The UK's Department for Work and Pensions has handed Capita £112m for a two-year extension to the controversial Personal Independence Payment (PIP) assessments contract.

The outsourcer has also been awarded £33m to extend its PIP assessment contract with the Department of Communities in Northern Ireland for the same amount of time.

PIP, which replaced the Disability Living Allowance in 2013, is designed to help people with a long-term condition or disability lead independent lives by providing additional financial support.

Along with Atos, Capita was first awarded the deal in 2013 estimated to be worth a total of £512m to mid-2017.

However, along with the Employment Support Allowance (ESA) contract, PIP has repeatedly come under fire for making inaccurate and incomplete assessments.

Last year, the House of Commons Work and Pensions Committee said the decision to contract out both PIP and the ESA was driven by a perceived need to introduce efficient, consistent and objective tests for benefit eligibility.

"It is hard to see how these objectives have been met. None of the providers has ever hit the quality performance targets required of them, and many claimants experience a great deal of anxiety over assessments," it said.

In June 2018, minister of state for disabled people Sarah Newton said the government was seeking a two-year extension to "better allow for a stable transition" to a new provision. In a ministerial statement, she acknowledged there is "still more to do to deliver the high quality of service those claiming PIP rightly expect".

She added: "At the same time we will look to enable more providers to deliver PIP by developing a DWP-owned IT system."

The government accepted the key finding by the Work and Pensions Committee (PDF) to make video recording of assessment interviews a standard part of the process. It also recommended greater online support, including chat and interactive media, or a "dashboard" to keep claimants updated on their claim.

Jon Lewis, chief executive of Capita, said of the contract win: "These contract extensions are testament to the commitment of our healthcare team, our consistently strong operational performance, and the strength of our longstanding relationship with government." ®