1. The Payment Card
1.1 Background
The BA/POCL Programme will develop and implement
a new method of paying benefits by automating post offices.
Paper instruments of payment will be phased
out and replaced by a magnetic stripe plastic card, the Payment
Card.
This will involve the automation of some 40,000
counter positions in about 19,300 post offices and the conversion
to cards of approximately 20 million social security benefit recipients
who choose to collect payment at the post office.
The contract to automate post offices and benefit
payments was awarded to ICL Pathway under a Private Finance Initiative
on 15 May 1996.
There are four joint aims held commonly by the
Programme Sponsors (BA, War Pensions Agency, Social Security Agency
(Northern Ireland), Post Office Counters Ltd): These are:
(a) To deliver a fraud free method of paying
benefits at post offices.
(b) To develop a system that meets recognised
accountancy practices.
(c) For automation to provide greater commercial
opportunities enabling Post Office Counters Ltd., to improve competitiveness
and increase efficiency.
(d) To provide an improved level of service
to all customers.
1.2 Progress to Date
Implementation started in October 1996 with
a trial involving 10 post offices in the Stroud area in South
West England involving approximately 1,500 BA customers whose
child benefit was now paid by Payment Card.
A further, more extensive trial of the systems
began in May 1997, introducing the Order Book Control Service
(OBCS) in up to 200 post offices—OBCS enables barcoded order
books to be identified by the system and issues electronic "stop
notices" to cancel payments.
In November 1997, a further software release
introduced the Benefit Payment Service (BPS) and the OBCS to 205
post offices involved in the previous trials. This will eventually
involve payment of Child Benefit to about 40,000 customers.
1.3 Next Stages
The programme sponsors, Benefits Agency and
Post Office Counters Ltd are presently working with ICL Pathway
to finalise plans for the next stages of the delivery of the Programme.
The objectives of the next stage are:
— to introduce the remaining post office
services: Electronic Point of Sale Service (to enable post office
sales to be recorded on the system) and Automatic Payment Service
(to enable post office customers to pay bills at their post offices);
— to provide the capability for more
benefit types to be paid by Payment Card and to roll out further
benefits;
— to enable a Live Trial of the whole
ICL Pathway solution;
— to provide the capability to automate
post offices nationally.
Plans are still under discussion but the working
assumption is that a Live Trial of all services would begin in
January 1999, involving up to 305 post offices. Subject to successful
completion of this trial, National roll-out of post offices would
start in April 1999, being completed before the end of 2000.
1.4 How the Payment Card Will Operate
The Card will replace order books and girocheques
for every customer who chooses to collect their benefit or pension
at their post office.
It is not a smart card but instead uses magnetic
stripe technology. It does, however, have the capability to be
upgraded to a smart card should it be required. The contract allows
for this.
The card will act as a single instrument of
payment for all of a customers benefits (other than any paid by
ACT). When using the Payment Card, all money due for collection
at the time of the visit to the post office will have to be taken
as a single transaction, unless the amount exceeds £1000.
The Card will be sent to the customer's chosen
post office. The customer will be sent a Pick Up Notice. Customers
will be able to collect their card by producing the Pick Up Notice
at their post office together with proof of identity.
When collecting a payment. the customer will
hand the card to post office counter staff who will "swipe"
it through a card reader to obtain payment information supplied
by the Benefits Agency, War Pensions Agency or Social Security
Agency (Norther Ireland) to ICL Pathway systems. The customer
will be asked to sign a receipt and the card will be returned
along with the benefit and a copy of the receipt.
The card itself has no intrinsic value, unlike
order books and girocheques. It carries very little personal information,
just the surname and initials of the customer and their national
insurance number. There is no photograph and, indeed no indication
of the age, sex, benefit entitlement or which post office is normally
used. Nor does the card show the address of the customer as do
order books. It is therefore much less open to fraudulent abuse.
The payment card will have a matt finish to
distinguish it easily from other cards and there will be a raised
mark on the front of the card for easier identification by the
visually impaired. There will also be a facility for customers
who cannot get to their post office to use agents and appointees.
Lost or stolen cards can be stopped on the system
as soon as the loss is reported to the ICL Pathway helpline (calls
charged at local rates).
There are different versions of the card for
BA, SSA(NI) and WPA. The BA and WPA cards can also be obtained
in English/Welsh versions.
2. Customer Accounting and Payment
Strategy (CAPS)
2.1 Background
CAPS is developing Information Technology (IT)
systems which will support changes in the way the BA records customer's
details, pays benefits and accounts for benefit expenditure. These
systems include:
— Personal Details Computer System
(PDCS);
— Programme Accounting Computer System
(PACS);
— The IT systems that will link the
current benefit systems and the payment systems; plus
— the necessary business processes.
The new systems will eventually make payments
and hold a common set of personal details and payment data for
all our customers no matter which benefits they receive. This
will allow BA to simplify the processing of benefit claims and
make information more readily available to customers and staff
across the full range of benefits, increasing efficiency in the
agency's field operations.
2.2 CAPS Aims
The specific objectives of CAPS are to:
— support security initiatives by preventing
programme losses and the consequent;
— reduce administration costs;
— support improved accounting, to provide
proper stewardship of programme money and to position BA to produce
resource accounts as required by HMT;
— make data available to facilitate
the Department's information needs;
— facilitate Benefit system alignment
to bring commonality to business processes and harmonise data.
CAPS has three main components all of which
will support Ministers' objectives for modernisation and fraud
control:
— it will support the introduction
of a plastic payment card to overcome fraud in post office methods
of payment;
— the introduction for the first time,
of proper accounting and controls (PACS) over post office methods
of payment;
— a new database (PDCS) for personal
details and control systems that will be common to all our existing
benefit systems and will act as a building block for future systems.
2.3 Programme Accounting Computer System
(PACS)
PACS, which went live on 6 May 1996 is an accounting
computer system designed to allow BA to account fully for programme
expenditure. It has, partly with the information provided by CAPS
systems, enable BA to account for £85 billion programme expenditure
and the production of accruals accounts. Together with future
development it allow BA to undertake improvements to the Operating
Statement and Balance Sheet by accounting effectively for Debt
and Third Party Payment.
2.4 Personal Details Computer System (PDCS)
PDCS will be a single source of benefit recipient
details, such as name, address and national insurance number and
will be shared across all benefits, pensions and allowances, providing
a single source of reliable and consistent data held in a common
format. This will improve the consistency and accuracy of our
records which will be essential for ministers objectives about
modernisation.
2.5 Current Position
Development of the CAPS systems has allowed
nearly seven million (out of an anticipated 7.2 million) Child
Benefit (ChB) customer accounts to be migrated to PDCS. Once further
benefits are migrated onto PDCS over 35 million sets of personal
details will have been loaded onto the system.
A total number of ChB customers receiving child
benefit by the card method of payment now stands at 22,594. BA
has paid a total of £3,062,146 Child Benefit by this new
way of payment.
On 13 April 1998 further software was released.
This release allows BA to progress on two fronts:
— it allows BA to bring Income Support,
Pensions and Incapacity Benefit, then Jobseeker's Allowance onto
the PDCS system;
— it will allow BA to pay multiple
benefits on a single card.
This extension of card payments is reliant upon
the development of the ICL Pathway system and the automation of
more Post Offices.
Benefits Agency
15 May 1998
