HC Deb 13 December 1999 vol 341 cc40-1W
Mr. Willetts

To ask the Secretary of State for Social Security if he will place in the Library the results of the assessment of the recent Payment Card trials carried out by his Department in the North East and South West of England. [100914]

Mr. Rooker

As part of the BA/POCL project, limited trials of the Benefit Payment Card were conducted with 37,000 customers in 204 post offices in the north east and south west of England. In the trials, benefit payments were made using plastic magnetic stripe cards, the Benefit Payment Card, instead of outdated paper-based methods of payment. This was supported by a new automated system at post offices. The trials undertaken were limited to Child Benefit and were carried out to provide experience of live running and to inform later stages of the BA/POCL project, including a full scale live trial of all aspects of the Card method of payment and the technology to support it.

The project, which was commissioned in 1996, suffered a series of setbacks and delays and the key milestone of a full scale live trial of the Card was not delivered. There were concerns that the project was too complex and would be undeliverable and in May 1999, the Government announced a new way forward to achieve the original objectives of the project, while simplifying it and reducing risk. Under this approach, the Benefit Payment Card element of the project was removed and, from 2003 DSS will move from paper-based methods of paying benefits to payment by automated credit transfer, a more modern, secure and efficient method of payment.

It was clear that the Benefit Payment Card had added substantially to the complexity of the BA/POCL project, and hence to the delay that had occurred and that its continuation could only increase the risk of further slippage to the programme. There were also increasing concerns that even if the Benefit Payment Card could have been delivered, the magnetic stripe technology on which it was based looked increasingly outdated as banks and others turned their attention increasingly to smart card technology. This, together with the combination of a three year delay to the project and the escalating trend of people opting for payment by ACT, had substantially reduced the role that the Benefit Payment Card could expect to play.