APPENDIX 2
Further supplementary memorandum submitted
by Department of Social Seccurity (MISC 5)
Q114. PAYMENT CARD
AND THE
CUSTOMER ACCOUNTING
AND PAYMENT
STRATEGY
Background
The Benefits Agency/Post Office Counters Limited
(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 the, approximately, 20 million
social security benefit recipients who choose to collect their
money at the post office.
There are four joint aims held commonly by the
programme sponsors (BA, War Pensions Agency (WPA), Social Security
Agency (Northern Ireland) (SSA(NI), POCL): These are:
(a) to deliver an as fraud free as possible
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.
The contract to automate post offices and benefit
payments was awarded to ICL Pathway under the Private Finance
Initiative on 15 May 1996.
How the Payment Card Will Operate
The payment card will replace order books and
girocheques for all customers who choose to collect their benefit,
or pension, at the Post Office. The card itself has no intrinsic
value and is less open to fraudulent abuse than order books and
girocheques. It carries very little personal information, just
the surname, initials and national insurance number of the customer.
There is no photograph, indication of the age, gender, address,
benefit entitlement or usual post office of the customer.
The payment card has a matt finish to distinguish
it easily from other cards and has a raised mark on the front
to ease identification for the visually impaired. The system includes
a facility for customers who cannot get to their post office to
use agents and appointees. It is possible to stop lost or stolen
cards on the system as soon as the loss is reported to the ICL
Pathway helpline (calls charged at local rates).
There are different version of the card for
BA, SSA(NI) and WPA. The BA and WPA cards are available in English/Welsh
versions. The card will act as a single instrument of payment
for all of a customers' benefits, except those which are paid
by automatic credit transfer (ACT). When using the payment card,
all money due for collection, at the time of the visit to the
post office, has to be taken as a single transaction—unless
the amount exceeds £1000.
The card is sent to the customer's chosen post
office. The customer is sent a pick up notice which alerts
them to the fact that the card is awaiting collection at the post
office. Customers are able to collect cards by producing the pick
up notice and further proof of identity.
When collecting a payment, the customer hands
the card to post office counter staff who "swipe" it
through a card reader to obtain the payment information supplied
by the BA, WPA or SSA(NI), to ICL Pathway systems. The customer
is asked to sign a receipt and the card is returned along with
the benefit and a copy of the receipt.
Progress to Date
Implementation began in October 1996, with a
trial covering 10 post offices in the Stroud area in South West
England. This involved approximately 1500 BA customers whose Child
Benefit was paid by payment card.
A more extensive trial of the systems, in up
to 200 post offices, began in May 1997. This introduced the Order
Book Control Service (OBCS) which enables bar-coded order books
to be identified by the system and "stopped"—if
necessary.
In November 1997, there was a further software
release. This introduced the Benefit Payment Service (BPS) and
the OBCS to the 205 post offices already trialling card payments.
This will, eventually, involve payment of Child Benefit to about
40,000 customers.
Next Stages
The BA and POCL are currently 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 functionality 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 for national
automation of post offices.
Plans are still under discussion, but the working
assumption is that a live trial of all services will begin in
early 1999. This will involve up to 305 post offices. Subject
to successful completion of the trial, National roll-out of post
offices will follow. This will be completed before the end of
2000.
Q123. ADMINISTRATION
OF JOBSEEKERS
ALLOWANCE (JSA)
Service to the public
The JSA Operational Vision includes the following
objectives:
to improve the operation of the labour market
by helping people in their search for work, while ensuring that
they understand and fulfil the conditions for receipt of benefit;
to secure better value for money for the taxpayer
by a streamlined administration, closer targeting on those who
need financial support and a regime which more effectively helps
people back to work;
to improve the service to the unemployed people
themselves by a simpler, clearer, more consistent structure and
by better service delivery.
In addition to these objectives, ministers have
committed to:
as far as possible, provide all services to Jobseekers
from Jobcentres including advice on relevant Social Security benefits.
