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Subpostmasters proved right on IT system failures as calls for full public inquiry mount
Post Office has been “in denial” about the robustness of its core retail system, which a judge said was to blame for problems experienced by subpostmasters in a multimillion-pound group action
Subpostmasters involved in the multimillion-pound IT-related group litigation against the Post Office are to call for a full public inquiry into the organisation’s behaviour towards them.
This comes after a High Court judge confirmed that allegations made by subpostmasters about the reliability of the computer system they use were right. He also described the Post Office’s denial of anything contradicting what the system – known as Horizon – said was today’s equivalent of maintaining that the Earth is flat.
As part of a the group litigation, Judge Peter Fraser handed down his judgments on the second trial in the case held earlier this year, which examined the robustness of the Horizon system.
Over the two decades since the Fujitsu system was introduced, subpostmasters have experienced accounting inaccuracies which they could not explain. Some who looked into it believed the Horizon system could be to blame, but the Post Office always denied this.
The plight of some subpostmasters was first reported by Computer Weekly in 2009, when it revealed that the lives of some had been turned upside-down after being fined, sacked, made bankrupt or even imprisoned because of unexplained accounting shortfalls.
In his latest judgment, Fraser said the Post Office had exhibited “a simple institutional obstinacy or refusal to consider any possible alternatives to their view of Horizon, which was maintained regardless of the weight of factual evidence to the contrary”.
He added: “That approach by the Post Office was continued, even though now there is also considerable expert evidence to the contrary as well, and much of it agreed expert evidence on the existence of numerous bugs.
“This approach by the Post Office has amounted, in reality, to bare assertions and denials that ignore what has actually occurred, at least so far as the witnesses called before me in the Horizon issues trial are concerned. It amounts to the 21st century equivalent of maintaining that the Earth is flat.”
Fraser said evidence of particular problems with Horizon, from claimant and defendant witnesses, had helped him to reach his conclusions. “I found some of the factual evidence to be of great assistance,” he said. “That of Mr Roll [former Fujitsu whistleblower] and Mr Godeseth [Fujitsu chief architect on the Post Office account] was extremely useful.
“The latter, one of the Post Office’s main witnesses, was sufficiently damaging to the Post Office’s case on the Horizon issues that they were, essentially, forced almost to disavow him, and the Post Office’s closing submissions were highly critical of the accuracy of his evidence.”
Known about problems
During the trial, evidence revealed that the Post Office had known about problems but did not reveal them to the subpostmasters who relied on the system.
Before he handed down his judgments, Fraser said he had “grave concerns” about the evidence of the Fujitsu employees. He said he would be supplying a dossier to the director of public prosecutions for further investigation.
The judgment on the second trial was announced despite the Post Office settling the long-running legal dispute with subpostmasters and agreeing to pay £57.75m in damages.
According to broadcast journalist Nick Wallis, who has followed the case closely for many years, the claimants were told in a pre-judgment meeting with their solicitors that the most they can expect to get from the £58m settlement is £8-11m, after the legal fees have been paid and the litigation funders have taken their cut.
The costs of the litigation have been huge as the Post Office threw money at a case that one of its legal team said was an “existential threat” to its business model.
Conservative peer James Arbuthnot said the subpostmasters had been vindicated in every respect. “It is an excellent Christmas present – but won at great cost,” he said. “The cost falls partly on the taxpayer, but also heavily on the subpostmasters themselves, who will have their damages reduced by the amount the litigation funders will, justifiably, deduct.
“Now that these battles are being won, it is time to turn our attention to how it all came about and went so far. We need an inquiry and, since the Post Office has repeatedly given inaccurate information, including to me, it needs to be led by a judge. It may be that the best person to conduct the inquiry would be the judge who already has such extensive knowledge of the details, Sir Peter Fraser. He has done much of the work already.”
Lee Castleton, a former subpostmaster in Bridlington, Yorkshire, was one of the furst subpostmasters interviewed by Computer Weekly in 2009. He was declared bankrupt after he refused to pay the Post Office £27,000 – money it said he owed because the accounts of his branch showed deficits over a 12-week period in 2004.
Castleton has always insisted he did not owe the money – although it showed as a loss on the Post Office’s Horizon system. He has now been proved right.
