HC Deb 24 October 1994 vol 248 cc613-4
3. Dr. Spink

To ask the Secretary of State for Social Security what are his objectives for the delivery of social security benefits; and what new initiatives he is considering to ensure sufficient delivery with reduced opportunity for fraud.

The Secretary of State for Social Security (Mr. Peter Lilley)

I have three clear aims: to ensure that pensioners and others can choose to be paid via the Post Office, to reduce administrative costs and to crack down on fraud. That is why in May I announced our intention to automate the process by which benefits are delivered at post office counters. That is good news for customers, good news for taxpayers and good news for post offices.

Dr. Spink

I thank my right hon. Friend for that answer. Will he confirm that he intends to involve the private sector in the automation of benefits delivery and that that improvement will enable those changes to be made more cost-effectively, more efficiently and more quickly and will be welcomed by sub-post offices?

Mr. Lilley

I can confirm that we shall seek to involve the private sector in the introduction of the system to computerise the 20,000 post offices. It will be an immense operation. We have already invited expressions of interest, and more than 90 firms have expressed an interest in taking part in the consortia. Post Office Counters is now trying to narrow the number of those who will be invited to tender. The result will be that we shall be able to involve private sector finance and private sector expertise to get fraud savings more quickly, more efficiently and better.

Ms Lynne

Is the Secretary of State aware that the merging of income support and unemployment benefit under the job seeker's allowance will discriminate unfairly against 18 to 24-year-olds who have been in previous employment? They will have £9.55 less than they have at the moment. Is not that unfair?

Mr. Lilley

I am not quite sure what that has to do with the delivery of benefits through post offices, but in the spirit in which the hon. Lady asked the question, let me say that I shall be making a statement immediately after Question Time about the job seeker's allowance. We shall bring together income support and the contributory unemployment benefit in a single structure of benefits. We shall naturally have a single structure of rates, including the lower rate for the under-25s, as is long established for those who are on income support. That is right and it reflects the lower level of financial expectations, and often of costs, of younger people and the shorter period during which they have been paying into the system.

Mr. Jenkin

Will my right hon. Friend join me in welcoming the Home Secretary's announcement on a voluntary identity card system in the United Kingdom? Would not a voluntary benefit claimant's card, for use in sub-post offices and post offices, be good news not only for the Government, as it would save taxpayers' money in relation to fraud, but for sub-post offices, which would then provide a secure route for the delivery of benefits?

Mr. Lilley

Yes, the proposals to which I have just referred will probably result in the introduction of a payments card for those whose benefits are paid through post offices. It would be voluntary in the sense that if they wish to have benefits paid through the banks, they will have whatever means the banks require to identify and ensure secure payment. That sensible approach will benefit pensioners and others, and will save the taxpayer money, as about £150 million-worth of fraud should be eliminated. It is right that my right hon. and learned Friend the Home Secretary should approach cautiously the issue of a national identity card, as he is through the discussion of a Green Paper and consideration of whether there is a prospect of widening the use of the benefit card. However, that is very different from a compulsory identity card, which would not be the same as my proposal.