The Cabinet Office has announced the private sector partner that will form part of the mutual enterprise responsible for the administration of civil service pensions.
MyCSP - spun out last year from the Department of Work and Pensions - will be joined by Xafinity Paymaster who will provide 'investment and commercial and technical expertise' to the partnership and take the largest share of ownership.
As well as looking after 1.5 million members of Whitehallpensions and benefit schemes the mutual enterprise will also be looking to provide services in other areas across the public and private sectors declaring itself "open for commercial business". The business claims it will halve the cost of administrating a civil service pension.
Within the "John Lewis-style" organisation, Xafinity Paymaster will hold a 40% stake; the government retains 35%; and the 500 or so employees will get 25%. According to a member of the Cabinet Office legal team all three stakeholdings will have equal say on the company board.
Chairing the company will be Lord Hutton, former DWP secretary, who said at the Whitehall launch that it was time to move on from the "now sterile debate on public versus private". He also said he looking forward to taking MyCSP into new areas in both the public and private sector, adding there would be no "no-go areas" for the new enterprise.
The man in charge of the government's efficiency drive, Cabinet Office minister Francis Maude, said public services were no longer "a binary choice" between state monopoly and straight privatisation.
"As a mutual, MyCSP will deliver better services for its pension scheme members, millions of pounds of savings for the taxpayer and a real sense of ownership for employees over what they do," he said.
Maude said MyCSP was contracted to cut costs and deliver service improvements under its agreement with the government.
The Public and Commercial Services union (PCS) has described the move as a 'risky privatisation experiment' and says its research shows 94% of MyCSP staff did not agree with Maude when he said the move would "empower staff and drive up performance". Even more (95%) said they wanted to retain their civil service status. PCS general secretary Mark Serwotka said ministers were using mutuals to shield their true aims: "This is privatisation by another name," he said.
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