Fujitsu told to cough up compensation over Post Office Horizon scandal

Fujitsu, whose defective Horizon IT system has been blamed for causing so much anguish, has been urged to pay compensation to victims by a senior Tory MP

Fujitsu logo sign of the Japanese technology company. The IT service provider supports the digital transformation. Equipment and software are products
Fujitsu is also facing tough questions over its role in the Post Office scandal. (Alamy)

A former postal minister has suggested Fujitsu should pay compensation to victims of its faulty Post Office Horizon IT system, which resulted in more than 700 staff members being wrongly convicted.

Paul Scully's comments come amid mounting anger over the Post Office scandal, with the government currently seeking ways to speed up the process of exonerating sub-postmasters who were jailed for offences including theft, fraud and false accounting after system errors produced inaccurate financial discrepancies.

The Post Office has been under intense scrutiny, with an independent public statutory inquiry set to continue this year. On Tuesday its former CEO, Paula Vennells, opted to hand back her CBE after more than 1.2 million people signed a petition calling for her to do so.

Now, attention is also on Fujitsu's role in the scandal, with questions raised over why the IT company is still contracted to provide the Horizon system to this day, and whether the Japanese multinational should also be paying compensation to victims. Asked on Monday if Fujitsu should "pony up" and make payments to the victims, Scully told BBC Newsnight: "Absolutely, very much so."

Scully, who was postal affairs minister from 2020 to 2022, added: "I think there is a new system needed and I think it's pretty clear what the Post Office should do about having a new contractor."

Watch: Minister says Post Office will 'quite possibly' have to pay compensation to victims

Scully accepted that the Post Office can't replace the system overnight and said it would need "a lot of funding" to do so. His remarks are just one example of how more accountability is now also being demanded of Horizon's developer.

The Post Office, a limited company wholly owned by the UK government, is still paying Fujitsu "tens of millions of pounds" each year, the service's now-chief executive Nick Read told the BBC in November, without disclosing an exact figure.

He told the broadcaster: “Yes, we are currently on the Horizon system, but as I’ve said on many occasions, it is our desire to upgrade and move away from Horizon. It’s a 25-year-old system, it needs to clearly be upgraded and we’re looking and developing at the moment a new system so that we can get off Horizon.”

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While the scandal itself has been rumbling on for several years, with only 94 convictions overturned so far, it has been brought back into the spotlight by ITV1's highly acclaimed drama, Mr Bates vs The Post Office, which portrays the devastating impact on staff members' lives and their battle for justice.

Those affected by the scandal said they were in tears watching the series but praised it for its portrayal, and for reigniting public discourse about the legal challenge. It has certainly fuelled discussion in Parliament, with MPs discussing who should be held account in the Commons yesterday.

They also raised questions over the number of contracts Fujitsu currently has with the government. According to ITV News, the firm has been awarded more than 150 since the Post Office stopped prosecuting staff over accounting discrepancies caused by Horizon's faulty software.



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ITV1's Mr Bates vs Post Office has brought the scandal back into the public eye. (ITV)

Addressing postal services minister Kevin Hollinrake, former home secretary Priti Patel asked: "Will the minister give an insight into the steps that will be taken to review the actions and accountabilities of Fujitsu, as well as its culpability, as it is still awarded contracts, week after week, across government? The entire scandal has demonstrated acute institutional state failures that have to be acknowledged."

Labour's Andrew Gwynne added: "Heads have to roll, because people were in the know at Fujitsu and at the Post Office. While I am not somebody who seeks retribution, heads really must roll in this case because of the lives that were destroyed."

Tory MP David Jones asked: "Fujitsu is also the recipient of multi-million-pound contracts from many public bodies, including departments. Indeed, it has recently had contracts awarded by the Foreign, Commonwealth and Development Office, the Home Office and His Majesty’s Revenue and Customs.

"Can my honourable friend say why a company that has been the cause of such distress to so many of our fellow citizens continues to be the beneficiary of public sector contracts?"

'We too must bear responsibility as ministers'

Hollinrake told MPs the government is "looking at" other Fujitsu contracts, but insisted that Sir Wyn Williams, chairman of the Post Office Horizon IT inquiry, should be given space to finish his work and "make a decision on what happened, who is responsible and exactly what we will do about individuals or organisations at that point in time".

He added: "As ministers, we must bear responsibility for what we do, as well as expect people within the Post Office, Fujitsu and others to bear responsibility. As ministers, we must serve a useful purpose.

"I totally agree about drawing a line under this. That is exactly what we want to do, in two ways: by overturning convictions and by paying full and final compensation."

RETRANSMISSION CORRECTING TITLE Post Office Chief Executive Paula Vennells at the launch of the Post Office's three new current accounts, at the Norwich Crown Post Office branch in Norwich.
Former Post Office chief executive Paula Vennells, who presided over the service during the scandal, is handing back her CBE following public pressure. (Alamy)

What's next for Fujitsu?

When asked what's next for Fujitsu and its system, the Post Office told Yahoo News that there have been several versions of Horizon since it was first introduced in 1999. It said the current version, brought in from 2017, was "found in the group litigation to be robust, relative to comparable systems".

A spokesperson said it has been the Post Office's "long-stated" intent to replace Horizon with a new cloud-based system, for which it is already carrying out some tests in two pilot branches.

"After evaluation, this will be the version that we plan to install in pilot branches later in 2024. Around 300 serving postmasters are helping make sure the system is fit for the future with an effective and efficient roll-out across the network,” they added.

Yahoo News asked Fujitsu what steps it has taken to prevent a repeat of the Horizon scandal, and whether it would consider paying compensation to the victims. Here's what the company had to say:

“The current Post Office Horizon IT statutory Inquiry is examining complex events stretching back over 20 years to understand who knew what, when, and what they did with that knowledge. The Inquiry has reinforced the devastating impact on postmasters’ lives and that of their families, and Fujitsu has apologised for its role in their suffering.

"Fujitsu is fully committed to supporting the Inquiry in order to understand what happened and to learn from it. Out of respect for the Inquiry process, it would be inappropriate for Fujitsu to comment further at this time."

Meanwhile MPs on the Commons business and trade select committee have called for bosses from Fujitsu to answer questions in parliament over their role in the scandal. Chairman Liam Byrne said: “It is vital that Fujitsu confess how they got it so wrong and how on earth they have had the temerity to carry on taking public contracts when they were so involved in a scandal that put innocent public servants behind bars. That’s the question we’ve now called the firm to parliament to answer.”