AN estimated 2,500 jobs are to be lost at Co-operative Insurance Society over the next two years, the parent company Co-operative Financial Services has announced.
However CFS Chief Executive Mervyn Pedelty told the Co-operative News that up to 500 new customer facing positions would be created leaving a potential net loss of 2,000 posts.
CFS say the job cuts ? many of which it is hoped can be achieved by natural turnover, voluntary redundancy and redeployment within the Co-op Movement ? are needed as part of a process of modernisation and repositioning of CIS.
CFS say in a statement that the modernisation programme is in response to market and economic changes and developments and is designed to ensure CIS's future as a profitable and growing operation with a distinctive customer service proposition.
A strategic review of the business has confirmed a number of CIS's important strengths, but that actions are also required which will:
? Improve the effectiveness of the CIS financial adviser salesforce.
? Increase CiS's sales capabilities across other channels – especially telephone, internet and affinity programmes.
? Investigate the opportunities presented by the FSA's proposed depolarisation rules – and how CIS might offer other companies' products through its channels.
? See a major investment in customer service designed to place a much greater emphasis on improving customer access and, where required by customers, fulfilling more of their needs at the initial point of contact.
? Reduce CIS' s overall cost base.
Said Mr Pedelty: `CIS has a strong reputation with its large and loyal customer base, an enviable level of customer trust and a robust capital position.
`However CIS is not immune from the intensifying economic and competitive pressures occurring within its core markets and we need to take action now to ensure a vibrant, successful and sustainable future for our business.
`By taking this action we will be better placed going forward to fulfill our Co-operative mandate of meeting the needs of millions of ordinary UK households – helping to bring savings, investments and insurance to wider society, not just to the better off segments of the population.`
?See the next issue of Co-operative News for further details and reaction.