Feeds

Contractors fear more BT job cuts

'Corrective action' in face of £25m IT overspend

Providing a secure and efficient Helpdesk

Hundreds of IT contractors and agency staff working at BT face the chop as the monster telco looks to cut costs. The telco's IT budget is already £25m over budget and execs are now desperately trying to cut overheads and drive revenue to turnaround the deficit.

Some 250 contractors have already been told that they will no longer be needed from September. But this is understood to be only the first wave in a series of job cuts leaving contractors feeling unsettled about their future within the company.

At the same time, BT is looking to move some 2,300 permanent IT staff into customer-facing ICT activities by March 2006 potentially leaving a skills gap for supporting BT's own internal IT projects.

Insiders fear much of this internal work is to be offshored to countries such as India as the telco seeks to cut overheads.

A leaked document seen by The Register reveals that the telco is "committed to significantly reducing the amount that BT spends on IT" and notes that BT's IT division - OneIT - is "£25m adverse to budget".

In a bid to tackle this shortfall Al-Noor Ramji, CEO of BT OneIT, told workers that "we must act now - because failure is not an option".

He goes on: "The OneIT leadership team is putting in place immediate, corrective action to ensure we get back on track and accelerate our transformation."

A separate memo from the deputising director of Resource Management talks of "freeing up people through a combination of productivity and efficiency savings (doing the same work more efficiently with less people) and offshoring (doing the same work with lower cost people, typically in India)."

Insiders have told The Register that BT plans to reduce the number of IT contractors to zero by the end of the year with the work either to be taken up by BT employees or shipped overseas to countries such as India, although this is denied by BT.

"Hundreds more agency staff, many of whom accepted below-market rates in exchange for the relative security of working for BT, can expect dismissal notices later this year," one insider told us.

In a statement a spokesman for BT told us: "BT's 'OneIT' strategy is ensuring that BT has the IT structure, processes and people to support its ongoing transformation into a global networked IT services company.

"One element of the IT strategy is to refocus BT staff on to customer facing work that is currently fulfilled by contractors. With this in mind, BT recently released a couple of hundred IT contractors. At the same time, BT is working to offshore non-critical functions in order to achieve its efficiency goals." ®

Security for virtualized datacentres

More from The Register

next story
Phones 4u slips into administration after EE cuts ties with Brit mobe retailer
More than 5,500 jobs could be axed if rescue mission fails
Special pleading against mass surveillance won't help anyone
Protecting journalists alone won't protect their sources
Phones 4u website DIES as wounded mobe retailer struggles to stay above water
Founder blames 'ruthless network partners' for implosion
Apple's iPhone 6 first-day sales are MEANINGLESS, mutters analyst
Big weekend queues only represent fruity firm's supply
Radio hams can encrypt, in emergencies, says Ofcom
Consultation promises new spectrum and hints at relaxed licence conditions
Bill Gates, drugs and the internet: Top 10 Larry Ellison quotes
'I certainly never expected to become rich ... this is surreal'
Big Content Australia just blew a big hole in its credibility
AHEDA's research on average content prices did not expose methodology, so appears less than rigourous
EMC, HP blockbuster 'merger' shocker comes a cropper
Stand down, FTC... you can put your feet up for a bit
prev story

Whitepapers

Providing a secure and efficient Helpdesk
A single remote control platform for user support is be key to providing an efficient helpdesk. Retain full control over the way in which screen and keystroke data is transmitted.
A strategic approach to identity relationship management
ForgeRock commissioned Forrester to evaluate companies’ IAM practices and requirements when it comes to customer-facing scenarios versus employee-facing ones.
Saudi Petroleum chooses Tegile storage solution
A storage solution that addresses company growth and performance for business-critical applications of caseware archive and search along with other key operational systems.
WIN a very cool portable ZX Spectrum
Win a one-off portable Spectrum built by legendary hardware hacker Ben Heck
The next step in data security
With recent increased privacy concerns and computers becoming more powerful, the chance of hackers being able to crack smaller-sized RSA keys increases.