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Post Office boss blames ‘culture of denial’ for Horizon compensation delay

Nick Read, seen here at the Business and Trade Select Committee on Tuesday, also appeared to concede the Post Office could ultimately face liabilities close to £1 billion
Mr Read, seen here at the Business and Trade Select Committee on Tuesday, also appeared to concede the Post Office could ultimately face liabilities close to £1 billion - PRU/AFP via Getty Images

The chief executive of the Post Office presided over a “culture of denial” as the company dragged its feet over compensation payments for victims of the Horizon scandal, MPs heard on Tuesday.

On a day of revelations, it emerged that the Post Office faces financial liabilities of up to £1 billion even as controversial IT company Fujitsu said it would contribute to compensation payouts.

Parliament’s Business and Trade Committee heard from some of the key players in the two-decade-long scandal, including some of those falsely convicted of criminal offences.

Alan Bates, whose dogged campaigning over the past two decades brought the scandal to public light, said the years-long delays to payouts were “madness”.

Meanwhile, fellow subpostmaster Jo Hamilton told MPs that applying for compensation was like being “retried” in court.

Another 200 potential victims have come forward since ITV’s Mr Bates vs The Post Office drama was aired a fortnight ago, lawyer Neil Hudgell revealed to MPs.

While Paul Patterson,  Fujitsu’s Europe boss, apologised for his company’s support for wrongful Post Office prosecutions, it was overshadowed by the news that just three subpostmasters have received full financial redress to date.

Culture of denial

The Post Office dragged its feet over compensation payments for victims, MPs were told.

Nick Read, the company’s chief executive, told Parliament’s business and trade committee on Tuesday that he could “only assume” it was a refusal to accept that hundreds of subpostmasters had been falsely accused over missing funds that led to the Post Office pushing back on compensation.

Challenged over why his organisation fought the provision of compensation to those who were unfairly punished for so long, Mr Read said: “A culture of denial. I can only assume that that is the case.

“It’s a lack of understanding and perhaps a lack of curiosity of really what is going on. I think that the most important cultural challenge that I have in my organisation is to ensure that everybody in the organisation sees and understands absolutely what has been going on.”

Mr Read also appeared to concede the Post Office could ultimately face liabilities from the scandal of close to £1 billion, and said he was unsure whether money paid by sub-postmasters was included in overall Post Office profits.

Mr Patterson offered a public apology for the Horizon IT system maker’s actions.

“We were involved from the very start. We did have bugs and errors in the system. And we did help the Post Office in their prosecutions of subpostmasters,” said Mr Patterson.

“For that, we are truly sorry,” he told the committee.

Committee chairman Liam Byrne MP said he had been “fairly shocked” by the two executives’ evidence.

“You’ve not been able to supply the committee with key events in the timeline, such as when the Post Office first knew that remote access was possible,” he said.

“You’ve told us that you haven’t kept evidence safe about what money was paid to you inappropriately and, therefore, is owed back. And you can’t estimate the scale of compensation.”

Only three sub-postmasters compensated

Just three compensation claims brought on behalf of more than 70 affected sub-postmasters have been settled so far, their lawyer told MPs.

Dr Neil Hudgell, who acts for wronged victims including Ms Hamilton - played by Monica Dolan in the ITV drama - explained how many of his clients had been given financial redress by the Post Office.

“Within the convicted cohort of clients that we have, of those 73, three have been fully paid out,” he said.

“Three?” asked an incredulous Mr Byrne. “Let me just check this. Years after the key landmark [court] cases, only three of those convicted have had a full and final settlement?”

“Correct,” replied Dr Hudgell, adding: “It’s taking three to four months to get a response to routine correspondence.”

Hundreds more victims come forward

ITV’s seminal drama, Mr Bates vs The Post Office, together with intense public interest in the scandal has prompted hundreds more potential victims to come forward since it was aired in the first week of January.

Asked by Mr Byrne whether the ITV show would prompt further compensation claims, Dr Hudgell said: “Up to this morning we have had in excess of 200 enquiries related to Horizon Shortfall (scheme),” clarifying that they were new enquiries.

He continued: “We have equally had in excess of 20 enquiries that have asked us to look at settled HSS cases. My gut feel is that there are a significant number of under-settled matters.”

Mr Read confirmed the 200 figure and said: “That is good, the raising awareness is a good thing as it is bringing people forward.”

Dr Hudgell explained that subpostmasters who push back against their initial offers are securing “on average at least a 25 per cent increase” in their payouts.

Many subpostmasters not only were forced to pay thousands or tens of thousands of pounds to the Post Office that never went missing in the first place but also lost their businesses, homes and livelihoods when their contracts were terminated.

Post Office branches are run as franchises, meaning many subpostmasters paid substantial sums to buy or lease their businesses and premises.

Mr Bates: ‘It’s all madness’

Mr Bates criticised the “madness” of the Post Office scandal compensation scheme, revealing he has been left waiting for more than two months after submitting a claim.

The former subpostmaster said he had been waiting for 66 days so far to hear from the Horizon Shortfall Scheme.

“It’s madness – the whole thing is madness and there’s no transparency, that’s the frustrating thing,” he told MPs.

“Today will be the 66th working day, allowing for Christmas and New Year, but I’m still waiting for my first offer. And I’m being told that I won’t receive anything or a first offer until the end of this month.

“We do not know what is happening to these cases once they are submitted.”

Jo Hamilton: Compensation claim like a retrial

Ms Hamilton, who testified to MPs alongside Mr Bates on Tuesday, said trying to claim compensation from the Post Office was like being put on trial all over again.

“It’s almost like you’re being retried, because everything you say, they say, ‘oh, justify that and justify that’. And it just goes on and on and on,” she said.

“They have to literally drill into the minute details of everything they think you might be claiming, you know, it’s almost like you’re a criminal all over again.

“They’re in this factory of bureaucracy that just swallows up paperwork.”

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