The commitment to provide services from Jobcentres
is the reason why Jobcentre letterheads, showing Jobcentre telephone
numbers, are used when JSA claims are being processed. BA staff
within Jobcentres have access to the computer system (JSA Payment
System) and phone links with processing sites. Local handling
arrangements are in place to make sure that the majority of enquiries
are dealt with in the Jobcentre and customers are not passed from
agency to agency. The fact that a customer's JSA is processed
in a completely different office should not detract from this.
There are no plans to change the existing arrangements,
however letter style and content are under review. There are currently
plans, in the forward work programme, to improve the quality of
letters and notifications which are sent to Jobseekers.
ES and BA joint Management Structures: Closer
Working
The basis for this relationship was set out
in a memorandum of understanding which was signed in October 1996—this
will be reviewed in Autumn 1998.
There are structures in place from director
level, down to local offices. These comprise the following:
a Joint Management Board with overall responsibility
for joint working arrangements;
a sub-group of agency field directors, the Joint
Operations Team (JOT), is responsible for the joint field delivery
of JSA and other joint activities;
responsibility for managing the resolution of
operational issues is by the Joint Operational Issues Management
Group, who report to JOT;
JSA Unit Management Teams report to nine Regional
Joint Delivery Teams (JDT). These comprise of the Employment Service
(ES) Regional Director and associated BA Area Directors, who in
turn, report to JOT;
JDTs are each supported by a Joint Agency Coordinator
(JAC) who has responsibility for co-ordinating joint working at
Regional/Area level, and generally supporting the work of the
JDT. JOT has regular meetings with JDT Chairs, and through its
support team, regular networking events with JACs.
There is some scope for improving the handling
of customer enquiries which cut across BA and ES areas of responsibility.
A workshop has recently been held, in the Leicester area, to examine
these issues. Staff from both agencies were involved in reviewing
the effectiveness of the current arrangements. Action plans are
being developed to push through the improvements which were identified
by the staff, including an increase in the number of BA staff
available to handle enquiries in some of the Leicester Jobcentres.
Q130. ACTIVE MODERN
SERVICE PROTOTYPES
Introduction
The Modern Service Programme is aimed at transforming
the delivery of Social Security in line with Ministers objectives
for modernising the Welfare System—as set out in the Government's
Green Paper "New ambitions for our country: a new contract
for welfare". The key message in the Green Paper about an
Active Modern Service—the system of delivering modern
welfare should be flexible, efficient and easy for people to use—is
being tested by a series of Integrated Service Prototypes.
1. Integrated Service Prototypes (Lone Parent)
to handle lone parents income support, child support
and housing needs together. April to October 1998.
— Integrated service delivery to lone
parents is being tested by the Lone Parent Prototype project and
cuts across the boundaries of the Benefits Agency, Child Support
Agency and Local Authority.
— The benefits included in the prototype
are:
— Housing Benefit and Council Tax
Benefit (where the lone parent lives in the London Borough of
Camden);
— an application for Child Support
maintenance.
Other benefits will be tested in the margins:
— The integrated service will be delivered
by the Benefits Agency Chilterns South Directorate using a remote
processing centre (Glasgow Benefits Centre) linked to four London
offices; Ealing, Acton, Euston and Highgate. The partnership with
the London Borough of Camden will further test a single point
of contact and the sharing of information across organisational
boundaries.
Initial Contact
— From 27 April 1998 lone parents living
in the catchment area of the prototype making a claim to Income
Support, with a child under 16, (or within 11 weeks of their expected
week of confinement) will be able to make their claim using a
tele-claim process. Customers will be advised that the call may
take around 25 minutes and a call back service is offered.
The tele-claim process
— A specially designed computer system
allows the tele-claims adviser to collect information from the
lone parent for their Income Support claim, their child support
application and their claim for Housing Benefit and Council Tax
Benefit and enter it immediately onto the electronic claim taking
system. The system is intelligent and will ignore questions not
relevant to the lone parent's circumstances. It effectively cuts
out questions that would normally be asked several times if the
lone parent were completing separate claims to Income Support,
Housing Benefit, Council Tax Benefit and applying for child maintenance.
