British Gas is planning to cut around 850 jobs after reviewing resource levels in its services business, the company has announced.

The cuts, revealed just hours after grim new unemployment figures, will focus on management and support roles, said the firm.

A statement said: "Household budgets are stretched, customers are looking for maximum value for money, and if we are going to remain competitive and offer the best prices for our customers, we need to reduce our costs.

"We have therefore reviewed resource levels in our services business, and are now proposing a reduction of around 850 roles.

"We will work to ensure continued high levels of service for our customers. We will now move into a consultation period to discuss these proposals in more detail with our people and their representatives.

"This is a sensitive and difficult matter, and we will work to support all those affected, and to ensure a fair, open and transparent process throughout."

Unison's head of business and environment, Mike Jeram, said: "This is seriously bad news on the day that the latest unemployment figures are announced and we learn that more than one million young people are now desperate for jobs.

"These 850 job losses come on top of the 270 British Gas is making in other business streams, so the true total stands at more than 1,100.

"British Gas claims these cuts won't harm customer service, but we will challenge them very hard to demonstrate exactly how they will guarantee to maintain decent levels of service, while axing this number of staff. In the face of recent price increases, customers will be very sceptical about the company's claims that standards won't be hit.

"Unison will vigorously oppose any compulsory redundancies, as well as proposals to worsen workers' pension benefits."

PA, photo by didbygraham