I would like to update the House on actions taken by my Department in response to the closure of the Cypriot banking system last week.
The Department for Work and Pensions (DWP) acted swiftly to hold on to benefit and state pension payments to our customers with bank accounts in Cyprus or accounts with Cypriot banks in Greece due to the financial uncertainty and the extended bank closures. In any event, the bank closures mean that recipients would not have received their benefits as payments have not been processed. And when the Cypriot banks do reopen, delays in payment processing are possible.
DWP then took the decision to contact all those with state pensions or benefits affected by the situation in Cyprus. To speed up this process DWP couriered letters to Cyprus to ensure this information reached individuals as soon as possible. Our staff have also been contacting individuals in Cyprus by email and phone.
We are advising customers to change the bank account into which payments are made, for example by nominating an alternative bank account or the account of a “trusted friend” which is permissible under our current rules on benefit payment. This is a practical measure to ensure that payments reach our customers promptly, and we are not advising these customers to close their Cypriot bank accounts.
Customers who do not currently have another bank account may wish to open one. HM Treasury have also worked with Barclays to put in place a process so that individuals can open a bank account quickly if they wish to do so.
The Government will continue to monitor the situation closely from London and Nicosia and attempt to minimise the disruption for those affected.
Customers who wish to change their accounts, or require more information should contact the International Pension Centre, whose details are on the Gov.uk website.