Written by: Keith Tully
Reviewed: Tuesday 8th March, 2016
The energy company Npower has announced that it will shed as many as 2,400 jobs in the UK after posting operating losses worth £106 million for 2015.
Statements made by the company in recent days confirm that several thousand of its 11,500-strong UK workforce are to lose their jobs as part of what is being presented as a two-year “recovery programme”.
It has been reported by Npower UK’s German owner RWE that the British energy supply business saw its customer base eroded by as much as seven per cent over the course of just 12 months.
Bosses at RWE have blamed stiff competition and issues with billing processes for the company’s “extremely disappointing” financial performance last year and for its having seen customer numbers dwindle from 5.13 million to 4.77 million.
“The main reason for this [poor performance] is serious process and system-related problems in customer billing,” statements from RWE have said.
“Substantial earnings shortfalls also stemmed from the fact that residential and commercial customers switched providers or we were only able to retain such customers by offering them contracts with more favourable conditions.”
Npower chief executive Paul Coffey said that his company’s performance last year reflects a business trying to do too much while failing to focus firmly enough on improving and maintaining the fundamental aspects of its operations.
“Energy should be simple for our customers and we have complicated it,” he said.
Of the confirmed job losses, Dave Prentis from the workers union Unison said: “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.”
German-owned Npower is considered one of the so-called Big Six energy supply companies currently operating in the UK.
Towards the end of last year, the company was ordered by the energy sector watchdog Ofgem to pay £26 million in fines for failing to treat many of its British customers fairly.