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I see from the numbers in the Chamber that the business in the main Chamber is obviously non-controversial and that hon. Members need somewhere to come out of the cold. The pleasure of seeing you in the Chair, Mr. Bercow, is lessened only by the realisation that you are not on the Front Bench, where you so obviously deserve to be. [Hon. Members: "Hear, hear!"] I hope that Hansard recorded that deserved applause. The Conservative party's loss is our gain.
I am delighted that the Speaker has chosen this debate, which is particularly welcome as it gives the Under-Secretary of State for Work and Pensions, my hon. Friend Mr. Plaskitt, the opportunity to explain current Government policy on Post Office accounts and the contract, and to settle genuine worries that there has been a change in policy in recent weeks. The debate also gives hon. Members and the Minister the chance to have a dialogue about the three pilot schemes that have come to our attention, although not through the House. A fair number of Members wish to speak, so I shall go through my speech as quickly as possible. I also hope that hon. Members will bear with me if I read my speech, because if I depart from it, I fear I shall lessen the number of those who can participate.
The history of the subject, briefly, is that since 1997 the Government have invested between £1 billion and £2 billion in modernisation of the Post Office. Most of that money went on IT, to enable the Post Office to get up to date and to compete for other markets. That allowed the Department for Work and Pensions to realise an objective that it had sensibly had in mind for a number of years, which was to introduce the plastic card and direct payments because pension books and giros were costly and open to abuse. Once the IT system was in place, the Department went ahead.
The obvious move from books to plastic cards directly affected pensioners, but it also called into question the viability of thousands of post offices. We all know the results: thousands closed, although not in every case because of the new payment method. However, a major source of income was affected. That proved to be the last straw for a number of post offices, and, where the offer was made, postmasters took the opportunity to depart the scene. Some 2,500 post offices disappeared in that tranche.
The customers also had a hard time. The Minister present was not at the Department then, so I can say without causing personal offence that its behaviour was slightly unpleasant. It wanted customers to give up their pension books and open bank accounts to facilitate direct bank payments. The Department was reluctant to tell pensioners that they could retain their books, and its literature was deliberately evasive on that point. It also frowned on the Post Office account and instituted a convoluted method of opening one, for which one needed a degree from Cambridge and the tenacity of a bulldog. I know from having spoken to those in the DWP who participated in early discussions that it wanted only banks to be involved, because they were the cheapest, and it set its stall out accordingly.
Can my hon. Friend imagine the angst and chagrin of those 4.7 million benefit claimants—up to 5,000 in each constituency, and 10,000 in some—who, having survived an obstacle course of Olympic proportions to get the card account open, now find that the Government have abandoned the very assurances that they gave to us MPs? Is not that a deception of sub-post office staff and a betrayal of benefit claimants? I speak as a member of a third generation sub-post office family in the village in which I still live.
I think that my hon. Friend has increased the number of pensioners and benefit recipients, but we will pass quickly over that. He uses strong language, but I shall touch on some of those matters, albeit in a gentler way—gentleness is the difference between us.
While the DWP was working in that way, No. 10, the Treasury and the Department of Trade and Industry took a more mature view. Although they recognised the financial benefits to the DWP, they understood the sensitivity of the pensioners' worries about the break with post offices and also appreciated that the Post Office needed time to build up other income streams. A seven-year contract was therefore signed to subsidise the Post Office accounts, and leading banks chipped in with a contribution of £180 million, which ends in 2008. The contract between the Government and the Post Office started in 2003 and will run to the financial year 2010–11.
A number of hon. Members want to speak and I am reluctant to take up too much time, so if the hon. Gentleman will forgive me, I will not.
Important to all parties concerned was the stated agreement to work together in the intervening period, between 2003 and 2010, to evolve the Post Office accounts into something more akin to a bank account, which was in line with the Government's financial inclusion agenda. The discussion centred on the concept of what was termed the universal bank, run through the Post Office. That has largely disappeared from public sight, but it is perhaps still alive, albeit barely, as an idea. Nevertheless, the position accepted by all participants and known to Parliament and hon. Members was that a seven-year contract was in operation, and it was intended to evolve into an acceptable, viable and convenient alternative that would fit in with the Government's wider intention of extending financial inclusion.
My hon. Friend makes his point strongly. Representing a semi-rural constituency, I persuaded people to use the Post Office card account instead of direct debits. We did that in my family, and I sent letters to constituents, a number of whom also did it. They did so because they wanted to keep their post office open, more than anything so that pensioners could use it. Does my hon. Friend agree that under the current position those people have been badly let down, if not completely deceived?
I welcome this debate, because I always give the Government the benefit of the doubt. Perhaps others in the Chamber are less generous, but I want to hear what the Minister has to say, because I cannot believe that a Labour Government would act in that fashion. I am prepared to suspend judgment, although I will touch on the matter later.
I hope that the Minister will largely agree—although perhaps not entirely—with a fair summary of the position, which is that it was unchallenged and widely understood before
"Government actions threaten us on two fronts. The first is their proposal to set up 70 high street offices to vet and interview applicants for passports. This would dig into the £12 million net contribution this business currently brings in. Secondly"— and relevant to this debate—
"the Department for Work and Pensions has notified us that the current Post Office account card will cease when the contract ends in 2010–11. It is simply not possible to maintain the service politically demanded while at the same time being deprived of the wherewithal to underwrite the cost of that service."—[Hansard, House of Lords, 12 January 2006; Vol. 677, c. 329.]
It was suggested that the DWP had unilaterally taken the initiative to indicate that it intended to end the Post Office account when the contract ended in 2010, despite a well accepted understanding that, although the existing contract was an interim one, with a seven-year life and an objective that had been agreed by everybody involved, every effort would be made to allow it to evolve into a better arrangement that suited post office customers, the Post Office and the Government.
Unfortunately, that statement by the noble Baroness was not referred to or expanded on by the Minister who replied to the debate in the other place. So the story is out: the implication of Baroness Prosser's remarks is that unilateral action has been taken via the DWP, and there is to be no "son of Post Office accounts"—no life after 2010. The attitude is, "We do not care what is said by the Treasury, the DTI or No. 10's performance unit, in 2010 we are coming out regardless of the consequences."
If the Minister in the other place had answered the point at the time, this debate might have been unnecessary. However, the remark in that debate referred to pensioners all over the UK, who did not want to give up their pension books and who eventually compromised and accepted a Post Office card account. They now feel let down, angry and fearful. They believe that their cards will be withdrawn and they will have to have bank accounts whether they like it or not. The hard-working people who run sub-post offices genuinely fear that the Government have reneged on the agreement and are determined to move the business out of post offices and into banks. That will mean massive closures and not a few bankruptcies.
