Capita 370M Whitehall outsourcing deal challenged in court

"Capita confirmed today it won a business process outsourcing deal for multiple UK government departments for £370 million over ten years, less than 40 percent of the estimated value outlined during the tender stage. The shared services deal to run HR and finance systems for four departments is already the subject of a legal claim from rival bidder Sopra Steria, which alleges Capita's bid was "abnormally low" and based on staffing "significantly below the current levels.""

"Capita said it would deliver tech-enabled back-office services for civil servants across four major government departments: the Department for Work and Pensions (DWP), Ministry of Justice (MoJ), Home Office, and the Department for Environment, Food and Rural Affairs (Defra). It represents the so-called Synergy cluster of the government's shared services strategy, which has seen around £2 billion in contracts awarded to migrate HR and finance systems to SaaS."

"Using a system being built by Oracle and IBM, Capita said it would support a suite of services including HR, payroll, recruitment, finance, procurement, and service desk support for around 250,000 civil servants. The UK outsourcer said the contract would start in March 2026, and run for seven years, with the option of three one-year extensions."

Capita secured a business process outsourcing contract worth £370 million over ten years to manage HR and finance systems for four UK government departments: DWP, Ministry of Justice, Home Office, and Defra. The deal, part of the government's Synergy shared services strategy, represents less than 40 percent of the estimated procurement value of £958.7 million. Capita will deliver tech-enabled back-office services supporting HR, payroll, recruitment, finance, procurement, and service desk functions for approximately 250,000 civil servants using Oracle and IBM systems. The contract begins March 2026 for seven years with three optional one-year extensions. Rival bidder Sopra Steria, the incumbent provider through SSCL, has filed a legal claim alleging Capita's bid is abnormally low and based on staffing levels significantly below current requirements.

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