Capita due to take over administration of the Civil Service Pension Scheme

Capita PLC is due to begin administering the Civil Service Pension Scheme from December 2025, under a contract the Cabinet Office awarded in 2023¹. The Scheme covers the Principal Civil Service Pension Scheme and the Civil Servants and Others Pension Scheme, and had 1.7 million members, both current and former civil servants, as of 31 March 2024, with a total liability for future pension benefits of £189 billion¹. The Cabinet Office has contracted with MyCSP to run the Scheme since 2012, a contract costing £238 million since 2016¹. Capita previously administered the Scheme's pension payroll services and deferred member administration prior to 2014¹.

The National Audit Office opened its investigation after correspondence from scheme members about the service they had received, alongside a reported rise in complaints about the Scheme, which had risen to 4,780 in 2024-25¹. Its report, published on 16 June 2025, examined the Cabinet Office's oversight of the Scheme, current levels of customer service, and preparations for the transfer of administrator¹.

Capita has said it expected to inherit around 37,000 outstanding cases when it took over the contract². In a joint statement published on 28 January, the Cabinet Office and Capita confirmed that the actual backlog stood at 86,000 cases at the point of transfer, many of which were already overdue². Capita has since told MPs that the backlog has risen to 120,000². The contract is reported as £239 million over seven years²; the NAO gives £238 million as the cost of the MyCSP contract since 2016¹.

The backlog includes around 8,500 retired staff waiting for their full pension payments, and a further 6,300 cases involving members who have died, where families are waiting for lump sums or survivor pensions². Around 1,500 of these cases have arisen since December². There are also 3,400 civil servants planning to leave under voluntary exit schemes who require paperwork and payments to be completed by the end of next month, and Capita has said it cannot guarantee that all of these cases will be finalised by that deadline². The government says pensions that were already in payment before the transfer to Capita should not be affected by the delays².

Capita has apologised for the disruption and acknowledged that some members had experienced financial hardship as a result of delays².

A surge team of more than 150 additional staff has been deployed to help clear correspondence backlogs, bringing the total workforce to more than 650². Capita says it expects to restore service levels for the most urgent cases by the end of February, and told the Public Accounts Committee that it hopes to return to normal levels of customer service by the end of March, with recurring payments paid as normal by the end of April². It added that nobody is waiting more than an hour to have their call answered, and that calls regarding bereavement are being answered within a minute².

Why it matters for households

The Scheme covers 1.7 million members¹, and the delays affect new lump sums and pension payments rather than pensions already in payment before the transfer². The Cabinet Office has confirmed that members whose pension payments are overdue can apply for an interest-free loan while their case is being resolved². Most eligible members will be able to borrow up to £5,000, rising to £10,000 in exceptional cases, and the loan is expected to be repaid within 28 days of pension payments being made, although payment plans will be available if needed².

Eligibility covers members who retired on or after 1 January 2025 and are still waiting for a first pension payment, those already paid a lump sum but now overdue monthly payments, and those who have taken partial retirement and are still working². Members who retired more than 12 months ago, or who are waiting for a payment following the death of a family member, are not eligible for the loan². Applications go to the former department's HR team, and the government says payments should be made within a few days once a loan is approved, although in some cases it may take up to 28 days². Members who do not meet the criteria but are experiencing financial hardship are directed to raise concerns with Capita².

What happens next

Capita says it expects to restore service levels for the most urgent cases by the end of February, return to normal levels of customer service by the end of March, and have recurring payments paid as normal by the end of April². The 3,400 voluntary exit cases require paperwork and payments to be completed by the end of next month, a deadline Capita has said it cannot guarantee for all cases². Members who cannot access the internet can call the helpline on 0300 123 6666, but should expect delays². Complaints start with Capita, then the scheme's formal dispute resolution process, and can be taken to the Pensions Ombudsman if unresolved².