Civil Service Pensions

Lord Davies of Brixton Excerpts

Monday 13th July 2026 Lords Chamber

[Lord Davies of Brixton (Lab)]

I thank my noble friend for the Statement. As she knows, I have been asking questions on this issue for most of this year, so I welcome the attention it is now receiving from the ministerial team and the work they are doing. Of course, the issue of outsourcing and the role of Capita will have to be dealt with, but I am sure my noble friend agrees that the priority now is to get the payments to the people who need them.

I attended the Statement in the House of Commons and listened to MPs repeating stories of the problems faced by the recipients, and I went to the Joint Committee meeting for as long as I could bear it. We all know that there are real human problems here. Of course, it is good that interest is being paid on late payments and that loans are being made. The interest rate is Bank of England plus 1%, but that is the rate paid when the Government pay people money. When the Government claim money from people, they charge a higher rate of interest. My view is that, in these circumstances, the higher rate of interest should be payable by Capita. Perhaps my noble friend could look at that matter and reconsider it.

The more important thing is that, in the Commons, the Minister said in reply to a question that

“members will have the opportunity to ask for other losses to be covered as part of the complaints process”.—[Official Report, Commons, 6/7/26; col. 66.]

We are beyond that stage now. These people deserve compensation for the mental stress and anguish that they have suffered, and we should expect Capita to give them cash compensation for the problems it created.

[Baroness Anderson of Stoke-on-Trent (Lab)]

I thank my noble friend for all his work to raise this and to work so constructively with my colleagues here and at the other end. On the specifics, I heard what he said about the interest payment—that may be a little above my pay grade, but I will raise it with colleagues. I very much appreciate my noble friend’s questions about compensation, but he will appreciate that we are still in the middle of trying to stabilise the pension scheme. I genuinely did not think I would be here saying that; I had hoped that, by this point, we would be well beyond that and Capita would have met its milestone deadlines, but it has not. There are still 429 people waiting on ill health retirement cases, 131 of whom have been waiting for two months, and 618 outstanding death in service cases, with 237 waiting for more than four months, as well as the harrowing stories that we have heard. We need to fix that and then look at what comes next.