Speaking outside court, he told Computer Weekly: “These [the subpostmasters] are lovely people and hopefully this will change their lives for the better. It will make some kind of amends for all the things that have been said about them and done to them.”
Castleton added: “For the last 15 years, I never thought I would see this day.”
Pam Stubbs, another lead claimant, said: “I am over the moon. We have been vindicated, proved not guilty. It was not us – it was the computer system.”
Stubbs paid tribute to Alan Bates, the former subpostmaster who led the claimants. “He is brilliant,” she said. “He never gave up once and he deserves a great deal of praise, as do the legal team.”
As early as 2000, just after Horizon was introduced, Bates experienced problems, which he explained to the Post Office. When the Post Office did nothing, he began a one-man campaign to get to the truth.
Bates set up a website to find others who had suffered at the hands of the system, contacted Computer Weekly, set up a campaign group, and eventually – and against the odds – took legal action against the Post Office, and won.
Bates said MPs have now approached him with concerns about the behaviour of the Post Office, and subpostmasters will call for a full public inquiry. “From the findings of the court, it seems to me that the Post Office either knew how bad the Horizon system was and covered it up, or it was incompetent management and lack of control, or possibly a combination of both,” he said.
“This is why we will be calling for a full public inquiry come the new year. I think there will be many MPs who have supported the group over the years and who are going to be utterly shocked at the revelations in the judgment, and they are going to want answers.”
Helen Baker, former subpostmaster and president of the Communications Workers Union (CWU) postmaster branch, was involved in the revelation of a major problem with the Horizon system. Known as the Dalmellington bug, and made public by Computer Weekly in 2015, it has featured in the group litigation as evidence that errors could cause loss for subpostmasters.
“Yesterday saw a momentous judgment, not only about the Post Office Horizon system, but the culture behind the decisions that led to atrocious treatment of so many postmasters, who can now hold their heads high knowing they have been vindicated,” said Baker.
“When I first came across the Dalmellington duplication errors, it was not the fact that that the Horizon system caused the errors that shocked me, it was the decisions that surrounded it. The discovery that not only had this error happened a number of times and the fix was six months or so away, but also the refusal to reveal the possibility of this error occurring to the subpostmaster community.
“I sincerely hope that the Post Office now changes the way it communicates and trains both the directly employed as well as the postmasters – that it acknowledges when errors occur, investigates, puts it right and communicates the situation to the whole network as soon as it becomes aware.”
Mark Baker of the CWU, who is a serving subpostmaster, said he was pleased claimants have “some sort of closure”, adding: “They have been fully vindicated, but I think this is just the beginning of the end of the story. This whole matter will rumble on because there are 11,000 subpostmasters that have to work with this system daily, which has now been labelled as not being robust.”
Baker said the system either has to be heavily modified or, “more sensibly”, replaced with a new platform. “It does not have to be as sophisticated as the previous system because the number and variety of transactions is smaller,” he said.
“But the change I want to see more than anything else is the Post Office sitting down with subpostmasters and rebuilding the trust that was lost.”
Baker said independent representation for subpostmasters is vital, and the CWU is ready to sit down and talk to the Post Office.
Call for an inquiry
When Bates first wrote to Computer Weekly in 2004, he said he understood that fighting the Post Office would take a long time, but he was determined to do it. Now his call for a full public inquiry could mean the dispute still has some way to go.
Tim McCormack, a former subpostmaster and campaigner for justice for affected subpostmasters, said: “In the light of Justice Fraser’s comprehensive decision paper on the Horizon trial, it is clear that both he and the claimants have been totally reliant on the Post Office disclosing all the information available to it. What is alarming is that even after the trial was complete, the Post Office was still providing further revelations of new evidence to the court.
“It is perfectly clear that the current management of the Post Office do not have the investigative ability, or, it seems, the desire to enquire for their own benefit the actual reality of the situation, both historical and current.”
Post Office chairman Tim Parker, said: “In reaching last week’s settlement with the claimants, we accepted our past shortcomings and I, both personally and on behalf of the Post Office, sincerely apologise to those affected when we got things wrong. We have given a commitment to learning lessons from these events, and today’s judgment underlines the need to do so.
“While the judgment does recognise improvements we have made and that our current Horizon system is robust relative to comparable systems, it makes findings about previous versions of the system and past behaviours, which further demonstrate the importance of the changes we must make in our business, particularly the ways in which we support our postmasters.
