§ Mr. Gordon PrenticeTo ask the Secretary of State for Social Security (1) what estimates have been made about the amount of money which could be saved from the introduction of automatic credit transfer of benefit payments into claimants' bank accounts;
(2) how many persons in receipt of social security benefits do not have a bank account.
§ Miss WiddecombeThe payment of social security benefits is a matter for Mr. Michael Bichard, the chief executive of the Benefits Agency. He will write to the hon. Member and a copy will be placed in the Library.
Letter from Mr. M. Bichard to Mr. Gordon Prentice, dated 7 May 1993:
As Chief Executive of the Benefits Agency, it is my responsibility to answer questions about relevant operational matters. I am therefore replying to your recent Parliamentary Questions to the Secretary of State for Social Security asking how many persons in receipt of social security benefits do not have bank accounts and what estimates have been made about the amount of money which could be saved from the introduction of automated credit transfer of benefit payments into claimants' bank accounts.
A survey undertaken in 1991 estimated that 30 per cent. of Social Security recipients did not have a bank or building society account.
Payment by automated credit transfer (ACT) has been available to many of our customers for several years. In line with a commitment made in the Citizens Charter, ACT is being made available for a wider range of benefits. The savings resulting from this extension will depend how many recipients select ACT as a method of payment. If all social security recipients were paid in this manner, this would lead to administrative savings of around £475m a year.
I hope you will find this reply helpful. A copy will appear in the Official Report and a copy will also be placed in the Library.