Co-op to axe 1,000 jobs in £100m efficiency drive

Co-operative Financial Services (CFS) is to cut 1,000 jobs this year as part of plans to reduce operating costs by £100m by the end of June 2008 but will also boost investment in new technology.

The company said no call centre jobs would be lost as part of the redundancies and reaffirmed its commitment not to offshore any customer-facing roles to low-cost locations such as India.

Other cost savings are planned through improvements in supplier procurement and the simplification of business processes across the organisation.

silicon.com Financial Services

Get the latest financial services news straight to your inbox. Sign up for the FS newsletter today!

CFS said the job losses are "regrettably unavoidable". David Anderson, CEO of CFS, said in a statement: "Decisions taken which lead to a reduction in colleague numbers are not taken lightly and consultation is underway with all the relevant trades unions. CFS will aim to achieve some of these changes through voluntary means however the scale of the reorganisation will mean that compulsory redundancies are inevitable."

But CFS will also boost its technology investment as part of the plans to improve operational business performance. The next stage of development following the integration of Co-Operative Insurance and Co-operative Bank - which was led by Co-operative Group CIO Gerry Pennell - will see a capital investment of £250m to support growth in insurance and retail and corporate banking.

Some of that £250m investment will go on new technology, including a new web offering for general insurance and new technology for CFS financial advisers.