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Pressure for public inquiry into Post Office IT system scandal begins with mountain to climb

Members of Parliament seeking a public inquiry into the Post Office Horizon scandal face huge challenges, but pressure and time could force justice

Members of both houses of Parliament will exert pressure on the government to find out why and how the Post Office ruined the lives of subpostmasters, wrongly blamed and punished for accounting shortfalls caused by computer errors.

But achieving a judge-led public inquiry, seen by many as the only way to get to the bottom of the scandal, will be an uphill struggle due to the massive potential financial implications for a government with a comfortable majority.

Kevan Jones, Labour MP for North Durham, has been a supporter of subpostmasters seeking justice for many years. He described the treatment of them as a “national scandal”.

“I don’t think people have fully worked it out, but this is the worst example I have seen of the state trying to cover up what went wrong, leading to peoples’ lives being completely ruined,” he said. “Unless you have some kind of public inquiry into it, I don’t think you can get to the bottom of what went wrong.”

But a full public inquiry cannot be forced, and is, in effect, a gift from a government wanting to be seen as doing the right thing.

If the government wants to avoid an inquiry, there is little campaigners can do unless enough MPs join calls for one and exert pressure in the House of Commons by voting against government on other bills in protest. But with a majority of about 80, it would take all opposition MPs and a significant group of Conservative MPs to back an inquiry.

Defending the indefensible

The government has reason to avoid Post Office methods being further dissected in public and potentially having to pay compensation that could be owed to subpostmasters that have lost money, livelihoods and even their liberty over the years.

“This is the worst example I have seen of the state trying to cover up what went wrong, leading to peoples’ lives being ruined. Unless you have some kind of public inquiry, I don’t think you can get to the bottom of what went wrong”
Kevan Jones, Labour MP for North Durham

A High Court legal battle between the Post Office and 550 subpostmasters ended in December 2019 with an out-of-court settlement. The Post Office conceded in the group litigation order, brought by subpostmasters, after two trials of four planned were complete, agreeing to pay £57.75m in damages. But this came after the public-owned organisation had spent tens of millions of pounds defending what is now known to be indefensible.

The Post Office made some controversial decisions during the trial, such as its request to have High Court Judge Peter Fraser recuse himself, which he refused, and then appealing this decision, which was also rejected. It also sought permission to appeal significant parts of his judgment from the first trial in the litigation, which was also rejected. All this racked up millions of pounds of extra costs.

In his judgment for the first trial, Judge Fraser slammed the Post Office for its contract with subpostmasters, which was balanced heavily in favour of the Post Office.

“There can be no excuse, in my judgment, for an entity such as the Post Office to mis-state, in such clearly expressed terms, in letters that threaten legal action, the extent of the contractual obligation upon a [subpostmaster] for losses. The only reason for doing so, in my judgment, must have been to lead the recipients to believe that they had absolutely no option but to pay the sums demanded. It is oppressive behaviour,” said the ruling.

In his judgement for the second trial, which focused on the Horizon IT system at the centre of the controversy, Judge Fraser said denials over the potential errors in Horizon causing account shortfalls “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”.

In the Court of Appeal, Lord Justice Coulson likened the treatment of subpostmasters by the Post Office to the way Victorian factory owners treated their workers.

Computer Weekly first reported the problems with Horizon in 2009, when it made public the stories of a group of subpostmasters. Soon after this, as more subpostmasters came forward, former subpostmaster Alan Bates formed the Justice for Subpostmasters Alliance (JFSA) and began campaigning. Bates, who lost his Post Office as a result of unexplained losses, first contacted Computer Weekly in 2004, four years after he had first alerted the Post Office to the problems.

Jones said continued pressure and increased publicity was needed to get the story out in public. “Once the penny drops for people there are huge questions to ask about the running of the Post Office, about a succession of ministers who frankly accepted whatever the Post Office told them without question,” he added.

Parliamentary debate

In Parliament, MPs are becoming aware of the Horizon case and its impact through concerted efforts by subpostmasters meeting their local MPs. Jones is also pushing for a debate in the House of Commons. “We haven’t got it yet, but I have put an application in for a back bench business debate to get some time on the floor of the House of Commons to discuss the entire scandal,” he said.

A committee will meet in a couple of weeks which could allocate time for this debate – this could be an entire afternoon. “We have applied for debates before, but we have been stopped because of the court case, but now that that has finished we can talk about not only what came out of court, but everything around it,” said Jones.

