NAO Launches Review Into Capita Over Civil Service Pension Failings
NAO Launches Review Into Capita Over Civil Service Pension Failings
Capita faces National Audit Office review over major failings in managing the UK Civil Service pension scheme. Thousands affected by payment delays and contract breaches. What's next for the outsourcing giant?
The National Audit Office (NAO) has initiated a comprehensive review into outsourcing firm Capita's management of the UK's Civil Service pension scheme. This move comes after Capita admitted that its performance in running the scheme falls significantly below the expected standards for both scheme members and the government.
Earlier this year, the London-based company issued an apology for a series of operational failures linked to the £239 million contract. Chief executive Adolfo Hernandez openly acknowledged delays in administering the pension scheme, which impacted an estimated 1.7 million civil servants.
These delays left thousands waiting for crucial payments and retirement quotes.
Capita notably failed to meet a critical deadline of June 30 to fulfill the terms of the contract, following previous missed targets. As a direct consequence of its poor performance, the Government has already withheld nearly £10 million in payments to the firm, and there have been increasing calls for Capita to be stripped of the lucrative contract entirely.
In response to the NAO's review, Capita has stated its commitment to engage "fully and transparently" with the National Audit Office, the Cabinet Office, and other relevant stakeholders. The company also claimed to have made "good operational progress" in key areas of the pension scheme during August and September.
Despite these claims, Capita reiterated its recognition of the need for continuous service improvement. The firm is implementing further automation and stronger governance, including enhanced management information systems, to address the ongoing issues.
They emphasized that the remediation of the Civil Service Pension Scheme (CSPS) remains the Group's top priority.
Previous statements from Capita indicated that these contract issues could potentially hit their earnings by as much as £40 million.
