>if someone can provide labour/goods/resources more cheaply,

Yes, that's the essence of capitalism, and there's nothing wrong with it.

Except that you left out any mention of quality. Most of the "offshored" projects I've worked on have been taken away from local staff who vary between "passable" and "excellent" and been handed to people who are utterly unsuited or incapable of doing it.

However, the general equation that the management uses is

1 local person = $400

1 offshore person = $200

But our large corporations are increasingly being run by people who don't actually have a clue (do I need to point at any banks here?) and they neglect the last bit of the equation:

1 person to fix the damage done by halving the cost of the original person = $600

Not every time of course, some transfers have gone very well. But these are in a very small minority - so far, of around 30 projects, I've only seen 3 or 4 that could be rated as a success after they've bedded in. The rest have ended up vastly over cost or with the people who used to use the systems reverting back to massively inefficient systems while demanding replacement systems that actually work.

It's a bout time the rest of the world got a bite of the pie, hopefully Africa will be next. When prices across the globe have finally normalised racists won't be able to hide behind economic arguments anymore and maybe ignorant people will turn their ire away from immigrants and back toward the rich ruling elites and bent governments of the world.

RBS employ hundreds of Indians, both onshore and offshore, getting rid of permanent UK staff to be replaced by foreign nationals.

Remind me who owns RBS again? Oh yes that's right, even the UK government is now complicit in the act of killing off the IT industry in this country and turfing out taxpayers for non-taxpayers.

What a load of shite.Take two cars, a Kia Ceed & a 3-series Touring. The BMW is twice the cost of the Kia, it will have less of a warranty, service costs will be higher, and if anything does go wrong with it you'll pay through the nose for BMW spares. At the moment, the money in the motor-trade is currently in servicing rather than sales.

Sorry, but when it comes to cars (and a great deal of other things in life), the extra costs tends to be the prestige of having a brand, rather than higher quality.

Best rate I ever had as a contractor for desktop support\project rollout was £19ph back in 2001, closely followed by £17.50 - 18.50 around 2004-2006.

One of the lowest rates was working for a local authority that paid £12ph, it was a substantial rate cut I took from the 2006 rate, just to be closer to home for the wife & kids.

The very worst rate of all I took when there was absolutely nothing to be had was £78 a day & I took that because it was based in my city centre about 20 mins walk away from my house.

As others have stated the rate you take is not the rate you pay yourself, its there to pay the tax's & both sets of NIC's, to pay accountants, to pay yourself between contracts\sick pay & holiday (actual family holidays not ones enforced on you by sudden contract terminations). I earned far less overall than the permies taking all that into account with far less job security & I was far happier than most of the permies when I was working & I wouldn't have swapped that experience for the world.

After being shown the door from the local authority along with some others, I managed about 2 weeks backfill work & 3 interviews in four months before I gave up my Ltd co & utilised my (new) residency status to move to Canada.

Coat because you need a good one here.

Companys that i have actually seen involved in this practice

AVIVA (formally Norwich Union), BT, Norfolk County Council, Computer Centre, Datalect, A&O (formerly EDS)...etc.....

Agencys Involved Modis International, Computer People....

OK so this is how it goes...

The Company go to a Recruitment Agency, some one there (may or maynot) offer a back hander to get cheap staff...

The agency advertises the job in the UK at a inflated unrealistic price (200 to 400/day) on the internet.

Lots of British Nationality applicants (hundreds+) apply for the postion.

The Agency rings up the most suitable applicants and asks if they are happy about the rate offered, which everyone says yes, very nice rate, very interested.

but....

They also advertise the same job in India/Pakistan etc...

(BUT at a much lower rate such as £30 a day, which for those countries is a lot of money) and also say they will pay for flights and sort out accomodation (like 10-15 people living in the same house which is rented by the agency) etc...

They (the agency) then turn round to the Company and say they have a few UK nationals but they are demanding unrealistic rates, but... they do have lots of Highly Qualified NON UK Nationals who are immediatly available to relocate and accept the offered rate!.

The Company may or may not realise but they are being ripped off by the agency as are the foreign staff who (dont speak good English) are being imported into a UK industry that has tens of thousands of unemployed staff looking for work.

When thier contract ends, then then are shunted off to some other IT job (which is never advertised as they now have surplus legal slave labour avalable to draw on) and the Agencys then pocket the surplus for the xmas do and the company profit margin.

