HC Deb 09 February 2004 vol 417 cc1168-70W
Mr. Gale

To ask the Chancellor of the Exchequer what discussions took place between the Treasury, the National Federation of Sub-Postmasters and non-governmental organisations representing the elderly prior to the decision to withdraw the National Savings Bank Blue Ordinary Account; and if he will make a statement. [153474]

Ruth Kelly

National Savings and Investments' primary role is to raise cost-effective financing for the Government and it can only achieve this by offering savings and investment products which are attractive to customers and which they want to buy.

The Ordinary Account, set up in 1861, has changed little since it was introduced. Due to extensive changes in the savings market, the Ordinary Account no longer reflects customers' savings needs. In light of this, and following research with a wide range of customers, National Savings and Investments decided, with the Treasury's approval, to close the Ordinary Account and open a new and more appealing product—the Easy Access Savings Account. The features of this new product are aimed at offering customers greater flexibility in managing their savings.

The Post Office remains a key channel for National Savings and Investments and the new Easy Access Savings Account has been specifically developed with them to take advantage of their new network banking capability.

Although neither the Treasury nor National Savings and Investments had direct discussions with the National Federation of Sub Postmasters, the Post Office engaged in direct discussions with the Federation on how to introduce the new account and close the Ordinary Account.

In December, as the first public announcement of the planned changes was made, special interest groups, including those with a special interest in the elderly, were informed by the Post Office and National Savings and Investments. National Savings and Investments also offered to discuss their plans directly with these groups as well as with the Federation.

Mr. Gale

To ask the Chancellor of the Exchequer (1) what provision will be made to enable National Savings Bank Blue Ordinary Account holders without bank accounts to transfer funds to a National Savings Bank Easy Access Account; [153475]

(2) whether post office card accounts are acceptable in lieu of bank accounts for the purpose of transferring from National Savings Bank Blue Ordinary accounts to National Savings Bank Easy Access accounts. [153476]

Ruth Kelly

In common with many other providers, National Savings and Investments' new Easy Access Savings Account requires a customer to have a bank or building society account to receive repayments. The Easy Access Savings Account will therefore not be suitable for those without such an account. However, National Savings and Investments offer other products, including the Investment Account, which can be operated without the need for a bank account. The Post Office card account is limited to receiving pension or benefit payments only and no other credits so would not be suitable as an alternative to use with an Easy Access Savings Account.

Mr. Gale

To ask the Chancellor of the Exchequer what facilities will be made available to give persons holding National Savings Bank blue ordinary accounts who do not have a bank account access to their funds after 31 July. [153451]

Ruth Kelly

After 31 July 2004, if a customer wishes to make a withdrawal from their Ordinary Account— which must be to close the account—the arrangements will remain as they currently stand. A customer who does not have a bank account can request an uncrossed warrant that can be encashed at a chosen Post Office branch.