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Post Office Horizon IT scandal victims face further battles as government digs heels in

The government repeats that it won’t pay victims’ legal costs and confirms review into the scandal will not have the power to call witnesses

Subpostmasters who had their livelihoods and lives wrecked by the Post Office’s faulty core IT system and the organisation’s refusal to accept that the system could be to blame for financial losses face more battles as the government refuses to budge on their demands.

The Justice For Subpostmasters Alliance (JFSA) is demanding that the government, which owns the Post Office, pay the costs racked up by subpostmasters in the legal battle that led to their victory. The campaign group also wants a judge-led public inquiry into the Horizon scandal, with the power to call witnesses to give evidence under oath, to identify what went wrong and who was to blame.

But answering questions in a House of Lords debate, Conservative peer Martin Callanan, a UK government minister, reconfirmed that the government had no plans to do either.

In 2009, a Computer Weekly investigation revealed that subpostmasters, who run branches, were being blamed for unexplained financial losses, which they claimed were caused by errors made by the Post Office’s Horizon retail and accounting system. The Post Office always denied this, and many subpostmasters were prosecuted for theft and false accounting, with prison sentences, community service, criminal records and heavy fines among the injustices they suffered as a result. Many suffered ill health due to the stress the situation caused, with premature deaths linked to this (see timeline below). 

In 2018, hundreds of subpostmaster took the Post Office to court in a group litigation action to prove the computer system was to blame for unexplained losses. They won the multimillion-pound High Court battle, which concluded in December 2019, proving that the Horizon computer system they used was to blame for the unexplained accounting shortfalls.

The call for a judge-led public inquiry came after High Court judge Peter Fraser ruled that 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”. 

Judge Fraser 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.”

In June, adding more fuel to calls for a judge-led inquiry, the Criminal Cases Review Commission (CCRC) sent 47 subpostmaster cases of potential miscarriages of justice to the Court of Appeal for review.

Government response to Horizon scandal ‘pathetic’

The scandal has been described as the biggest miscarriage of justice in modern UK history. But the government has only offered a non-statutory review of the scandal, described by Conservative peer James Arbuthnot as “a pathetic response to a national outrage”.

Arbuthnot began a debate in the House of Lords this week (7 September), when he quizzed Callanan.

During the debate that followed, Labour peer Robert Stevenson asked Callanan: “Can the government minister confirm that the review will not have the powers under The Inquiries Act 2005, so how will the reviewer compel witnesses, including ministers, to give evidence or see the papers necessary to assess, for example, whether lessons have been learned and that whistleblowers in the Post Office will not be treated in such a disgraceful way again in the future.”

Callanan confirmed the review was non-statutory and therefore did not have the power to call witnesses under oath.

Speaking for the JFSA, Alan Bates, the subpostmaster who led the campaign against the Post Office and was the lead claimant in the court case, questioned the point of a review that could not call witnesses to give evidence under oath. “We are not going to get involved in the Post Office’s hearsay review,” he told Computer Weekly.

The JFSA has made its own plans to scrutinise the government’s role in the scandal. It recently raised over £98,000 in just six weeks using a crowdfunding platform focused on raising money for legal cases. The money enables the subpostmasters to fund legal support to a submission to the Parliamentary Ombudsman to investigate the government’s handling of the Post Office, which it owns, in relation to its role in miscarriages of justice.

The other main demand being made is for the government to pay the legal costs of the subpostmasters related to the court case they won. They had been forced to use a litigation funding company to take on the Post Office, which used taxpayers’ funds to fight their case.

“The minister said he doesn’t want to interfere, but the government is the 100% owner of the Post Office. The government is ultimately responsible for this scandal. It is not good enough to keep delaying – [subpostmasters] have got to be compensated fully”
Peter Hain, Labour peer

After the court victory, subpostmasters were awarded a £57.75m settlement from the Post Office, but after legal costs and money for the litigation funders, claimants were left with only about £11m between them. This didn’t even come close to covering the losses experienced by the subpostmasters, never mind compensating them for their suffering.

Subpostmasters are demanding that the government pays these costs to leave the subpostmasters with more of the damages they won.

But during the debate in the House of Lords, Callanan was asked by peer Chris Holes whether the government would pay the legal costs. “My heart goes out to all these subpostmasters and mistresses who have been dragged through this Horizon hell. They have been treated despicably,” said Holes. “Could the government act ahead of the review and pay the legal fees of those brave subpostmasters and mistresses that took legal action? Surely the government can take that action without having to wait for the review to commence.”

Callanan reconfirmed the government’s stance that it would not pay the costs. “There was an agreed settlement for the subpostmasters that took the legal action and it would not be right for the government to get involved,” he said.

But Labour peer Peter Hain said the government was already involved, with ultimate responsibility for the scandal.

“The minister said he doesn’t want to interfere, but the government is the 100% owner of the Post Office. The permanent secretary of the department is the accounting officer for the Post Office, the government has representative on the board, and the government’s is ultimately responsible for this scandal. It is not good enough to keep delaying this with lots of process and reviews, they have got to be compensated fully.”

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

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