Strong indications emerged this week that Npower, one of the leading energy companies in Britain may soon retrench about 2,500 of its staff to strengthen the company’s current frail financial performance.
However, the proposals were still being finalised, with some of Npower’s directly employed workforce of 7,500 at risk and the remainder of the cuts taking place at internal suppliers elsewhere in the RWE group and at outsourcing partners, Ksy News reported. By extension, about 11,500 jobs in indirect employment of the firms operations in the UK would also be affected.
If the planned reduction materializes, the firm would have reduced its workforce by 20 per cent.
The grim news will be delivered just days before competition regulators announce a series of measures aimed at making the UK’s energy market more transparent. This is even as Npower, which is part of the German utility RWE, rivals such as British Gas and SSE had announced a round of price cuts a few months ago, and was criticised by government officials and customers for failing to step up.
The oil giant had disclosed that it would cut gas prices for residential consumers by 5 per cent on March 26, this year, equating to a £32 annual bill cut for households using a standard domestic tariff, based on the rapid decline in oil prices globally.
The company announced last February that it was scrapping its full-year dividend, blaming sliding earnings from its electricity generation business and the changing political sentiment towards nuclear power in its home market. Experts say the dividend move will save around €600 million or £464m for the company.
If the reports from Britain are anything to go by, the job cuts will be the latest piece of bad news affecting RWE in the UK, following last month’s accident at the power station it owns in Didcot, Oxfordshire, which is thought to have left several people dead.