PENSIONS and investments giant M&GPrudential has given a big vote of confidence to Scotland by announcing plans to make significant investments in its operations in Stirling and Edinburgh.
The group said the Scottish centres will be at the heart of a location strategy which has been developed to support its ambitious growth plans. The strategy will involve the closure of four offices in England.
Read more: Demerging Prudential prepares for Brexit to hit UK arm
M&GPrudential unveiled the changes on a day another big sector player, Aviva, announced plans to shed 1,800 jobs without saying how the cuts would impact on its 2,000 strong workforce in Scotland.
The shakeup at M&GPrudential will see 400 posts created in an enlarged Edinburgh operation over the next 18 months as the firm looks to capitalise on developments in the digital world to respond to changes in how people save for retirement.
“Edinburgh is the UK’s largest financial services centre after London and one of the world’s top ten fin-tech hubs,” said a spokesman for the business.
“As the Scottish base of Wealth Solutions, it gives us access to expertise and supports our transformation to a digital first business.”
Read more: Lloyds to create 500 jobs at new Edinburgh tech hub
The expansion in Edinburgh will be achieved by transferring posts from Stirling.
However, some jobs are expected to move from England to Stirling, which is home to functions such as finance and human resources as well as pensions administration staff.
M&G Prudential expects to close two offices in London and bases in Reading and Chelmsford.
The spokesman said M&GPrudential is fully committed to Stirling which will be one of three centres for the UK operations alongside London and Edinburgh.
“This gives us geographical access to the best talent and right skills for our business,” he said, adding that M&GPrudential will invest millions of pounds in the coming years to create a modern and flexible workplace in Stirling.
Read more: Scottish financial industry growth outpaces London
This is home to 1,100 of the 1,300 staff working for M&G Prudential in Scotland, out of a total of 4,500 in the UK. Some 200 are employed in Edinburgh currently.
As the majority of M&GPrudential staff are expected to be based in Scotland by the time the office rationalisation programme is complete in 2025, jobs numbers could increase significantly.
Prudential has shed jobs in Scotland since the £2.75 billion acquisition of former mutual Scottish Amicable, which employed around 2,000 when the deal was struck in 1997.
Prudential took on the Craigforth facility in Stirling following the acquisition. It subsequently moved Scottish Amicable’s investment management operation from Glasgow to London.
Some 150 staff at Craigforth work for Diligenta under an out-sourcing deal agreed by Prudential last year.
The office closure programme announced yesterday comes amid a shake up in the savings and pensions markets which is being accompanied by big changes at established players.
Read more: Standard Life Aberdeen wins backing for transformational £3.2bn sale of pensions arm
Prudential group plans to spin its UK business off from faster-growing international operations in Asia, the USA and Africa.
Yesterday Aviva announced plans to shed 1,800 jobs globally over the next three years as new chief executive Maurice Tulloch looks to save £300m costs annually by 2022.
It did not say how the programme will impact on its operations in Scotland. The company employs around 1,100 in Perth, 700 in Bishopbriggs and 160 in Glasgow. It has a total workforce of 30,000.
Aviva said it would do all it could to reduce roles through natural turnover, not filling vacancies and voluntary redundancies.
Mr Tulloch said the changes he planned to make would reduce cost and duplication at the group and reduce the complexity he reckons has held it back for too long.
Edinburgh-based sector stalwart Standard Life completed an £11bn merger with Aberdeen Asset Management in 2017. The enlarged group sold its UK and European insurance business to Phoenix in a £3.2bn deal; last year after deciding to concentrate on the global investment business.
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