Meanwhile the British IT workers are left on the dole facing having thier homes repossesed because they cannot find ANY IT work in the UK because they are constantly being undercut by the immigrants who are working at well below the UK legal minimum wage.

Which is why many of us are now forced to look for work in Europe, Canada, Australia/NZ.

rant over :)

Maybe someone should kick (whats left of the UK.Gov. ) into shutting down these Agencys with thier sharp practices and sending all these foreign workers home.

@John Bayly :

> Sorry, but when it comes to cars (and a great deal of other things in life), the extra costs tends to be the prestige of having a brand, rather than higher quality.

Doesn't work like than in software engineering / programming -

You've clearly never had the pleasure of working on a terrible codebase hacked together by a drunken recent graduate who was hired at half the costs of the senior guy, left to his own devices and learning on the job.

Or trying to bugfix / maintain some hideous undocumented crapware created by an offshore team in a different timezone who barely speak english and got the qualifications the sub-sub contractor demanded off the guy on the street corner with the photocopier.

Yeah - buy the cheapest. Good luck and just see how that works out for you!

ps. I'll be available after you've slipped your deadline, wasted all that money and are finally willing to pay the market rate for someone with skills, requisite experience and track record to do the work properly.

To the AC near the start of this.

£220 isn't much when you consider:

Have to live in hotels (and trust me, you usually pick the cheapest - no £120/night hotels like when your company pays for you), away from friends, family.

That's before tax.

Before you pay for hotels

No sick/holiday/training

No job security/redundancy payout

Before you criticise, give up your permie job and go contracting.

Stomme eikel.

I've heard that Lloyds Banking Group is another who outsources all their development. Now that they are merging, sorry taking over, HBOS, I wonder if they will stop using Indian outsourcers and go back inhouse? I suspect that they have to because it would not look good for a company who majority shareholder is the government to use non-UK staff.

"Hard-working Indian immigrants pass much-needed money to their families, improving the standard of life back in India."

Dream on, friend. How do you think these Indians got into top-flight universities against horrendous competition in order to qualify for the outsourcing company? They all come from wealthy middle- or upper-middle class families. None of the dough we pay them trickles down to poor Indian families.

They take these jobs to get experience, improve their English, and beef up their CVs. Then they move on - which reveals another hidden cost of using outsourced labour. The work BT pays for (the source code, the Word docs) sometimes completely vanishes when the Indian leaves the outsourcing company - happened to me.

Firstly, let me describe my time at BT in Martlesham a couple of years ago...it took about 2 hours to get through security on a Monday morning as busload after busload of 'Indian' (just a guess but they were all Asian) bodies piled into the security building to get their temporary passes. Me and my colleague, an American, were amongst the very few non-Asian faces at lunch time, and it's a BIG canteen.

I have witnessed the same kind of behaviour at Vodafone in Newbury, Co-op in Manchester (nice ethical policy, giving the locals jobs to Indians), LloydsTSB and elsewhere. The 'resources' at Vodafone lived above an Indian restaurant crammed in like sardines according to colleagues who worked there.

Several times I have witnessed teams of more than 20 with a nominated spokesperson whose English was considered good enough to communicate with the locals. Imagine what gets lost in translation.

The normal incentive for the short-sighted UK management that subscribes to this 'off-shoring' is the typical £100/day rate that they get quoted. The skills are almost always run-of-the-mill (Oracle, SQL Server, Java, Unix, C etc) and readily available in the UK market, so the argument that they fulfill a skills gap is absolute bollox. Even if true, what about training recent graduates or school-leavers?

This is what pisses me off - jobs that can readily be filled by EU nationals (even Brits!) are being now being performed en masse in the UK by non-EU nationals. It's one thing to send the jobs offshore where costs and therefore labour rates are lower, it's quite another to import the low labour rate into a higher cost market and unfairly undercut the locals.

The UK government simply does not care one iota about the displaced UK IT staff, both contract and permie. Management wants lower costs, at any cost. Simple as that. The agencies are fully complicit in this stitch-up, fo' sho'. So long as they get their cut they don't care where the warm body comes from. It's a volume game for those vultures.

The quality of the offshore work that I have witnessed has been poor generally, and in some cases downright shocking, as attested by the techies back at the customer site. Management needs to ask the cost per unit of high quality work, not what each of the non-EU nationals is being paid per day. Throwing armies of cheap bodies at the problem leads to higher costs, almost always.

