What estimate he has made of the number of retired civil servants experiencing financial hardship due to them not receiving their Civil Service Pension payments on time; and what funding has been allocated for interim financial support and emergency payments to those civil servants.
The Cabinet Office awarded the contract to administer the Civil Service Pension Scheme to Capita in November 2023 under the previous government.The issues and delays facing a number of civil servants and pension scheme members in receiving their pension quotes are unacceptable. I want to reassure you that this Government has taken firm action to help put things right as soon as possible. We have agreed a clear recovery plan with Capita, which includes specific milestones and accountability targets for delivery. For priority cases, we have deployed additional resources and improved communication with affected colleagues, so that staff, both former and serving, receive the quality of service and support they deserve.Existing Key Performance Indicators (KPIs) have been enhanced and strengthened to deliver improved performance and higher penalties for failure, including financial penalties. These have already applied in respect to Capita's performance with recent issues and delays in administering the Civil Service Pension Scheme.Capita prioritised the most urgent cases and by the end of February, all death in service cases were either settled or progressed to the final stage or awaiting a member response. The same position was reached for ill health retirement applications by mid-March.While hardship estimates are not held, Capita has made lump sum payments to 8,979 members, the majority of whom have retired but are not yet receiving their pension, and are on track to bring these members into regular pension payments by the end of April.To provide immediate financial support to those who may need it, arrangements are in place for interest-free bridging loans typically up to £5,000 or £10,000 in exceptional cases to most recent retirees facing payment delays. This is alongside interim lump sum payments being made to provide immediate funds to retiring members. The pension scheme continues to make monthly pension payments to approximately 730,000 existing pensioner members on timeInterest will be paid on delayed benefits to avoid financial loss by members. In addition, the existing statutory complaints process evaluates claims for financial losses, as well as distress and inconvenience caused, on a case-by-case basis to determine whether compensation is due. This ensures that any retiree who provides evidence of extra costs, such as bank penalties or interest charges caused by the delay, is fairly assessed. This process is run in accordance with the standards set by the Pensions Ombudsman.The latest position of the Civil Service Pension Recovery Plan Update is available at this weblink: https://www.gov.uk/government/publications/civil-service-pension-recovery-plan-updates