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Thousands of retired civil servants are grappling with financial distress as the outsourcing firm Capita struggles to manage a significant backlog in pension payments. Since taking over the administration of the Civil Service Pension Scheme in December, Capita has reported an escalation in unresolved cases from an inherited 86,000 to an alarming 120,000, compounded by an influx of over 15,000 unread emails.
Backlog Overwhelms Capita
Richard Holroyd, the chief executive of Capita Public Services, acknowledged during a session with the Public Accounts Committee that the scale of the existing backlog has “overwhelmed” the company. In response, Capita has nearly doubled its workforce dedicated to the pension scheme, increasing staff from 400 to approximately 750, but the challenges remain severe.
Many retirees have expressed frustration at the long wait times for assistance. Reports indicate that individuals trying to reach Capita by phone are experiencing waits of several hours, with some unable to access their pensions, thereby facing difficulties in meeting their financial commitments.
Julie Morton, a terminally ill retiree, has shared her distressing experience of being unable to access her pension payments. “My life expectancy was originally 12 months back in August last year,” she explained. “Now, six months later, I have not been able to make any memories with my family due to lack of income.” Morton’s poignant testimony highlights the emotional and financial strain many retirees are enduring.
Emergency Measures and Criticism
In light of the ongoing crisis, Capita has implemented an emergency interest-free loan programme. Newly retired individuals are advised to apply through their former employers, while those retired for over a year must contact Capita directly. However, this approach has been met with criticism, as many view it as an inadequate solution that places further strain on public resources and forces retirees to “prove” their hardship.
Hazel Cranstoun, a former civil servant who left her role in 2011 to provide care for her mother, is among those affected. Now operating a village shop in Arran, Scotland, Cranstoun has encountered financial difficulties due to her delayed pension. “I missed my mortgage payment on 20th January and I’m terrified about the impact on my credit rating,” she said. Her frustrations reflect a broader anxiety among retirees who depend on their pensions for financial stability.
Union Response and Calls for Action
Fran Heathcote, the general secretary of the Public and Commercial Services (PCS) union, has condemned the situation, asserting that civil servants who dedicated their careers to public service should not be subjected to financial hardship due to a private contractor’s failures. “Thousands have been left without income for months, pushed into debt, and even relying on family for food,” she stated, calling for more substantive solutions beyond emergency loans.
The government’s response, while attempting to provide temporary relief, has been described as insufficient to address the underlying injustice of the situation. Heathcote emphasised that members deserve dignity and security in retirement, rather than having to navigate a crisis brought on by administrative failures.
Why it Matters
The ongoing pension crisis highlights significant flaws within the administration of public services, particularly when outsourced to private firms like Capita. The plight of these retirees not only underscores the personal hardships faced by individuals reliant on their pensions but also raises critical questions regarding the efficacy and accountability of outsourcing in public administration. As this situation develops, it is imperative for both the government and Capita to take decisive action to rectify the backlog and restore trust among retired civil servants who have served the nation with dedication.
