Recommendations & Conclusions
8 items
4
Recommendation
49th Report - Administration of the Civ…
Rejected
In order to ensure a smooth transition from MyCSP to Capita it is important that appropriate consideration is given to the rights of staff members transferring across. MyCSP staff who are members of the PCS union have been on strike over the summer in protest at the lack of PCS …
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In order to ensure a smooth transition from MyCSP to Capita it is important that appropriate consideration is given to the rights of staff members transferring across. MyCSP staff who are members of the PCS union have been on strike over the summer in protest at the lack of PCS involvement in Transfer of Undertakings (Protection of Employment) (TUPE) negotiations. MyCSP told us that the PCS union is not recognised by MyCSP for collective bargaining or otherwise, which it states is due to MyCSP being a part-mutual organisation with an elected, formal employee works council which is involved in negotiating terms, conditions and pay. It did, however, state that there were ongoing discussions between itself, Capita, the Cabinet Office and PCS about this issue. The Cabinet Office acknowledged these discussions too, while claiming that given it was not the actual employer it could merely advise and support where appropriate. It does however list staff retention as a key risk to be managed as part of the transition and identified staff shortages as being partly responsible for performance failures in 2024 and the decline in contact centre response times. recommendation The Cabinet Office should set out in its Treasury Minute response what its approach is to ensure that suppliers that it contracts with are committed to giving adequate recognition to the voice of employees, for example, through union recognition.
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Government response AI summary
The government rejects the recommendation, stating it is prohibited by the Employment Act 1982 from forcing suppliers to recognise trade unions. It clarifies that its Social Value Model requires suppliers to ensure workers are informed of their right to join a trade union and have …
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HM Treasury
6
Recommendation
49th Report - Administration of the Civ…
Rejected
There has been a small market of pension administrators bidding for the contract, potentially limiting the Cabinet Office’s ability to secure value for money for the scheme administration. Capita administered only some elements of the pension scheme before MyCSP took over the contract in 2014 to administer the whole scheme. …
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There has been a small market of pension administrators bidding for the contract, potentially limiting the Cabinet Office’s ability to secure value for money for the scheme administration. Capita administered only some elements of the pension scheme before MyCSP took over the contract in 2014 to administer the whole scheme. Capita is now taking on the responsibility for administering the scheme in full from MyCSP. The Cabinet Office says that the market of pension providers is quite small, undermining its scope to encourage competitive procurements and obtain value for money for the taxpayer. In light of the small market of pension providers and need across government to apply the McCloud remedy across several pension schemes, the Cabinet Office stated that it is currently reviewing the market to understand how to encourage new entrants and ensure market resilience. It also told us that when looking to procure any significant contract like this, there would also be consideration given to the costs and benefits of delivering the service in-house. recommendation The Cabinet Office should set out in its Treasury Minute response its overall commercial strategy for pension administration including consideration of the benefits and costs of administering the scheme in-house. 5 1 Customer service Introduction
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Government response AI summary
The government disagreed with the recommendation, stating it is legally required to follow the Procurement Act 2023 and its standard procurement process already includes reviewing in-house solutions for contracts.
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HM Treasury
17
Recommendation
49th Report - Administration of the Civ…
Rejected
On 24 June 2025, MyCSP staff who are members of the PCS union announced six weeks of strike action planned to take place in the period preceding the transition in protest at the lack of PCS involvement in Transfer of Undertakings (Protection of Employment) (TUPE) negotiations.34 TUPE regulations are intended …
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On 24 June 2025, MyCSP staff who are members of the PCS union announced six weeks of strike action planned to take place in the period preceding the transition in protest at the lack of PCS involvement in Transfer of Undertakings (Protection of Employment) (TUPE) negotiations.34 TUPE regulations are intended to protect employees’ rights when they transfer to a new employer. MyCSP said that the decision to award the contract to Capita had driven uncertainty among staff and increased turnover rates. The Cabinet Office lists staff retention as a key risk to be managed as part of the transition35 and identified staff shortages as being partly responsible for performance failures in 2024 and the decline in contact centre response times.36
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Government response AI summary
The government disagrees with the recommendation to ensure suppliers recognise employee voices through union recognition, stating it's prohibited from forcing suppliers to recognise unions under the Employment Act 1982, although the Social Value Act ensures fair working conditions, including the right to join a union.
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HM Treasury
18
Conclusion
49th Report - Administration of the Civ…
Rejected
MyCSP told us that it does not recognise the PCS union for collective bargaining or otherwise, because MyCSP is a part-mutual organisation with an elected, formal employee works council who are involved in negotiating terms, conditions and pay.37 It did, however, state that there were ongoing 31 Q 75 32 …
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MyCSP told us that it does not recognise the PCS union for collective bargaining or otherwise, because MyCSP is a part-mutual organisation with an elected, formal employee works council who are involved in negotiating terms, conditions and pay.37 It did, however, state that there were ongoing 31 Q 75 32 Q 78 33 Q 75 34 PCS Press Release, 6-week strike announced at MyCSP, 24 June 2025 35 C&AG’s Report, Figure 13 36 Q 1 37 Letter from PCS union, 9 September; Letter from MyCSP, 15 September 11 discussions between itself, Capita, the Cabinet Office and PCS about the issue. It added that union membership and activity had increased substantially in the last six months, which it believed was due to the union seeking to be recognised when the transition to Capita takes place.38 We understand that Capita have agreed to move towards recognition with PCS and have been meeting with them to understand and agree on the precise terms and nature of the recognition. This is a positive development and underlines the importance of employers who supply contracts to government engaging meaningfully with unions including through formal recognition.