— Once all the information has been
collected the adviser will make an appointment for the lone parent
to call into their local BA office with the evidence needed to
support their claim. The interview will usually be booked for
two days time, but where the lone parent cannot get into the office,
a home visit will be offered.
— The electronic claim form will be
printed and sent to the lone parent together with confirmation
of the office appointment and details of any further evidence
required and which questions still need answering.
The office interview
— The lone parent will attend their
local office. The interviewing officer will take the customer
through their electronic claim form, updating it as necessary,
using the electronic claim taking system and getting just one
signature from the lone parent to authorise the claims to benefit.
The officer will verify evidence and take copies for Camden LA.
The interviewing officer will also identify whether the customer
falls with the target group for New Deal for Lone Parents and
if so, issue a leaflet encouraging them to join the programme
and advising them that a New Deal Adviser will be in touch in
around 8 weeks.
Processing the claim
— After the electronic claim form has
been signed, the system will process the lone parent's integrated
claim. Information and any evidence to support the claim for Housing
Benefit and Council Tax Benefit, will be output from the electronic
claim taking system and sent to Camden Local Authority for processing.
Information for the claim to Income Support will be transmitted
immediately to Glasgow Benefit Centre where it will be processed.
If the lone parent is willing to give details of the absent parent,
the details will be transmitted immediately to Glasgow Benefits
Centre. Staff will contact the absent parent by telephone and
invite them to give information to process the lone parent's application
for child support.
Enquiries
— Once the claim to benefits and child
maintenance have been sorted the lone parent will be encouraged
to use the telephone to contact the integrated team and to use
them as a single point of contact for any enquiries. The team
will be able to provide the lone parent with advice and guidance
on Income Support, Child Support and other related benefits, such
as Family Credit and Child Benefit.
Further contact
— When lone parents are told of their
entitlement to Income Support they are also told of a further
interview in a few weeks time. Depending on where they live, the
interview will be a home visit or held in the local office. The
interviewing officer will check the current circumstances and
ensure that the Income Support payment is correct. The officer
will also advise of the progress of the child maintenance application
and highlight the New Deal for Lone Parents.
— The lone parent will be able to report
changes of circumstances to the tele-claim team and will be encouraged
to do so by telephone. The details of the change will be entered
on the electronic claim taking system, printed out and sent to
the customer telling them what to do next. Using the single point
of contact principle the lone parent only has to give the information
once as the change will be shared across Income Support, Child
Support and the London Borough of Camden.
Evaluation
— The sole outcome of the Prototype
is the information that it produces about the operation of the
new way of working, and the issues which have to be overcome in
order to design a workable business process and IT support. The
evaluation will be comprehensive and provide two sets of information:
— qualitative and quantitative
information from the operation of the prototype;
— lessons learned in the development
and operation of the prototype.
— Both sets of information will be
important in developing the modern service programme and in moving
forward, at a more detailed level, to plan how far and how fast
service delivery changes can be managed, and what changes would
be required to support such changes, including legislation, infrastructure,
and staff training.
2. Lewisham Integrated Service Prototype—closer
working between Lewisham DSS and Lewisham Local Authority. April
to October 1998.
— Integrated service delivery to Lewisham
DSS/LA customers is being tested by the Lewisham Integrated Services
Prototype and cuts across the boundaries of the Benefits Agency
and Local Authority.
— The benefits included in the prototype
are:
— Job Seekers Allowance (JSA);
— Council Tax Benefit (CTB).
— The integrated service will be delivered
in partnership between Lewisham BA, using a remote processing
centre (Belfast Benefits Centre) and the London Borough of Lewisham,
(LBL).
Prototype Phased Development
— The prototype will operate for a
six month period from 27 April 1998 to 30 October 1998 and will
be developed in three phases:
— electronic data transfer
commencing 27 April 1998;
— integrated security visiting
commencing 26 June 1998;
— integrated advice and information
services
commencing 27 July 1998.
