Capita (CPI): Closed book Life & Pensions exit

This situation live

CPI Capita

£344m · 297.0p · −25% since the first step

12 Dec 2025 · Transition agreement signed; five-year migration · −30% until the next step Under the agreement, the two contracts will migrate back to Royal London, with each party covering their own associated migration costs.

12 Dec 2025 · Transition agreement signed; migration under way · −30% until the next step The closed book Life & Pensions business has now met the criteria to be treated as a business exit and from the year end its results will be excluded from the Group’s adjusted results.

10 Mar 2026 · Hand-back agreed; migration under way · +25% until the next step Agreed hand-back terms for final contracts in the loss-making closed book Life & Pensions business unit, concluding a key component of our Manage for Value strategy

18 May 2026 · Recovery plan agreed with Cabinet Office · −18% until the next step We remain fully focussed on delivering the administration of the Civil Service Pension Scheme under the project improvement plan with the Cabinet Office.

7 Jul 2026 · Ministerial Statement made; implications under assessment · −21% until the next step Capita is assessing the implications of the matters contained in the statement and, if required, will update the market as soon as it is able to do so.

9 Jul 2026 · Quantified: £25-40m profit hit in 2026 · +14% until the next step are now expected to impact adjusted operating profit in 2026 by £25m – £40m with a £35m – £50m free cash flow impact, compared to our previous expectations

4 Aug 2026 · Costs flowing through H1; guidance held, recovery ongoing · −15% until the next step We recognise that the service delivered on the Civil Service Pension Scheme has not been good enough since the transition in December 2025.

2 Oct 2026 · CSPS recovery ongoing; NAO review announced · +39% since Capita notes the National Audit Office's (NAO) decision to undertake a review of the administration of the Civil Service Pension Scheme (CSPS).

Disposal of a part (break-up)

Closed book Life & Pensions exit

CSPS recovery ongoing; NAO review announced

NOV4 Next: Capital Market Event in 11 days

Every step · 8

12 Dec 2025 Transition agreement signed; five-year migration – Under the agreement, the two contracts will migrate back to Royal London, with each party covering their own associated migration costs. ↗
12 Dec 2025 Transition agreement signed; migration under way – The closed book Life & Pensions business has now met the criteria to be treated as a business exit and from the year end its results will be excluded from... ↗
10 Mar 2026 Hand-back agreed; migration under way – Agreed hand-back terms for final contracts in the loss-making closed book Life & Pensions business unit, concluding a key component of our Manage for Value strategy ↗
18 May 2026 Recovery plan agreed with Cabinet Office – We remain fully focussed on delivering the administration of the Civil Service Pension Scheme under the project improvement plan with the Cabinet Office. ↗
7 Jul 2026 Ministerial Statement made; implications under assessment – Capita is assessing the implications of the matters contained in the statement and, if required, will update the market as soon as it is able to do so. ↗
9 Jul 2026 Quantified: £25-40m profit hit in 2026 – are now expected to impact adjusted operating profit in 2026 by £25m – £40m with a £35m – £50m free cash flow impact, compared to our previous expectations ↗
4 Aug 2026 Costs flowing through H1; guidance held, recovery ongoing – We recognise that the service delivered on the Civil Service Pension Scheme has not been good enough since the transition in December 2025. ↗
2 Oct 2026 CSPS recovery ongoing; NAO review announced – Capita notes the National Audit Office's (NAO) decision to undertake a review of the administration of the Civil Service Pension Scheme (CSPS). ↗

What is happening

Capita: Closed book Life & Pensions exit – CSPS recovery ongoing; NAO review announced. ['CSPS recovery ongoing; NAO review announced']

In short: Capita went live on the Civil Service Pension Scheme with an 86,000-case backlog (10 Mar 2026) and agreed an improvement plan with the Cabinet Office (18 May 2026). On 9 Jul 2026 it quantified a £25m-£40m hit to 2026 adjusted operating profit and pushed positive FCF to 2027. H1 results (4 Aug 2026) held guidance. On 2 Oct 2026 Capita noted a new NAO review, reported operational progress in August and September, and said remediation remains its top priority.
Announced: 12 Dec 2025 · Transition agreement signed; five-year migration
Latest: 2 Oct 2026 · CSPS recovery ongoing; NAO review announced
Cash impact: £35m-£50m on 2026 free cash flow
Cost drivers: Surge resource, remediation, pension consulting disruption, delayed cost efficiencies
FCF guidance: Positive free cash flow excluding business exits expected in 2027
Government scrutiny: Ministerial Statement 6 Jul 2026; Public Accounts Committee 8 Jul 2026
H1 2026 profit: Adjusted operating profit £32.2m, down 31.6% (reported 4 Aug 2026)
New scrutiny: NAO review of CSPS administration, noted 2 Oct 2026; builds on NAO investigation of June 2025
Progress claimed: Good operational progress in August and September across priority areas of CSPS; no figures given
Remediation steps: Further automation, stronger governance and improved management information

What comes next

Capital Market Event (4 Nov 2026).

Briefing

Capita in 4 minutes

Capita runs outsourced services for UK government and regulated industries: pension schemes, training, road charging and customer contact. Since 2024 it has cut about £250m of annual costs and sold businesses to...

Act 1New chief executive, deep cuts and asset sales
Act 2The savings land, but the old problems linger
Act 3A pension contract goes wrong, and the contact centres go

Read the briefing →

From the company's own announcements. Not investment advice.

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