UK firms 'up pace of outsourcing'

India remains the top centre for offshoring, Deloitte says

The number of UK financial services jobs outsourced to low-cost centres abroad is expected to soar to 180,000 by 2010, according to a survey.

So far 25,000 UK jobs have been moved overseas, accountants Deloitte said.

UK financial firms were achieving higher cost savings than global rivals through offshoring, Deloitte said.

Firms made average cost savings of 47% - 10% higher than global rivals, Deloitte said. Unions have condemned the practice of moving jobs abroad.

'Offshore fatigue'

"UK companies seem to have a better grip on offshoring issues than some overseas headquartered firms," said Russell Collins, head of the financial services practice at Deloitte.

"However, offshoring is not a straightforward cost savings tactic. Many organisations are beginning to experience 'offshore fatigue', as the initial novelty wears off and the original operational managers return from their tour of duty."

Deloitte said its survey of 62 global financial services institutions dispelled the myth that the majority of offshoring involved call centre jobs.

"90% of offshoring investment is activities such as HR, IT, processing, finance and administration, with only 10% in call centres," said Chris Gentle, Deloitte's director of financial services.

The survey said India remained the most popular destination for offshoring, although many companies also based a second centre in countries including South Africa, China and Singapore.

Worldwide, Deloitte said it expected 2 million financial services jobs to be outsourced to low-cost countries by 2010.