The UK Department of Education will be re-tendering the £ 185million outsourcing contract for teacher pensions to replace a 25-year relationship with Capita.
According to a tender published late last week, Whitehall is looking for a new contractor to run the Teachers’ Pension Scheme (TPS).
The Department is looking for a TPS administration “accepted as the UK’s best managed public service pension system”.
The contractor is expected to “provide an effective, fully digital and personalized service to our members,” the communication states. It states that software and IT services are part of the contract.
The deal is set to last for 10 years, with an option for an additional five years, although the tender notices did not specify when it was expected to begin. The registry asked for clarification.
Capita, the incumbent operator, has been operating the service since 1996. It was reappointed in 2011 with a £ 80m contract.
That contract was supposed to run until 2018, but in May of that year Conservative Minister Nick Gibb said a £ 32.3 million contract extension would be granted to operate the service until 2021.
“The TPS contract with Capita is the largest single contract administered by this department and has been rated as ‘low cost, high quality’ by the Cabinet Office as platinum quality and external benchmarking,” he said.
That deal was renewed in 2020 when Capital signed a four-year deal worth £ 60million through 2025.
The TPS collects contributions from over 11,200 employers and the calculation and payment of pensions to more than 700,000 beneficiaries. Capita also manages the programs for both deferred and active members, which total an additional 1.3 million people. It is currently operated by Capita’s Darlington Employee Benefits division, which is part of the company’s People Solutions division. ®