Electronic Data Transfer
— From 27 April 1998 notification of
new claims for IS/JSA, changes in circumstances and termination
of award will be electronically transferred from the BA to LBL.
Customers will not be aware of any change but the processing of
their HB/CTB will be faster and the potential for overpayment
of HB/CTB will be reduced. This faster and more efficient exchange
of information will, additionally, produce savings in administrative
costs.
Integrated Security Visiting
— 70 per cent of IS/JSA customers in
Lewisham also claim HB/CTB. Currently, both organisations visit
their customers and ask very similar questions. From 26 June 1998
security visiting for BA and LBL will be coordinated. Visits will
be made by either BA or LBL visiting staff and the information
gathered will be shared, as appropriate, between the two organisations.
BA will carry out all new visits and LA will carry out all review
visits.
— This will provide a better customer
service to the public in Lewisham, as it will avoid the need to
answer similar questions at separate visits. It will also ensure
information about customers circumstances is effectively exchanged
between BA and LBL and areas of common interest are found, so
avoiding duplication of work.
Integrated Advice and Information
— From 27 July 1998, Lewisham customers
will have the choice of going to Laurence House (LBL) or Lewisham
BA for an integrated advice and information service.
— Staff from LBL will be stationed
at Lewisham BA and vice versa to provide this service. It is expected
that the advice service will be supported by an improved computer
benefit information system which can identify potential benefit
entitlement from personal information supplied by customers.
— Lewisham customers will also have
the opportunity to attend either office where interviewing staff
will take integrated claims for IS/HB/CTB on an electronic claim
form. Developing the electronic claim facility further, it is
proposed to offer customers the opportunity to make a telephone
claim for IS/HB/CTB direct to the Belfast Benefit Centre.
— These new services will simplify
the claims process for new customers. It will provide a swift,
one stop opportunity, which ensures that the relevant, identical
information is held by both BA and LBL and reduces the potential
for fraud and overpayment of benefits.
Evaluation
— The sole outcome of the prototype
is the information that it produces about the operation of a new
way of working, and the issues that had to be overcome in order
to design a workable business process and IT support. The evaluation
will be comprehensive and provide two sets of information:
— qualitative and quantative information
from the operation of the prototype;
— lessons learned in the development
and operation of the prototype.
— Both sets of information will be
important in developing the modern service programme and in moving
forward, at a more detailed level, to plan how far and how fast
service delivery changes can be managed, and what changes are
required to support the changes, including legislation, infrastructure,
and staff training.
Q117. NIRS2
Release 1b
Release 1b was introduced on the 28 January
1998 using a controlled approach. Five hundred staff are currently
able to update and process work. There are still a number of outstanding
issues which limit full functionality. Some of the outstanding
issues are being resolved as fixes are put in place and specific
outputs are produced. The Contributions Agency (CA) is working
with Andersen Consulting to address all outstanding issues, although
the scope for further improvement is limited because of the need
to stabilize the system for Release 1c. One part of the Release
1b functionality, which deals with scheme cessation (this is the
process which notifies pension providers of scheme member pension
entitlement), has been deferred to Release 1c. This decision was
taken to ensure the stability of the current service.
Release 1c - initial proposed go-live date of
6 April 1998
The system did not go-live on the 6 April as
the Acceptance Closure Report (produced jointly with Andersen
Consulting) highlighted a large number of critical outstanding
testing incidents. At that stage CA decided that it could not
authorise the migration of data from NIRS1 to NIRS2. Before undertaking
migration, CA has to be assured that sufficient critical testing
incidents are resolved to enable a reasonable service to customers
and that feasible contingency plans are available. Once this increased
business confidence has been gained, by further system testing,
migration will begin. Current testing indicates that it should
be feasible to start the three week migration period on 19 June,
resulting in a Release 1c go-live date of 13 July 1998. Meanwhile,
staff training has begun and feedback is positive. All preparations
by CA and BA for the new system are complete. The effect of further
delay is that it will take longer to process stockpiled work,
including end of year returns. The effect has been modelled on
updating benefit records, and the bulk of work can still be done
by December 31, as required (although this very much depends on
how robust the live service is). The active business continuity
planning (see below) has reduced the impact of delays on customers.
