§ Dr. Lynne JonesTo ask the Secretary of State for Social Security what arrangements he will put in place to allow benefit recipients without bank accounts to be paid in cash over the counter at post offices once automated credit transfer is introduced. [119707]
§ Mr. RookerThe vast majority of benefit recipients, over 80 per cent., already have access to a bank account.
The Post Office is working with banks and the Department to make a range of bank and other simple accounts available to everyone, and to make sure that getting cash from these accounts will he available to customers from local post offices.
However, we recognise that there will be some people who we will be unable to pay by automated credit transfer, and some urgent payments that cannot be made this way. For these, we are considering what alternative simple electronic money transmission system, which could also be accessed at post offices, may be commercially available.
§ Mr. LilleyTo ask the Secretary of State for Social Security if he will estimate the cost of paying all relevant pensions, currently paid via automated credit transfer four weeks in arrears, on a weekly basis in the year the transition was made. [119422]
§ Mr. RookerThere would be no overall increase in benefit expenditure in moving to weekly payments.
However, there could be a one-off cash flow effect, with expenditure up to the value of £555 million1 being brought forward to an earlier tax year because of more frequent payments.
The Department would also incur some small additional banking costs as a result of more frequent payments.
1 This figure assumes that all pensioners and widows, whose pensions are currently paid into a UK bank account, take up the option and that the transition was made in a single year, neither of which may necessarily be the case.