Question to the Cabinet Office:

To ask the Minister for the Cabinet Office, what assessment he has made of the adequacy of Capita's ability to operate the Civil Service Pension contract under its current terms when the recovery plan concludes.

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

The issues and delays facing a number of civil servants and pension scheme members in receiving their pension quotes are unacceptable. I want to reassure you that this Government has taken firm action to help put things right as soon as possible. We have agreed on a clear recovery plan with Capita, which includes specific milestones and accountability targets for delivery. For priority cases, we have deployed additional resources and improved communication with affected colleagues, so that staff, both former and serving, receive the quality of service and support they deserve.

Existing Key Performance Indicators (KPIs) have been enhanced and strengthened to deliver improved performance and higher penalties for failure, including financial penalties. These have already been applied in respect to Capita's performance with recent issues and delays in administering the Civil Service Pension Scheme.

The Cabinet Office has mandated Capita that they must restore service levels by the end of June 2026. We are using every commercial lever at our disposal, including withholding payments for deliverables that have not been met. We also reserve the right to take further formal action to ensure the service returns to the required standards. This will continue throughout the contract to ensure Capita’s contractual requirements are delivered.

The government has deployed surge resources to increase capacity at Capita, including a Civil Service surge team of approximately 140 people. Capita has also increased its resources, now operating with 500 full-time staff, which is a 50% increase compared to the previous pension administrator. Resources will continue to be monitored post recovery to ensure there are adequate and appropriately skilled resources in place to deliver services.

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. and no estimate is available.

Regular updates on the work to recover the service, continue to be posted on the Civil Service Pensions member portal and on Gov.Uk.