I would never recommend IT as a career these days and that's the saddest part for me :-(

The Tech Mahindra contractors are paid split, half in the uk and half in india (in fact its not even 50/50). The indian gov gives them high levels of tax relief on the bit earned through offshore (ie working in the uk) work, so while they may be cheaper, theyre actually a lot better off than they look on paper compared to the expensive UK employee they just replaced, because the whole Tech Mahindra setup is taking the mickey out of the british taxation system.

You should also remember that not so long ago Tech Mahindra was once called Mahindra BT, and only very very recently was it floated off and sold, so it was designed at the start as a mechanism to offshore all the IT workers and managers to india without raising the spectre of mass union action... Now BT has flogged TM to some unsuspecting suckers on the basis of their cashflow, they have a new load of bods in from yet another indian outsourcing company, because theyre cheaper than the Tech M guys!

It really is a race to the bottom.

"nice to see you people all standing up for yourselves as AC, by the way"

Whereas, of course, "Big Bear" is your real name and not anonymous in any way at all.

Fucking hypocrite.

Norfolk county Council recently started a 5000 unit PC refresh project, they just took on these so called specialised contractors at some ridiculiously low rate.

the numbers are, 5000 PC's + monitors to be replaced in an 8 week migration project.

so thats assuming that each pc takes 4 hours to build and migrate all data from the old PC

An experienced technician can deploy about 4 pc's in an 8 hour day (real world deployment rate

So thats 1-2 hours to build each PC by RIS, then 2 hours to migrate all user data to it and get it working ok. (not including specialised apps)

they would need: (total PC's / No. of days / PC's deployed) = bod's needed

5000/56/4 = 22 technicians do do the rollout if they work 7 days a week

or ......... 11 if they do double shifts breaking UK's working week laws, which they(the slaves) will no doubt not be covered by.

odds on that it will be x2 teams of 8 doing the deployment, with 1 senior engineer(almost speaks english) and x7 grunts (that cannot speak any english).

Nice to know the council (that lost 40Mil in dodgy iclandic banking investments) is spending our hard earned money wisely on a very dubious IT project.....

who wants to bet that they deployment will be considered a failure if a customer satisfaction review is ever carried out after the deployment,

The outsourced deployment team is always blamed for any thing that goes wrong, not the managers that caused the issues by attempting the impossible with inadaquate hardware resources and unsuitably screened staff.

i wonder how much of our corporate and personal data will wonder off with these foreign contractors....

mines the one with the pockets full of hdd's packed full of council data.....

"- the NHS project, workers from TechMahindra, earn about £220 a day, versus £400 a day for a UK contractors. The contractor told the BBC's File on 4 it was a cost-cutting move. He said he'd got the figures from his line manager."

No savings for the taxpayer. Instead, savings for BT, which mean higher commissions for the sales people and more money for freebies, bribes and kickbacks to hiring managers and executives of customer firms.

I'd like to know how many years experience these imports have in the technology they'll be using.

And is it a matter of the lame, "we can't find British residents with experience in version 7, only version 6, so we had no choice but to import" -- using minor educational requirements of a few person days to scam officials into putting British citizens and residents out of work.

Are the bosses allowed to flog the slow workers?

Or has slavery changed over time*?

* money aside

So would you opt for a BMW with reliability, safety and a great track record... or a cheapo new entry. Thought so

Fact

BT employ contractors to do the work their own permie staff are either incapable of or unwilling to.

The Indians vary from very good to very very poor at times.

BT do this to reduce costs nothing more.

One of their Directors promised their staff and Unions a few years ago on a UK wide conference call that only low level backend work would go offshore - certainly NO customer facing work would. Now look at where it's at.

They are a disgrace, they lied, their staff took it and they are now reaping the results.

Wait till you see the 21cn developments - the Martlesham and other BT permie groups used to rely on the contractor resource to do most of the key work as they themselves couldn't hide behind the unions with an apathetic, lazy couldn't care less attitude.

Now whose going to help you? Serves you right!

That said some brilliant BT permy staff are isolated in this mixed bag of dross. If tye shareholders at BT want to see success get rid of the heavy senior and middle management and some of the back pocket lining execs. Do they still have the director whose other interests are HAYS IT recruitment, on the board?

A Contractor

that's still doing very well with my transferable skills and experience thank you very much.

It is simply exporting jobs from a developed, high social benefit economy with high taxes and cost of living to a low tax economy............ it will always happen. Manufacturing in the 80s and now IT is going to be caned. The sad fact is that the high cost of social benefits and therefore tax and cost of living will accellerate the shrinkage in jobs. The really bad issue for the governement , which they have not appear to have woken up to, is that these people are net contibutors to the Tax system. I do not see a solution... protectionism has problems.... true market economy has problems...

