Pension Schemes

Mike Wood Excerpts

Wednesday 22nd April 2026 Commons Chamber

[Mike Wood (Kingswinford and South Staffordshire) (Con)]

I begin by paying tribute to our fantastic public servants, civil servants and postal workers. The vast majority give so much in service of our country and the general public. This week, perhaps more than any other, is a reminder that it is Ministers’ responsibility to provide the political leadership so that those workers can deliver. The Minister’s decision to terminate the Royal Mail statutory pension scheme is enormously consequential and will be welcomed by many in this House, but more so by our many retired postal workers.

While I appreciate being given advance sight of today’s statement, it does seem that the Minister, particularly in regard to the civil service pension scheme, has come to the House with more of a plan than a statement. It is clear that the current situation, as the Minister said, is the culmination of a series of entirely unforced errors by Capita. Its failure to adequately administer the CSPS has caused significant financial distress to thousands of former public servants, such as my constituent Chris. He has found himself without the pension he was relying on at just the time that his wife has had to step back from work after a cancer diagnosis.

These people worked hard and planned responsibly for retirement, on the basis that the CSPS would be there for them when they needed it. Capita’s failures have left them anxious, frustrated and, in many cases, desperately out of pocket, but in all too many cases that I am aware of, Capita has been utterly unresponsive. Sadly, the constituents and others from around the country who have contacted me about Capita simply would not recognise the Minister’s claim of answer times being down to two minutes. This is not the way to reward a career of dedicated public service.

Last year, the National Audit Office highlighted that Capita had failed to meet three of the six key transition milestones that had been due by March 2025. All those milestones related to scheme design and operational readiness. In October last year—two months before Ministers had to make a final decision on the transition to Capita—the Public Accounts Committee noted that Capita had missed milestones to deliver its IT systems. The Committee called on the Cabinet Office to fully develop contingency plans before making a final decision about whether Capita should take over administration on 1 December last year.

The Minister’s Department confirmed that—four months after the transition was completed—Capita had still not met three transition milestones, while one was only partially met It is only at this point that the Minister has brought forward the contingency plans—the same contingency plans that the Public Accounts Committee recommended months before—but the warning signs were there, and they should have been clear and obvious. Despite that, last November, a full year and a half after the Government took office, they wrote to trade unions, confirming that Ministers were pressing ahead with Capita’s contract..

We all agree that it is in everyone’s interests that the operational stability of the CSPS be restored as quickly as possible. After all, Capita won the contract because of the failure of the previous MyCSP contract, and clearly a further change would mean more disruption, causing further harm to those who have already been so badly impacted. Ministers must ensure that Capita meets its contractual obligations consistently, and that any penalty clauses in the contract that can be enforced are enforced, to allow compensation to be paid.

The Minister has some questions to answer. For those who are missing out because of Capita’s failings, will the Minister unequivocally commit to delivering a functioning service in the timeframe that he has set himself? Will he confirm that his Department has delivered the standardised mitigation letter that CSPS members can share with lenders to explain their temporary financial difficulties? That was promised last month; has it been delivered? I understand that there will be a commercial session on 28 April to discuss the penalties that Capita is facing, and what officials have called the “wider commercial position”. Will the Minister be attending in person? Will he commit to updating the House at the earliest opportunity, following that meeting? Will he elaborate on exactly what his officials mean by Capita’s “wider commercial position”?

Finally, and most importantly, what contingency plans has the Minister put in place in case it becomes necessary to terminate Capita’s contract for the CSPS, just as he has today terminated its contract for the Royal Mail scheme?

[Nick Thomas-Symonds]

First of all, I echo the shadow Minister’s tribute to public servants, including his constituent Chris; I am very sorry to hear about his wife’s cancer diagnosis. I welcome what I think was his support for my decision to terminate the Royal Mail statutory pension scheme contract. On the civil service pension scheme, he asked about a plan; I have been implementing a plan, and I have come here to update the House on its implementation. He also talked about the contract. The Capita pension scheme contract was awarded by the previous Government in November 2023 on a long-term basis. That is what I inherited and have been trying to deal with. He talked about the point of transition; what I did at the point of transition was get in the Capita chief executive and the Cabinet Office permanent secretary to go through these matters, and to seek assurances. I am afraid to say that the assurances given have not been met.

The shadow Minister talked about not meeting milestones; I can assure him that milestone payments have been withheld, and I will not hesitate to use the commercial levers in the contract to drive performance. I am absolutely clear about the restoration of service by the end of June; that is what I am holding Capita to. He also talked about MyCSP. I have said that we are reserving rights under both these contracts, with regard to the backlog that was left by MyCSP and how Capita has dealt with it since. In relation to MyCSP, there is also an option to pursue a parent company guarantee, and he can be assured that I will explore all possible legal options to ensure that the service that public servants rightly deserve—not just in retirement, but in very difficult circumstances, such as death in service—is being provided sensitively.

The shadow Minister asked about forthcoming meetings and updates. I will consider the appropriate steps to take, and will update the House, and Members from across the House when they write to me.