Dáil Éireann Debate, Tuesday - 11 October 2022
496. Deputy Michael Moynihan asked the Minister for Social Protection the payments that have been made to An Post in each of the years 2017 to 2031 for the delivery of social welfare payments in post offices; if she will outline the calculation process for determining these payments; and if she will make a statement on the matter. [49706/22]
Amharc ar fhreagraMy Department provides two main payment method options for its customers: payments in cash at post offices or payments direct to customer accounts in financial institutions. My Department intends, where possible, to continue to offer its many customers the choice of being paid in cash at the post office or directly into an account in a financial institution by Electronic Fund Transfer (EFT).
For some social welfare schemes, it can be mandatory for a payment to be collected in cash at a post office. For example, some social welfare scheme rules require a customer to prove that they are resident in the state and are available for work. These payment method restrictions are limited and, in most cases, a customer can choose the payment method most convenient for them.
Cash welfare payments are governed by the Department’s Cash Payment Services Contract with An Post which was signed in December 2019 and came into effect in January 2020. This contract ran for two years, from 1 January 2020 to 31 December 2021. After the two year contract period was completed, the Department had the option to renew the contract for a further year, which was executed.
The Cash Payment Services contract allows for 4 such annual renewals, i.e. to 31 December 2025. Given the consistently high level of service delivered by the company, it is my intention that this contract be renewed again with An Post for 2023.
The annual agency fees paid to An Post from 2017 to date (under the terms of the current and of the previous Cash Payment Services contracts) are set out in the following table.
|
Year |
Agency Fee Paid |
|
2017 |
€51,565,680.00 |
|
2018 |
€50,806,680.00 |
|
2019 |
€49,760,632.00 |
|
2020* |
€51,826,256.00 |
|
2021** |
€49,506,400.00 |
*Agency fees are paid in advance to An Post in monthly instalments with a final reconciliation carried out in the following year. The 2020 agency fee was €47,965,624.00 based on the level of transactions carried out by An Post that year. However, the company was also owed an outstanding balance carried forward of €3,860,632.00 which resulted in a final pay over of €51,826,256.00.
**The 2021 fee figure is provisional pending the final sign-off on the 2021 figures by both the Department and the company. This formal sign-off is expected to be carried out shortly.
The fees are calculated on a transaction basis as set out in the publicly tendered contract. The transaction fees are set out in three bands. The first band fee relates to the first 10 million payments cashed by An Post, the second band relates to the next 10 million transactions cashed by An Post and the third band relates to each subsequent payment cashed. The actual transaction fees set out in each of the three bands cannot be released due to the commercial nature of the contract and to comply with both national and EU procurement rules.