Nevertheless, the management task to catch up in CA's operations
will be immense over the coming year.
Contingency Planning
Over the past six months the Agency has made
considerable effort to develop and finalise contingency plans
which will ensure that customers receive a seamless service and
that disruption is kept to an absolute minimum. Much of this work
has been done jointly between CA, BA and Inland Revenue (IR).
The agency has also ensured that there has been a strong focus
on all customer groups. The plans assess the possible impacts
on customers and outline the steps which will mitigate such impacts.
There are also plans to keep customers informed. Particular attention
has been paid to benefit recipients. The effectiveness of the
plans is demonstrated by the fact that CA and BA have been able
to maintain a service to customers beyond the original critical
date of 6 April using NIRS1 and Release 1b only. Below is a brief
summary of the contingency plans currently in place.
Recipients of Retirement Pensions
Pensions claims are being identified, and forward
claims will be covered before NIRS1 closes down. Due to the delay
in introducing Release 1b, which is primarily concerned with Contracted
out Employment, a small number of complex retirement pension claims
cannot be finalised. It is not possible to identify, in advance,
which claims may be affected. Two hundred cases have been affected
to date. These are being resolved clerically, and payment is being
made. BA also have procedures in place to clerically calculate
entitlement during the move from NIRS1 to NIRS2, when no facilities
will be available for three weeks. Payment will be made at the
standard basic rate, and automatic back payments will be made
where necessary. These arrangements will also apply to people
living abroad who claim UK Retirement Pension.
Widows Benefit Recipients
For deaths which occur on or after 6 April 1998,
BA have procedures in place to calculate some 3,000 Widows Benefit
claims per month clerically until the new system is available.
Payments will be made at the standard basic rate and will include
any increases for children. It is recognised that there is a need
to manage this situation sensitively to avoid causing any difficulties
for claimants or delayed payments. The CA, jointly with BA, have
contacted support organisations to ensure that contingency arrangements
are appropriate and have set up a helpline to keep them informed
and up to date on developments.
Other Benefit Recipients
This includes claims for incapacity, maternity
benefits and Jobseekers Allowance. The existing system provides
contingency to finalise these claims up to January 1999. During
the computer shutdown period, claims will be finalised using other
sources of information. It will not be possible to finalise some
claims as not all the required information will be available.
In these cases BA have procedures in place to make interim payments
until claims are finalised. It is anticipated that approximately
300 Jobseekers Allowance claims per month will be handled in this
way. If it is not possible to finalise a claim to Incapacity Benefit,
customers will be advised to claim Income Support, which most
people without a clear contribution record would claim. Procedures
will be in place to ensure that the benefit recipients account
is corrected and any back payments are made.
Taxpayers
A software programme has been developed to extract
Income Tax details from paper forms and magnetic tapes using NIRS1
facilities. This required minimal development effort for a small
cost and posed no risk to NIRS1 or NIRS2 implementation activities.
It has been agreed with IR that the information which can be provided
is acceptable as a contingency. This will mean amendments to taxpayers
records for 1997/98 can be made, even before end of year returns
are processed by NIRS2.
Self Employed
The existing system provides contingency for
issuing quarterly bills and recording payments made by Direct
Debit up to the end of September 1998. The introduction of the
new system, and closedown during April 1998, was planned to take
account of Direct Debit and quarterly billing cycles. Quarterly
bills have been issued for April from the existing system and
the next bills will be prepared and issued early, in July, so
that the new system does not have to process the sensitive workload
immediately. Customers will be informed that this is happening.
Pension Providers
Contingency arrangements have been operating
in the CA business area which interfaces with the pension industry
since April 1997. The arrangements primarily comprise the stockpiling
of certain computer forms until the new system is introduced.
