Barclays and Lloyds TSB have outsourced yet more IT functions to India, and the exodus of high-end development roles is likely to continue.

Lloyds TSB has offshored 450 roles there and has plans to outsource some jobs from its programme management department, which employs 75 people. This follows on from the 250 roles shipped out in May last year.

The bank has offered to find suitable replacement positions for the affected staff, but Lloyds TSB’s union (LTU) has said there’s no guarantee they’ll be on the same pay, or even working in IT.

Steve Tatlow, assistant general secretary of the LTU, said: “A lot of people will be choosing redundancy. We are fundamentally opposed to offshoring.”

Barclays, meanwhile, has stated that it will be upping the number of IT jobs outsourced to India and elsewhere, and increasing the complexity and value of the processes it offshores.

Nick Mayes, senior consultant at IT think-tank Pierre Audoin Consultants, says this is an ongoing trend: “India used to be a location for low-level maintenance and support roles, but now it’s more higher-end development work around new systems.”

The National Outsourcing Association (NOA) is divided over whether investment banks’ current cost-cutting could mean more or less IT outsourcing.

Martin Hart, chairman of the NOA, cites the recent example of UBS canning a £1bn outsourcing deal at the last minute: “But the financial services sector has always been leaps and bounds in front of other vertical markets in the UK in terms of outsourcing – they are well versed in how to harness it to help them improve internal efficiencies and engineer processes.”

And it’s not just India you have to worry about: Russia, Czech Republic and Ukraine are all new hot spots, says Hart.

Hayes adds: “The fact is, there’s a skills shortage for high-end development roles in the UK, particularly around SAP. Deutsche Bank does a lot of development work out of Ukraine. There are a lot of ex-Soviet Union military programmers. They have a very strong scientific background and are doing highly skilled work around customer relationship management systems.”