Question to the Cabinet Office:

To ask the Minister for the Cabinet Office, how much money has been paid to Capita to date for administering the Civil Service Pension system after appropriate contractual deductions.

The Cabinet Office awarded Capita the contract to administer the Civil Service Pension Scheme (CSPS) in November 2023 under the previous government. The current delays facing scheme members are entirely unacceptable, and this Government has taken firm action to resolve them. We have deployed additional resources to expedite priority cases, so that serving and former staff can receive the high standard of service they deserve.

The Government is taking robust action to hold Capita to account. This includes withholding £9.9 million in contract payments for undelivered milestones, alongside confirmation that the Government surge team costs will be recovered directly from Capita. To date, out of the 12 contractually defined transition phases, multiple critical milestones have been missed, leaving only £17,351,934.85 excluding VAT authorised and paid to date.

Recognising the service failures to date, Capita has agreed to reduce monthly service charges, pending conclusion of the ongoing commercial review of contract performance. The total paid for the ten months December 2025 to September 2026 is £18,929,469.80 excluding VAT.

The Government continues to hold Capita to account for delivery of the service, applying all contractual levers, and we intend to seek to recover all the Government’s delay-related costs, and that Capita bear the costs of their failure, not the taxpayer.

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. All complaints will be handled with reference to Pensions Ombudsman standards.

Regular updates on the work to recover the service continue to be posted on the Civil Service Pensions member portal and on GOV.UK.