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The UK government has introduced a new recovery plan for the Civil Service Pension Scheme (CSPS), increasing oversight of administrator Capita after nearly 11 months of payment delays, unresolved cases and missed performance targets.
Cabinet Office minister Sally Jameson told the House of Commons that Capita’s progress in restoring the pension administration service had been “abysmal”. Senior civil servants will now work directly with the company to oversee operational improvements, address outstanding cases and strengthen its technology.
- Capita faces a new government-supervised recovery plan after an independent review found serious weaknesses in its technology, planning and operational controls.
- Around 1,800 complex pension cases have remained unresolved for more than a year, with the Cabinet Office demanding faster progress and direct access to Capita’s systems.
- Delays have affected implementation of the McCloud remedy, while ministers warn that further action could follow if service performance fails to improve within a month.
The UK state pension could exceed £33,000 annually by 2050 under the government’s proposed changes to the triple lock, although retirees would receive less than under the existing pension uprating system.
The problems began after Capita took over administration of the scheme from MyCSP on 1 December 2025. Delays in pension payments and retirement quotations subsequently caused financial difficulties for members and their families.
An initial recovery plan introduced at the end of January failed to deliver the expected improvements. Capita missed milestones in April and June, prompting ministers to commission an independent audit of its systems and require the company to appoint an independent remedial adviser.
Grant Thornton, appointed to that advisory role, found substantial deficiencies in Capita’s approach to resolving the problems.
According to Jameson, the firm’s assessment described Capita’s rectification planning as “wholly insufficient” and its technology as “weak”. Its ambition was also “falling well short of restoring the quality services that members deserve”.
The review found that Capita had failed to apply “the right techniques to understand demand, productivity and capacity” and had not established “effective mechanisms to detect and escalate failure”.
Jameson did not disclose details of the separate independent auditor’s findings. She said the Cabinet Office and Capita had used recommendations from both reviews to develop a “credible, workable and realistic” recovery plan, for which Capita alone would remain accountable.
New Civil Service Pension Scheme recovery plan introduces direct oversight
Under the revised arrangements, Cabinet Office officials have gained full access to Capita’s systems and operational data for the first time.
Specialist government teams are working alongside the administrator to establish priorities, improve processes, strengthen quality controls and ensure pension payments are calculated and delivered correctly.
The recovery plan consists of five workstreams. Three address pension cases according to their complexity, while a fourth covers major administrative exercises, including the McCloud remedy. The fifth focuses on technology and infrastructure problems affecting service delivery.
“We will require Capita to evidence its focus on fixing complex cases, ensuring that this plan makes the difference that Capita’s original plan could not,” Jameson said.
A Cabinet Office-led group of specialists drawn from across the civil service will provide independent challenge and advice during implementation.
Jameson stressed that government officials had not created the administration failures but would play a central role in resolving them.
“These problems were not created by civil servants, but it will be through the expertise, commitment and perseverance of the civil service that operational delivery is supported and we shape the solutions with Capita,” she said.
Capita has committed to contacting every scheme member with a complex outstanding case within the next month, explaining the status of their case and the support available.
Cases that have remained unresolved will receive more active management, with revised procedures intended to prevent payment requests and pension quotations from remaining indefinitely in administrative backlogs.
“Old cases will no longer be allowed to sit on backlogs without progress,” Jameson said. “Any stuck quote or payment will be actively managed through revised complex case management.”
The Cabinet Office will continue publishing fortnightly performance reports on the pension scheme’s website until service delivery has stabilised.
These updates will include the number of outstanding complex cases, categorised by age, performance against service standards for straightforward cases and the volume of other unresolved administrative tasks.
Jameson declined to set a firm completion date for the new recovery plan, saying she did not want to “set a date here today and end up with there being disappointment”.
She warned, however, that further intervention could follow if Capita failed to demonstrate substantial progress.
“If we do not start to see pretty rapid improvement over the next month, I will come back to this House and explain the next steps that might be taken,” she said.
Capita faces criticism over 1,800 pension cases delayed for more than a year
Jameson said she had met Capita’s chief executive and senior management twice since assuming responsibility for the Civil Service Pension Scheme in July.
On both occasions, she said, she had “expressed in no uncertain terms my outrage at their performance throughout this contract”. The scale of unresolved cases remains a central concern.
“Complex issues remain unresolved for too long – 1,800 cases for more than a year,” Jameson told MPs. “Although some individuals have more than one case, too many members and family are still left waiting in limbo.”
She also rejected Capita’s assertion that it had achieved its September recovery objectives.
According to the minister, those results did not match the experiences reported by scheme members or the complaints received through her correspondence.
She characterised the company’s September goals as “self-imposed, self-determined and self-assured targets”.
Capita’s technology performance also came under criticism. Jameson said the company had “comprehensively” failed to fulfil its commitment to provide “the most AI-enabled pensions service”.
The administrative problems have also disrupted work on the McCloud remedy, which addresses pension discrimination arising from changes to public service pension schemes.
Jameson promised to provide MPs with a further update on the remedy next month. Earlier in October, Cabinet Office permanent secretary Cat Little acknowledged that completing the remaining McCloud remedy cases by the March 2027 deadline was “no longer achievable”.
Capita is now processing more priority cases than it receives, reducing pressure on that part of its workload. Automation has increased, while new digital tools are being introduced to allow eligible spouses and dependants to access pension payslips and submit enquiries online.
Public Accounts Committee chair Sir Geoffrey Clifton-Brown challenged the government’s assessment, arguing that the underlying problems were even more serious. “The situation is worse than she has outlined,” he said.
“We have had four PAC inquiries into Capita’s administration scheme this year, and it has missed virtually every single one of the deadlines that it set out in each of those hearings.”
Capita apologises for pension delays and promises faster case resolution
Capita acknowledged that its administration of the Civil Service Pension Scheme continued to fall below acceptable standards and apologised to affected members and their families.
A company spokesperson said Capita was “deeply sorry for the frustration that the administration of the Civil Service Pension Scheme has caused members and their families”.
We know that behind every outstanding case is a person waiting for the pension they have worked for and are entitled to receive, or a family trying to get support at an already incredibly difficult time.
The company maintained that improvements had been achieved but accepted that further work was necessary to resolve outstanding problems.
Capita said its teams were concentrating on longstanding cases, particularly those involving members experiencing financial hardship or difficult personal circumstances.
“Our teams are completely committed to getting this right and are putting everything they can into resolving these issues. They are working tirelessly to resolve outstanding cases as quickly as possible, with particular focus on people who have been waiting the longest and those facing financial hardship or challenging personal circumstances.”
The spokesperson added that restoring the pension administration service remained the company’s highest priority.
There is nothing more important to us right now than the administration of this scheme. We are working closely with the Cabinet Office and will continue that work until members are receiving the reliable, timely service they expect.
The revised recovery plan leaves Capita responsible for delivery under closer government supervision, with its immediate performance to be assessed against progress on complex cases, outstanding payments and the reliability of pension administration services.
