Investigation into members’ experience of civil service pension administration

12 Feb 2016 10:17 AM

The NAO has published the findings from its investigation into members’ experience of civil service pension administration.

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• Press Release

“When MyCSP took over the administration of the civil service pensions payroll in September 2014 it did not cope with the workload and a large backlog of work built up. Some people were paid late and members struggled to contact MyCSP. Some reported hardship and distress. The problems were made worse by longstanding limitations in the membership data on which I have reported over the last five years. MyCSP’s performance is now back to a steady state but the underlying data problems have still not been fixed. This should now be a priority for the Cabinet Office, MyCSP and the employers.”

Amyas Morse, head of the National Audit Office, 11 February 2016

The National Audit Office has yesterday published the findings from its investigation into members’ experience of civil service pension administration. The administration of the civil service pension payroll and certain other services moved from Capita to MyCSP in September 2014. Following these changes many scheme members and participating employers expressed dissatisfaction with the services provided by the pension administrator (MyCSP). We looked at the quality of pension services provided to members and participating employers of the civil service pension schemes. It examines the nature and causes of the dissatisfaction, the steps taken to recover the situation and the challenges that remain to be overcome.

The key findings of this investigation are as follows:

• Some scheme members have experienced serious problems with the way their individual cases have been processed. Our initial enquiries with employers led us to dozens of individual stories of hardship, distress and inconvenience caused by late payment of pensions, difficulty in getting in touch with MyCSP and failure to provide accurate and timely information on pension entitlement. In some cases members who were waiting for a retirement quotation or new payment did not receive their quotation or payment until after they retired
• When MyCSP ran the payroll for the first time in September 2014 14,703 pensioners who lived overseas were paid their pensions up to 7 days late and 99 were not paid at all until the next month or later. MyCSP did not fully understand Capita’s payment practices. This meant it did not issue the payments before the due date to allow for the extra time needed to make an international payment. Problems with the payment details for the 99 required MyCSP to ask for a new banking mandate
• Following migration, MyCSP could not cope with the increase in calls and emails. Between September 2014 and March 2015, MyCSP failed to answer 99,408 calls
  During the migration, there were 59 staff working at MyCSP’s contact centre. MyCSP has since increased this to 100
• A backlog of work grew at MyCSP. MyCSP did not have sufficient staff to process the 14,000 items of work inherited from Capita and the 40,000 data issues requiring attention caused by migration of the system. A backlog grew between September 2014 and January 2015. This peaked at 22,000 urgent cases in January 2015. The backlog of urgent cases was cleared in March 2015
• MyCSP had far more casework to complete following migration than it expected. MyCSP expected 10,000 to 12,000 items of work in progress casework to be transferred from Capita, such as payment of new awards or notifications of a change in circumstance. MyCSP told the Cabinet Office that there were 54,000 items of work in progress at the point of transfer. This total included 40,000 data queries that were identified on migration
• MyCSP’s systems made prioritising clearance of the backlog more difficult. MyCSP’s work management system was configured to reflect and monitor performance in line with the contract requirements. This meant that cases were prioritised based on when they arrived. This was not helpful once the backlog had built up because it did not allow staff to identify and prioritise cases that required urgent action
• The Cabinet Office told MyCSP in January 2015 to develop a plan to tackle the backlog. The Cabinet Office asked MyCSP to manually count the backlog of outstanding work, prioritise the most urgent items and develop a plan to stabilise the business by the end of March 2015
• By September 2015 MyCSP had returned performance levels to where they were before migration. By September, MyCSP’s monthly progress report showed that call-handling had improved to pre-migration levels (96%). Complaints, while still high (428 received in the month), were falling
• MyCSP has received no financial penalty for its performance over the migration. The Cabinet Office told us that that it suspended contract service credits in the year before migration. If imposed, these would have amounted to around £90,000
• Members and employers continue to report problems in getting accurate and timely information from MyCSP about their pension entitlement. MyCSP agreed with the Cabinet Office to suspend the issue of benefit statements until late 2015 because of poor data quality and the concern that sending them would lead to a poor customer experience, an increase in member queries and a build-up of a new backlog. The production of annual benefit statements recommenced in August 2015 and by the end of 2015 some 95% of members had received a statement.