This debate is a good chance for the Minister to kill that misunderstanding and reassure people. I sincerely hope that that will happen. This is not a pleasurable debate; it reflects a lot of worry among small businesses, vulnerable pensioners and benefit recipients. The sooner that fear is dispelled the better. I still worry, however. In the past half hour, I have received some e-mails. The one from Postwatch says:
"We were surprised to learn that the government's subsidy for the POCA will not be continued".
That is from people who know the situation. If they are surprised, one wonders what is going on. The most worrying one was from the Post Office itself. It says:
"The Department for Work and Pensions have informed Post Office Ltd that they will not support the Post Office card account beyond 2010. This notification is given under the terms of the current agreement."
That is worrying, and it needs to be dealt with, because we have a Government commitment to life after 2010 for the Post Office account and the plastic card for those who wish it, yet this suggests that the DWP is acting unilaterally and has given notice. It would be useful to clear that up.
I congratulate the hon. Gentleman on having secured this debate, because he has touched on a serious point. A major redirection of Government policy seems to have happened in the Department without the involvement of this House, although the Department must know how much concern there is about the issue in all parts of the House.
I totally agree. We have reached the stage at which a statement during a debate in the House of Lords has gone unchallenged by a Minister and we have learned the facts from a written answer, while nobody has made a statement. The good news might be that that was because there was no statement to make; the three or four Departments are all acting together and we are still on track.
Having dealt with that point—I am sure that others will reinforce the message—it is necessary to seek assurances and explanations about the three pilot schemes. They, too, surfaced in such a way that hon. Members read about them for the first time in the newspapers. They are important, because they seem to go against the spirit, if not the letter, of the stated policy. The first pilot scheme is to frame the payment system information given to 3,000 new claimants in the north-east so that it does not include the Post Office account as an option for new claimants. That is disgraceful—London or the south I could understand, but surely not the north-east. I jest.
That is reminiscent of the Department's early tactics with pensioners over the right to retain the pension book, and the right to a Post Office account. It was not volunteered, and one had to be a persistent pensioner to fight to retain one's pension book or even to get a Post Office account. That is not an entirely open and straightforward way to deal with people and needs to be reconsidered. It is also unfair to the sub-post offices in the area, because it affects their businesses and futures.
Does the hon. Gentleman accept that it is worse than that in rural areas such as mine? The banks have pulled out, so pensioners cannot go to them. The post office is their only option, and if that goes there is nothing for them.
The hon. Gentleman makes a very relevant point.
The second pilot scheme is totally unacceptable and raises questions of bad faith; it allows those minded to cause mischief and distress to vulnerable people to go ahead. The intention is to send letters to existing Post Office account holders who also have bank accounts to demand their bank details and to tell them to use those accounts. That is how the initiative is framed by the sub-postmasters. We have not been officially informed about it, but my only other source of information is impeccable: it is a briefing note from the parliamentary Labour party. As hon. Members can imagine, it is much more gentle—
It is genuinely much gentler. It states:
"DWP will . . . write to 35,000 existing POCA customers with bank account details, suggesting they may like to move over to a bank account payment and requesting their bank details."
It we consider the two approaches, the truth will lie somewhere in the middle. It is still a disturbing situation and we would welcome clarification from the Minister. Much gentler that might have been, but, however phrased, it puts pressure on the customer. It is reminiscent of past bad behaviour and, above all, it is a breach of faith with sub-postmasters and Post Office account holders and takes a potential 35,000 customers away from sub-post offices.
In my former incarnation as a trade union official, I would not have accepted it if an employer who had a seven-year agreement with me sought to interfere with it in such a way in only the third year. The Government and the DWP made an agreement and signed a contract. To do anything without consultation in the third year of a seven-year contract is provocative and needs to be rethought.
I have a communication from one of my constituents who runs a sub-post office, who says:
"The whole idea of the Post Office Account Card was to give people freedom to choose the most convenient method of claiming their pension or benefit . . . This village is way out in the country—we have no public transport and no bank."
He goes on to say:
"Now the Government—without consultation and without warning—is withdrawing the card. We were never told it would be a short-term or temporary measure."
I am sure that the hon. Gentleman will agree with that sentiment.
I repeat my reply to earlier interventions: I hope that it is not true. The question is not about the Government, but about what the Post Office said. It said that the DWP has unilaterally reneged on the contract, sought to come out of it or indicated that it is not interested in having a contract or any relationship after 2010. There is no sign that other Departments or No. 10 are going in that direction. I am sure that the DWP has not carried out that unilateral action. We await the Minister's response with some interest.
I have taken a few interventions. Will my hon. Friend let me finish this point? I am conscious of the time. I hope that you understand the difficulty with my taking a lot of interventions, Mr. Bercow.
The third pilot scheme is along the same lines, and is equally objectionable. In that pilot, 2,500 Post Office account holders who have one benefit paid into a Post Office account and another into a bank account have been told by the Department that the payment that goes into the Post Office account will be moved into the bank account forthwith. However logical and harmless that might seem when discussed around a ministerial table, it is offensive, not only because it cuts across the long-term contract to the detriment of people who are trying to keep small businesses afloat, but because it ignores customers' decisions. They were asked to use only a bank account—indeed, one could say that they were badgered into it—but they settled on a Post Office account. Now it is suggested, without a word of apology, that 2,500 people's payments will be moved into their bank accounts. As the Citizens Advice, sub-postmasters and others say, there are often individual reasons why people want to keep such accounts separate, and those should be honoured and recognised.
I thank my hon. Friend for giving way, and I apologise for the fact that I will have to leave to meet a constituent at 3 pm to discuss this very issue. For me, this came to light only two years ago when the whole issue of the pension credit was being considered, when I discovered through Pension Service staff that the account was short-term. If there is a problem, it is the fact that it was not spelled out to everyone when the Post Office card account was introduced that it would be only until 2010.
I agree with what the spokesman for the Scottish National party, Mr. Weir, said about this being an issue in rural areas. We have a particular difficulty in Scotland, because of the major banks. It would have meant additional business if the major banks had joined up, and we might have been in a more sound position.
I genuinely have a different opinion from my hon. Friend. There is a seven-year contract, but it was tied to an agreement that there would be work in the intervening period to put together some mechanism to move towards financial inclusion, as the Government wanted to, by making the Post Office account a more attractive financial vehicle.
When I started this debate, we were aware of the arrangement that we had seven years with Post Office accounts, and we were looking forward to the post-2010 arrangements and the universal bank. The worry is that people such as my hon. Friend are suddenly accepting that all that is going to disappear in 2010, but that is not the case. The contract was to end, but was to be replaced with something better. The suggestion now is that not only will that not happen, but steps are being taken to weaken the seven-year agreement.
