Dáil Éireann Debate, Thursday - 24 October 2013
4. Deputy Michael Moynihan asked the Minister for Communications, Energy and Natural Resources if he has had any communication with the Department of Social Protection regarding the introduction of electronic payment for the social welfare system; his views on the introduction of electronic payments in this area and its effect on the post office network; and if he will make a statement on the matter. [45357/13]
Amharc ar fhreagraThe introduction of electronic payments for the social welfare system is primarily the responsibility of my colleague, the Minister for Social Protection, as part of the payments strategy for her Department. In that regard, I have acknowledged that a move to e-payments will help to underpin national competitiveness. Indeed, the switch to electronic payments for social welfare transactions is a trend that has been apparent for some time with most new social welfare clients using electric funds transfer methods of payment.
As Minister for Communications, Energy and Natural Resources, I am keen to see the development of an e-commerce and digital economy. Social welfare clients should have the same opportunities to avail of the benefits of the digital economy as the rest of us.
An Post has many strengths, such as the largest retail presence in the country, a strong brand and a fully computerised network. Post offices already undertake e-payment transactions and, in common with other retail networks, this trend will accelerate in coming years.
The Department of Social Protection payment strategy intends to implement a strategy whereby the bulk of social welfare payments will be made electronically. I understand An Post will pitch strongly for the social welfare e-payment business when it is put out to tender by the Department of Social Protection.
I have welcomed the recent selection of An Post as the provider of over the counter cash services for social welfare customers. The social welfare contract is the largest contract held by the post office division of An Post. The move to make social welfare payments electronically will clearly pose challenges for the network both in terms of changes to how business is conducted at the counters and the value of the contract in an electronic payments environment. Addressing these challenges is primarily a matter for the management and board of An Post as part of developing a strategy to secure the future of the network.
As Minister for Communications, Energy and Natural Resources, I see a strong future for the network in using its existing strengths to remain a significant player as a front office for Government services, including those provided by the Department of Social Protection.
I interrupt to advise that Question Time will be sacrosanct today in that one hour and 15 minutes will be allowed for it, the full time.
The An Post network and its services is a fundamental issue. The Minister alluded to An Post's strong brand, and every Member of this House has something to say about An Post, but unfortunately it has been losing retail units. In terms of the transfer of electronic payments from the Department of Social Protection outside An Post, we will not turn the river against the hill.
An Post must move its business in such a way that electronic payments can be made to people's savings accounts and then accessed by the individual through an ATM card of some type. An Post must move on with that because communities are losing their post offices and there are knock-on consequences from that. This is a State contract and it is time the Minister, as the major shareholder in An Post, examined the ways An Post can move on its business. We must ensure every payment can go through An Post because that is what will be required as time goes on. We must ensure An Post is in a position to deal with those payments.
I agree with Deputy Moynihan. There is no point in us putting our finger in the dyke. The digital economy is here. The trend towards electronic funds transfer and electronic commerce transactions generally is well under way and if we are to stay competitive, we must ensure we can compete in this space.
We have a unique rate of retail outlets in Ireland in terms of our population. I understand there are still 1,130 offices of An Post throughout the country. It was good that An Post won the social welfare contract last year but undoubtedly that is moving in the direction of going electronic. Therefore, as Deputy Moynihan says, it must bring in new products. It has been developing new products. It has been developing, for example, a relationship with some of the banks that is very productive from the point of view of An Post and the local customer because some of the banks do not want to see anyone presenting at the counter. An Post can do some of that work, and do it usefully.
The new chairman of An Post is a man with many ideas who would agree with the arguments Deputy Moynihan is setting out. Christoph Mueller was a former chief financial officer of Deutsche Post before he took up the job in Aer Lingus, and he has a vision for the future of An Post. The existing management of An Post has done a good job in the new products and services it is offering but Deputy Moynihan is right. We have to grow that. I was glad to see An Post as part of the consortium that won the lottery, for example. That is a very valuable stream of revenue for An Post into the future, but the Deputy is right that the future is digital.
The future is digital, the office network is computerised and there must be a face-down in terms of that reality. For far too long An Post allowed these retail units to close in smaller communities in particular, and in some urban areas in an effort to rationalise its system at a huge cost to the social fabric of communities. In going after this State contract we must ensure every possible advantage is with An Post in terms of its products and the ability of the punter to get the best possible service from An Post. For as long as I have been a Member of this House we have been talking about transferring the motor tax service to An Post. All these fanciful ideas are great in reports but An Post has never taken them up. It is high time the Minister, as the major stakeholder in An Post, told the company that we must energise this service and give An Post the ability to attract new business in a range of ideas.
I take on board what the Deputy is saying. The evidence would appear to be, for example, that where a post office has been refurbished and modernised and has the latest technology, it attracts new business. Deputy Moynihan will know that some of the older offices he has spoken about have been run down, and the trickle of business is limited enough. I know the kind of constituency the Deputy represents but, for example, there is very similar terrain at the other end of the country. I got a telephone call before I came into the House about the post office in Greencastle, at the tip of Donegal, which is threatened with closure because of developments in the family who were the postmasters. I then find that the bank has pulled out of the adjacent village of Moville. It seems there might be an argument for An Post looking at what the bank is leaving behind and trying to maintain the Greencastle facility. An Post will argue that very little business has been going through it, but as Deputy Moynihan said, it is important to the local community and it may well be that An Post would look again at this in the light of the decision of the bank in Moville to pull back and provide a service to people in respect of basic bank products as well.
