The Royal Mail Pension Scheme contract overseen by Capita has been axed by the government after the firm allegedly failed to meet key technological milestones for the project.
Nick Thomas-Symonds, paymaster general and cabinet minister, confirmed the government’s decision in a statement in the House of Commons.
Thomas-Symonds says: “Following a failure to meet critical transition milestones and a lack of confidence in Capita’s ability to implement and transition to the new operating model in a timely fashion, I’m announcing today to the House that I have terminated the new Royal Mail statutory pension scheme contract with Capita.
“Capita had an 18-month planning window to prepare for the transition. They failed to deliver numerous milestones, including a failure to implement the required IT automation. The Cabinet Office repeatedly flagged delays in transition milestones.”
Capita had most recently renewed its contract to administer the Royal Mail Statutory Pension Scheme in July 2024.
The scheme’s members are expected to receive a 3 per cent increase to the basic rate of pension for the 2026/2027 financial year.