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Government must go further after agreeing to pay compensation for wrongly convicted subpostmasters

The government has agreed to pay compensation to former subpostmasters wrongly convicted in the Post Office Horizon IT scandal, but continues to refuse to pay a significant group of victims

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The government has agreed to pay full compensation to subpostmasters who have had wrongful convictions overturned in the Horizon IT scandal, which will focus campaigners on the financial redress for 555 former subpostmasters still denied it.

While the move was welcomed, campaigners have demanded the government go further and fairly compensate a group of victims they believe are being discriminated against because they took the Post Office to court.

The 555 victims are part of the Justice for Subpostmasters Alliance (JFSA), which has campaigned since 2009 and forced the Post Office into court (see timeline of Horizon scandal articles since Computer Weekly broke the story in 2009). 

In a written statement, Department for Business, Energy and Industrial Strategy (BEIS) minister Paul Scully said: “I am pleased to confirm that today the government is making funding available to facilitate the Post Office to make final compensation payments to postmasters whose convictions have been overturned. We are working with the Post Office to finalise the arrangements that will enable the final settlement negotiations to begin as soon as possible. By providing this funding, the government is helping the Post Office deliver the fair compensation postmasters deserve.”

Peer James Arbuthnot, who has campaigned for subpostmaster victims for a decade, questioned the government’s statement that it wants “to see these postmasters with quashed convictions compensated fairly and swiftly”.

He said: “So they don’t want to see the others compensated fairly or swiftly? They are still dragging their feet, doing the minimum they can to stave off the expense and embarrassment of malicious prosecution litigation.”

The Post Office Horizon scandal saw hundreds of people who own and run Post Office branches prosecuted, with some sent to prison based on computer evidence that has since been proved to be wrong. The scandal has already seen the biggest group referral of potential miscarriages of justice to the Court of Appeal.

Compensation from the government for those subpostmasters whose convictions have been overturned was not unexpected after the government said, in July, it would pay these victims of the Post Office Horizon scandal interim compensation of up to £100,000 each before full settlements.

But there are huge questions over why the government continues to refuse to pay the legal costs of the former subpostmasters who took the Post Office to court to expose the Horizon scandal. They were awarded £56.75m in the settlement, but after they paid their legal costs to the litigation funders that backed them, they were left with about £11m.

It was this court case that paved the way for subpostmasters having grounds to appeal criminal convictions related to the unexplained losses. So far, 72 subpostmasters who received criminal convictions for false accounting or theft have had their convictions overturned.

Furthermore, following the Post Office’s defeat in a High Court litigation brought by more than 550 former subpostmasters, it was forced, as part of the settlement, to open a compensation scheme for any subpostmasters affected by the Horizon system errors, but it excluded the victims who took it to court.

None of this would have happened without the JFSA and the High Court victory, yet the Post Office and the government continue to state that the settlement was full and final.

“The government knows the settlement with the 555 group action litigants was unfair. It was imposed on the subpostmasters by the Post Office spending millions of taxpayers’ pounds on defending actions which it knew were unlawful”
Lord Arbuthnot

The JFSA has always stated that its first demand from the inquiry is to get fair compensation for its members. This includes paying back their £46m legal costs, all the money paid back by subpostmasters to cover losses that didn’t exist, estimated to be £8m, and compensation for losses, including lost businesses and homes, and suffering over the years since members were wrongly blamed for accounting errors.

Speaking at a BEIS committee hearing in the House of Commons, solicitor Neil Hudgell of Hudgell Solicitors, which is representing subpostmaster victims, said the losses experienced were probably near £400m, before taking into account suffering.

Also during the hearing, Alan Bates, the former subpostmaster who set up the JFSA and led victims to court, said the group was being punished because of its successful legal action. “They have never been happy that we brought this action on them in the first place,” he said. “We cannot let this rest and we will never let it rest until we get fair compensation.”

Arbuthnot said: “The government knows perfectly well that the settlement with the 555 group action litigants was unfair. It was imposed on the subpostmasters by the Post Office spending millions of taxpayers’ pounds on defending actions which it knew – had been advised – were unlawful. The Post Office did not even disclose this key bit of advice until the end of 2020. If ever there was a case for setting aside a settlement, this is it; otherwise the government is relying on something which it knows to be unconscionable and wrong.”

Darren Jones, Labour MP for Bristol North West and chair of the House of Commons BEIS committee, said it was plainly logical that the 555 subpostmasters should be fully paid back.

During the committee hearing, Jones slammed the government for making the compensation announcement the day before the BEIS committee hearing discussing the subject.

“For ministers to publish a written ministerial statement two hours before a hearing like this, and leaking it to the press the day before, not providing sufficient details, or giving a statement to the House, is quite frankly unacceptable,” he said.

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

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