MPs have raised concerns about significant delays in the Capita-run civil service pension scheme, which could result in bereaved families facing tax bills on lump sum payments. These payments are tax-free only if processed within two years of the member's death, and many families have been waiting over 100 days for their claims to be processed.
The Commons public accounts committee has highlighted the distress caused by these delays, with some families at risk of financial hardship. The government has acknowledged the unacceptable service levels and is under pressure to ensure timely payments and prevent unjust tax implications for grieving families.
Watch for potential legislative changes as the PAC pushes for reforms to protect bereaved families from tax penalties due to administrative delays. Monitor Capita's response to the government's accountability measures and the impact on the processing of claims.