Vol. 382 No. 11
asked the Minister for Social Welfare if he will introduce greater flexibility in the method of making welfare payments by allowing for the use of cheques, electronic fund transfers, or post office warrants; and if he will make a statement on the matter.
30.
asked the Minister for Social Welfare the categories of social welfare recipients who received payment by way of cash; and if he will make a statement on the matter.
I propose to take Questions Nos. 6 and 30 together. My Department operate a wide range of payment systems the majority of which do not involve direct cash payments. Disability benefit is paid by cheque while longer-term payments such as pensions and child benefit are paid mainly by means of pension and allowance books containing orders cashable at nominated post offices. About one third of the unemployed are also paid at nominated post offices and the balance are paid in cash through the Department's network of local offices.
My Department are actively considering ways of reducing the amount of cash used at employment exchanges. Cheques, postal drafts and electronic fund transfer are being considered but these cannot be introduced until the work of employment exchanges has been computerised. This is at present taking place and will be completed on a phased basis.
In line with my policy of developing more modern facilities using the most up-to-date computer systems, discussions are taking place with the banks and An Post with a view to substituting as far as possible more efficient and secure electronic payment methods for existing paper transactions. It is envisaged that social welfare clients would be offered a degree of choice in the method of payment but the Department's own market research and experience elsewhere suggests, however, that the take-up of new payment methods such as electronic funds transfer may be relatively low initially. One of the constraining factors is that many of the persons receiving social welfare payments do not have active bank accounts.
It is desirable for security reasons, and for management reasons, to switch from payment of benefits by cash. I accept that people are reluctant to move in the direction of getting their welfare payments other than in cash, but would the Minister consider the introduction of some kind of publicity or education programme spelling out the advantages for the State and for the people involved? Can he estimate the amount of money, per week or per year, paid by his Department in cash?
About £6 billion.
That is a separate question but unemployment payments would amount to just over £700 million a year, disability benefit about £230 million — cheques — and there would be other small amounts in cash. We have carried out surveys and the percentage of the elderly who would like to change to payment into the bank or otherwise is extremely small — about 7 per cent. Among the unemployed the number who would be interested in that sort of transfer represents about 40 per cent. There are other problems relating to it and this is why discussions are going on with An Post and the banks.
In relation to payments made through the post, what is the average number of letters which go astray each week? What is the postage cost of the Department each year? Does the Minister consider that savings could be made in this area? Does he agree that a move towards electronic funding would not only be convenient for many people but would also avoid their being without funds at weekends, which sometimes happens?
These are separate questions. In general I would agree with making payments directly to people. Young people want to deal by plastic card. The percentage of pensioners who would be interested in having their funds transferred is 8 per cent, not 7 per cent as I mentioned earlier. That illustrates the kind of difficulty in terms of attitude. I accept the general point that as far as possible we should be moving in that direction.
Would the Minister give an assurance that in moving towards any new system of payment the primary consideration would be to ensure that a person entitled to a payment would get it on time and would not be left without income, in view of the fact that such people are on a very tight budget and a delay of even a day can cause severe stress?
One of the benefits of direct transfer is that the money would be there on the day or the day before. There would be much less difficulty in that respect. We are very conscious of the factor the Deputy mentions.
