Capita has issued an apology for operational issues plaguing the civil service pension scheme, a situation that has led to significant hardship for pensioners and bereaved families who have been deprived of their incomes for months. The outsourcing firm has failed to meet its promise to resolve the problems by June 30, leaving a backlog of nearly 11,000 cases, according to Paymaster General Nick Thomas-Symonds.
In a statement to the House of Commons, Thomas-Symonds highlighted the severity of the situation, noting that 4,100 of the unresolved cases involve bereavement, describing them as "the most harrowing stories, affecting devastated scheme members and grieving families." Capita, which took over the administration of the civil service pension scheme from MyCSP in December, acknowledged that the service has not been adequate, particularly for members awaiting decisions on bereavement, retirement, and quotation requests. The company stated it has now implemented the necessary processes, automation, and technology to address the backlog and is assessing the implications of the Paymaster General's statement.
The failures have drawn sharp criticism from government officials and Members of Parliament. Thomas-Symonds informed the House of Commons that the government has already withheld £9.9 million in payments from Capita, stating that public funds will not be used to cover the company's failings. He added that the company was awarded the contract in November 2023 with a two-year transition period and received personal assurances from senior leadership regarding their readiness to manage the workload. "It is clear that non-delivery of technology has been a fundamental part of Capita's inability to deliver," Thomas-Symonds said, noting the system was unprepared and overwhelmed, leading to a backlog of approximately 120,000 unresolved cases. The government is providing interest-free "hardship loans" of up to £10,000 to those affected by financial distress due to the scheme's failures, and the Cabinet Office has deployed a taskforce of over 140 officials to expedite the process. The Paymaster General asserted that all costs incurred by the government for this recovery effort will be recovered directly from Capita.
Conservative Shadow Minister Mike Wood echoed these concerns, emphasizing the anxiety and hardship faced by retired public servants and their families. He criticized the timeline of the issues, stating that the critical transition phase, data integration, and system go-live occurred under the current government's watch. The government has committed to recovering all surge costs directly from Capita until the service is permanently fixed and fully restored.