I shall finish now, Mr. Bercow. I am grateful for hon. Members' patience and your wisdom. I hope that on the substantive issue there will be life after 2010 for an improved form of Post Office account, and that the Minister will confirm that there is no intention by the DWP of the sort described, and that no precipitate action was taken. I would equally welcome reconsideration by the Minister and his Department of the three pilot schemes, which I find provocative. Perhaps I am alone in that. In view of the misunderstandings and worries caused by the statement in the other place, to go ahead with the pilot schemes would send out the wrong message.
Order. I intend to call the Front-Bench winding-up speakers at approximately 3.30 pm. Many Members seek to catch my eye; naturally, I am in colleagues' hands, but the shorter speeches are, the more hon. Members will have the chance to contribute.
Thank you, Mr. Bercow, it is a pleasure to speak with you in the Chair. I reiterate the comments of Mr. Mudie; perhaps this will be a temporary sojourn on the Chairmen's Panel and you will be on the Front Bench soon.
I congratulate the hon. Member for Leeds, East on landing this debate, which is of great interest to many of our constituents. I have worked on this issue as a constituency MP for a long time. As I have told the House before, a few years ago I drove around 28 post offices in my constituency, a 150-mile drive, and established that in many of them the proportion of turnover related to benefits was extraordinarily high. It was 60 per cent. in Gobowen, 80 per cent. in Treflach, 70 per cent. in Pant, 60 per cent. in West Felton, and 50 per cent. in Baschurch and Prees.
At that time, I was working with a splendid postmaster, Colin Doyle from Knockin. I went to see the then Minister of State for Energy, E-Commerce and Postal Services, Mr. Timms, to discuss the real barriers that were being put up by authorities, which were being backed by the Government, to put people off getting a card account. We were told on the Floor of the House that there were only three steps to be taken, but I went through it with Colin and we established that in some cases there were a minimum of 22 steps, and that applications for cards would be rejected for the slightest of errors, in order to force people to take payments directly into bank accounts.
The outgoing Conservative Government had a perfectly sensible swipe card scheme, which would have had the advantage of the security that the Government wisely seek, and would have kept income going through sub-post offices. However, that scheme was unwisely scrapped because there was great belief in the universal bank. The hon. Member for East Ham, who is one of the most respected members of the Government and whom I completely trust, said that he genuinely thought that everyone would have an opportunity to partake in the universal bank in a few years.
The Minister who is here today gave me a parliamentary reply only yesterday saying that the following banks do not offer current accounts through post offices: Abbey, Bank of Scotland, First Trust, Halifax, HSBC, NatWest, Northern bank, Royal Bank of Scotland, Ulster bank and Yorkshire bank. We are a country mile away from having a universal bank option and enabling all benefits customers to take direct payments.
At no stage in any discussions was it hinted that for those who had struggled through the jungle with their machetes, survived the passage of 22 obstacles and got their cards, this was a temporary option. It was thought that having made a substantial investment—the Minister will tell us how much; the Government trumpet those figures all the time—in the new system, it would be there for good. I have a letter from the hon. Member for East Ham, which does not even hint that there was a 2010 deadline.
I enjoy the role of secretary to the all-party group on sub-post offices, which is chaired by Kate Hoey. We were astonished on
I ask the Minister to confirm what consultation he had with anyone, not least with his colleagues in the DTI. I asked the Secretary of State for Trade and Industry about the subject in questions recently, and he seemed bemused. I raised it with the Leader of the House in the main Chamber and he ran into semantics about the difference between the words "impermanent" and "temporary". Again, he did not seem to realise the consequences of what the Government are proposing through their arm, the DWP.
What consultation has taken place? What happens if one of the 3,000 new benefits claimants does not want to open a card account? What would happen to one of the 35,000 existing customers who did not like the tone of the letter from the DWP, however it is phrased and even if it is in cuddly language from the parliamentary Labour party? What happens if one of the 2,500 existing customers is not prepared to have their payments put into a bank account or if they are with one of the banks mentioned on the list in the reply to the parliamentary question? What will the consequences be? What is the legal basis for the change? What rights do benefits claimants have not to be bamboozled by the Government and forced into new arrangements that none of us have heard of?
It was alarming in our meeting that the chief executive of the Post Office, Adam Crozier, said that he would need 4,000 post offices to run a mail service. The Government have done grievous damage to post offices. An income of £400 million through the benefit payments has been taken away from post offices, and it is probably down to £160 million with the 4.3 million existing card account holders. If they are to be dragooned into some form of direct payment and made to surrender their cards in 2010, what will be the role of the 14,400 post offices when only 4,000 are needed to run a mail service? The Government do not appear to have thought that through.
There may be sensible, rational gains and savings to be made. We would all support that; we do not want the Government to waste public money. There may be savings in having direct payments and dropping the card account scheme. However, there has been substantial investment in recent years and benefit income is the core of the sub-post office network. The post offices that I have visited—we have been through this in previous debates—have other business tacked on. There is stationery related to the direct benefits payment at the post office, but it may also sell dry food, fresh food and fruit. Many post offices have an off-licence attached, or they may sell cold food or products for tourists. Benefits are always the core base from which the hub of the village shop is built up, and that performs a valuable service.
That case would be reflected in many rural seats. Indeed, an active post office and village shop in the heart of both our rural and our urban communities would be a valuable social product.
Does the hon. Gentleman remember—it was before my time in this House—an Opposition day debate on the introduction of Post Office card accounts on
"If we did not make this change, the post office network would be bled dry by people increasingly choosing to have their benefit or pension paid into a bank or building society."—[Hansard, 11 June 2003; Vol. 406, c. 767.]
Does the hon. Gentleman not think that that is exactly what would happen? The Government were right to be concerned about the possibility and if the Post Office card account is abandoned that will have a severe impact on the viability of the post office network.
The hon. Lady understates her case. The network would collapse. I do not see what will maintain the 10,000-odd post offices without a core business of benefits on which they can build a business of selling Post Office products, food and so on. The Government have not thought things through. Perhaps they will save money in the DWP, but there will be substantial economic costs in closing down the post office network. There will be massive social costs. There is not joined-up government.
I rarely sign early-day motions, but I drafted one with the hon. Member for Vauxhall about the abolition of the Post Office card account. I am delighted to see that on the first evening 81 Members signed that early-day motion, and you, Mr. Bercow, were one of them. I got myself into some trouble because I had not cleared the proposal with my hon. Friend Mr. Ruffley, but we sorted it out later and it now has full Tory support. We want a review of the DWP's proposals, but I would also like a review of the future of the Post Office. What does the DTI think the post office network is for and what does it think is its future over the next 50 years? What does the DWP think is the future of the network? What is the Government's social view? What social function do post offices provide? The Government must give a coherent strategic view. At the moment, we have a mess.
I, too, signed that early-day motion. Does my hon. Friend share my concern that a review is not the answer? In the meantime, all the people who have invested in their own post office businesses will find that their businesses are blighted and that the business plans that they entered into—perhaps with bank support—are complete mincemeat as a result of the Government announcement.
