The Cabinet Office has said it plans to recruit around 40 additional staff to help deal with compensation claims from members of the Civil Service Pension Scheme who have been affected by the ongoing backlog crisis.
Pensions Taskforce head Angela MacDonald told MPs last week that the department is “doubling” capacity to deal with compensation requests from the thousands of former civil servants left out of pocket in recent months.
MacDonald – who is due to retire from the civil service later this month – did not specify the baseline for the doubling of capacity she referred to and members of the Public Accounts Committee and the Public Administration and Constitutional Affairs Committee did not push for further details on the precise numbers.
The Pensions Taskforce, which is based in the Cabinet Office, currently comprises around 40 core staff and a further 140 “surge” staff who are dealing with problems related to the payment backlogs that have emerged since Capita took over administration of the pension scheme from MyCSP in December.
Civil Service World has been told that the “doubling” of capacity MacDonald referred to at last week’s joint PAC/PACAC session in parliament relates to the expansion of the taskforce’s core staff. The Cabinet Office says it is currently “actively recruiting” for the roles.
Back in May, Steve Thomas – who is deputy general secretary of the Prospect union – said the Cabinet Office should be bracing for a tidal wave of claims from tens of thousands of former civil servants who have not received their pensions or lump sums on time.
He said “substantial extra resources” would clearly be needed to handle the spike in complaints related to the backlog crisis.
Reacting to the Cabinet Office’s proposed capacity boost, Thomas applauded the commitment but questioned whether the staff numbers involved would be sufficient.
“Any increase in the capacity to deal with complaints is welcome,” he said. “But just doubling capacity when complaints could increase by ten or twenty-fold or more does not inspire confidence that delays in responding to complaints will not become an unwelcome next chapter in this scandal.
“It is vital that complaints from members who have been seriously impacted by the Capita debacle are dealt with efficiently. Adding months for compensation to months of frustration waiting for a delayed pension would make matters worse. People need to move on with their lives with out-of-pocket expenses they incurred reimbursed swiftly and without unnecessary drama.”
In addition to interest for the late payment of their pensions, if they have waited for more than one month, many scheme members will be entitled to compensation for financial losses they have suffered as a result of delays – and also for distress and inconvenience.
Complaints are supposed to begin with scheme administrator Capita, before progressing through the Cabinet Office and, ultimately, to the Pensions Ombudsman if scheme members are not happy with the redress they are offered.
Figures from 2024-25 show that then-administrator MyCSP received 339 Internal Dispute Resolution Stage 1 appeals and the Cabinet Office received 143 Stage 2 appeals. The Pensions Ombudsman received a total of 9,610 complaints related to occupational pension schemes.
The Cabinet Office’s capacity boost is believed to relate to the processing of Stage 2 appeals.
Claims should be dealt with ‘quickly and sympathetically’
At last week’s parliamentary session, PAC chair Sir Geoffrey Clifton-Brown sought assurance from Cabinet Office leadership that former civil servants owed compensation because of the CSPS failings will have their cases dealt with “quickly and sympathetically”.
Clifton-Brown noted that Stage 1 and Stage 2 appeals can take a year to process and that claims escalated to the pensions ombudsman can take “much longer”.
He said the “least” government could do for former civil servants who qualify for those three levels of compensation would be to ensure their cases are dealt with quickly.
MacDonald responded: “You are absolutely right that we cannot have people having to spend several years battling to get all the way through to the ombudsman and then go through that process.”
“I regularly speak with both the regulator and the ombudsman,” she said. “We are doubling the size of the capacity in the Cabinet Office to make sure that the Cabinet Office step can go much faster and can cope with an increased volume.”
Compensation payments could be fast-tracked
MacDonald suggested that upfront compensation packages that would essentially fast-track payments to wronged CSPS members are under consideration for some categories of claim.
“Obviously, these cases are typically case by case, but we have also been working with the ombudsman to look at themes,” she said. “Rather than waiting and having the only point at which somebody could get a level of redress be to all the way through the ombudsman, if we know that the ombudsman would make a certain award for a case like that, let’s make that award right at the very beginning, not wait for the member to have to go all the way through those many steps.”
She added: “Our aim is to be able to provide redress for all the awful experiences that people have had as early in the process as we possibly can and with as few cases as we can manage having to wait to get as far as the ombudsman.
“The ombudsman is working very hard with us to ensure that we are living within the kind of judgments he would make and the levels of redress that he would have the power to instruct us to make so that everything is happening early and not late.”
A Cabinet Office spokesperson said: “Capita has failed to meet their critical end of June deadline, repeatedly missing recovery targets and delivering a service that is completely unacceptable to both members and taxpayers.
“This government is now drawing a line in the sand. While we are doubling our capacity to deal with complaints and will continue to withhold payments to hold them firmly to account, we are also looking beyond short-term fixes.
“We have set out our intention to advance the biggest wave of insourcing in a generation, and we are now actively shaping a long-term strategy to bring this pension scheme back in-house.”