“Importantly, our new CEO has made clear the need to reset our relationship with postmasters and started the process to build a much better relationship with them.”
Timeline of the Post Office Horizon case since Computer Weekly first reported on it in 2009
- May 2009: Bankruptcy, prosecution and disrupted livelihoods – postmasters tell their story.
- September 2009: Postmasters form action group after accounts shortfall.
- November 2009: Post Office theft case deferred over IT questions.
- February 2011: Post Office faces legal action over alleged accounting system failures.
- October 2011: 85 subpostmasters seek legal support in claims against Post Office computer system.
- June 2012: Post Office launches external review of system at centre of legal disputes.
- January 2013: Post Office admits Horizon system needs more investigation.
- January 2013: Post Office announces amnesty for Horizon evidence.
- January 2013: Post Office wants to get to bottom of IT system allegations.
- June 2013: Investigation into Post Office accounting system to drill down on strongest cases.
- July 2013: Post Office Horizon system investigation reveals concerns.
- October 2013: End in sight for subpostmaster claims against Post Office’s Horizon accounting system.
- October 2013: Former Lord Justice of Appeal Hooper joins Post Office Horizon investigation.
- November 2013: 150 subpostmasters file claims over ‘faulty’ Horizon accounting system.
- September 2014: Fresh questions raised over Post Office IT system’s role in fraud cases.
- December 2014: MPs blast Post Office over IT system investigation and remove backing.
- December 2014: Why MPs lost faith in the Post Office’s IT investigation, but vowed to fight on.
- December 2014: MPs to debate subpostmaster IT injustice claims.
- December 2014: MP accuses Post Office of acting “duplicitously” in IT investigation.
- January 2015: MPs force inquiry into Post Office subpostmaster mediation scheme.
- January 2015: Post Office faces grilling by MPs over Horizon accounting system.
- February 2015: Post Office CIO will talk to any subpostmaster about IT problems, promises CEO.
- March 2015: Post Office ends working group for IT system investigation day before potentially damaging report.
- March 2015: MPs seek reassurance over Post Office mediation scheme.
- March 2015: Retiring MP aims to uncover truth of alleged Post Office computer system problems.
- April 2015: Post Office failed to investigate account shortfalls before legal action, report claims.
- April 2015: Criminal Courts Review Commission set to review subpostmasters’ claims of wrongful prosecution.
- May 2015: IT system related to subpostmaster prosecutions under review by CCRC.
- June 2015: Post Office looking to replace controversial Horizon system with IBM, says MP.
- July 2015: Campaigners call for independent inquiry into Post Office Horizon IT system dispute.
- October 2015: James Arbuthnot takes Post Office IT fight to House of Lords.
- November 2015: The union that represents Post Office subpostmasters has warned of a problem with the Horizon accounting system.
- November 2015: An email from Post Office IT support reveals a problem with the Horizon system and supporting processes that could lead to accounting errors.
- November 2015: Group litigation against Post Office being prepared in Horizon dispute.
- February 2016: Post Office faces group litigation over Horizon IT as subpostmasters fund class action.
- June 2016: Post Office chairman Tim Parker says there would be “considerable risk” associated with changing its Horizon computer system.
- November 2016: The legal team hired by a group of subpostmasters will take their case to the next stage.
- January 2017: The group action against the Post Office that alleges subpostmasters have been wrongly punished for accounting errors gets a green light from the High Court of Justice.
- March 2017: 1,000 subpostmasters apply to join IT-related group litigation against Post Office.
- April 2017: Investigation into claims of miscarriages of justice in relation to a Post Office accounting system has appointed a forensic accountant firm.
- May 2017: Hundreds of subpostmasters have applied to join IT-related legal action since March.
- July 2017: Post Office defence in computer system legal case due this week.
- August 2017: Campaigners submit initial evidence in group litigation against Post Office over controversial Horizon IT system.
- October 2017: Subpostmasters’ group action against the Post Office reaches an important milestone.
- November 2017: An end is in sight for subpostmasters’ campaign against alleged wrongful prosecution, which they blame on a faulty computer system.
- November 2017: The High Court judge managing the subpostmasters versus Post Office legal case over an allegedly faulty computer system tells legal teams to cooperate.
