Postmasters seek delay on plan to phase out welfare payments

Postmasters have called on the Government to stall plans to phase out cash welfare payments until the likely damage to post office business is assessed.

An Post has the contract to provide over-the-counter cash welfare payments for the Department of Social Protection which makes 50% of all its payments in cash — about 43.7m transactions worth €9.5bn.

However, from September, the department wants to rapidly increase the number of welfare recipients using accounts in financial institutions to receive their payments electronically so that cash payments are all but eliminated by 2017. The Irish Postmasters Union warned the move would decimate smaller post offices, possibly leading to the closure of 400 of the network of 1,152.

President Ciaran McEntee said the knock-on effect would be devastating. “Rural society will be killed. We’ve seen it here in this country and in England — where the post office goes, the town dies.”

He said public choice about the format in which they received their payments should also be considered. The delay in thousands of payments due to a computer glitch yesterday, and the problems that plagued Ulster Bank customers last summer showed electronic transfers were not infallible. He also pointed out that many adults — studies show between one in six and one in ten — do not have a bank account and would rather do their business in cash. “We would like the Government to stop [the phase-out of cash] and do this study on what impact it would have We are not against change but there is no good in pushing this through and not knowing what the impact will be and finding out in 12 months that it wasn’t a good idea,” said Mr McEntee.”

That call was backed by government and opposition TDs in the Dáil yesterday. Fine Gael’s John O’Mahony said: “We should think carefully before this is processed. It should not be done at the expense of thousands of jobs in our post offices.”

Fianna Fáil’s Michael Moynihan said the Government would be cutting off the lifeline to the post office network and it was vitally important that a cost-benefit analysis be done.

Communications Minister Pat Rabbitte, however, warned An Post would have to take on more banking contracts — similar to the counter services it provided for AIB and Danske Bank — if it was to save its network of local post offices.