British Gas owner Centrica will cut 1,000 jobs this year

Energy provider has blamed government policy for price hikes and job cuts

The group has stemmed the number of customers leaving (Reuters)

Centrica, the FTSE 100-listed owner of British Gas, said it expects to cut 1,000 roles this year as it reported a slowdown in the number of customers leaving the energy provider.

In February the company announced that it would cut 4,000 jobs by 2020, blaming “political and regulatory intervention”, and on Monday said it expects “like-for-like direct headcount” to reduce by 1,000 during 2018.

The group said overall financial performance has been “good in the year to date” in a trading statement issued ahead of its AGM. Centrica faces a potentially heated meeting with shareholders harbouring concerns over performance and executive pay.

The firm said it benefited from colder than usual weather, which increased energy demand, and added: “The significant commodity price volatility we have experienced has been managed well by our energy supply businesses and energy marketing and trading.”

While the group said it is still dealing with “high levels of competitive intensity” it noted that consumer customer account losses “have slowed materially relative to the average of 2017” so far this year, dropping by 62,000 in the first fourth months of the year. The group lost 823,000 customers in the period between June and October last year.

Centrica said it was operating under the assumption that a temporary energy price cap would be in place in the UK at the end of this year, but said it continues to believe “that price controls in competitive energy markets are not good for customers”.

Last month, British Gas said it would hike prices by an average of 5.5 per cent in May and blamed government policy for its decision. On Monday, the company said it was continuing to encourage the government and energy regulator Ofgem to take a different approach, adding: “We continue to call for energy policy costs as a whole to be funded through general taxation rather than through people’s energy bills.”

Iain Conn, Centrica chief executive, said 2018 had begun well: “Our customers continue to see new products and propositions and stable service levels, other than in UK home services which was impacted by extreme weather. We are making good progress against our cost efficiency targets.

“While the outcome of regulations to impose a temporary cap on all default energy tariffs in the UK remains uncertain, we continue to participate actively in the consultation process. Our focus remains on performance delivery and financial discipline and we remain on track to achieve our 2018 group targets.”