PCS Parliamentary Group raises alarm over £950m Capita shared services contract

The PCS parliamentary group has issued a strong warning to the secretary of state for work and pensions about the government’s decision to award Capita the £950 million ‘Synergy’ shared services contract, which will provide payroll and HR services to more than 250,000 civil servants across several major government departments.

The Synergy programme covers staff across DWP, Home Office, Ministry of Justice, DEFRA, and multiple arm’s‑length bodies. MPs and unions say engagement with staff representatives has been minimal and inconsistent.

Chair of the PCS parliamentary group John McDonnell's letter to Pat McFadden MP, secretary of state for work and pensions, described Capita's track record as "appalling" and warned "Any disruption to payroll would have immediate and damaging consequences for staff who are already under significant financial pressure, with many struggling to meet rising household costs. Pay delays cannot be dismissed as administrative inconvenience: mortgages, rent, and bills cannot wait."

Why MPs say Capita isn’t fit for purpose

Capita has been associated with major failures including Civil Service Pension Scheme backlogs, troubled public service contracts, and a major data breach resulting in a £14 million fine.

Handing responsibility for paying a quarter of a million civil servants to a provider with a documented history of failure, risks:

• Missing or incorrect pay, directly affecting the financial security of often low-paid staff
• Increased stress, hardship, and debt among civil servants, who rely on timely payment of wages
• Reduced confidence in the government’s ability to deliver HR and payroll services, damaging morale and causing disruption across major departments
• Potential data security risks, entirely conceivable, given Capita’s recent data breach.

MPs argue the awarding of this contract is difficult to reconcile with the Labour government’s ‘Make Work Pay’ commitment to the “biggest wave of insourcing of public services in a generation”. PCS has consistently argued that shared services should be designed, delivered, and governed in-house.

The PCS parliamentary group is requesting an urgent meeting with the secretary of state to discuss risks and the case for keeping shared services in‑house.

Get involved

Act now and write to your MP, asking them to support our demands and to write to the minister for the Cabinet Office, asking him to work with PCS to get the government to urgently reconsider its decision.