“This is far from over and it is important that we not only get justice for the individuals, but it is also important to expose the way public money is being used,” he added.

Jones is referring to the huge sums of money thrown at the group litigation, which cost tens of millions of pounds. “I think [the Post Office was] working on the basis that the subpostmasters wouldn’t be able to continue funding the case,” he said.

The ultimate goal, he said, will be to achieve a full public inquiry and get the government to pay compensation to the affected subpostmasters.

Signs are that the government has no appetite for further compensation. In a reply to a request for government to pay the subpostmasters’ legal bill, Kelly Tolhurst MP, minister for small business, consumers and corporate responsibility, part of the Department for Business, Energy and Industrial Strategy (BEIS), wrote: “I note that the settlement agreed with the Post Office included all legal and other costs. In those circumstances, I must respectfully refuse your request for payment.”

But the nature of the action subpostmasters were forced to take meant only around £10m was left after costs.

“Subpostmasters had to fund the action the way they did and it left a small amount of money for compensation,” said Jones. “The government is implicated in this, not just the Post Office.”

MPs up the pressure

The government, through BEIS, confirmed that ministers kept a close eye on and were kept up to date with the case, but added they did not play a role in the litigation.

Gill Furniss, Labour MP for Sheffield Brightside and Hillsborough, and shadow minister for steel, post and consumer protection, recently gave a speech in Parliament in which she asked the government whether it would call a full inquiry into the “circumstances that led to this tragedy”, what support the government was giving to those affected, and what was being done to “ensure a scandal like this is never allowed to happen again”.

In the House of Lords, pressure is being applied by James Arbuthnot, former MP for Hampshire North East, and long-time campaigner for justice for the subpostmasters affected. Now Lord Arbuthnot of Edrom, he became a supporter of the subpostmasters when, as an MP, he was contacted by constituent Jo Hamilton, a subpostmaster who was being threatened with jail for accounting irregularities that could not be explained.

He said achieving a full public inquiry would be difficult due to the fact that the government could have to pay out large sums of compensation and was under little pressure due to a large majority in the House of Commons.

Arbuthnot said the only previous campaign for an inquiry he has worked on was for the Chinook helicopter ZD576 crash on the Mull of Kintyre, Scotland, in 1994, when 29 people died. The circumstances of the crash, initially blamed on pilots, needed further investigation after Computer Weekly brought new evidence to light. In 2001, Computer Weekly reported that three fellows of the Royal Aeronautical Society had said that issues with either control or Fadec systems could have led to the crash.

“This ended in an inquiry, though not public, and after 16 years, the pilots were exonerated. But it is impossible to say that that is what would happen here. In the Chinook case, there was no money to be paid out by the government – they had already paid out all the families were asking for. And there was no face to be lost by the government.” he said.

“This matter is one which requires relentless, persistent questioning and pursuit until the government and the Post Office have nowhere else to go but to put the matter right”
Lord Arbuthnot of Edrom

“In the Horizon case, there are hundreds of people who want, deserve and need substantial compensation. And there are many more out there of which we know nothing, employees of subpostmasters who were not themselves in the frame, subpostmasters who just decided to pay and go away, subpostmasters who decided to sell their businesses at a loss because they could not be sure of the figures the Post Office was giving them, and so on and on,” added Arbuthnot.

He said the money issue was huge and the government would still wish to say that the Post Office is a valuable going concern that should be sold at a profit, but “an inquiry would put that off for years”.

“Select committee inquiries, where committees can go back and back and back with witnesses and reports, can be very influential. And MPs being faced in their constituencies with facts which make very uncomfortable reading is one way to change the tide,” added Arbuthnot.

But the Lords is a very different group. “We feel our lack of legitimacy, in the sense that we are not elected. We too feel the need to achieve good things.”

Arbuthnot recently instigated a debate on the Horizon scandal in the House of Lords earlier this month. “I was very heartened by the number of peers who came in on the questions earlier this month on the side of the subpostmasters. It remains the fact that there has been surprisingly little publicity about this scandalous affair, and it was therefore encouraging to see so many peers both joining in with well-informed questions and making supportive noises in the background,” he said.

Arbuthnot concluded: “This matter is one which requires relentless, persistent questioning and pursuit until the government and the Post Office have nowhere else to go but to put the matter right. In the end justice usually is done, but it takes more time than it should – in fact, sometimes it is the time factor that allows it to happen because everyone involved moved on long ago.”

Timeline of the Post Office Horizon case since Computer Weekly first reported on it in 2009

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