Outsourcer wants a commercial chinwag before agreeing to cover UK government's recovery costs
Capita has yet to agree to reimburse the UK government for the full cost of recovering the failing Civil Service Pension Scheme (CSPS) it administers. In a testy Parliamentary hearing in which Capita was called to account for its performance since taking over the CSPS, Adolfo Hernandez, group chief executive, refused to be drawn on whether the company would pay the full amount that the government had invested in emergency support. Capita's CSPS went live in December last year, after which The Register exclusively revealed problems with its online systems. By January, it was clear the service was seriously failing, leaving some retired civil servants struggling to make ends meet.
Capita won the seven-year, £239 million contract to oversee the CSPS in November 2023, taking over from MyCSP, which ran the scheme on behalf of the Cabinet Office under a £238 million contract first agreed in 2012.
Speaking to MPs this week, Minister for the Cabinet Office Nick Thomas-Symonds said the government deployed 140 officials in a pensions recovery team on January 13, but was determined Capita would pay for it. "I will not have a situation in which public money is funding corporate failings, so I will fight relentlessly to ensure that we recover every single penny of the cost of the surge interventions from Capita," he told a joint meeting of the Public Accounts Committee and the Public Administration and Constitutional Affairs Committee. Later in the meeting, Angela MacDonald, Permanent Secretary and Deputy Chief Executive at HM Revenue & Customs, estimated the total investment in the government's recovery program, which includes 40 people beyond the surge team, would amount to £12.5 million for the 2026-27 financial year. Hernandez refused to say whether Capita would pay for any earlier spending in the previous financial year, which ended in April. "In the first place, we never intended to have a surge team," he told MPs. "I made a commitment to… the Cabinet Office that we would start picking it up from April."
