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Capita Group PLC (CPI)

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Friday 28 November, 2003

Capita Group PLC

Re Contract

Capita Group PLC
28 November 2003

                               Press Information


28th November 2003

Capita grows existing contracts across the public and financial services sectors


The Capita Group Plc ('Capita') announces today that it has secured and signed
contract extensions and additional work across both Life & Pensions and Local
and Central Government. The company also confirms its participation in the
health service ProCure 21 National Framework.

The London Borough of Lambeth Executive has agreed in principle to extend its
revenues contract with Capita, which was due to end in November 2004. Capita is
now agreeing the detailed contractual arrangements with a view to signing a
contract worth approximately £20m for a further 5 years. The extended contract
will encompass Council Tax and Business Rates collection and administration,
Benefits IT services, cashiering services and Housing Benefits customer call
centre. The contract extension will take the life of the contract up to 2009 (12
years from the initial contract start date in December 1997).

The contract extension is being negotiated due to the consistent high levels of
service and results delivered across the revenues contract by Capita, in
partnership with Lambeth, over the past six years. These successes have been
achieved during a period when major modernisation of the IT infrastructure has
been undertaken. They include:

   • Improved Council tax collection from 78.6% in 1997 to 90.1% in 2003;
   • Improved NNDR collection from 92.8% in 1998 to an anticipated 97.4% in
     2003;
   • Increasing Council Tax direct debit payers from 6,000 in 1997 to 31,000
     in 2003;
   • The conversion of the old legacy revenues systems to Capita's specialist
     software, Academy UNIX;
   • The introduction of a state of the art revenues Call Centre in Coventry
     targeted to respond to 80% of calls within 20 seconds;
   • The introduction of a 24 hour a day, 7 day a week, automated telephone
     payments system accepting debit and credit card payments;
   • The introduction of a new income management and cash receipting system
     for Lambeth.


ProCure 21: Capita has been selected to participate in the NHS ProCure 21
National Framework as partner to a number of the 12 Principal Supply Chain
Partners (PSCPs) selected by NHS Estates.

ProCure 21 is a significant health service initiative in England covering all
non-PFI refurbishment and new build schemes, from £1m to £20m. Relating to all
hospital provisioning, including diagnostic and treatment centres, the aggregate
value of the programme is estimated to be worth £7bn over five years.

Capita will provide a wide range of property consultancy services to a number of
the successful PSCP consortia, including Interserve (with which it has been
involved on the pilot programme of ProCure 21 in the North West and West
Midlands), forming a strong, comprehensive offering to the 600 NHS Trusts who
will be able to contract directly with their PSCP of choice.

The framework provides NHS Trusts with an efficient, accelerated procurement
route as NHS Estates selected the participating organisations following an open
tendering process in line with European legislation.

Capita's involvement in the ProCure 21 framework draws on expertise from across
the wide range of practices which make up Capita Property Consultancy and
positions Capita at the heart of providing support services for NHS trusts. The
consultancy is currently experiencing substantial demand for the provision of
integrated support for major infrastructure, construction, regeneration and
property portfolio management programmes across the Health Sector and Local
Government. Capita's involvement in these projects not only opens up new
relationships for its wider outsourcing offering but also adds further value to
existing clients.

Lincoln Financial Group: Building on Capita's original £160m contract to
administer life policies for Lincoln Financial Group, we have now signed an
evergreen contract with Lincoln. This transforms the original 10 year contract,
due to expire in 2012, to a contract worth £272m over an estimated total
contract term of 25 years. The evergreen contract has been awarded due to the
consistent high levels of service and results delivered.

Commenting on the new arrangement, Michael Tallett-Williams, Chief Executive of
Lincoln UK, said:

'Lincoln has been delighted with the service provision we have received from
Capita in the first year of the contract which has met or exceeded our
expectations. As we seek to build our business over the next year we believe
that this quality of service, coupled with our plans for new products, will play
a key part in differentiating Lincoln in the IFA distribution channel.'

Department for Work and Pensions: Since the initial contract award, Capita has
consistently extended and broadened its relationship to deliver Office Services
to the Department for Work and Pensions (DWP) across three UK geographic
regions. This extension, which was previously announced to be worth £18m over 9
months, is now confirmed today as a 12 month extension to March 2005 worth £26m.

Capita successfully developed the initial 3 year, £27m contract awarded in 1999,
and this has now been extended into a £118m, 6 year contract, due to Capita's
ability to deliver a high quality, flexible service for the DWP. Originally
managing 700 staff over 190 offices, Capita is now responsible for employing
2,000 staff to provide comprehensive office administration services, producing 3
million typed documents, handling 24 million telephone calls and delivering 54
million items of photocopying/printing each year.

Transport for London: Capita also confirms that it has now signed a supplemental
agreement with Transport for London regarding the delivery of the London
Congestion Charging Scheme. The agreement is worth up to an additional £31m,
over the remaining term of the initial contract to February 2008, subject to
certain quality performance indicators being met. The supplemental agreement is
for Capita to deliver a programme of new technical and procedural enhancements
over and above the original contract. Capita is working in close partnership
with TfL to deliver the new service improvements and enhancements, building on
the initial successful launch of the scheme and clearly focused on delivering
benefits to the people of London.

Rod Aldridge, Executive Chairman of The Capita Group Plc, commented,

'These extended and new arrangements announced today will contribute a minimum
additional £10m of revenue in 2004. They reflect a clear trend whereby our
customers lengthen and broaden their relationships with us as the benefits of
outsourcing from their original contract flow through.

'Furthermore, in the Financial Services Sector, we are increasingly being
approached to develop more open ended relationships, such as that with Lincoln
Life, whereby both parties benefit from a longer term view. Such a long term
relationship increases the overall value of the contract to the Group and is a
clear endorsement of the value and benefits that our services deliver to our
customers, although the additional revenues will not have an effect for several
years.'

A Capita Group pre-close period statement will be made on Monday 8 December
2003.

                                     -Ends-

For further information please contact:

The Capita Group Plc                                         +44 (0)207 799 1525
Rod Aldridge, Executive Chairman
Paul Pindar, Chief Executive
Shona Nichols, Communications Director
Press Office                                                 +44 (0)870 2400 488

Finsbury                                                     +44 (0)207 251 3801
Morgan Bone
Anthony Silverman

The Capita Group Plc, is the UK's leading provider of integrated professional
support service solutions. The Group's service capabilities encompass customer
services, financial services, human resource services, software services,
systems and strategic support and property services delivered to both public
sector and private organisations. With over 17,000 employees at more than 200
offices across the UK, Capita is quoted on the London Stock Exchange (CPI.L).

In April 2003 Capita was named Company of the Year in the Royal Bank of Scotland
Sunday Times Business Awards. Capita has won Management Today's Most Admired
Support Services Company Award in 2001 and 2002.

Further information on The Capita Group can be found at: www.capita.co.uk





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