That was a great question from my hon. Friend. It is just the point that I was going to make. Like many people, my constituent, Colin Doyle, bought into the business to round off the working years of his life and as a nest egg for his retirement. Many sub-postmasters cannot sell their businesses because the future is blighted. We do not have a clue of the Government's strategic view of the post office network, and there is a real problem as people are getting out and retiring. Above all, however, there is a huge blight on people coming into the business. To have a vibrant post office network we need a constant turnover of fresh, enterprising people to take on that role.
There is obviously great concern about the future not only of post offices but of other shops nearby. In an urban constituency such as mine the parades that surround post offices are under threat from the Government's plan to shut down thousands more post offices.
I am sure that that is a perfectly valid point.
I will wind up, because I know that others want to speak. Will the Minister please give us an answer about the three schemes? What is the legal basis for them and what will happen to people who say no? What is the Government's long-term strategic view of the post office network and will they have a review between all the relevant Departments?
I congratulate my hon. Friend Mr. Mudie on obtaining this debate. We will need to debate the subject on the Floor of the House as soon as possible if we do not get proper answers from the Minister today. As chairman of the all-party group of which Mr. Paterson is secretary, I obviously agree with everything that he has said. He has put a number of points that I hope the Minister will answer.
The Government have, I am afraid, committed a dual breach of faith. First, they have breached the faith of all those people, particularly pensioners, who went through such trauma giving up their book, which they were used to, and after a huge amount of work managed to get a Post Office card account. Most in my area have got used to it and begun to feel that it gives them the freedom to go along each week and get out as much cash as they want.
Secondly, the Government have breached the faith that many sub-postmasters and sub-postmistresses had in what they had said. Those people put in extra money, produced their business plans and thought that they had a future. Not only do they now see that they are likely to have no future after 2010, but they are facing those ridiculous three pilot schemes, which we only heard about at the last minute, which the Post Office and Adam Crozier told us that they had only known about for a short time and which seem to have been plucked out of the air by the DWP. They were probably worked on for many months by civil servants and signed off by a Minister who gave them no real thought, with no consultation at all of the DTI. I hope not only that we will obtain answers to the legal questions that have been asked today, but that the Minister will ask for the schemes to be withdrawn.
The wording of the letters that went out is so patronising; the attitude is basically "We know best." The letters state:
"As you have been using your Post Office card account for some time, now is the time to make arrangements to pay your benefit/pension into a bank (or building society) account. You'll go on receiving the same amount of money as often as you do now."
How dare any civil servant or Minister send out such letters to people who chose to have a Post Office card account? They may have a bank account but still want their card account. It is all very well saying that the people who have gone on to benefits for the first time have been told that they must have a bank account, but that if they say no, they will probably be told, "That's okay. You can carry on as you are." That will be made so difficult for them. They will have to do all the work to get their Post Office card account when the situation should be the other way round. If banks want to take people away from having a card account, it is up to them to spend the money to do that; taxpayers' money should not be spent trying to do it.
I hope that the Minister will try to answer that question. There is no doubt that the proposals will save the DWP money, and they probably tick a box in one of the spending plans that it has to produce over the next few years, but the long-term effect will be to destroy the post office network. Yes, some post offices will remain—the 4,000 that are needed, as was pointed out, to provide a universal delivery service across the country—but there is no doubt that the vast majority, having thought that they had been saved, will be lost. That creeping attack on the Post Office card account demonstrates so much bad faith. The Government are not saying openly and honestly, "Look, we want to get people off the account as quickly as possible. Let's do it this way." They hoped that everything would be happening almost before anyone knew about it.
On that point, Mr. Jas Palmer in my constituency highlights the fact that the Driver and Vehicle Licensing Agency has recently been advertising for people to buy their car registration online, with no mention that that can still be bought at post offices, almost implying that there is a move from post offices to doing business online. That creeping effect will take place in a number of ways.
The hon. Lady is right, and that is exactly what happened when the pension books were originally withdrawn. The situation was made very difficult for people. The Government must get their act together on what their policy is on post offices, because clearly they are saying one thing to us and something else behind the scenes. It is amazing how a campaign or an issue such as this unites political parties. Whatever our politics overall, we know that for our constituents this issue is very important. It does not matter whether someone is a Conservative, a Liberal Democrat or a Labour MP: this issue matters to our constituents, which is why there is so much unity on it.
I say to the Minister, "You have been caught out." I do not mean the Minister personally—at least, I hope that it is not him who has been caught out—but the issue has now come to the attention of us all, and we will not give in. We want answers today, we want all three pilot schemes withdrawn and we want everyone to get round the table and find a sensible solution for the time after 2010—a solution that retains people's right to use the post office and to have the flexibility that they have at the moment.
I, too, congratulate Mr. Mudie on securing this important debate and on his excellent presentation of the case.
The recent announcement that the Government intended to abolish the Post Office card account in 2010 came as a big shock to us all. Sub-postmasters and the 4 million pensioners who had chosen to use that account assumed that it or a similar successor would continue indefinitely. At least 4 million pensioners had to battle to get the account. The customer conversion centre that they had to telephone tried to badger them to the banks, but those pensioners were determined that they wanted a Post Office card account. They were never told that the account would be temporary, which must now come as a big shock to them.
Does the hon. Gentleman share my concern about closure? Some of my constituents jumped through various hoops to get the Post Office card account and registered it with their local sub-post office only to find that that post office was to close. They then had to move their account to another post office, which also closed. If someone does not have a local sub-post office, there is no point in having a Post Office card account.
The hon. Gentleman makes a valid point. Part of the problem with the Government's approach is that abolishing the Post Office card account and forcing people to go to the banks inevitably means that many post offices will close. Even though some of the bank accounts may allow the pensioners to lift their money at the post office, they cannot do that if there is no post office in their local village.
In all our debates during the previous Parliament, the Government never once made it clear that the Post Office card account would be temporary. They always argued that people could collect their money through a Post Office card account; there was no mention of the words "only until 2010". Of course, it is not only the abolition of the account in 2010 that has become apparent; the Government have started to take people off the account this very month. They know that if they are to abolish the Post Office card account in 2010, they need to move every pensioner and benefit recipient off the account by then. As we have heard, the Government have already written to 3,000 pensioners saying, "You must use a bank or a building society account; you are not being given the choice of a Post Office card account." When I asked the Minister in a written question what would happen to people who did not have a bank account, he effectively replied, "We'll send them giros." That practice, as we know from what has happened in the past, is open to fraud, but it is what the Government are going to do.
My hon. Friend mentioned how the Department for Work and Pensions seems to be resurrecting its desire to bully people into banking the way it wants them to, rather than letting them have a free, open and clear choice to do it their own way. It has also reverted to the old language of not telling the whole story. I received a letter from the Minister today, saying:
"People will still be able to collect their benefit or pension at the Post Office if they wish by using their bank or building society account there."
