Government to fund interim compensation of up to £100,000 for each wrongly convicted subpostmaster

The government is to fund interim compensation of up to £100,000 for each of the subpostmasters who have had their criminal convictions overturned.

A total of 59 subpostmasters have so far had their convictions – based on evidence from an error-prone computer system – overturned. They could receive an interim damages payment within weeks.

And there could me hundreds more, with a total of 736 subpostmasters prosecuted based on evidence from the Post Office computer system, known as Horizon. Some subpostmasters were sent to prison and spent many years with criminal records after being wrongfully convicted.

There are also hundreds of former subpostmasters who were not prosecuted, but had their lives destroyed after being blamed for accounting errors and being forced to pay the money back.

A Computer Weekly investigation in 2009 first revealed the plight of the subpostmasters in interviews with seven of those affected (see timeline below for more).

After years of campaigning, a High Court case that started in November 2018 and ended in December 2019 saw subpostmasters proved right that the unexplained accounting shortfalls were computer errors. As part of the settlement, the Post Office was forced to set up a compensation scheme for all subpostmasters who had suffered as a result of Horizon errors.

The Historical Shortfall Scheme, which did not include subpostmasters with criminal records, has received 2,400 applications, compared with 500 expected by the Post Office, and compensation payouts are expected to exceed £300m, all of which will be paid by taxpayers.

But this does not include compensation for the 555 subpostmasters who took the Post Office to court over the Horizon errors. These subpostmasters revealed what the Post Office and Fujitsu, which supplied the Horizon system, had been up to for nearly two decades, and what the Post Office’s government owner had failed to stop.

They were excluded from the scheme because the Post Office and government said the damages paid when the subpostmasters won the High Court action were full and final. However, most of that £57.75m settlement was swallowed up by costs that had to be paid to a litigation funder, leaving the claimants with only about £11m between them.

The government is refusing to pay subpostmasters’ legal costs, and the campaign for fair compensation for these 555 subpostmasters and all others affected goes on.

Following the announcement that the government would pay the interim compensation to those prosecuted, postal affairs minister Paul Scully said: “The suffering and distress these postmasters and their families have gone through cannot be overstated.

“While nothing will make up for the years of pain they faced after this appalling injustice, I hope this initial step provides a measure of comfort.”

The government had already agreed to cover the compensation costs, which according to Scully, “is beyond what the Post Office can afford”.

Post Office CEO Nick Read said: “Ensuring compensation is made as quickly as possible is a priority for the Post Office. I welcome the government’s support to enable these interim payments that begin to provide some redress to people who were badly failed.

“While we cannot change the past, this is an important step towards meaningful compensation for victims and we will offer payments as soon as possible.”

Neil Hudgell, solicitor at Hudgell Solicitors, which represented many of the subpostmasters when appealing their convictions said the government commitment is a "cautiously positive step” and he expects fair compensation to be significant sums in many cases. 

“The dialogue we have been having with legal representatives instructed by the Post Office has been very positive to this date and there appears to be good intentions," he added. “This cautiously positive step is to be welcomed and suggests, hopefully, that the Post Office is now intending to do right by the many people it has harmed so badly.  

“We don’t want to see any legal gymnastics, game playing or delaying tactics. We want to see words very quickly translate into actions, and hopefully this is a positive start that will ease some of the pressures our clients are facing," added Hudgell.

The Post Office is contacting subpostmaster victims whose overturned convictions relied on Horizon evidence. It aims to make an offer for an interim payment within 28 days of receiving an application.

The interim payments announced today do not prevent people from bringing civil claims through the courts.