A microcomputer system has been developed which is able to deal
with some urgent and complex rebate payments. Scheme administrators
and pension providers have been kept up to date both by face to
face contact and regular briefings. A pension provider help line
has also been set up. Offers of compensation have already been
extended to personal pension providers directly affected by the
delays.
Q78. NEW AMBITIONS
FOR OUR
COUNTRY: A
NEW CONTRACT
FOR WELFARE
SUCCESS MEASURES
Introduction
1. The Welfare Reform Green Paper sets out a
series of success measures (see annex to this note) against which
the Government's progress on reform will be assessed. The success
measures themselves are open to consultation—one of the
questions posed in the Green Paper is 'are our tracking measurements
for success right?' The Government's aim is to firm up the measures
in the light of consultation and as policy develops.
2. This work will be undertaken across Government.
For example, one of the key first phase priority tasks for the
Social Exclusion Unit is to "draw up key indicators of social
exclusion, and recommend how these can be tracked to monitor the
effectiveness of Government policies in reducing social exclusion".
This work has clear links with the proposed welfare reform success
measures. The Department of Social Security and the Social Exclusion
Unit will be working in parallel on indicators and success measures
which might be used to track the progress of welfare reform and
the effectiveness of Government policies in reducing social exclusion.
Nature of consultation
3. At this stage, there are a series of different
levels of questions around which debate on the success measures
could focus.
Level 1: Do people agree with them?
4. For example, do people agree that an increase
in the proportion of lone parents, people with long-term illness
and disabled people of working age in touch with the labour market
would indeed constitute success?
Level 2: Is the list sufficiently complete?
5. Clearly it cannot be exhaustive—a list
running into hundreds of measures would cease to act as a guide
for the reform process. The wood would be lost for the trees.
But are there major omissions?
Level 3: Assuming that people accept a given success
measure as worthwhile, what is the best way of tracking it?
6. For example, using the success measure quoted
above:
— how should "in touch with the
labour market" be defined?
— what statistics would prove the best
yardstick (do existing ones provide a fair proxy or would more
data be needed than is currently collected?)
— over what period is it sensible to
gauge success, and should allowance be made for seasonal and cyclical
factors?
— how would perverse effects within
the measures be avoided?—in the example quoted above care
may be needed to ensure that more people staying on at school
did not perversely count as failure to reach the success measure.
Level 4: What quantification—if any—should
be added to the success measures stated in the Green Paper?
7. So, sticking with the quoted example, how
big a proportionate increase should be sought?
Manner of consultation
Levels 1 and 2
8. The Green Paper (and summary document) provide
a good basis for consulting at the first and second levels described
above. People will be sending in their responses and the various
consultation events planned will provide a further forum.
Level 3
9. Consultation at the third level would probably
be undertaken after consultation on levels one and two had been
completed. Consultation at this level is much more technical and
the Green Paper deliberately avoids an overly technical approach
so as to promote a wide debate. The Government wants to encourage
input from academics, researchers and practitioners at this technical
level in order to build a consensus around the technical measures
chosen.
10. The Government intends to produce a series
of technical discussion papers which would be targeted on those
expert groups with the most input to make but would, of course,
also be publicly available. There could be quite a number of these,
although not necessarily one for each success measure. Some measures
may be grouped, others may be less suitable for this technical
treatment.
11. The Government may seek written responses
to these discussion papers and may hold some meetings with key
players to discuss them. Such an approach would lead to us publishing
details of the technical measures subsequently chosen.
Level 4
12. At this stage, public debate on quantification
is rather premature. The Government will look at the case for
quantified targets in particular areas in the light of the consultation
on levels 1—3. The area of quantification is often difficult,
especially in areas where many external factors are at play. Much
will depend on what emerges from the earlier stages of consultation.
The role of the Select Committee
13. The input of the Social Security Select
Committee is, of course, highly valued. Initially, it would be
most helpful if the Committee could focus its work on levels 1
and 2 (are the measures broadly right and complete?). The Committee
may then wish to look at some of the more technical (level 3)
issues, but may find that more profitable after the summer once
the technical papers have been written.
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