The UK government has admitted that retired civil servants have been failed by the outsourcing of their pension scheme to Capita, with maladministration leaving some claimants waiting up to a year for payments. The Cabinet Office is now looking to bring the scheme back in-house after "unacceptable" service levels left pensioners and bereaved relatives in financial hardship, with some forced to rely on food banks or claim universal credit while awaiting money they were owed.

Capita, which took over the civil service pension scheme in December, was awarded the £239m contract despite having previously been stripped of contracts to run Teachers' Pensions and the Royal Mail statutory pension scheme over delays. An estimated 17,000 relatives of deceased claimants have faced payment delays, including a 98-year-old widow who needed three months just to establish which forms were required, and Sarah Colhill, who has been unable to access an £86,000 death-in-service benefit nine months after her husband's death. Parliament's public accounts committee had previously urged the government to bring the scheme back in-house, criticising both Capita's missed milestones and the government's failure to act when service standards fell under the previous provider, Equiniti.