The Department for Work and Pensions (DWP) is onboarding 2,700 outsourced staff to bolster its Universal Credit checking department, as it seeks to tackle incorrect payments through a targeted case review.
The department said that in the last financial year, 1.2 million Universal Credit claims had been checked, with roughly 250,000 issues identified and corrected during the review.
Contract termination and new internal service
Business services firm Teleperformance was initially awarded a £368 million contract in 2024, as part of a project that tasked 6,000 workers with stopping more than £6 billion in incorrect benefit payments by 2027-28.
The DWP said the contract with Teleperformance was terminated to allow an “internal service” to be put in place for the next phase of delivery. The timeframe has been extended until 2031, and workers will also begin checking Pension Credit claims.
Savings achieved and future targets
According to the DWP's annual report, this review had made £1.7 billion in savings by the end of March, and the savings figure for 2025-26 alone was £1.1 billion.
A DWP spokesperson said: “We thank TP for their support in helping us to ramp up our targeted case reviews, return money back to the taxpayer and their collaborative approach as a strategic supplier,” reports Civil Service World.
“The decision was taken to deliver targeted case reviews internally for the next phase, as we work to deliver £17.3bn of savings by March 2031, and was not due to supplier performance. Both parties continue to work closely during this phase of transition from supplier to DWP.
“This is part of wider plans targeting billions of pounds more in savings in the coming years by tackling fraud and error in the welfare system.”
Union reaction and transition details
Fran Heathcote, general secretary of the Civil Service's largest union PCS, said bringing Teleperformance staff in-house represented a “significant victory” for the union, claiming the outsourced staff created extra work for colleagues.
“We have consistently argued that Universal Credit review work is core civil service work and should never have been outsourced for private profit,” she said.
Both DWP and Teleperformance said the decision was not made on the basis of any breach of contract or performance issue.
“Since being awarded the DWP contract more than two years ago, TP has delivered staffing well ahead of its contractual obligations and has met benchmarks against both quality and productivity and in its strategic relationship with DWP,” a Teleperformance statement said.
“Both organisations remain fully committed to supporting all colleagues through this transition to ensure operational continuity. Under TP’s and DWP’s collaborative partnership and in accordance with TUPE regulations, the in-scope TP staff involved in the contract will transfer to DWP under a controlled and co-ordinated partnership project with full HR support.”
