KPMG set to slash jobs and pension contributions in cost-cutting drive
KPMG is set to cut more than 100 jobs and slash contributions to employees’ pensions in a bid to slash costs during the pandemic.
The Big Four firm is expected to cut just under 200 jobs across the UK ahead of the long-awaited reform of the audit reform.
Sky News first reported that partners and affected employees were informed in a briefing on Wednesday morning, held by UK chairman Bill Michael.
He reportedly told partners that while the firm’s performance during the pandemic had been ahead of expectations it had accelerated the need to streamline the business.
KPMG confirmed to City PM that around 100 jobs will be cut from its 3,000 strong consulting practice, with a similar number to be cut from its internal business division.
A spokesperson for the accounting firm said: “Due to changing demand from our clients as a result of the COVID 19 pandemic, we have announced proposals to make fewer than 100 positions in our Consulting business redundant. ”
Sky News also reported that KPG is launching a consultation on reducing pension contributions to 4.5 per cent of salaries, which will adversely affect older employees.
A spokesperson told City PM: “We are operating in highly volatile times and are proposing a series of actions to safeguard our business in the medium and long term. We are consulting with our people on a proposed temporary change to our employer pensions contributions. At this stage, no final decision has been taken.”
KPMG, Deloitte, EY and PwC are facing a demand from the auditing watchdog to separate their audit and consulting businesses by 2024. It comes after increased regulatory scrutiny after a string of corporate failures.
Earlier this month the Financial Reporting Council (FRC) told the Big Four accounting firms to separate their units to ensure their audits “do not rely on persistent cross subsidy from the rest of the firm”.