No caveat is given to show that many banks or accounts do not allow that. The DWP fell into that trap before, and it is falling into it again. If a post office is shut, no one will be able to access their bank account there, so unless the Government have a strategy for keeping post offices open, there will not be any access.
My hon. Friend is quite right. Before his intervention, I described pilot A. The DWP has two other pilots. In pilot B, it simply writes to pensioners who are collecting their pension through a post office account and asks them to supply their bank or building society account details. There is nothing in the letter to tell the pensioner that they have a choice to continue with the Post Office card account; it simply asks them to supply bank account details, thus conning them into moving to a bank. The pensioner receives a letter from the Government, does what the Government ask and phones up to supply their bank account details. Suddenly, without being aware of it, they will find that their pension has been removed from their Post Office card account to a bank account.
The hon. Gentleman mentioned earlier that the Minister had said that someone can always get a giro, but if there are no banks in rural areas and the post offices are closing, where will they be able to cash that giro? Given that the banks have moved out and post offices are closing, does the hon. Gentleman agree that we are increasing financial exclusion in rural areas of Scotland, Wales and probably even England?
The hon. Gentleman is quite right. In my constituency, of the three main Scottish banks, the Clydesdale is the only one that allows current accounts to be accessed at post offices. The Clydesdale is closing rural branches, however, so he is right: if people have a giro and there is no post office or bank to go to, they face the expense of journeying to the nearest town.
In the third pilot, pilot C, people are given no choice. The people involved are pensioners or benefit recipients who receive more than one benefit from the Government. One is paid through the Post Office card account, and they have chosen to be paid the other through a bank. The benefit that they currently receive through the card account is simply moved to the bank account without any choice being given to them. The Government are taking choice away from people again.
It had always been the assumption that if the Post Office card account came to an end in 2010, it would be replaced by another solution based in the post office. When I raised the matter with the Leader of the House at business questions, he said:
"We are not about to abandon the success of the card—we want to ensure that it continues but in an appropriate way."—[Hansard, 2 February 2006; Vol. 442, c. 474.]
However, by starting these pilots now and forcing pensioners away from post offices to banks, the DWP is pre-empting what the Leader of the House believes and, as we heard earlier, what other Departments believe. It is simply not joined-up thinking. The DWP may think that it is going to save money in its own budget, and as Kate Hoey said, it will be able to tick a box, but that is not joined-up thinking. It will cost other parts of the Government money. The publicly owned Post Office will lose money; and if it loses money as a publicly owned company, the Government and the taxpayer lose money.
The abolition of the Post Office card account threatens the viability of thousands of urban and rural post offices, many of which are in very remote areas or areas of urban deprivation. Often the post office is the only shop in such areas. Even if it is not, those around it may rely on people getting money there and then spending it in the shops. If the post office goes, there will often be no shop left in the village or the urban housing scheme.
Before it is too late, I urge the DWP to think again, because its actions will have devastating effects throughout Britain. As Mr. Paterson said, we have heard from Royal Mail that the approach could mean 10,000 post office closures, leaving us with only 4,000 in the country. I urge the DWP to think again, abandon these pilot schemes, get together with other parts of the Government, initiate a full review of how we can secure the future of the post office network in the long term and allow pensioners to have the choice of continuing to collect their money at the post office from a Post Office card account.
I thank my hon. Friend Mr. Mudie for securing this debate and making his case effectively and eloquently. Rather than repeat many of the points that he made, I should like to draw the Minister's attention to just two issues.
The all-party group on small shops, of which I and many hon. Members present are members, published a survey today called "High Street Britain: 2015". One of its conclusions is that the Government should directly support and expand the specific services offered by the sub-post office network. The sub-postmasters' submission to the inquiry went further and suggested that they could be paid to provide advice centres for the Government. Many of them already give a wide range of advice for free.
The Welsh Assembly Government have given £4.1 million of Post Office development fund money to support and develop post office branches located in the 125 most deprived and isolated electoral divisions throughout Wales, including a number in my own constituency. The grant was given to improve their future viability. If a post office closes within three years of receiving a grant, the money, quite properly, must be repaid.
The killing off of the Post Office card account is a real threat to the viability of post offices that serve small rural communities or deprived urban communities. Is that really joined-up government thinking? The card account brings people into the post office who then make other purchases there or in an adjacent corner shop, helping to make those businesses viable. Furthermore, in a close-knit and caring community, if Mrs. Jones does not pop in to use her card account, the post office staff will make inquiries to check that she is safe and well and ensure that nothing untoward has happened to her. I hope that the Minister is listening and that he realises post offices are the heart of our communities. If the heart is ripped out, the community is killed off.
I am very pleased to follow Nia Griffith, and I agree entirely with what she said. It demonstrates the cross-party support there is for the Post Office and the card account. When the Government launched the Post Office card account in the first place, they did so under intense pressure because they were trying to transfer benefits to banks. For the life of me, I cannot understand the Government's obsession with giving business to banks and taking it away from post offices. It does not make sense, it undermines the post office network and it undermines many villages and small towns in Scotland.
Looking at my constituency, one sees that many of the larger towns are down to one or two sub-post offices. Two of the larger villages, Letham and Newtyle, have a post office, but they have no banks. They are quite large communities. Friockheim, another large village in my constituency, has neither bank nor post office any more. If we take away the Post Office card account, and we have plenty of evidence of what that will do to the post office network, it will destroy what is left.
I do not agree with the comment earlier that there will be enough post offices left for a universal service. That will be doubtful if we lose another huge tranche of post offices as a result of this measure. The universal postal service is essential to our rural area. It is as much under threat because of the threat to our post offices as anything else. The post office system was unified, and it is being broken up by this Government's action, and it will be killed off if this measure goes through.
The Government say that people can use banks instead. Where are those banks? Throughout rural Scotland and Wales, and throughout rural England I am sure, the banks have pulled out of small communities, and they have done so over many years. In Scotland, we are now in the ridiculous situation whereby one major bank is advertising that there is no bank closure programme. There is no bank closure programme because it closed all the branches years ago. It is using that as an excuse to poach business from one other bank that is in the middle of a closure programme. Many of our rural communities no longer have banks.
My hon. Friend Hywel Williams reminded me that a few years back, the Select Committee on Welsh Affairs produced a report on this very subject and considered financial exclusion in rural areas. The Committee raised the spectre of exclusion increasing in Wales at that time. It is increasing throughout our rural areas. He mentioned that in Caernarfon, the rural post offices have closed and been replaced by a post van, which will effectively reduce post office services in those communities to a couple of hours a day. There will be no financial benefit. Throughout Scotland, Wales and rural England, the problem is serious.
