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Sir Robert Smith: The Minister has mentioned the various bank accounts available. What monitoring are the Government carrying out as part of this social contract with the banks to ascertain how easy people are finding it to open a basic bank account, and how many are being opened? Is there any monitoring of those statistics?
Mr. Timms: I do not have those figures with me this afternoon. There is certainly monitoring of the number of basic bank accounts that are being used. I am not sure that we have data on the number of accounts, but there is certainly information on the number of transactions. There are also data on the number of Post Office card accounts being applied for and opened. It is fair to say that the number of basic bank accounts opened so far remains quite modest, and that strengthens the case for opening up access to other current accounts. We are keeping a close eye on how that is developing.
In the past, Post Office income has been heavily dependent on benefit payments, but that business has been dwindling. It is worth making the point that, before the Government made the decision to switch to making all payments through direct payment, more than 43 per cent. of benefit recipients already received their cash directly into their bank account, compared with only about a quarter in 1997. Sixty-two per cent. of all new child benefit recipients and 68 per cent. of all new pensioners already have their benefits paid directly into their bank account by choice. So the direction in which things were moving was already clear, even before the transition to direct payment commenced.
The old order book system needs to be modernised to keep in step with changing customer needs and to reflect the fact that owning and using a bank account is now the norm. About 90 per cent. of pensioners now have access to one, for example. A business built on serving people who do not use bank accounts will clearly be serving a shrinking market. Instead, we all want the Post Office to serve an expanding market, and banking provides that opportunity.
I welcome the initiative that my hon. Friend has taken, and the support that he has attracted in this debate and through the early-day motions. I also welcome the keen interest that Members on both sides of the House and people across the country have in the future of the Post Office. The hon. Member for West Aberdeenshire and Kincardine pointed out to me a number of post offices in his constituency when I visited it last week. I want to make it clear that the Government share the commitment to the Post Office that hon. Members have expressed. We want to help to ensure that it can move forward with confidence and that sub-postmasters and sub-postmistresses can look forward with confidence to the prospects for their business.
It is clear that the business could not prosper if it stood still. The challenge is to adapt and to meet the changing demands of customers and society. The status quo is not an option; the future lies in banking and the Government hope that all banks will provide their customers with access to their accounts through post offices. The critical issue, however, will be whether customers demand post office access. I certainly hope that they will.
- Adjourned accordingly at twelve minutes to Three o'clock.
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