Pension chaos as thousands left without payments this month after system shake-up: 'We've got no money!'

The company had anticipated inheriting roughly 37,000 outstanding cases when it took control of the contract, but later confirmed the true figure was closer to 86,000 — more than double its original estimate.

Since the transition, many retirees have reported receiving neither their expected lump‑sum payments nor their regular monthly pension instalments, leaving some without any income at all.

Capita has apologised and said it has deployed more than 500 staff to clear the backlog, around twice the number employed by the previous administrator, MyCSP.

A new online portal launched as part of the handover has also been affected by technical problems, making it even harder for pensioners to obtain updates.

Steve Duell, a 65‑year‑old retiree from Hull, said he may be forced to borrow money if his pension does not arrive before the end of the month.

After spending four decades working at the Land Registry, he retired on January 1 expecting his lump sum to follow shortly afterwards, but has received no information about his entitlement.

“We’ve got no money, and we’ve got lots of financial commitments,” he said, explaining that he needs to make mortgage payments and repay car loans.

He had arranged building work on his home in anticipation of receiving his pension funds and described spending almost 15 hours on hold trying to reach administrators without success.

Paul McKenna, a 59‑year‑old from Liverpool, said he is facing similar difficulties after taking early retirement following heart bypass surgery.

He submitted the required five months’ notice and finished work on November 30, planning to use his lump sum to clear his mortgage and rely on his monthly pension for living costs.

Neither payment has arrived.

“The worry has been affecting my sleep, it’s bad for my angina,” he said, adding that the uncertainty has overshadowed plans for his wedding in September.

He said repeated attempts to contact the helpline failed, including two occasions when, after waiting an hour, he was told via recorded message that the building had been evacuated due to a fire.

When he eventually reached staff, he was informed his case had been passed to the “resolutions team”.

Capita secured the seven‑year, £239million contract to run the Civil Service Pension Scheme after a two‑year preparation period, taking over from MyCSP at the start of December.

However, concerns about its readiness had already been raised.

In October, the Public Accounts Committee warned that Capita might not be fully prepared for the transition.

Its chair, Sir Geoffrey Clifton‑Brown, said at the time that scheme members “who have dedicated their careers to public service ought to be secure in the knowledge that it is under sound administration”.

The Cabinet Office, which oversees the contract, said it has instructed Capita to resolve the problems as a matter of urgency.

Fran Heathcote, general secretary of the PCS union, said the situation has been “extremely distressing” for those affected, noting that many retirees had contributed to the scheme throughout their working lives and were now being left without the income they were expecting.

The union believes responsibility for administering the scheme should return to the civil service under direct ministerial oversight.