Bosses at outsourcing giant Capita have said they were "overwhelmed" by the unexpectedly large amount of Civil Service Pension Scheme casework they were presented with when the firm formally took over administering the scheme in December.
Members of parliament’s Public Accounts Committee heard this morning that the firm inherited an "unheard of" amount of unread emails relating to scheme – some 16,000 – while daily call levels had been more than three times higher than anticipated.
Today’s session saw chief executive of Capita Public Services Richard Holroyd and Capita Pension Solutions managing director Chris Clements grilled about service disruption that has affected thousands of CSPS members in recent weeks.
There is a backlog of around 120,000 cases requiring attention, according to the Cabinet Office, with 8,500 scheme members who have yet to receive expected payments and a further 6,300 cases relating to scheme members who have died.
Holroyd started his evidence with an apology.
“This service is not meeting in any sense the service that Capita seeks to deliver or the pensioners and the members of this scheme deserve,” Holroyd said. “We absolutely recognise that. We are really aware of the hardship that some of the members of this scheme are going through. We are also aware that this is a major life milestone which needs to be managed correctly and without fault.”
He added: “We’ve inherited a service that is in distress and we absolutely recognise that it is our problem to solve, and we are absolutely committed to solving it. We now own this problem. It’s ours to fix at pace, in partnership with the Cabinet Office who are supporting us through this process.”
Holroyd told MPs the backlog of work Capita inherited had “overwhelmed” the company, which was awarded the £239m contract to administer the CSPS in late 2023 and had been preparing for the handover for months.
Previously, the company suggested that the backlog of “work in progress” passed on from MyCSP was more than double the 37,000 cases expected. Today Holroyd said that the 16,000 unread emails was exponentially more than would be normal in such circumstances.
MPs were also told that the work backlog had included 12,000 pension-scheme members known to be due payments as of 1 December, but who had not been put onto the CSPS system.
They also heard that the firm had been presented with 20 million lines of corrupt data as part of the transfer process, which has seen the introduction of a new platform for the pension scheme’s 1.7 million members.
Both Holroyd and Clements acknowledged that MyCSP had warned Capita that it would be passing on unread emails as part of the handover. Neither were able to give MPs the figure that MyCSP had indicated.
“You always have a work in-progress backlog,” Holroyd said in relation to the emails. “We’d anticipate a backlog of around 200. That would be reasonable.”
He said that if Capita had been told that 16,000 unread emails – some relating to new claims – would be bulk downloaded on 1 December, it would have immediately started to build up staff numbers to deal with the situation.
MPs were told that following the creation of a Cabinet Office taskforce to help with the backlogs there are now almost 750 staff working on administration of the CSPS. The figure includes extra staff drafted in by Capita and a further 150 civil servants.
Clements said the team now expected to have gone through the 16,000 unread emails by the end of this month. He said that any new cases that needed to be set up as a result of the mails would have been created by then.
'We were overwhelmed'
Holroyd told MPs that on top of the surprise backlogs of work, he believed that MyCSP staff – many of whom now work on administering the pension scheme for Capita – had batted off telephone enquiries ahead of the switch, prompting a surge in calls on 1 December.
“MyCSP was taking about 1,300 calls a day,” he said. “We, immediately from 1 December, started receiving 5,000 calls. It became really clear to us that there was a huge backlog. Huge pent-up demand from people who were expecting answers.”
He added: “What we believe was happening is that our predecessors were saying ‘call back on 1 December – ask the new service’. What we got was people calling on 1 December and asking the new service. At that point we were overwhelmed.”
Holroyd said Capita was grateful to MPs for raising concerns about CSPS members in difficulty as this allowed for urgent cases caught up in the backlog to be prioritised.
Civil Service World sought a response from MyCSP.
A spokesperson said: “MyCSP completed a comprehensive handover of the pension scheme with the new provider which was overseen by the Cabinet Office. All outstanding work items, including items paused during the agreed blackout period, were fully disclosed, discussed and reviewed with Cabinet Office senior management prior to commencement of the handover process.”