Barnet Council pension scheme shows ‘litany of failures’ by Capita, says East Finchley councillor

Cllr Alison Moore said the pensions report "presents a shocking picture". Picture: Nigel Sutton

Cllr Alison Moore said the pensions report "presents a shocking picture". Picture: Nigel Sutton - Credit: Nigel Sutton

An East Finchley councillor slammed outsourcing giant Capita after a report revealed more evidence of underperformance and mistakes in its running of Barnet Council’s pension scheme. 

Cllr Alison Moore criticised what she called a “litany of failure” by Capita, as the firm prepares to hand over the council’s pension contract to the West Yorkshire Pension Fund. 

The report shows Capita’s service level attainment dropped over the past few months and was below a pensions industry target of 95 per cent – partly due to staff absences during August and an IT systems failure. Performance on death and retirement cases was “disappointing”, the report adds. 

A blunder by Capita payroll saw benefits overstated on annual statements sent to 1,660 members of the pension scheme, according to the report.

It also reveals five people had their pensions overpaid since they attained guaranteed minimum pension age, meaning funds will have to be paid back. Meanwhile, seven pensioners were underpaid. 

Speaking at a meeting of the pension fund committee on Wednesday, Cllr Moore (Labour, East Finchley) said the report “presents a shocking picture” and “continues a litany of failures and underperformance by Capita – not only in pensions administration, but in Capita payroll.” 

The former Barnet Labour leader added: “The comments about the performance on the retired and death cases, where they are only resolving about three quarters of them, is genuinely shocking. I don’t know in which world it is acceptable for people who are in grief or retiring and trying to organise their finances to be subjected to those delays.” 

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Barnet Council’s pension fund, which serves more than 27,000 current and former employees, has been overseen by Capita since 2013. Since then, it has been hit by a string of problems, including more than 6,000 “critical” errors in member data, £1.7 million of late contributions, a failure to submit a scheme return on time and a £70,000 fraud. 

The council agreed in February to remove the fund from Capita’s oversight and transfer it to the West Yorkshire Pension Fund, with the move set to take place on November 1. 

Committee chairman Cllr Mark Shooter (Conservative, Hendon) said a lot of the issues affecting the scheme were due to regulation and claimed other pension funds were in similar situations. Cllr Peter Zinkin (Conservative, Childs Hill) said what happened with the benefit statements was “unforgiveable” but other problems arose as a result of general changes to the pensions world. 

George Bruce, the council’s head of treasury, said progress had been made on fixing the pension problems over the past 12 months, adding that a lot of the issues arose because no-one from the council was monitoring the contract with Capita. 

But Labour councillors questioned whether Capita would compensate the council pension fund for its underperformance and the formation of a dedicated team by West Yorkshire Pension Fund to fix outstanding data errors. 

After some debate, the committee unanimously agreed to commission a report into the way in which the council terminated the contract with Capita, financial matters relating to the performance of the contract over the past year, and any cost implications to the pension fund itself.

A Capita spokesperson said: “We are in the process of resolving all cases, but due to a sizeable amount of outstanding casework, where information is outstanding from third parties, this is taking slightly longer than usual. We apologise for any delays people are experiencing at this time.”