HC Deb 14 December 1999 vol 341 cc116-7W
Mr. Luff

To ask the Secretary of State for Trade and Industry what assessment he has made of the impact of significant numbers of child benefit claimants switching from cash to direct bank account payments on the rural post office network; and if he will make a statement. [101328]

Mr. John Smith

To ask the Secretary of State for Trade and Industry (1) what estimate he has made of the impact on(a) post office incomes and (b) the viability of post offices of paying social security benefits directly into claimants' bank accounts; and if he will make a statement; [101373]

(2) what estimate he has made of the number of post offices which would close in (a) the Vale of Glamorgan, (b) Wales and (c) the United Kingdom if social security benefits were to be paid directly into claimants' bank accounts. [101375]

Mr. Alan Johnson

There will be no change before 2003 to existing methods of paying social security benefits, under which recipients can choose between payment by order book at a post office and payment direct to a bank account using the automated credit transfer system (ACT). Some 54 per cent. of new child benefit recipients and 47 per cent. of new pensioners currently choose to have their benefits/pensions paid by ACT. The Horizon counters automation project will equip all post offices with a modern, on-line IT platform by 2001, and will enable the Post Office to extend its existing arrangements with the high street banks under which customers of those banks—including benefit recipients—can access their accounts at post offices. This project, to which the Government have made a significant financial contribution, represents a major investment in the future of the post office network to which the Government remain fully committed. It will ensure that all benefit recipients who wish to do so will be able to access their benefits in cash at post offices. It will also offer other bank customers the benefits of wider availability of banking services, especially in rural areas.

For the longer-term future, the Prime Minister has asked the Performance and Innovation Unit within the Cabinet Office to undertake a study of the contribution which post offices make to their local communities, and how the network can best contribute to Government objectives.