Vol. 409 No. 9
16 Mr. Spring asked the Minister for Tourism, Transport and Communications whether in the light of his recent statements regarding the viability of the post office network, he has any plans to introduce a giro banking service into the post office; and if he will make a statement on the matter.
30 Mr. Spring asked the Minister for Tourism, Transport and Communications if he has any plans to provide computer facilities to the network of post offices throughout the country.
31 Mr. Howlin asked the Minister for Tourism, Transport and Communications if he has any plans to computerise the post office network in order to create more employment in the post office and to extend the services it brings to people; and if he will make a statement on the matter.
I propose to take Questions Nos. 16, 30 and 31 together.
An Post already operate the Post Office Savings Bank on behalf of the Minister for Finance. As explained to the House in reply to a question on 30 May 1990, development proposals for the banking and retail services of An Post drawn up by the company in conjunction with their main agency customers, viz. the Departments of Social Welfare and Finance and to be co-financed by them were finalized and approved at the end of 1989. Implementation of the proposals had to be deferred because of difficulties experienced by the company in relation to the supply of a central software package. An Post have now informed me that they have completed their reassessment of the proposals in the light of these difficulties, and that the company are currently discussing the revised proposals with their main agency customers.
The proposals would encompass widespread networking of computers to post offices nationwide and would include a number of the retail facilities of a giro banking nature, for example, bill payments, money transmission, direct debits, standing orders, etc.
I understand that An Post have already studied the question of the introduction of a full giro banking service and that the company decided against it having regard to such factors as the capital investment required, the minimum solvency ratio and the extent to which the marketplace is already served for such a service. However, it is open to the company to submit proposals to me at any time for a full giro banking service and I will have them considered speedily.
I welcome what the Minister has to say about the operation of a banking service by An Post. Under section 67 of the Postal and Telecommunications Services Act, 1983, provision was made to allow the post office to develop a banking service provided they got the permission of the Minister for Finance. Would the Minister inform the House if that permission has been granted by his colleague, the Minister for Finance?
No, Sir, it has not. On the surface it appears that it is an attractive proposition for An Post to go into the banking business flat out but there are aspects which are not so clear, for example, if An Post were in banking they would have to ensure that the very substantial solvency ratio deposits be kept as well as a whole plethora of very stringent Central Bank rules and regulations. I understand that An Post have studied this and they themselves have indicated they do not wish to proceed to a full banking service at this time, but no doubt they will continue to study the situation.
Do I understand from the Minister's reply that he doubts very much that An Post have the competence to provide a banking service despite the incursion of the building societies into banking with the full blessing of the Government? I cannot accept that the post office would not be able to compete in this area. If we are to make the post office viable I think it is absolutely essential to allow them to develop in this area, as provided for in the Act.
Questions Nos. 30 and 31 deal specifically with the provision of computer facilities. How soon does the Minister envisage the computer package being made available to An Post which would enable them to diversify into the banking service. How far have we gone down the road in regard to the provision of these computers?
On the latter point, let me say there has been a breakthrough in the supply of the central softwear package and An Post are completing their reassessment of the proposal. That difficulty has been sorted out. I cannot put a date on it but we have got over one hump, as I understand the package is now available.
Let us be clear about the idea of An Post providing a banking service; the Government and I are not standing in the way of the post office providing a banking service and if An Post wish to put a proposal to me I will have it studied very carefully indeed. However, getting into banking is superficially attractive for An Post because of their present difficulties but I would be nervous about grasping at it as a readymade solution because banking is neither as easy a business nor as cheap to get into as we might consider.
Deputy McCartan rose.
I wish to call Deputy Eric Byrne who had offered earlier but should Deputy Byrne wish to yield——
Would the Minister agree that many of the sub-post offices in urban areas, particularly in Dublin, are inferior in structure to the banks, building societies and credit unions and that the viability programme would have to address the quality of the environment in which people would be doing their business? If An Post do not make the sub-post offices attractive places for people to conduct their business, the viability proposals will get nowhere.
What is the meaning of that? It could be construed two ways.
Sub-post offices and, in fact, all post offices should be attractive to the customer. I should point out that An Post already have a very substantial saving certificate business and that is being conducted through all the offices. I take it the Deputy is encouraging the sub-post offices to continue to improve the quality of their offices and I join with him in that.
Does the Minister accept that when he talks about An Post's difficulties he is talking about his difficulties? Will he indicate whether he is actively promoting and assisting An Post to diversify? In his reply he said he would not stand in their way but he is still the Minister for Communications and has responsibility for the postal services. Can the Minister quantify the capital requirements of An Post to provide the limited programme of a bank giro service? What assistance by way of capital investment will come from his Department or from the EC or elsewhere through his efforts?
Of course, An Post's difficulties are mine and all of the people of Ireland. We want to see a vibrant, healthy post office service. I think I have been helpful in that I have asked the NESC-appointed consultants to examine additional sources of revenue for the sub-post office network. I am not concentrating solely on the cost side as I am also examining possible sources of revenue. There have been interesting suggestions in the House and I will ensure that the consultants study those suggestions carefully.
Is the Minister providing capital?
With regard to the question on investment, I pointed out during the debate that there is a very substantial capital investment programme — I think the figure is over £60 million — over the next few years. The post office require this investment programme and we are committed to it.
Is any of that £60 million coming from Government revenue?
It is part of the investment programme of An Post. Some of it comes from the resources of An Post and the rest from the capital programme agreed with the Government on a year-by-year basis.
Is that a "yes" or "no"?
A final question from Deputy Toddy O'Sullivan.
Will the Minister confirm that the Minister for Finance has given his authorisation for the development of the postal banking service? The Minister for Finance was to have consultations with the Central Bank and, in turn, with the Minister for Communications with responsibility for post and telecommunications. Will the Minister confirm that these discussions have been held and, secondly, if authorisation has been given?
Authorisation has not given but let me repeat that it is open to An Post at any time to request me or the Minister for Finance to look at the potential for the provision of a banking service through the post office network. I will not delay in considering An Post's proposals at any time. The position is that they do not wish to proceed at full speed in that direction at present but wish to examine the initial area.
