 jobs will be cut from all pension and investment sales and support teams across the UK by the end of the month.

The decision affects 190 jobs in sales and a further jobs in customer services.

Lloyds, 43 per cent government-owned after its takeover of Halifax Bank of Scotland, insisted Scottish Widows was committed to keeping its head office in Edinburgh, and that compulsory redundancies would be made only as a last resort.

Announcing the second round of cuts since the takeover, Archie Kane, Lloyds' group executive director for insurance, said: "This is the first important step in our aim to establish one simplified organisation.

"We are mindful of the rich heritage and strength of the Clerical Medical brand. However, our research has shown that Scottish Widows is the most recognised and trusted brand in the market place.

"(This] announcement takes us a step closer to achieving our vision: to be recognised as the best life, pension and investment company by our customers, colleagues and shareholders."

Under the new plans, pension products will be provided by Scottish Widows, with onshore and offshore investment products coming from the Bristol-based Clerical Medical. The branding will change over time, but the news means no change for existing Scottish Widows or Clerical Medical policyholders.

Union leaders expressed dismay last night. Ged Nichols, the general secretary of Accord, said: "

Whilst Accord recognises that there is a clear overlap between Clerical Medical and Scottish Widows, Lloyds Banking Group should not be tempted to seek unnecessary job cuts to achieve short-term cost savings to the detriment of the long-term future of the bank and the UK economy as a whole."

However, finance secretary John Swinney said that, while any redundancies were "disappointing", overall the news was positive for Scotland.

"(This] announcement has aspects of encouragement for the Scottish financial services sector. It was based on clear market research which demonstrated public confidence and trust in the Scottish Widows brand identity.

"This indicates that the underlying strength of Scotland's reputation in financial services is much more powerful than recent setbacks," he added.

Meanwhile, Dr Andrew Goudie, the Scottish Government's chief economic adviser, warned yesterday that he had seen no signs the economy is nearing recovery, forecasting the UK recession would last until well into next year. He expected employment to fall for "about three years or so".