Capita Warns of £40 Million Earnings Hit as MPs Rebuke Pension Failures
Updated
Updated · Consultancy.uk · Jul 14
Capita Warns of £40 Million Earnings Hit as MPs Rebuke Pension Failures
1 articles · Updated · Consultancy.uk · Jul 14
Summary
Capita told MPs its civil service pension failures could cut 2026 underlying operating profit by £25 million to £40 million, as chief executive Adolfo Hernandez issued another apology at a Commons hearing.
The reprimand followed repeated missed targets on the £239 million contract, which covers 1.7 million members and has left thousands waiting for payments, retirement quotes and other casework.
Cabinet Office figures show more than 6,700 quotations for past retirement dates and 4,100 bereavement cases are still outstanding, prompting the government to send in 140 civil servants to tackle the backlog.
Nick Thomas-Symonds said the government would recover "every single penny" from Capita, while ministers are considering bringing the operation back in-house after MPs accused the outsourcer of treating contracts as a "cash cow."
Capita's shares have already fallen 18% in a day to a one-year low, underscoring the wider risk to a company that holds at least 80 government contracts.