The government said Capita’s performance on the troubled civil service pension scheme “remains unacceptable” despite the outsourcer reporting it has reached its latest target.
In a written update on the disastrous outsourcing contract, Sally Jameson MP, parliamentary secretary in the Cabinet Office, said Capita meeting its self-imposed targets is “not sufficient progress” and does not constitute full service recovery.
Capita set 1 September as its first target to clear the “workable” case backlog. Although Capita reported meeting its own targets across the “priority” areas of bereavement, death in service, ill health retirement, retirement payments and retirement quotes, the government deemed the overall service levels “unacceptable”.
Earlier this week, Computer Weekly asked Capita about its remediation plan. It said: “We continue to work at pace against the remediation plan submitted to the Cabinet Office. The first milestone fell on 1 September and is subject to review by the Cabinet Office.”
In that review, Cabinet Office minister Jameson said: “Overall performance remains unacceptable, and far too many scheme members continue to face uncertainty while waiting for their cases to be resolved.”
Since it took over the contract from previous supplier MyCSP in December 2025, Capita has failed to meet its delivery promises and left claimants in severe financial difficulties. The company has admitted it is set to lose money on the contract, with pressure mounting on Capita, which is heavily reliant on public sector business, due to the government’s current insourcing plans combined with its much-publicised failures.
Move in-house
In her statement, Jameson reiterated the government’s plan to bring the service in-house. “I will also continue work on actively shaping a long-term strategy to bring this pension scheme back in-house.”
Capita also set a target to process cases within key performance indicators from 30 September 2026.
Jameson said there will be a “substantive update” next month following the conclusion of the technical audit and report from the remedial adviser Grant Thornton.
Capita said: “In the meantime, our focus remains on working through outstanding cases and improving the service members receive. Despite the progress made, we recognise the service has not been good enough, particularly for members waiting on bereavement, retirement and quotation cases, and we are sorry for the impact this has had on those members.”
The government’s criticism is shared by people within Capita. Computer Weekly revealed last month that Capita’s CEO, Adolfo Hernandez, was slammed by a staff member after making claims that the “right” things were in place to turn the botched Civil Service Pension Scheme (CSPS) administration around.
Hernandez had written to staff admitting things had not been good enough but that this was being put right: “The service there has not been good enough and we are sorry about the impact on members – but we now have the right people, processes and technology in place to put that right.”
But in a response to Hernandez’s statement, copied to all Capita staff, a member of the pensions team said: “The service provided by Capita surpasses your assertion of ‘not good enough’ – it has been abysmal for members. The fact members have died in waiting due to this whole catastrophe is a really harrowing thought that none of us should have to live with, yet we sadly do.”
The worker said that staff have been trying to air their concerns about the CSPS contract, but that all contacts have been “met with vague, deflective and meaningless responses”.
Jameson’s statement is a sign that the government is getting tough on Capita, a firm that has thrived in the UK public sector.
Capita has a huge UK public sector client base. According to figures from Tussell, Capita currently has 199 public sector contracts worth a combined £7.9bn. Despite the CSPS failures, Capita won the Synergy Business Process Services contract in March, which, according to the official tender, has an estimated value of around £959m over 10 years. The contract supports back-office services for the Department for Work and Pensions (DWP), the Ministry of Justice, the Home Office, and the Department for Environment, Food and Rural Affairs (Defra).
But the government’s proposed biggest wave of insourcing in a generation will put pressure to perform on service providers like Capita.
