Paschal Mooney (Fianna Fail) | Oireachtas source

I again welcome the Minister of State, Deputy Kevin Humphreys. It is always a pleasure to have him in the House. Before he made his presentation, I was going to frame my response with a simple one line question: "Why was the letter sent in the first place, creating all sorts of concern?" I am sure the Minister of State will remember that when rumours started to circulate some time ago suggesting free travel would be affected, it caused enormous hassle across the country.

As the Minister of State has explained, on the face of it, the letter seems to be innocuous enough, yet it is rather interesting that the Irish Postmasters Union issued a statement indicating postmasters slammed the Department's letter encouraging the payment of welfare payments through bank accounts. It refers to the cost being pushed on to the consumer and the electronic payment of welfare payments. It is obvious that the Department's letter did not state it at all but offered options. I wonder what the point of it was. From what I can remember, the form for most social benefits highlights the option of receiving payments by direct mandate. It does not give equal prominence to the option of receiving payments through one's post office. That might be partly responsible for what is happening and the Minister of State may correct me if I am wrong.

There is a trend towards electronic transfers. The Minister of State is absolutely correct about this, as I know from having had exchanges on this issue with the boss of his Department, the Tánaiste and Minister for Social Protection, on a number of occasions. Interestingly, AIB has an arrangement with the An Post network and now Ulster Bank is entering into an arrangement with it. That leaves only one other major pillar bank, Bank of Ireland, apart from permanent tsb. In my home town, for example, there is only one bank branch, that of Bank of Ireland. There used to be an AIB sub-branch, but there was no Ulster Bank branch. It is obvious that AIB customers have probably transferred to the post office network and are probably receiving their payments therefrom. It seems that is the way to go, but it still leaves the reality that post offices are relying to a large extent on the Government contract.

The post offices have a figure of €57 million for last year. The Minister of State also has a figure. Postmasters were paid approximately €25 million of this sum in transaction fees, which represents approximately one third of their income. One can understand, therefore, the rationale for their concerns about any erosion of their business. The other aspect, about which I did not know, is that An Post returned €65 million in uncollected benefits to the Department of Social Protection in 2013. Some of these moneys may have been paid subsequently. However, there is no return of uncollected payments via electronic funds transfer, leaving the Department potentially exposed. It has a figure of up to €65 million, but I am sure it is putting a spin on it. It is a point of note that €65 million has been returned, but I do not know why. Is it in unpaid benefits? Why is it not the position in the case of the banks? Payment through the An Post network deters fraud, which is acknowledged by the Department.

The postal network comprises a major industry. There are 3,700 people employed, while €2.1 million is paid in rates to local authorities. Wages exceed €64 million which is spent in local economies and the national economy, with a total contribution in PRSI payments in excess of €10 million.

It is interesting that the Irish Postmasters Union states in its submission that it fully appreciates that some people may find it more convenient to receive their welfare payments by electronic transfer but that there is the opportunity to develop an electronic system through the post office network to accommodate this. It states no further transfer of post office transactions to the commercial banks should be pursued until a long-term solution which includes using the post office is found. The inference throughout is that the Department's letter is forcing people to make a choice. The Minister of State has clarified that matter. I am curious to know why the Department bothered sending the letters in the first place as the Minister of State has made it quite clear that people have a choice. One can understand the concerns of the post office network that when a letter is sent, there is a covert conspiracy theory behind it. Perhaps those concerned do not trust the Department, perhaps because they are blaming it for what effectively is the phenomenon of people voting with their feet. They are increasingly opting for EFT, but, at the same time, there is a need to develop some system that could mirror the EFT system through the pillar banks. I am not sure how it would work in practice.

If I had a bank account and wanted to opt for payment through the post office network, how would I do it in a cashless context? Would there be a facility that would allow for the transfer of the money from the Department to my account in the post office which, in turn, would transfer the money to my account in the bank? There is a very real challenge for the post office network. I do not want in any way to rain on its parade, but it is increasingly obvious that we are moving towards a cashless society. Ireland is unique in Europe in that its citizens use the largest number of cheques. Ireland has the lowest number of cashless transactions relative to other European countries and we are now playing catch-up. Owing to the closure of various bank branches, I am sure the Minister of State will agree that there is now a continuing opportunity for, apart from a challenge facing, the post office network. It has AIB on board and it is now getting Ulster Bank to do so.I hope that perhaps other services provided by Government would be channelled through the post office network. There is much talk about motor tax, for example. Perhaps the challenge for the Government as well as the post office network is to work out what Government services could be put through the post office network that would be effective, cost-efficient and in the interests of the consumer.