The government’s flagship mutual venture, which pays pensions to more than 1.5 million retired civil servants, has hit a crisis over delayed payments as a result of a new IT system and moving its payments in-house.
MyCSP processes pension payments worth more than £4bn a year. In 2012, it became the biggest public sector body to spin out from central government as a mutual venture. Cabinet Office minister Francis Maude said at the time that as a mutual, MyCSP would deliver better services for its pension scheme members. “We are transforming a neglected back-office operation into a new competitive and responsible business - the rest of the world is watching,” he said.
In October, MyCSP’s private sector partner Equiniti increased its holding in the organisation to take a 51% stake.
But the organisation has recently been hit by a series of problems, including a fault that meant payments have been delayed to civil service pensioners living overseas.
When it was mutualised, MyCSP continued to calculate pensions but payments were still made by Capita. Just over a month ago, MyCSP took over the Capita contract for payments. This coincided with the late delivery of a new IT system, provided by an Equiniti subsidiary, and preparation for the new alpha civil service pension scheme, which begins next year.
The combined problems have resulted in delays to pensions being paid, extra work for staff and a huge increase in complaints, with pensioners struggling to get through to My CSP to get their issues dealt with.
Letters were sent out to pensioners to inform them of the change in administration, which said that members of the scheme would continue to receive their pension in the same way on the same day. But MyCSP members living overseas are furious at the lack of response to what the organisation says is a “small number” of delays. On Twitter, pensioners have resorted to tweeting the Cabinet Office permanent secretary Richard Heaton to get their problems resolved.
Former civil servant Evelyn Marshall said dealing with MyCSP had been “an absolute nightmare”. Marshall, who had been due to get a lump sum and a regular pension on her 60th birthday on 2 November, was told in September that her pension arrangements were all in order. She then received a letter informing her of the changeover from Capita to MyCSP, but was told no further action was needed.
Concerned that she had heard nothing in the week before her payment was due, Marshall attempted to contact MyCSP. She was finally told on 7 November that her lump sum would be in her account next Wednesday. “This is a substantial amount of money, and my complaint still stands,” commented Marshall. “There has been no communication. This is a shambles.”
The PCS union, which represents 160 of the 350 of the staff at MyCSP, is seeking an urgent meeting with the organisation. A PCS spokesman said: “This is an appalling situation for people waiting for their pension payments and trying to contact MyCSP, as well as for the staff there who, through no fault of their own, are facing mounting backlogs and complaints.
“MyCSP was mutualised entirely against the will of staff on the premise it would improve efficiency, so the fact this is happening in what remains the civil service’s only significant mutual, and hot on the heels of Equiniti taking a controlling stake, looks deeply embarrassing for Francis Maude and exposes serious flaws in his dogma.”
The union added that a steady stream of people have left MyCSP since the merger, and newer, less experienced staff are having to deal with problems generating large numbers of complaints.
In a statement, MyCSP said: “MyCSP successfully took over the administration for civil service pensioners and former employees from Capita in September. We are now paying pensions for 660,000 people. However, a very small proportion of our scheme members have been affected by delayed payments.
“Our members are our top priority and we are doing everything we can to put this right. We have brought in additional staff and are extending our opening hours to deal with queries and to resolve the small number of outstanding payments. We are confident that in the future our service will be more efficient and convenient than ever.
“We have received an extremely high number of calls over the last few weeks after letters were sent to 1.1 million scheme members informing them of the transfer of administration to MyCSP. We sympathise with the frustrations some members are experiencing, and we are grateful for their patience as we correct these teething problems.”
A Cabinet Office spokesperson said it was “simply untrue” that mutualisation was entirely against the will of staff, adding that over 75% voted for fellow employees to represent them on the employee partnership council and that there had been a rise in staff engagement and a decline in sickness absence.
“MyCSP is now dealing with legacy problems from the previous administrator. The overwhelming majority of the 658,000 existing pensioners were paid accurately and on time,” said the spokesperson. “However, we have received a limited number of complaints and are working closely with MyCSP to address these where necessary.”
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