Ref. 25860-03POSTMASTERS in Swindon are against the government's plans to scrap the payment of benefits over the counter at post offices.

They say direct payment into bank accounts threatens to send sub-post offices to the wall, because they will lose revenue from over the counter transactions.

And a report by the Commons trade and industry select committee has criticised the government's handling of the switch to direct payments into bank and building society accounts.

It says the traditional giro book remained the best method of payment for many elderly and disabled people.

Pensioners are about to receive letters urging them to choose direct payment into a bank or building society account, or a new-style post office account.

The MPs' report also criticised the complicated procedure for setting up a post office account, which they said should be as easy as opening a basic bank account.

It concluded the change had been made primarily to save money without consideration for its impact on the lives of vulnerable people and that the public had not been properly informed of the change.

Dave Fenwick, sub-postmaster of Poetsfield Post Office in Gainsbor-ough Avenue, Wootton Bassett, said: "This is typical government skulduggery. They are trying to force people into having payments into their bank accounts.

"It just means business is going to be taken away from us.

"We have had customers telling us that it has been very difficult for them to open a post office account."

Susan Budd, sub postmaster at Purton Post Office, said: "Most people are being persuaded to have benefits paid into their bank accounts.

"That will stop people going into their post office, they will go elsewhere and that will affect business.

"Every transaction over the counter makes up the wages of the sub post master.

"We lose the transactions and it will become less viable for us to run a business.

"We have already lost young mums who are having their benefits paid straight into a bank and don't need to come here anymore."

Linda Banks, postmaster at Chiseldon Post Office, is more cautious about the changes.

She said: "I think we have to wait and see, nobody can tell what it is going to be like. I can't see there being much of a change. People who want to use their bank can do that at the post office anyway."

She added that if people use a post office account, then post offices would still receive a fee for that transaction.

Martin O'Neill, chairman of the select committee, said the new system does not cater for those who find it difficult to open a bank or post office account.

He said: "This has created anxiety and confusion which could and should have been avoided by proper forward planning on the government's part."

The proportion of pensioners currently using a pension book varies from 50.5 per cent in the North Swindon constituency to 49.2 per cent in South Swindon

Pensioners and benefit claimants should be told that they could continue to use their order books until at least 2005.