Post Office Horizon Inquiry calls for compensation to be brought forward

Suffering and financial loss of subpostmasters prompts decision in interim report

An inquiry into one of the UK's greatest IT scandals has called for compensation offered by the government to victims falsely accused of fraud to be brought forward and strengthened.

In an interim report before Parliament, inquiry chair Sir Wyn Williams said the government should resolve issues blocking full and fair compensation to sub-postmasters affected by the Horizon scandal.

He called for legislative change and a strengthening of the Horizon Compensation Advisory Board to help those affected by the mass miscarriage of justice.

Between 2000 and 2014, 736 managers of local Post Office branches around Britain were criminally convicted of financial fraud when errors in a nationwide accounting system, Horizon, were to blame.

The Post Office relied on evidence from its Horizon branch office management IT system when it privately prosecuted subpostmasters over the period. While the system was known to throw up accounting errors, managers did not warn the subpostmasters.

Faced with significant shortfalls between reported revenues and takings, some subpostmasters resorted to putting their own money into their franchised branches to balance the books. When Horizon continued throwing up discrepancies, Post Office managers accused the subpostmasters of stealing the money. Private prosecutions and criminal convictions followed. At least two subpostmasters later committed suicide, one taking his life after the Post Office said he owed the branch hundreds of thousands of pounds.

In April 2021, the Court of Appeal in England quashed 39 convictions that were obtained by the Post Office's in-house lawyers who had ignored their own barristers' advice.

Separately, in 2019, 555 postmasters who had taken the first legal action against the Post Office over Horizon received £43 million ($52 million) plus legal costs in a settlement. The bulk of the money, however, was consumed by the costs of funding the case.

The inquiry was established in non-statutory form on September 29, 2020. It was converted to a statutory inquiry on June 1, 2021, and is calling witnesses from both the Post Office and Fujitsu, which built the Horizon system under government deals originating in the 1990s.

Politicians previously said they felt Fujitsu had remained out of the limelight in the case, and want to see the company held to account.

In an interim report, Sir Wyn, a former high court judge, has decided to bring forward his investigation of compensation issues from a later stage of his inquiry after hearing human impact testimony from former subpostmasters and others about the suffering and financial loss they endured.

"Such evidence left me in no doubt that there was a compelling need to provide compensation to all those who had suffered loss and damage which properly reflected their pecuniary and non-pecuniary losses," he said.

"The object of each scheme is to put the subpostmaster into the position in which he/she would have been had he/she not been the victim of unlawful tortious behaviour and/or the position in which they would have been had the various breaches of contract which they may prove had not occurred."

Sir Wyn said concerns he has previously set out about delays in the administration of the schemes remain valid. He would judge whether the compensation had been full and fair would come during Phase 5 of the inquiry, which looks to redress access to justice in the autumn of 2023.

In a statement to The Reg, Fujitsu said it is "committed to giving its full co-operation to the Post Office Horizon IT Inquiry as it continues to examine complex events stretching back over 20 years, and to providing the fullest and most transparent information so that key lessons are learned for the future.

"Out of respect for the inquiry process, it would be inappropriate for Fujitsu to comment further at this time."

The Post Office told us: "We welcome Sir Wyn's interim report and share his view that victims of the Horizon scandal must be provided with full compensation, fairly and consistently. This remains our priority.

"Across Post Office's compensation arrangements, offers totalling more than £120m have been made to around 2,500 Postmasters, with the majority of these agreed and paid. Interim payments continue to be provided in cases not yet fully resolved."

"Regarding late applications to the Horizon Shortfall Scheme, we can confirm that we continue to accept eligible late applications and publish data each month showing the progress we're making in resolving these applications and the level of compensation paid." ®

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