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To: ci: Mr Scholar
SECRETARY OF STATE _) separate Mr Macdonald
MRMCCARTNEY _ ) copies Mr Baker
Dr Hopkins CII
From: Mrs Britton PORT
DAVID SIBBICK. Mr Whitehead CGBPS 1
_DIRECTOR POSTS Ms Anderson CGBPS1
GRO Mr Corry SpAd
gham Palace Road Mr Wegg-Prosser Sp Ad
22 December 1998
MINISTERIAL DECISION ON HORIZON PROJECT: LETTER OF 22
DECEMBER FROM ALISTAIR DARLING
Issue
1. How to respond to today's letter from the Secretary of State for Social
Security.
Recommendation
2. Whilst the letter represents yet another attempt to find a compromise more
acceptable to DSS/BA, you should continue to urge a decision in favour of Option
1 (continuation of Horizon with the benefit payment card).
Timi
3. URGENT. The telephone lobbying/canvassing is likely to continue apace.
Argument
4. The proposal from the Secretary of State for Social Security is perhaps most
simply viewed as a regurgitation of Option 2 (continuation of the Horizon
infrastructure but without the benefit payment card), but with the full savings from
a move to ACT (as compared with what is now proposed for Option 1) being
recycled to support the development of a smartcard and other facilities for the
delivery of electronic Government. It should be stressed that the smartcard would
not be used for the payment of benefits (i.e. it is not a replacement for the benefit
payment card) nor would it be used to facilitate front-end banking (unless and until
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the banks are happy for this technology to be used with their accounts). The
argument is simply that it is better to use these funds for something which will
eventually be useful to government rather than deploy it on a short lived benefit
payment card, or worse still pay it to ICL in compensation for dropping the bpc.
5. Considerably more work will be needed to turn this into a fully fledged
option which Ministers could consider alongside those already on the table. First
reactions are that this proposal might hold attraction for ICL. The move straight
from paper based system to ACT has always been of concern to POCL on the
grounds that, no matter how well co-ordinated the timing, more benefit recipients
would be likely to be lost to the post office system (with consequential footfall
effects) than if transitioned through the bpc.
6. Given the increasingly damaging effects of delay and uncertainty there is
much to be said for now deciding in favour of Option 1 which remains the most
thoroughly tested and risk free option available to Ministers.
Line to take
© proposal represents an interesting variation on Option 2. Much further work
would, however be needed to turn it into a fully worked up and costed option;
¢ given the increasingly damaging effects of delay and uncertainty we still believe
that the best way forward is an urgent decision in line with the proposal in the
Chief Secretary's note of 21 December;
© it is clear that ICL and POCL will in any event press ahead with the
development of electronic Government within the framework of their recently
agreed public / private partnership.
DAVID SIBBICK
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