§ Baroness Byfordasked Her Majesty's Government:
Whether the Department for Work and Pensions is within its right to encourage claimants to open accounts with high street banks, rather than the Post Office card account; and [HL453]
111WAWhether they still plan to offer the Post Office card account, which used to be called the universal bank, or whether they plan to close this proposed scheme. [HL454]
§ The Parliamentary Under-Secretary of State, Department for Work and Pensions (Baroness Hollis of Heigham)The Post Office tells us that it is on schedule to introduce universal banking services (consisting of access to the banks' basic bank accounts at Post Office branches and the Post Office card account) in April 2003. There are no plans to cancel or delay its introduction.
Customers are being supplied with all the information they need to choose the account option (current account, basic bank account or Post Office card account) which best meets their needs and circumstances. All of our information material mentions Post Office access and the availability of the Post Office card account. Which account option customers choose will be entirely up to them. It is not the job of the Government or the Post Office to choose an account for them.
But it is also true to say that the Post Office card account will not be the best option for many people as it only has very limited features—for example, it will not be able to receive payments of wages, it has no direct debit facility, and can only be used when Post Office brances are open. The Government are keen to encourage financial inclusion, by giving people access to the wider financial benefits of having a bank account—the card account does little to help achieve this.
Baroness By ford askedHer Majesty's Government:
Whether they are concerned that benefit claimants may be refused basic high street accounts [HL456]
§ Baroness Hollis of HeighamThe Government believe that the availability of basic financial products is essential to ensure access to wider, mainstream services and is an important component in tackling financial exclusion both for benefit customers and others currently without access to bank accounts. Basic bank accounts have an important role to play in providing this access.
The Government support initiatives by banks and other institutions to promote greater availability and knowledge of the benefits of basic accounts, and is working with the British Bankers' Association and others to ensure that banks are well prepared to deal with benefit customers who want to open basic accounts.
Our information campaign will take customers through the changes. Customers are being supplied with all the information they need to choose the account option (current account, basic account or Post Office card account) which best meets their needs and circumstances. Customers do not need to take any action until they receive a letter from us about the change.