The Department of Social Protection will not be issuing "any further letters at this stage" about pension payment arrangements, Minister of State Kevin Humphreys has said.

He was responding to Opposition concern about a trial mailshot to pensioners across the State about how their payments are made.

TDs and Senators had accused the Government of attempting to undermine the post office network by encouraging pensioners currently receiving their payment in cash to transfer to electronic payment through their financial institution.

Mr Humphreys rejected the allegations but he said it cost the department six times more to issue cash payments than to make them through electronic transfer.

Last year more than €8.5 billion was paid out in cash to welfare clients at post offices. “This accounts for 40.5 million transactions and cost the department just under €62 million.”

He said 38 million payments were issued electronically, costing just under €10 million.

No further letters would be issued but the department “does not propose to limit the freedom of these clients to amend their payment arrangements if they so wish”.

During a debate in the Seanad, the Minister said the letters asked pensioners whether they would “like to receive their payment directly into an account, bank, building society, certain credit union accounts or post office savings account”.

He added that more than 60 per cent of social welfare recipients already received their payments by lodgement directly into their accounts.