Civil Service Pension Scheme: Administration

Anna Dixon Excerpts

Wednesday 4th February 2026 Westminster Hall

[Anna Dixon (Shipley) (Lab)]

It is a pleasure to serve under your chairship, Ms Lewell. I thank my hon. Friend the Member for Blackpool North and Fleetwood (Lorraine Beavers) not only for securing this important debate, but for her excellent opening speech, which set out comprehensively and with passion the impact that this issue is having on our constituents all across the country.

As a member of the Public Accounts Committee, I am well aware of the problems with the civil service pension scheme and contributed to the report that was published on it in October. In that report, we highlighted a range of issues that we have heard about already in this debate: poor customer service and staff retention at MyCSP, long waits for pension options to be set out for those wishing to withdraw pensions, a failure from the Cabinet Office to manage transitions between suppliers, and concerns about Capita’s readiness to take the scheme over and about whether the scheme administration overall was delivering value for money.

The Cabinet Office’s response, in the Treasury minute published at the beginning of December last year, reassured the Committee that, yes, everything was in place for the success of the transition, that Capita had sufficient staffing, and that the Cabinet Office had sufficient penalties for poor performance in the contract with Capita. Does the Minister agree that the Cabinet Office underestimated Capita’s ability to take on administration and that it should indeed face consequences for severe failure?

Those issues are evident in my own constituency; I can briefly talk about a couple of them. One constituent has been trying to claim civil service pension since May 2025; they have faced long waits on the phones, emails unanswered and documents going missing. Since Capita took over, they have had new problems, such as the portal not allowing log-ins and eventually getting through on the phone only to be cut off. My constituent is suffering from financial hardship, and still waiting for the lump sum.

Another constituent, approaching 60, wanted to claim a deferred pension from January this year. The forms were posted in August. He was told he would receive a quote in November, did not receive it, and was unable to speak to Capita despite persistent attempts to contact it. The deferred pension would allow him to remain financially secure. Instead, he has reduced his hours and is now facing financial hardship. A third constituent is waiting for a lump sum to be paid on partial retirement. Again, the correct forms were sent in, but the lump sum was not received and there have been no communications.

Such examples are rife. Given the terrible hardship and worry that this fiasco has caused, I urge the Minister to explain what urgent action she is taking to rectify the situation and ensure that Capita, and not our public service pensioners, pays the price.

--- Later in debate ---

[Mike Wood (Kingswinford and South Staffordshire) (Con)]

I congratulate the hon. Member for Blackpool North and Fleetwood (Lorraine Beavers) on securing this important and timely debate. The situation is an entirely unforced error by Capita, and it has caused real and significant financial distress to thousands of former public servants—people who dedicated their working lives to serving this country. The people affected are individuals who planned responsibly for retirement and relied on the integrity of the civil service pension scheme, but have been left anxious, frustrated and, in many cases, desperate.

Like other hon. Members, I have had several constituents contact me to say that they have been left without any income to fall back on. Mark contacted Capita several times at the start of this year without any reply at all, and he now finds that none of the links in the previous letters and emails from MyCSP work anymore. There was no transition.

In many of the cases reported by colleagues from across the country, those affected are suffering missed mortgage payments, unpaid bills and the indignity of having to borrow money simply to get by. That should never happen to anyone who has served the public in good faith.

[Anna Dixon]

The hon. Gentleman sets out many of the hardships and challenges, as other hon. Members have in this debate. Will he take some responsibility? Under the previous Government, when this contract was let, these problems should have been foreseen and the contract never awarded to Capita.

--- Later in debate ---

[Anna Turley]

I appreciate the hon. Gentleman’s flagging that point, and I was coming to that. I have taken the quite unusual step of bringing a print-out for colleagues, which will be available at the end of the debate and will be shared with colleagues more widely. It has an email address on it. I am keen that hon. Members bring their cases directly to us. Of course, we are addressing the wider issues, but it is a cause of great concern to me that, where cases are raised with Members of Parliament, they should be brought straight to our attention.

The McCloud pension sector remedy work was raised. We know how important it is for the many members awaiting an update. We have agreed a separately resourced project to deliver the remedy with Capita. Many of these cases are very complex, and we hope the majority will be issued by April ’27. We are working with the Pensions Regulator, and we will provide progress updates to the members affected and to MPs.

The new contract with Capita includes a number of key performance indicators, which colleagues have rightly raised, with financial penalties to be applied where they are not achieved. We reserve all commercial rights at present. We have already withheld millions of pounds of payments for failure to meet transitional milestones. We continue to contractually monitor service level key performance indicators linked to payments, and we have refused to waive service levels, ensuring that Capita remains contractually liable for performance.

My right hon. Friend the Member for Hayes and Harlington (John McDonnell) asked whether there was a cause for termination. There is an option to terminate in any contract of this kind. These are complex and commercial requirements, and terminating the contract and moving to another provider would mean another massive upheaval of data and everything else. I am sure colleagues share my view that the priority right now is to resolve people’s immediate concerns and issues, make sure people get their money and undertake a review of exactly what happened. However, everything is on the table. As I said, we will do a full review of these contracts, but our priority is to get people the support that they deserve. It has now been two months since Capita took on the new contract, and we are very clear that members of the pension scheme deserve so much better. Our focus is on taking fast action to resolve the most critical issues for impacted individuals while simultaneously ensuring a detailed recovery plan that brings the commercial contract back within service level agreements as quickly as possible.

I want to reassure every member of the pension scheme that their pension is safe and their data is secure. We are working, and will continue to work, tirelessly with Capita to support the recovery programme until such time as we are wholly satisfied that the service is fully recovered. We are committed to ensuring that every member is treated fairly and with respect, and that no one suffers a permanent financial loss due to these administrative failures. We are holding Capita to account and are going to kick backside, as the hon. Member for Strangford (Jim Shannon) said. We are making sure that members are at the heart of the recovery plan, and we will use every commercial lever at our disposal to ensure that Capita delivers effectively.

I thank all hon. Members who brought the voices of their constituents to the Chamber today. I have brought a handout for colleagues, and I urge anyone with constituency cases to raise them with us. We will do our best to accelerate them, but I am conscious that we have to resolve this matter not just for those who are brought to our attention but for absolutely everyone. We will hold further drop-ins to assist hon. Members and their teams, and we are doing our absolute best to make sure people get their money as quickly as possible. The House has my word, and that of my right hon. Friend the Minister for the Cabinet Office that we will not rest until the service is stabilised and our civil servants receive the support that they have earned after so many years of dedicated service—for which, once again, we thank them.

[Anna Dixon]

On a point of order, Ms Lewell. I would like to apologise. I need to declare an interest: I also hold a civil service pension and would like to put that on the record.