We have heard about the pilot schemes. I can only imagine the situation of a pensioner who has gone through the whole procedure of getting a card account, and then gets a letter saying, "Go to your bank account." In many areas, people will be asking, "Where is that bank. Do I have to get a bus to the nearest town? How much is that going to cost out of my already meagre pension?" This measure will increase financial exclusion in many areas.
We are told that in one other pilot scheme, people who have a bank account and a Post Office account have been told that they should go to the bank account. Whatever happened to personal choice? Why are people not given such choice? They may have very good reasons for wanting ready cash in a Post Office account, and for using their bank account for other matters.
One of those ready cash reasons will the avoidance of bank charges. One safe thing about someone used to budgeting on a cash basis through the post office is that the card account does not incur them any charges. Bullied by the Department into prematurely going into banking, they go overdrawn and end up with £20 letters from the bank.
The hon. Gentleman is correct, and he makes an excellent point. Many people with bank accounts are having to take money out of cash machines, and in rural areas many of them charge. Again, it is a charge on their already meagre pension. I must ask the Minister again, why the obsession with banks? My experience of banks these days is that they do not want accounts into which people put money and take it all out again. There is no good business in that for the banks. We are told, I think by Citizens Advice, that one reason the Government may be doing so is that it costs considerably more to pay into a Post Office card account than it does to pay into a bank account. I cannot find the figure, but I think that it is something like 30p as opposed to 1p. That makes one suspect that the measure is purely financially driven. There is no evidence of joined-up government, and the Government are taking no account of the effect on rural communities. I urge the Minister to rethink the policy before it is too late.
I, too, congratulate Mr. Mudie on securing this very important debate. It ensures that Ministers at last have their first chance to explain to Members of Parliament what precisely they are trying to achieve with the Post Office card account.
I strongly agree with the comments made by other Members that the matter should be the subject of a full debate on the Floor of the House, and I hope that it can be secured in Government time in the near future. The anger that has been expressed by Members of all parties in this debate is shared more widely throughout the whole House.
The Government claim that it was known all along that this was an interim measure and that the Post Office card account would be wound up in 2010. Perhaps the Minister will tell us otherwise. That news has come as a devastating shock to many people. If the Government had always planned to end the account in 2010, it was a very well kept secret.
On the question about whether the measure was temporary, does the hon. Gentleman remember that back in 2001, there was a grand vision for the future of post offices as general practitioners for Government services, which would boost their business? I think that it was called the "Your Guide" scheme, and the Post Office card account seemed to be an essential part of it. Does he agree that we ought to be returning to that vision, rather than moving even further away from it?
I am grateful to the hon. Gentleman for giving way. He says that the announcement has been some sort of shock. Is he unaware of the parliamentary answer given on
First, I should like to agree with the point being made here very strongly. There is a great difference between the termination of a contract and the ending of a service. That distinction has been made by Members from all parts of the House. I have scoured in vain many previous debates on this matter in Hansard to find an occasion when the Minister has made clear not the term of the contract, but when the service was going to end. I have not been able to find a single quotation from a Minister making clear that the Post Office card account was a time-limited, temporary matter that would not carry on after 2010. Terms of contract are one thing; provision of service is quite another. It is that point that I should like to hear the Minister address when he responds.
For a Government who place such a high value on the presentation of policy, that aspect was well hidden at the time. The contract, which apparently makes this clear, was not made public for commercial reasons, and therefore, Members of Parliament and benefit recipients had no reason to believe that the card account would cease to exist after 2010.
"Two million pensioners have taken up the opportunity to get cash from the local post offices with the card, which replaces the benefit booklet, and that is a sensible way to proceed."—[Hansard, 15 January 2004; Vol. 416, c. 965.]
Would so many people have thought it a sensible way to proceed if they had known that the Government were going to pull the rug from under their feet a few years later? Those statements and many others, which I could list if there were enough time, contained not even a hint that the Post Office card account was intended to be only a short-term or temporary measure .
A joint DWP and DTI statement described the card account, and the package of which it was supposed to be a part, as the "cornerstone" of the services provided by the Government—a strange cornerstone when, seven years later, it is removed and the building collapses.
Will the Minister tell us today when Ministers explicitly told Parliament that the card account was a purely temporary measure? The announcement has also come as a shock to the National Federation of Sub-Postmasters. The general secretary said that he first knew of the decision when it was announced by Baroness Prosser in the House of Lords. She is not even a Government spokesperson.
We must think about the impact that the measure will have on the people affected. Some 4.3 million people throughout the country use the card accounts, and they are not just pensioners. According to an answer that I received this morning, giving a list broken down by constituency, in which other hon. Members may be interested, 6,500 people in my constituency use the account; 33,000 use it in the highlands and islands; 562,000 use it in Scotland; and almost 7,000 of the Chancellor's constituents and 10,000 of the Prime Minister's constituents use it. The figure in the Minister's constituency is smaller—5,500—but in relation to his parliamentary majority it is still a very large number indeed.
Like the switch away from pension books, this measure will cause real distress and anger. Indeed, 40 per cent. of those benefit recipients who were invited to convert to direct payment instead chose a Post Office card account. Of the many who did not, more than 500,000 people still receive their payments by weekly girocheque. Does the Minister want to see that number balloon when he removes the card account, with more people on the least secure form of payment?
The card account contract is worth around £1 billion to post offices between 2003 and 2010. Without that income stream, many thousands of branches will be unable to survive. Indeed, the National Federation of Sub-Postmasters has predicted that many thousands of post offices throughout the country will have to close. The worst hit will be post offices in rural areas and urban deprived areas, as the hon. Member for Leeds, East made clear. The people who most need the service of a post office will be worst hit.
Typical post offices run alongside a retail outlet, and it has been estimated that within a rural community alone £3.7 billion of retail expenditure is facilitated directly by having local post offices serve as an anchor to those services; thus a mass closure of post offices, as a result of cutting the card account, is likely to have a crippling effect on the local economy in rural and poorer urban areas alike.
By terminating the Post Office card account the Government are seriously damaging the post office network. Far from seeing it thrive, the Prime Minister risks making the destruction of Britain's post office network the most visible part of his legacy. Will the Minister tell us today how many post office branches throughout the country he thinks will have to close if the Post Office card account is removed?
I want to make a couple of points about the pilot schemes. They have been much discussed in this debate, but no evidence has been produced to suggest that they were introduced as a result of any consultation with stakeholders. Perhaps the Minister would tell us what consultation took place. It seems that the pilot schemes were implemented without any publicity to alert pensioners that they were able to open a Post Office card account. Will the Minister tell us, especially in relation to pilot C, whether people will be able to say, "No. I would like to keep my Post Office card account"? If not, what is the legal basis for that?
There have been rumours that the Government are considering making extra payments to people as an incentive or sweetener for them to move to card accounts. Will the Minister tell us whether that has been considered?
