Civil Service Pension Scheme: Administration

Mike Wood Excerpts

Wednesday 4th February 2026 Westminster Hall

[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 ---

[Mike Wood]

I am sure that the hon. Lady will accept that because I was not a Minister in the previous Government, I did not have access to the tendering process, and do not have the details of the bid. However, there was a clear failure by the previous providers and there have been many opportunities since the last general election to review that contract in light of the clear failure—

[Cameron Thomas]

The hon. Gentleman is probably quite right to note that there were significant failings by the previous provider. Does he accept that there were clear failings by the previous Government?

[Mike Wood]

No. The hon. Gentleman is obviously trying to hide from the fact that his party was part of the Government that awarded that contract in 2012 to the mutual joint venture. He may wish to look at his own party’s part in that if he thinks that it was a mistake. Sadly, the information provided by the Minister for the Cabinet Office to the House last week fell well short of what is required. It failed to address the fundamental question of how the Government allowed Capita to take over the contract in December despite the repeated warnings and the signs that it had clearly failed in its key milestones.

[John McDonnell]

Will the hon. Member give way?

[Mike Wood]

I must continue, because I have only a short time; I have given way twice. We know that in November 2023, Capita was awarded the contract to administer the civil service pension scheme, but we also know that the previous administrator, MyCSP, had its contract extended until December 2025 specifically to allow for a two-year transition period that was meant to reduce risk, not create it. The National Audit Office investigation report published in June 2025 made it clear that MyCSP had failed to meet agreed service levels in the final year of its contract, with complaints more than doubling towards the end of that contract. That is a large part of the reason why the contract was awarded elsewhere.

If I may briefly refer to the tragic case of Philippa—not a constituent but someone who I had the pleasure of meeting because she was the long-term partner of a member of staff of one of our colleagues.

[John McDonnell]

Will the hon. Member give way? He should not be allowed to get away with this.

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[Emma Lewell (in the Chair)]

Order. It is up to the Member if he wishes to give way; he has made it clear that he does not wish to.

[Mike Wood]

I have already given way twice and I may give way later, but I need to get through my speech so that the Minister can reply, because I know that hon. Members will want to hear her response.

Philippa retired in May and suffered a nervous collapse triggered by pension delay. Tragically, Philippa died on Boxing day, so that is the very real human cost. Of course, the National Audit Office report did not stop with the failings of the final years of MyCSP’s contract. It also highlighted that Capita had failed to meet three of the six key transition milestones that were due by March 2025, all relating to scheme design and operational readiness. In other words, the warning signs were there in black and white. Ministers were on notice of the potential for serious problems, and of the consequences that those problems would have for pensioners, for at least the final half of 2025.

[Leigh Ingham]

Does the hon. Member agree that the warning signs were there when Capita failed on the TPS?

[Mike Wood]

As I have said, I did not see the details of the bid. Obviously, with any bid, it is right to look at previous performance. There will be some causes for concern with any of the bidders for large Government contracts because of the complexity of those contracts.

[John McDonnell]

Maybe the Ministers at the time did not see Capita’s Army recruitment fiasco, its primary care fiasco that put patients at risk, the near-collapse of the teachers’ pension scheme or the cyber-attack in which Capita exposed the data of 6.5 million people and was fined millions. Does the hon. Member not think that Ministers might have taken those into account before awarding this contract?

[Mike Wood]

I appreciate that the right hon. Gentleman has not always been an uncritical friend of the current Government, but he has to recognise that his party has been in government for more than a year and a half, during which there were opportunities to take action if they were unhappy with our contract.

As I said, the warning signs were there in black and white. Ministers were on notice of the potential for problems and their consequences. Despite that, on 7 July last year—a full year into this Government—the permanent secretary told the Public Accounts Committee that the Cabinet Office would decide in December whether Capita should take over administration. On 14 November 2025, the Cabinet Office wrote to trade unions confirming that Capita would indeed take over from 1 December, stating that it was satisfied—this Government, this permanent secretary and this Minister’s Department were satisfied—that Capita had taken on board the findings of those reports.

Serious questions have to be answered. What assurances were provided by Capita to Ministers before that final decision was taken at the end of last year? What scrutiny was applied to those assurances and by whom? Why, in his letter to colleagues, did the Minister for the Cabinet Office claim that these issues had only come to his attention “in recent weeks” when both the National Audit Office report in June and the Public Accounts Committee report in October warned of a “clear risk” that Capita would not be ready? The Public Accounts Committee was clear that Capita had missed seven out of its eight key transitional milestones to deliver its IT system and said:

“The Cabinet Office needs to fully develop contingency plans”.

If the Minister is right that he was only made aware of these problems in recent weeks, should the Government not have known far sooner and acted far sooner?

Although it is welcome that interest-free hardship loans are now available, this action has clearly come too late. Those loans should have been made available on an emergency basis from 1 December—the same day that Capita took over administration—so that people were not left in financial limbo. Instead, some pensioners have reported being forced to take out costly commercial loans or to borrow from friends and family simply to cover basic living costs. That is unacceptable. Can the Minister guarantee that no one affected will face further disruption beyond the end of this month? Can she guarantee that pension payments will be stabilised fully and permanently?

The warning signs were there for months, and the failure to act decisively after the publication of the National Audit Office and Public Accounts Committee reports is stark. Although it is deeply disappointing that the Government failed to prevent this from happening, we can all agree that it is now in everyone’s interest—

[Jenny Riddell-Carpenter]

Will the hon. Member give way?

[Mike Wood]

I have given way four times; I really ought to conclude.

We can all agree that it is now in everyone’s interest for operational stability to be restored as quickly as possible, for the Government to ensure rigorously and transparently that Capita meets its contractual obligations consistently and that any penalty clauses in the contract that can be enforced are enforced to allow for compensation to be paid to those affected. Above all, we owe it to those affected—public servants who did everything asked of them—to put this right and ensure that such a failure does not happen again.