1. ITV Report

Direct Line axes hundreds of jobs in Liverpool

Direct Line is axing hundreds of jobs in Liverpool Photo: PA

Direct Line is closing its office in Liverpool. The firm is axing 2000 staff across the country - 485 of them on Merseyside - under plans to slash more costs.

The insurer is consulting with staff over job losses, and hopes to redeploy some of the affected workers to its site in Manchester, or find opportunities with other potential employers.

The job cuts come as Direct Line announced aims to more than double its original cost savings target to over #200 million by 2014, or #130 million a year on a net basis. It has already shed 1,200 jobs since last August under the cost-cutting drive.

Unite said the planned job losses were a "savage bolt from the blue" and slammed Direct Line for refusing to recognise the trade union.

Dominic Hook, Unite national officer for finance, added: "Unite will continue to strongly oppose anti-union bias where it exists in the finance sector and will give all the support we can to our members at Direct Line on an individual basis.

"The Government's claim that the economy is out of intensive care will have a hollow ring for those at Direct Line who face the dole queue."

Paul Geddes, chief executive of Direct Line Group, insisted the firm had "not made these proposed changes lightly".

He said: "As we have done in the past, we will deal fairly and carefully with those impacted, and do all we can to support them through these changes."

Direct Line also has major sites in Leeds, Glasgow and Manchester.

The group was spun out of Royal Bank of Scotland (RBS) when it floated on the stock market last year.

It recently revealed a #94.3 million profits haul for the first three months of 2013 - up 47% on a year earlier thanks to cost savings and unusually low weather-related claims.

But the group, which also owns brands including Green Flag and Privilege, saw gross premiums fall 4.5% during the quarter to about #1 billion as it refused to get drawn into a price war in the fiercely competitive motor insurance market.

Taxpayer-backed RBS floated Direct Line to appease European Union rules on state aid.

RBS still owns 48.5% of the insurer but must sell its entire stake by the end of 2014.