Lloyds has denied that its strategy to offshore IT roles to Indian workers is creating a shortage of certain types of skills.

A report in the Daily Mail said Indian workers were being brought into the UK to replace UK IT workers. It said there are fears at the bank that workers coming in are not all up to the job.

Internal documents, seen by the Daily Mail, revealed that managers at Lloyds are concerned about knowledge gaps of some computer specialists. Another document referred to the inability of suppliers hiring from the sub-continent to provide Lloyds with system designers with the necessary skills to perform their jobs properly.

But Lloyds said the programme to offshore IT jobs is not new and does not create a skills shortage.

"We continue to outsource areas of IT work to companies based overseas. At any one time some of the staff from these companies will be based in the UK to deliver aspects of our IT projects. This is standard industry practice," said a Lloyds statement.

It said that offshoring fills skills gaps rather than creates them. "The staff from the companies we work with provide a real addition to the knowledge and technical skills of our IT division."

The Lloyds Banking Group Union, which has asked the Bank to abandon its Offshoring Policy in numerous occasions, said offshoring is accelerating and is leading to pay cuts in the UK, as well as job cuts.

"Over the past 12 months, the Lloyds Banking Group has not only increased to over 5,000 the number of jobs it has now transferred to India - in the process, replacing existing UK-based staff - but it has also been flying in to the UK hundreds of workers from India who have replaced existing UK-based IT staff and contributed to forcing down pay levels of IT contractor staff."

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