I think we need to examin why we have soooo many economically inactive people (Unemployed, disabled, sick).. they are being carried by the workers.... some willingly but some less so.

breaks down in general in this model of employment:

1) Get rid of indiginous worker, and bring in low cost worker from abroad.

2) Internally to the company, the costs increase due to linguistic difficulties coupled with cultural differences. This, however, is borne invisibly. It doesn't show up as a direct immediate cost on an accountant's balance sheet, it only shows as a reduction in performance, which is blamed on management structures. The financiers pat themselves on the back and the management crumbles (think: replacing your load bearing steel and brick walls with plain plasterboard. Cheaper, but what will be the 'hidden' costs over time?).

3) You now have the sum cost of all of the monies paid to the 'onsite, offshore' workers being untaxable (they pay in their home country). This contributes to a necessity to increase taxation on the monies that 'stay at home', i.e. you and I.

4) You also have one more person locally that is no longer contributing to the UK economy, and possibly has no job at all, thus actually drains it (rather than about £3-4k contribution to the coffers per worker, there is now about a £1500 drain in benefits). This again contributes the a raise in taxes to cover the fact that the government needs to pay these benefits. Essentially, the FULL cost of the original person is paid anyway, just half of it is punted off to the taxpayer, with only a fraction of the rest being paid by corporations.

5) For all those advocating giving the money to the third world, and saying "Give them a slice of the pie".. By all means. Let them create companies in their home countries, produce, and sell it on the global market. It'll happen, and we'll be in for a good ol' bit of competition. However, in the meantime, the Western economies are struggling. If they fold, then there will be NO work for the third world to take up, thus they'll lose money, existing support agreements and a whole load of benefits, causing collapse of their nascent economies, industry and education.

Paris 'cos she knows all about a slice of pie.

Yes, I used to be a BT Global Services contractor. £400 a day was above the norm. Interesting to read about the intra company visa scheme which appears to be a convenient loophole. Offshoring brought pressure on contractor positions and then on Permie positions. I'm sure a lot of BTGS permies feel very insecure in their positions. BTGS is run by accountants who have driven it by dogma into the ground and now a massive loss. So does the off shoring business model work? errr... well probably not. The owners and directors of the Indian outsoursing companies are still making a lot of money. BTGS isnt, and customer satisfaction is down... If you think the work visa system works, why not turn up at BT Martlesham Heath outside Ipswich and observe the fleet of double decker buses that bring the non EU workers in every morning. Why not ask Chris Mole MP, Tim Yeo MP, Michael Lord MP, David Ruffley MP, John Gummer MP what they are doing about keeping Suffolk techies employed...

I have had so many severely bad expereinces with "foreign" call center staff that these days I refuse to even buy products from companies that employ them.

English Speaking, Live in my own country, Technically Proficient - only.

Barely able to understand english, live far away, utterly clueless script monkey - NO WAY.

Last case: Western Digitial Hard Drives...... Situation: An apparently flawed HDD, sounds like it's having a head crash... Ring the Western Digital "Help Line / Tech Support" for Hard Drives; Gets guy in Philipines / India / Malaysia call centre....

"Hi I have bought a new HDD, and it's having a "head crash".... answer 1. "What is that?"

"It's when the read write heads start scraping on the disk surface".... answer 2. "Could you be more specific?"

Etc.,

A FUCKING CLUELESS script monkey......

Oh Hoooray for Western Digitial Hard Drives.......

Yet again our government claims to be listening yet pisses around with more spin and horseshit rather than addressing the issue at hand.

It should be British jobs for British people first and foremost.

I am yet to meet a 'skilled' Indian IT developer, contractor OR permanent that fills a 'skills gap.'

As so many other posters have pointed out they are 99% of the time worse than UK staff and generally have poor communication skills to boot.

I work for an investment bank who are reversing their offshoring trend because they're sick of seeing poor code and slow progress. Sadly 50% is down to poor management too, but that doesn't negate the fact that - Indian contractors are CLEARLY POOR, as are offshore teams, plus the latter always require a full time local resource to manage them.

Why for the love of Christ don't UK managers wake up and smell what they're shovelling!

I used to work as a permie for BT and IMHO found the management decisions to be 'questionable' and very often short-term solutions to serious long term problems. This situation sounds like the cumulative effect of much short-termist manager bodging, is coming home to roost. I got out and am very pleased I did.