British Gas, one of the UK's biggest energy suppliers, is cutting 1,300 call centre jobs across six cities: Glasgow, Edinburgh, Cardiff, Leicester, Stockport, and Leeds. The company's parent, Centrica, says 800 of those cuts are connected to new AI tools — software that can answer customer questions automatically. Another 500 cuts were confirmed the month before. The changes were reported on July 23, 2026.

The cuts add up to 14% of British Gas's customer service staff and will happen over two years. Some of the jobs will simply go unfilled after people leave on their own. The rest will be redundancies, meaning workers will be let go.

The boss of Centrica, Chris O'Shea, said the cuts are mostly about how customers behave, not about AI replacing people. He said more than 90% of customers now start by going online rather than calling, and the number of phone calls has dropped by 20%. "AI isn't driving these particular job reductions; that's mainly due to changing customer behaviour," he said. He also said the company expects to hire more people to work on its digital systems.

Trade unions — groups that represent workers — disagree. The GMB union said 500 jobs are being replaced by AI directly. Other union voices warned that Centrica's investment in AI would hand "hundreds of human jobs" to chatbots, which are computer programs that chat with customers. The fact that the company and the unions tell such different stories about the same job cuts shows how much disagreement there is about whether AI is taking people's jobs.

The job cuts come at a complicated time for British Gas financially. The retail side of the business made £346 million in profit in the first half of 2026, up from £338 million the year before. But the number of British Gas customers at home dropped slightly, from 7.5 million to 7.45 million. On top of that, British Gas may have to pay up to £112 million to customers who had prepayment meters — a type of meter you top up in advance — force-fitted during the Russian gas crisis.

Here's where things get tricky. O'Shea says AI is not the reason for the cuts. But the company itself linked 800 of the jobs to "AI tool deployment." The difference seems to be about how you describe cause and effect. O'Shea's view is that customers are choosing digital options, so fewer staff are needed. The union's view is that the technology itself is replacing workers.

The bigger picture is that AI and chatbots are being used more and more in customer service across the UK and beyond. Centrica is not the first big company to cut jobs while talking about digital change, but the size of these cuts — 14% of customer service teams — and the direct mention of AI tools make this an important example for anyone watching how AI affects jobs in companies that serve everyday people. The two-year timeline suggests the company is easing into the change rather than cutting everyone at once, which could be about both practical logistics and avoiding bad publicity.

The money side raises questions too. A company making £346 million in half a year while cutting frontline service jobs — and facing a £112 million compensation bill — invites scrutiny of how cost-cutting, AI investment, and customer experience fit together. The small drop in customer numbers shows British Gas is trying to keep customers at the same time it is reducing the number of humans available to help them.

The key questions going forward are whether the drop in calls continues, whether AI customer service keeps people happy, and whether the unions' prediction of wider job losses to chatbots comes true. The two-year window gives everyone a clear timeline to watch. Competitors, regulators, and policymakers will all be paying attention to what happens at Centrica.