- January 2018: Forensic investigation into Post Office IT system at centre of legal case nears completion.
- April 2018: Criminal Cases Review Commission forensic examination of the IT system at the centre of a legal case against the Post Office has raised further questions.
- May 2018: Post Office branches unable to connect to Horizon computer system for several hours after morning opening time.
- October 2018: After over a decade of controversy, next week marks the beginning of a court battle between subpostmasters and the Post Office.
- November 2018: Case against Post Office in relation to allegedly faulty computer system begins in High Court.
- November 2018: High Court case in which subpostmasters are suing the Post Office has revealed a known problem with a computer system at the core of the dispute.
- November 2018: A High Court trial, where subpostmasters are suing the Post Office for damages caused by an allegedly faulty IT system, ends second week.
- November 2018: Post Office director admits to Horizon errors and not sharing details with subpostmaster network.
- November 2018: The High Court trial in which subpostmasters are suing the Post Office has reached an important stage.
- December 2018: CCRC may hold off subpostmaster decision until after Post Office Horizon trial.
- December 2018: Court case where subpostmasters are suing the Post Office set to span at least four trials and extend into 2020.
- January 2019: Subpostmasters’ campaign group attacks Post Office CEO Paula Vennells’ New Year honour amid ongoing court case.
- January 2019: Thousands of known errors on controversial Post Office computer system to be revealed.
- March 2019: Tech under spotlight at High Court in second subpostmasters versus Post Office trial.
- March 2019: Post Office considered Horizon IT system “high risk”, court told.
- March 2019: CCRC watching Post Office Horizon trial closely.
- March 2019: Judge rules that Post Office showed “oppressive behaviour” in response to claimants accused of accounting errors they blamed on Horizon IT system.
- March 2019: Post Office ‘lacked humanity’ in the treatment of subpostmasters, says peer.
- March 2019: A High Court judge heard that the Post Office did not investigate a computer system error that could cause losses, despite being offered evidence.
- March 2019: The Post Office legal team in the case brought by more than 500 subpostmasters has called for the judge to be recused after questioning his impartiality.
- March 2019: A senior civil servant asked the Post Office to repay public money it had wrongly allocated to paying legal costs.
- April 2019: Subpostmaster claimants’ legal team makes application for the Post Office to pay millions of pounds of costs associated with trial.
- April 2019: Post Office to appeal judgment from first Horizon trial.
- April 2019: The Post Office’s claim that the judge overseeing the case concerning its controversial Horizon IT system was biased has been dismissed – but will now be considered by the Court of Appeal.
- April 2019: MP questions government over Post Office Horizon case.
- April 2019: Government says no conflict of interest in trial despite Post Office chairman’s dual role.
- May 2019: The Court of Appeal has refused the Post Office’s application to appeal a major decision in the Horizon IT trial.
- May 2019: The Post Office has applied for permission to appeal judgments from the first trial in its IT-related legal battle with subpostmasters.
- May 2019: The judge in the Post Office Horizon trial has ordered the organisation to pay the legal costs of its courtroom adversaries, and refused to give permission to appeal a major judgment.
- June 2019: Post Office asks Court of Appeal for permission to appeal judgment in first Horizon trial.
- July 2019: The Post Office has admitted that some subpostmasters are at risk of accounts not balancing due to an error it does not understand.
- July 2019: Problem revealed during High Court trial left subpostmaster with £18,000 surplus after IT system failed to register full amount of cash scanned in.
- August 2019: Subpostmasters suffering slow running and frozen terminals while Post Office searches for a fix to issues apparently caused by a software update.
- August 2019: The Post Office has fixed the latest problems with its Horizon system, affecting hundreds of branches.
- October 2019:A High Court judgment for a trial that focused on the Post Office’s IT system at the centre of a multimillion-pound litigation will be announced early next month.
- November 2019:The Court of Appeal has rejected a Post Office application to appeal judgments made in the its multimillion-pound battle with subpostmasters over IT system failures.
- November 2019:Peer calls for clear-out of Post Office board after Court of Appeal confirms major court defeat.
- December 2019: The Post Office has settled its long-running legal dispute with subpostmasters, and will pay £57.75m in damages.
- December 2019: Subpostmasters ended their legal battle with the Post Office at the optimal time, according to the lawyer that managed the High Court action.
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