Retired civil servants across the UK have been plunged into financial crisis due to severe delays in their pension payments. The government has finally admitted that outsourcing the scheme to private company Capita was a catastrophic failure, with many individuals waiting up to a year for their rightful payments.
The Cabinet Office has confirmed it is actively considering bringing the scheme back in-house, citing “unacceptable” service levels from Capita. This move comes after an estimated 17,000 relatives of deceased claimants have experienced financial difficulties due to the chaos within the scheme. A 98-year-old widow's family has spoken out about their struggles, with her son describing the difficulty of even establishing the correct application forms. Meanwhile, a sole carer for her disabled daughter has been forced to claim Universal Credit due to delays in receiving a £86,000 lump sum death-in-service benefit.
The financial implications are severe, with those awaiting pension payments experiencing a complete loss of expected income – making it impossible for some to meet essential outgoings like rent and energy bills. While support schemes exist, the process of applying can be lengthy and may not fully bridge the gap left by missing pension payments.
Capita's £239 million contract has come under scrutiny, particularly given the company's history of performance issues – including being stripped of contracts for Teachers’ Pensions and Royal Mail statutory pensions. A parliament report had advised against outsourcing, recommending the government bring the scheme back in-house due to Capita missing key milestones during handover.