Postal Services Bill

My Lords, the purpose of this amendment is to require the Secretary of State to give full consideration of how more use can be made of Post Office card accounts and to extend the services available in respect of them. The Post Office card account was launched in April 2003 as an alternative for those who could not or did not want to open a basic bank account when the direct payment of benefits was introduced. The contract for that account is extremely important to the post office network, being worth around £1 billion to post offices between 2003 and 2010. There were, it is fair to say, some issues around the Post Office card account contract. Suffice it to say that the matter was resolved in November 2008, not least because of the intervention by my noble friend Lord Mandelson. He was able to announce then that the Post Office card account had been saved for the Post Office. On 13 November 2008, Richard Bates, head of community services at Consumer Focus, said: "““Post Office card account users will be delighted that they can continue to access their money in an environment they trust and that is within easy reach. The decision is good news for consumers and provides a bedrock for the viability of the post office network””." He went on to say: "““Consumer Focus thinks the Post Office Limited is in a strong position to play a much more expanded role in financial services. … Today's decision is a good step in the right direction. People tell us they need the option to deposit money, pay bills and make savings in their Post Office card account. The Government must now provide and promote these services””." It is interesting, given some of our recent debates, that there was a particular cheer at the news in Northern Ireland, where 190,000 people have their pensions and benefits paid into a Post Office card account using nearly 500 Post Office outlets. In many ways, the Post Office card account has been a major success. Around 4.3 million people now receive benefits via such accounts, of whom approximately 40 per cent are pensioners. The account plays a central role in service provision in a whole host of areas, providing great benefit to communities across the country. Each week, 6.5 million visits are made to the post office network with a view to withdrawing funds from the Post Office card account, and it has been calculated that those under 65 who hold such an account are 28 times more likely to be ““unbanked””. These same people—those in receipt of state benefits and tax credits—are also the most likely to use high-cost credit, while those without bank accounts are the least likely to hold any other financial product. We have heard already today that the Government are looking for ways to extend appropriate, inclusive and functional services to Post Office customers. We welcome that commitment. The National Federation of Sub-Postmasters, in its Six Steps to a Sustainable Post Office Network, emphasised that: "““The Post Office card account … reminds vital for the post office network and””—" I stress these words— "““its functionality should be increased””." That is what this amendment is about. Post Office card account customers are some of the least well served by financial services in society. They make up 20 per cent of visits to Post Office branches each week and spend as much as £2 billion in the network each year. It should be a priority for the Government, in seeking to protect and grow the network, to find ways to develop that account. A robust Post Office card account must be an essential part of the portfolio of financial services that the Government are now proposing for the Post Office, not least because it will provide valuable bridges to financial inclusion and much needed committee support. Before the Government transfer the Post Office to a mutual, we think it sensible to require the Secretary of State to give full consideration to how more use can be made of the Post Office card accounts and to extend the services available in respect of them. I beg to move.