Lloyds Banking Group is going to cut another £2bn of costs as part of a four-plan which will the see a major investment in AI technology and the scaling up of the Lloyds Technology Centre in India.
The Lloyds Technology Centre celebrated reaching 5,000 permanent employees a few weeks ago. It’s grown to 5,000 employees in just 3 years. It’s clear that with the investment in AI and another major cost reduction exercise we are going to see an acceleration in the offshoring of jobs to India. And that won’t just be just IT related jobs. We estimate that by the end of 2030, 10,000 employees will be working in India. That will be made up of jobs offshored from the UK and those created directly in India rather than the UK. And let’s be clear all the redundancies in Lloyds will be made in the UK.
There will be some who argue that other banks are investing in India so why should Lloyds be any different? Lloyds is not an international bank. 96% of its profits come from the UK. It makes no money in India. Moreover, Lloyds tells its customers that its ‘Helping Britain Prosper’ but that’s hardly the full story. How can the UK grow its economy if the biggest domestic bank offshores its knowledge-based jobs to India. Some 40,000 graduates leave UK universities every year with IT related degrees: how are they supposed to start their careers if roles have been offshored? Lloyds said yesterday it’s going to offer more placements but that’s just window dressing for gullible politicians.
The new Prime Minister has argued for a controlled approach to globalisation saying that unregulated free markets have hollowed out ‘working class’ communities both in terms of jobs and opportunities for the future. That’s what Lloyds is doing. In our letter to the then MP for Makerfield, we said:
“Lloyds Banking Group should be training its own staff in these new skills rather than go looking for cheaper alternatives overseas. Why doesn’t Lloyd Banking Group commit to establishing 1000 IT apprenticeships every year for the next 3 years to train the home-grown IT specialists it’s going to need for the future?”.
We deal with the new strategy in more detail in a separate Newsletter. Although I did smile at the key strategic priority of integrating bancassurance and wealth and doing more cross selling to customers: now many times have we heard that before? In fact, I read: “Increase cross-group connectivity”, “extending propositions to unlock connected … growth”, “extending into higher-value, fee generating adjacencies” (that one was my favourite) and “broadening our reach … through data-led connected propositions”. Lloyds has been saying the same thing for as long as I can remember and never achieves it.
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