KPMG is to lay off an undisclosed number
of staff from its UK tax practice in response to the economic
downturn.

A spokesman said the firm did not know exactly
how many staff might be affected but every effort would be made to
redeploy staff into other areas. The firm could not provide a
timeline for when the layoffs would take effect.

The job cuts specifically affect its
transactions related tax services. The spokesman said other areas
of its tax practice, including pensions and indirect tax, were
doing well.

The cuts have come despite the implementation
of KPMG’s highly publicised Flexible Futures scheme, which was
launched earlier this year.

The initiative allowed employees to work
four-day weeks, equivalent to a 20 percent pay cut, or apply for up
to 12 weeks of partially-paid leave at about 30 percent of
wages.

More than three quarters of KPMG’s 11,000
strong workforce signed up to the scheme.

KPMG said Flexible Futures had already been
put to use in the tax area, but while it was an effective tool to
manage costs, it had not been sufficient to offset the decline in
transaction related tax activity.

The firm said it was still taking on 600
graduates in September, which was down from the 750 it recruited in
September 2008.