In the briefing to the parliamentary Labour party, the Secretary of State referred to the Government's intention to honour the full contract. If so, how will the phasing out take place? Honouring the full term of the contract presumably means that by the end of the contract no one will have a Post Office card account. That implies removing 1 million people a year from the card account for the next four years. Is that the Government's intention?
Why not build on the success of the Post Office card account instead of pulling the rug from under people's feet? The Government should look for additional services to be provided through post offices, not cut the services that are already provided. We need a joined-up approach. The Government's rhetoric refers to supporting post offices, yet the DWP is removing the card account, the DTI is considering ending or reducing the social network payment that keeps rural post offices going, the Home Office has decided not to allow post offices to be involved in delivering passport services and the Department for Transport is not allowing all post offices to issue driving licences. The Government's words to post offices may be positive, but their actions are deeply negative. If they want to be seen to be taking post offices seriously, the Government need a joined-up approach that says, "This is how we are going to support post offices and build on the tremendous network of outlets throughout the country." They should not undermine them at every turn.
It is always a pleasure to serve under your chairmanship, Mr. Bercow.
I congratulate Mr. Mudie on securing this debate and on a superb speech.
The future of the Post Office card account is escalating into a major political problem for the Government. More than one third of the Members of the House of Commons have signed early-day motions 147 and 1531, which express concern about the future of that account. The Post Office card account cannot be debated in isolation from the future of the sub-post office network, as many excellent contributions today made clear.
I have no desire to play Punch and Judy politics on this issue. There is a great deal of cross-party agreement and I am prepared to accept that the Government have put many millions of pounds into social network payments and the urban reinvention programme, but there are still some serious questions that the Minister must address because Government rhetoric is simply not being matched by Government action.
The Cabinet Office performance and innovation unit's report of June 2000 assured us that over the next five years, there would be development of
"a shared understanding of the role that post offices should play in the longer term" and that advice would be given to the Government on the options for the policy framework after 2006. It is now 2006 and there is not much sign of a framework. The Government have not said whether the social network payment will extend beyond 2008. They have not said whether Post Office Ltd will have its current duty to prevent avoidable closures in rural areas extended beyond March 2006. We are now told that after 2010 there will be no Post Office card accounts and that everyone should have realised from day one that that was the deal. Even worse, three pilot schemes have been introduced this year out of the blue, as hon. Members made clear, with no consultation and, as the hon. Member for Leeds, East said, without Parliament being properly informed.
The pilot schemes are likely to have the effect of ensuring that well before 2010 a large number of Post Office account holders will have their accounts closed, 35,000 existing customers will receive a letter from the DWP asking for their account details, 3,000 new benefit claimants will not have a right to open a Post Office card account, and 2,500 existing customers will unilaterally be told that their payments must be paid into a bank account and not an existing Post Office card account. As Sir Robert Smith and my hon. Friend Mr. Paterson said, all that echoes the rather high-handed, bullying tactics deployed by the Department when the order books were phased out.
Post Office card accounts are very popular and more than 4.5 million people use them. Some do so purely to support their local post office, as Mr. Drew said in a powerful observation. In other cases, as Age Concern's director general made clear, people opened Post Office card accounts because it was
"easier for older people without a bank account to receive their cash securely without the fear of becoming overdrawn or paying extra charges."
That was the beauty of that simple, straightforward account. Many pensioners who did not have traditional bank accounts found that even basic bank accounts did not meet their needs.
The paper from Citizens Advice on banking benefits makes it clear that basic bank accounts are not a panacea. There may be difficulties getting a credit score to obtain eligibility for such an account. There may be problems with identification documents and the length of time it takes to open an account. Pensioners in my constituency said that they did not want a basic bank account because they would be bombarded with banking bumph trying to sell them things that they did not want. That put them off the whole idea of getting involved with the basic bank current account system with Barclays or any high street bank. Those are reasons why the Post Office card account was the choice of so many people.
We have heard that the National Federation of Sub-Postmasters was not told when the Post Office card account was created that it would be a temporary contract or that it might end in 2010. Most of us—the Minister is the exception—agree that that is the case. There was never a clear statement that the account would go beyond 2010, but nor was there a statement that it would not. In the Government's response to the Trade and Industry Committee's report, "People, Pensions and Post Offices", in September 2003, they said:
"This is the first year of a seven-year contract and it is too early to speculate about what might happen in the future."
I took the trouble of listening to the Minister on that great programme, "Moneybox" on
"Well, they were always an interim arrangement."
Paul Lewis, the interviewer, said:
"Well you say it was always intended" to be interim
"but I asked your office for any evidence from 2000 to 2003. They couldn't produce any."
The Minister replied:
"It's always been in the contract. Now we didn't speak publicly about the contract for commercial reasons."
The Government are speaking publicly now, but it is a bit late. It really is unacceptable for the Minister to say that people knew about the interim nature of the account. How on earth could they have known something that was stated in a contract that nobody could see or know about for commercial reasons, as the Minister said on the radio? Such logic is usually found in the pages of "Alice's Adventures in Wonderland".
The Minister tried to get out of the hole he had dug for himself by saying that there are four years left on the contract and that the Government would now start helping people in a sensitive way to migrate to other accounts. The Minister talks about new accounts that will be developed by Post Office Ltd. That sounds fine, but, unfortunately, the sub-postmasters in my Suffolk constituency to whom I have spoken know only that they have no chance of planning their business for the long term. They fear that the pilots will be extended and that they will drive people away from POCAs long before 2010, with a commensurate loss of subsidy to urban and rural post offices. It is for that reason that the National Federation of Sub-Postmasters referred to the DWP tactics as underhand. I believe that there is another word for them.
Direct payments removed more than £400 million of annual revenue from the post office network. Not coincidentally, that move resulted in the closure of 2,500 post offices. The announcement of the termination of the POCA in 2010—in effect, before 2010, for the reasons that I gave—will be a further grievous blow to post offices. They will lose income; it is as simple as that. If post offices close, not only will pensioners stop accessing benefits and pensions through the POCA, but no one will be able to access money from basic bank accounts, or any bank account, because there will be nothing at all in the village, settlement or suburb.
In conclusion, we need an urgent review of the future of the POCA and the strategy for the post office network. First, it would be useful to know on what basis the Government say that it costs £1 a time to pay pensions or benefits on the POCA, compared with 1p on a traditional bank account. Sub-postmasters get about 15p for every £100 withdrawn from a POCA, but no one seems to know what the remainder of the money is or whether it is a subsidy that the Government will continue in the future.
Secondly, we need a clear indication from the Minister today that he has spoken to his colleagues at the Department for Environment, Food and Rural Affairs and the DTI about doing a cost-benefit analysis of the overall cost to the whole of Government should the change go through and lead to closures of post offices. My hon. Friend the Member for North Shropshire also made this point. What about the loss of jobs? More than 14,500 sub-post offices employ more than four people, many of them part-time. What will happen to them, and what will be the social and economic costs of those job losses?
