Government set to give £700m civil service payroll contract to Capita
Capita has been named as the preferred bidder to handle the payroll for more than 250,000 civil servants.
The Department for Work and Pensions (DWP), acting as the lead department for the programme, has selected the outsourcing company as preferred provider for payroll covering staff in the DWP, Home Office, Ministry of Justice and the Department for Environment, Food & Rural Affairs.
PCS has branded the decision a “reckless gamble” with civil servants’ livelihoods, warning that any disruption to pay would have immediate consequences for staff, some who already face below-inflation wages, and struggle to get by.
The deal sits within the government’s “Synergy” shared services cluster, part of a strategy to collapse 286 legacy systems into five major platforms through a single cloud-based system to cover HR, payroll, finance and procurement.
Capita already has a track record of serious failures, including the current pension crisis, which is not an isolated incident. Last year, the Information Commissioner's Office fined Capita £14 million following a data breach that exposed the personal information of millions back in 2023.
PCS general secretary Fran Heathcote said: “Capita is already at the centre of a pensions crisis that has left retired civil servants in distress. Privatisation is a failure, so why does the government continue to reward those responsible with yet another massive public contract?
“Ministers can see these crises unfolding in real time, yet they are prepared to place the pay of 250,000 serving staff at risk."
PCS is calling on the government to urgently reconsider. Our members cannot afford missed or delayed pay because mortgages, rent and bills don’t wait. The government must guarantee that staff will not pay the price for contractor failure, which would have serious and immediate consequences for thousands of working families.”