Question to the Cabinet Office:

To ask the Minister for the Cabinet Office, what assessment he has made of the potential merits of compensating people who were unable to pay (a) mortgages, (b) credit card bills and (c) other household bills due to delays in payments from the Civil Service Pensions Scheme.

The Cabinet Office awarded the contract to administer the Civil Service Pension Scheme to Capita in November 2023.

The delays facing scheme members are unacceptable, and no former civil servant should face financial hardship as a result. There is a robust recovery plan in place to ensure normal service can resume as soon as possible.

Arrangements are in place for interest-free bridging loans of up to £5,000 (and up to £10,000 in exceptional cases) to most recent retirees facing payment delays. This is alongside interim lump sum payments being made to provide immediate funds to retiring members.

Interest will be paid on delayed benefits to avoid financial loss by members. In addition, the existing statutory complaints process evaluates claims for financial losses, as well as distress and inconvenience caused, on a case-by-case basis to determine whether compensation is due. This ensures that any retiree who provides evidence of extra costs, such as bank penalties or interest charges caused by the delay, is fairly assessed. This process is run in accordance with the standards set by the Pensions Ombudsman. The Cabinet Office is working with Capita to ensure this process is applied as efficiently as possible.