Cabinet Office Moves to Bring Civil Service Pension Scheme Back In-House

Cabinet Office Moves to Bring Civil Service Pensions In-House

Contract Failure and the Move to Insourcing

Adolfo Hernandez Apologizes to MPs for Capita Service Failures

The Cabinet Office has confirmed it is looking to take the scheme back in-house following “unacceptable” service levels. This decision follows a period of maladministration under Capita, which took over the administration of the civil service pension scheme in December. The Guardian first flagged concerns in December last year, and MPs have repeatedly warned that Capita, which was already facing a backlog of cases when it took over from MyCSP, part of Equiniti, was ill-equipped for the scale of the task. Capita took over the Public Service Pensions Scheme from MyCSP in December and said it had inherited a backlog of 86,000 cases, 49,000 more than expected, which grew to 120,000 within months. However, MyCSP said only 36,000 of the cases it left were key service-level-related, which it said was consistent with the level it had been asked to achieve.

Capita has apologised for a raft of failures connected to its civil service pensions contract with the UK government. The company has also warned of a multi-million hit to its earnings as a result of the scandal, with the firm stating last week it expected to lose up to £40 million for cleaning up the problem. Members of parliament have accused Capita of treating government contracts as a “cash cow”. I would love to have the opportunity to deeply, first and foremost, apologise, Adolfo Hernandez, chief executive of Capita, said during a grilling from MPs in a commons committee hearing. I would like to apologise for all the members who have been receiving a very poor service at a very difficult and challenging time in their lives. Hernandez reiterated that the firm will “not stop” until its failures have been fixed.

Human Cost: Pensioners and Families in Limbo

Catherine Curtis and Jamie Dalgleish Face Financial Hardship

The administrative chaos has left many in precarious financial positions. Catherine Curtis, a widow from Kent, said she owes her children thousands of pounds after the contractor failed to pay out her husband’s civil service pension for nine months. Her husband, former driving examiner Michael Curtis, died in November, shortly before Capita took over. Catherine Curtis said she had phoned the firm about every two weeks since but was getting the same run around.

Multiple members of the civil service pension scheme have come forward to say they are unable to afford rent and have been forced to use food banks after being left without an income. An estimated 17,000 relatives of deceased claimants are also facing financial hardship. The Guardian reported that among those struggling is a 98-year-old, who may require a bailout from her sons. MP Brendan O’Hara raised the case of a former submariner and MOD police officer, Jamie Dalgleish, who retired but has not been paid his pension. Mr. O’Hara said his constituent had to take a civilian job cleaning out dog kennels at 65 years of age to support himself. He has been failed by Capita, Mr. O’Hara said in Westminster.

Operational Backlog and Oversight

Angela MacDonald Leads Cabinet Office Recovery Taskforce

Data from the Cabinet Office showed there were still about 6,700 people who had retired but were waiting for a pension quotation, with bereavement benefits due to about 7,600 families. A Cabinet Office recovery taskforce set up in January is now deploying auditors to review Capita’s systems and processes, and the company will be made to pay for a remedial adviser to improve its service. The taskforce is being led by HMRC deputy chief executive Angela MacDonald, though she is retiring, with new pensions director Richard Vianello set to take over.

Sources: BBC, The Guardian.