Select Committee on Social and Family Affairs: Minister for Social Affairs Seamus Brennan has said An Post will have to greatly improve its services if it is to keep its social welfare payments business.
Mr Brennan said his department had "held off" on promoting electronic-transfer payments for social welfare recipients where they can have payments made directly to their bank account through the electronic transfer fund (ETF) system.
He said that 31 per cent of social welfare recipients availed of this service, 11 per cent were paid via cheque and the remaining 58 per cent received their payments in cash through post offices.
He had held meetings with An Post, along with Minister for Communications Noel Dempsey, during which he stressed that changes were needed. He had asked that the seven-day rule for withdrawing funds from post office savings accounts be changed so that people could have their social welfare payments transferred electronically to these accounts.
"In the short term we can only do so much to protect post offices," Mr Brennan told the Oireachtas committee, and that electronic payments would become the norm for social welfare payments. The only way that An Post could protect itself was "to be totally up to speed electronically".
"They have to be able to out-bank the banks," he said.
The committee's chairman, Labour party TD Willie Penrose, said he had serious concerns about the ETF system, and that it would fail to provide an adequate service for rural dwellers. He also warned that people faced paying bank charges to access their money.
Mr Brennan reiterated his plans to reform the lone-parent payment system. He has previously said that the payment did not reflect the reality that a lot of recipients were in relationships. His preference was that the payment be child-based.