Npower confirms 2,400 job losses following customer exodus

Npower said it had lost 351,000 gas and power customers in Britain last year due to problems with its billing systems which led it to be fined a record £26 million in December by the regulator, reports The Times.

The company’s two main businesses in the UK made an aggregate loss of £154 million in 2015 — £99 million at npower and £55 million at RWE Generation.

Paul Coffey, the chief executive of npower, said: “Npower results continue the trend seen earlier in 2015, but they are nonetheless extremely disappointing and we are starting a two-year process to fix them.”

He said the company tried to do too much, too soon and this led to over-complicated processes and procedures resulting in “unhappy customers, too many complaints and extra costs to put things right”.

“We have looked at every part of npower, and over the next two years we’re fundamentally changing how the company operates. We shared the outcome of this review yesterday with employees. By 2018, around 2,400 fewer people will support npower overall through a mix of those who work directly and indirectly for npower,” he said.

The job cuts will be spread across offices, including some in the Midlands, and are not “site specific”, the company said.

It confirmed the closure of an office in Burton, which employs around 200 staff, and said it was consulting with affected employees and with unions. There will be no job cuts at any of npower’s power stations.

Dave Prentis, the Unison general-secretary, said: “These huge job losses will come as a devastating blow to the workforce. Npower has been in trouble for some time thanks to poor decision-making at the very top, and workers are now paying the price. The company’s failure to invest properly in new systems has left it with one of the worst customer service records in the business.”

The job losses at npower are part of a plan by its German parent, RWE, to reduce its 11,500 workforce by almost a fifth.

Npower, which has 4.9 million accounts, has several big plants in the UK, including Pembroke and Aberthaw in Wales and Staythorpe in Nottinghamshire. Along with other big suppliers, it announced a 5.2 per cent price cut to its standard domestic gas tariff.

The grip of the Big Six energy supplier on Britain’s 28 million households will be the focal point of the Competition and Markets Authority when it unveils its latest recommendations for shaking up the market on Thursday, after a two-year investigation.

The Big Six have suffered a steady erosion in customer numbers as a new breed of independents encroach on to their territory. The industry also has suffered criticism from the CMA and politicians for overcharging customers who fail to shop around, who are more likely to be poor, disabled or single parents.