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Government response AI summary
The government disagrees with the recommendation to ensure suppliers give adequate recognition to the voice of employees through union recognition. They state that the Model Services Contract has a clause for Social Value that successful bidders must comply with under the Social Value Model and …
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HM Treasury
20
Recommendation
49th Report - Administration of the Civ…
Rejected
We queried with the Cabinet Office if it was normal practice to let a contract to an organisation that does not recognise trade unions.42 Although unable to give us a definitive answer at the time, the Cabinet Office subsequently wrote to the Committee to confirm that there is no government …
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We queried with the Cabinet Office if it was normal practice to let a contract to an organisation that does not recognise trade unions.42 Although unable to give us a definitive answer at the time, the Cabinet Office subsequently wrote to the Committee to confirm that there is no government policy requiring trade union recognition in contracts.43 The Cabinet Office did say, however, that if non-recognition had a direct impact on performance, then it would be a concern from a value for money perspective.44 38 Qq 20-21 39 Qq 25-26 40 Letter from PCS union, 29 July 2025 41 PCS press release, MyCSP strike to be extended, 1 August 2025 42 Q 27 43 Letter from Cabinet Office, 28 July 2025 44 Q 29 12 Capita’s readiness for the transition
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Government response AI summary
The government disagrees with the recommendation to ensure suppliers give adequate recognition to the voice of employees, stating that while the Social Value Model ensures fair working conditions and the right to join a trade union, it's prohibited from forcing suppliers to recognize trade unions.
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HM Treasury
25
Recommendation
49th Report - Administration of the Civ…
Rejected
Noting the seemingly small concentration of suppliers, we queried with the Cabinet Office if the market for pension providers is too small and, if so, what it is going to do to ensure that it has more options in future contract tenders. The Cabinet Office responded that the market is …
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Noting the seemingly small concentration of suppliers, we queried with the Cabinet Office if the market for pension providers is too small and, if so, what it is going to do to ensure that it has more options in future contract tenders. The Cabinet Office responded that the market is quite small, with few outsourced providers. In light of the small market of pension providers and the need across government to apply the McCloud remedy across several pension schemes, the Cabinet Office stated that it is currently reviewing the market to understand how to encourage new entrants and ensure market resilience.56 Following our evidence the session, the Cabinet Office wrote to us and stated that it has started engaging with the Crown Commercial Service to understand what it may do to shape the market in future procurements.57
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Government response AI summary
The government disagrees with the recommendation, stating it adheres to the Procurement Act 2023, conducts market analysis, and reviews in-house solutions before making procurement decisions, ensuring equal treatment and transparency across the process.
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HM Treasury
26
Conclusion
49th Report - Administration of the Civ…
Rejected
We asked the Cabinet Office if it considers the past performance of companies when procuring suppliers. It said that it did take past performance into account.58 Subsequently the Cabinet Office has written to the Committee to clarify that public procurement regulations state that consideration of a supplier’s past performance when …
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We asked the Cabinet Office if it considers the past performance of companies when procuring suppliers. It said that it did take past performance into account.58 Subsequently the Cabinet Office has written to the Committee to clarify that public procurement regulations state that consideration of a supplier’s past performance when tendering a contract 52 Q 75 53 Letter from Cabinet Office, 5 August 2025 54 C&AG’s Report, para 1 55 BBC News, Teachers in divorce ‘limbo’ take pension legal action, 24 March 2025 56 Q 79 57 Letter from Cabinet Office, 5 August 2025 58 Q 101 14 is at the contractor’s discretion, and that a supplier may be excluded from a tender on grounds of past performance only where past failures were significant such that a contract was terminated early.59
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Government response AI summary
The government disagrees, stating that it follows the Procurement Act of 2023 which outlines the requirements for ensuring equal treatment and transparency across the procurement process, including reviewing whether an in-house solution is a viable option.
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HM Treasury
27
Recommendation
49th Report - Administration of the Civ…
Rejected
If the market isn’t sufficiently competitive, one option we suggested that the Cabinet Office could consider is what value there might be to bringing the work in-house. The Cabinet Office said that ‘insourcing’ was always considered when making such business case appraisals. It said that insourcing was generally, but not …
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If the market isn’t sufficiently competitive, one option we suggested that the Cabinet Office could consider is what value there might be to bringing the work in-house. The Cabinet Office said that ‘insourcing’ was always considered when making such business case appraisals. It said that insourcing was generally, but not always, more expensive than outsourcing options, because of transition costs, transfer arrangements, and the ‘on-costs’ of joining the civil service.60 59 Letter from Cabinet Office, 5 August 2025 60 Q 108 15
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Government response AI summary
The government disagrees with the recommendation to set out its commercial strategy for pension administration including consideration of the benefits and costs of administering the scheme in-house, stating that it follows standard procurement procedures and the Procurement Act 2023.
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HM Treasury