Barry Cowen (Laois-Offaly, Fianna Fail)
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Question 50: To ask the Minister for Social Protection her plans to put the social welfare payments contract out to tender; and her views on comments by the Irish Postmasters' Union that this will lead to major job losses in An Post. [10432/11]

Joan Burton (Dublin West, Labour)
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Government policy aims to facilitate the greater use of electronic payment systems in the economy in the interests of developing a modern payments environment in Ireland. In this regard, my Department is currently developing a Payment Strategy to enable the Department to continue to modernise the payment of welfare benefits in line with wider Government policies and objectives such as better public services, better and more effective e-payments and the National Payments Implementation Programme. As the Deputy is aware, An Post issues Electronic Information Transfer (EIT) payments on behalf of my Department in respect of various Social Welfare schemes. The contract under which An Post provides this service will expire on 31 December 2013.

Public sector contracts for the supply of products and services are usually awarded following a competitive tender process. This ensures that the taxpayer receives value for money and it also ensures that all potential suppliers are given the opportunity to put forward for consideration and evaluation the most efficient, effective and competitive solutions.

The award of public sector contracts with a significant financial value is subject to various EU Directives. Because of the financial value of this particular service, the Department is required to tender for any new contract for the delivery of social welfare payments when the current contract with An Post expires in 2013.

It will of course be open to the current provider to bid for the business for the next period. The procurement process will be completed in advance of the termination of the contract, in order to ensure continuity of payments to our customers.