"If you listen to the DTI and what they are saying about Government investment you want to give them credit for that. But when you hear the DWP talking about the scrapping of the post office card account . . . you ask yourself 'whatever happened to joined up government?'."
Perhaps the Minister can tell us.
I congratulate you, Mr. Bercow, on your impartial chairing of this debate, given your signature on the early-day motion. I also congratulate my hon. Friend Mr. Mudie on securing this debate on the Government contract for the Post Office card account. Let me also thank the other Members who spoke: Mr. Paterson, my hon. Friend Kate Hoey, Mr. Reid, my hon. Friend Nia Griffith, and the hon. Members for Angus (Mr. Weir), for Inverness, Nairn, Badenoch and Strathspey (Danny Alexander) and for Bury St. Edmunds (Mr. Ruffley), all of whom have made points that I certainly expected to hear, precisely because there has been a great deal of misleading coverage and comment about the issue over the past few weeks. This debate gives me an opportunity—I know that hon. Members are waiting for me to use it—to give what I hope will be some reassurances about what is actually happening.
People have been claiming that the end of funding for the Post Office card account will lead to the closure of thousands of Post Office branches, as I have heard again this afternoon; that people will no longer be able to get their benefit or pension at the post office, as I believe has been repeated this afternoon; and that we at the Department for Work and Pensions have in some way gone back on commitments on the Post Office card account. None of those things is true, so I am pleased to be able to put the record straight today.
Government funding for the Post Office card account will continue until March 2010, as was always going to be the case. All existing Post Office card account customers will still be able to use the post office to collect their benefit or pension, if they wish to, by using other accounts that are already available or that are likely to become available in the future. There is no reason why the viability of post offices should be threatened if customers continue to draw cash at the post office after moving on from the Post Office card account.
Many hon. Members spoke up on behalf of their local sub-postmasters or sub-postmistresses, all of whom have been reported to have expressed shock, dismay or surprise at what is happening, but that needs to be offset against what their national conference was told last year by Tricia Jenkins, the national president of the National Federation of Sub-Postmasters. She said:
"The post office card account does indeed have a limited life. When it finishes, we hope to convert existing POCA customers into using another Post Office Ltd. service. It could be that because POCA customers are used to banking, they might be prepared to switch to a bank account. And since we can offer a banking service, we would like to think we can keep those customers. So it is 'all change' in 2010, but it will not necessarily be all bad news."
That is the president of the federation speaking.
The POCA was introduced in April 2003 to help support some customers in the conversion from having their benefit or pension paid by order book to having it paid into an account by direct payment. The card account was aimed at those who did not already have a suitable account, and was designed as a stepping stone to help people who had not used a bank account to get used to banking before moving on to an account offering more features. It was intended that people's money would be paid into a card account for a period before they moved on to a more suitable account.
If the hon. Gentleman will let me make this point, I will take interventions.
That intention was specifically covered in the contract signed by the Government and the Post Office in 2002. It is unusual to quote from contracts, but in view of what has been said by others in recent weeks, I shall do so. I shall not breach any commercial aspect of the agreement, as that would of course be wrong. The contract states:
"Under the Government's present policy to combat social exclusion and in order to improve efficiency and effectiveness of government and minimise fraud, Benefits recipients will receive benefits by Direct Credit. A POCA will complement the range of Bank Accounts available to customers; in particular, to promote a service to those who do not have or cannot otherwise obtain a Bank Account."
I am in the middle of a quotation, and I must conclude it. It goes on:
"The POCA is intended to be an interim step for Account Holders who will be encouraged by both Parties to migrate to Bank Accounts which provide services and opportunities not available through the POCA."
Can the Minister give the Hansard reference for the point at which the intention to which he refers was made explicit to Parliament, and will he deposit a copy of the contract, which he has now effectively brought into the public domain, in the Library so that Members can study it? Will he also make sure that the Secretary of State provides me with a copy of the contract, as he promised in the Chamber only a couple of weeks ago?
I will not place a copy of the contract in the Library, because most of it is highly commercially sensitive. [Interruption.] The contract is still in force and will run until 2010. I quoted from the preface and introduction a section containing no commercially sensitive information, because it is necessary to correct some of the things said about it in the public domain by, I am afraid, the Post Office. It has not accurately reflected the contract that it signed with my Department back in 2002.
It is interesting to hear what is in the contract; of course, this is the first that most of us have heard of it. How was the Minister's point about the limited life of the Post Office card account made at the time to those customers who went through the tortuous process of being directed towards and taking out one of those accounts?
Certainly, in the course of this debate, many hon. Members have referred to the time when the card accounts were introduced, and told of the alleged barriers that the Government put up—
Well, let us just reflect on what hon. Members have said about that. If, when my Department was accused of putting up all sorts of barriers to discourage people from taking up a Post Office card account, we had been actively saying, "Of course, it's a temporary arrangement," that would have been interpreted as yet another barrier to discourage people from taking up the account. The circumstances in which the account was introduced were perfectly clear. I set that position out; it was in the contract and was stated at the time. It was part of the process of moving to direct payment of benefits.
The Minister says that the circumstances were perfectly clear in the contract, but there is no way that they were perfectly clear to the customer taking out a card account. In fact, the Minister is saying that the Government did not want to tell the customer, because we would have spotted them telling the customer and would have been alerted to what the Government were trying to do. Does he recognise that, in a sense, all our constituents with Post Office card accounts have been mis-sold a product? It was not made clear to them that the contract said that the account was only a temporary phenomenon, and that they were going to lose it.
I do not accept that. Again, I refer the hon. Gentleman and other hon. Members to the contract that the Post Office itself signed. I am making it perfectly clear to hon. Members who have spoken in this debate that the Post Office accepted a liability, falling jointly on it and on us, for helping to migrate people from the Post Office card account to alternative accounts. That was the declared purpose from the outset, which is important.
There are only a couple of minutes left, and hon. Members have made a lot of points. I am happy to take interventions, but the inevitable consequence will be that I am unable to respond to many points that I had hoped to address.
I am grateful to my hon. Friend for that intervention, because he mentions an important point that others raised, too. It is simply not true that the Department for Work and Pensions has made some unilateral change of policy. The reality is that discussions commenced with the Post Office last summer, in a manner entirely consistent with the contract that it signed. Both parties began to explore the options as to how would that migration process would be begun. The Post Office was fully part of the early discussions, which, incidentally, led to the pilots now taking place, because both parties were doing what they were obliged to do under the contract that had been signed. It was to begin the process of working out—
I am sorry to interrupt the Minister, but we must move on to the next debate. I remind the House that we have already been interrupted by one Division this afternoon, so for the convenience of Members I shall explain that for each and every future Division I will suspend the sitting for 15 minutes a time.