Socialist Party members in PCS union
On 1 December 2025, private company Capita took over the administration of the civil service pension scheme. A seven-year contract worth £239 million – and it has not gone well.
The company has left thousands in limbo, due to years of neglect and as a direct result of privatisations.
Just how bad this is was revealed at a Public Accounts Committee hearing on 12 February:
- 120,000 cases awaiting action
- 8,500 members missing expected pension payments
- 6,300 cases concerning deceased members
- 12,000 members due payment but not entered the system
Behind these figures are heartbreaking stories of hardship and anxiety. Many face severe hardship because of delays paying out for ill-health retirements and to families because of deaths in service. Working members cannot plan with certainty as they cannot guarantee that pensions will be paid on time if they want to retire. The scale of the problem is enormous.
Capita bosses blame the problems on the backlog they say they inherited from MyCSP, the previous pension provider. This is difficult to accept as they had plenty of time to prepare to take on the work. The backlog has grown since they took over.
The Public Accounts Committee warned in October that Capita would not be ready. According to the BBC, Capita has previously faced criticism over its management of teachers’ and firefighters’ pensions. What does this say about a government which is supposed to conduct ‘due diligence’ before entering into any private contracts?
Civil service trade unions opposed the privatisation of the pension scheme in 1996, and have consistently argued that the work needs to be brought back in-house. This has been an accident waiting to happen and the warnings from unions, including during the recent strike of MyCSP workers, have not been heeded.
It is the Cabinet Office and government which should be held to account.
Civil service pensioners are being told to apply to their old department for interest-free loans of £5,000, or exceptionally £10,000. Members might appreciate this financial help, although getting it may not be straightforward.
However a temporary fix is no real solution to this crisis. The unions should demand that the work is immediately taken into the civil service, with all those affected given hardship payments and compensation.
The unions must launch a joint campaign to force Labour to honour its manifesto pledge of ‘the biggest wave of insourcing of public services in a generation’. Transfer this Capita contract into the civil service with immediate effect.
