Post Office: Horizon Compensation

Statement

My Lords, with the leave of the House, I will now repeat a Statement made by my honourable friend Minister Scully in another place:

“With permission, I will make a Statement on the latest steps that the Government are taking to ensure that swift and fair compensation is made available to postmasters impacted by the Horizon IT scandal.

This House is well aware of the terrible impact felt by the many postmasters affected by issues with the Post Office’s Horizon IT system, which began over 20 years ago. These distressing consequences have been widely documented both in the courts, in the 2019 group litigation order judgments, and in the more recent Court of Appeal judgments, as well as in the media. I would like to pay tribute to colleagues on both sides of the House who have supported postmasters in their efforts to expose the truth and see justice done.

Today, I would like to take the opportunity to update the House on the latest steps that the Government are taking to ensure that fair compensation is paid to people impacted by the Horizon IT scandal. As you all know, the members of the GLO performed a great public service by bringing the case in 2019 which exposed the scandal. That is why I was pleased that the Chancellor announced in March this year that further funding is being made available to ensure that they receive similar levels of compensation to that which is available to their non-GLO peers.

Today, I can update the House that the Government intend to make an interim payment of compensation to eligible members of the GLO who are not already covered by other compensation support, totalling £19.5 million. Together with the share of the December 2019 settlement that we understand was distributed to the GLO postmasters, this brings the total of compensation to about £30 million. Postmasters will be contacted in the coming weeks to submit an application, after which we aim to distribute the funds within a few weeks of receiving their application. I hope this will go some way in helping many postmasters who have, and still are, facing hardships.

In parallel, we are continuing to work at pace on delivering the final compensation scheme for the GLO. I can confirm that we will be appointing Freeths to access the data and methodology it developed in relation to the distribution of the 2019 settlement. Freeths represented the GLO claimants and has vital knowledge and expertise based on its involvement in the case. This will allow us to work at pace on the design of a scheme with the JFSA and Freeths to give those in the GLO similar compensation to their non-GLO peers.

As promised in March, we will informally consult with members of the GLO about the proposed scheme’s operations. I am also pleased to announce that members of the GLO group will be able to claim reasonable legal fees as part of participating in the compensation scheme. I hope this will allay any concerns that they might have about meeting the costs of seeking legal advice and support when applying to the scheme.

Turning now to progress on compensation for overturned criminal convictions, I am pleased to report to the House that interim payments are progressing well. As of 27 June, there have been 75 overturned convictions, with the most recent convictions being overturned in recent weeks. The Post Office has received 73 applications for interim payments, including several new applications in recent weeks. Sixty-seven offers have been accepted by claimants, with 66 payments totalling nearly £7 million paid out in compensation so far. This marks significant progress, with nine additional interim payments made to postmasters since I updated the BEIS Select Committee on 11 January 2022.

I am pleased that these interim payments have helped to deliver an early down payment on the compensation due to affected postmasters in advance of full and final compensation packages being agreed. For those postmasters with an overturned conviction who have already submitted quantified claims, I can share that we are working with the Post Office to agree part-payments of agreed elements of claims, such as loss of earnings, wherever possible and will continue to do so with additional claims which are submitted.

Taking this step should enable us to avoid undue delays by awarding partial compensation while outstanding matters are resolved. I acknowledge that one area where it has been challenging to agree compensation is non-pecuniary damages, some of which reflect the wider impact on postmasters’ lives that these wrongful convictions have had. These include compensation for the loss of their liberty or impacts on their mental health. A number of the postmasters have agreed to refer this issue to the process of early neutral evaluation, to be conducted by former Supreme Court judge Lord Dyson. It is hoped that this evaluation will facilitate the resolution of these issues. Government stand ready to support the delivery of the early neutral evaluation process and are keen to ensure that the outcomes of this process enable swift compensation. I urge all postmasters with a Horizon-related conviction to continue to come forward to seek to have these overturned. They are being contacted individually by the CCRC and other relevant bodies to encourage them to do so.

In addition to the progress on compensation for those with overturned criminal convictions, good progress has been made on delivering compensation for those in the historical shortfall scheme. As of 23 June, 65% of eligible claimants have now received an offer, meaning £29 million has now been offered and that 444 further postmasters have been offered compensation since my last update to the House. I would like to thank the independent panels for their diligent work in progressing these cases. As I have said previously, I have set the Post Office the ambition to make 100% of HSS offers by the end of the calendar year, and the Government are working closely with the Post Office to achieve this.

As I have said before, it is important—in addition to providing compensation—that we learn lessons so that something similar can never happen again. That is why the Government have set up the Post Office Horizon IT inquiry and put it on a statutory footing to ensure that it has all the powers it needs to investigate what happened, establish the facts and make recommendations for the future. We are co-operating fully with the inquiry to ensure that the facts of what happened are established and lessons learned.”

My Lords, I thank the Minister for repeating the Statement and in anticipation of answering my questions. He has often been on the right side of this debate, and I thank him for that. The biggest and most frequent criticisms that your Lordships’ House has had are threefold—some have been answered—the time taken to deliver compensation, who gets it, and the levels and amounts. Many of those issues have now been resolved over previous months and with this Statement. March’s announcement that 555 sub-postmasters would receive the compensation that they were entitled to was welcome, as is today’s further announcement confirming a £19.5 million interim compensation package.

However, it is frustrating that it has taken so long to reach this point, when what was needed to be done has been clear and obvious for many years. I am sure that we all agree that the victims of this scandal have been made to endure this stressful uncertainty for far too long.

It is clear that the positive resolution we have now reached is thanks to the tireless work of campaigners both inside and outside this place. That includes, as ever from this place, the noble Lord, Lord Arbuthnot, and from the other place, Kevan Jones. Both have done a tremendous job in fighting this injustice. To be fair, the Minister here and Minister Scully have acted where their predecessors have failed to.

We all know the history of this case, so I will not rehearse the arguments. It is well-documented, both here in Parliament and across the media. We all hope that this sad episode will drive lasting change. The shame of this miscarriage will, rightly, be felt across government for many years to come.

I have a few questions for the Minister; he has touched on some already, and I am looking for more details on others. Can he provide a timescale for when all compensation payments will be made? Will the Minister confirm that the compensation will not affect the Post Office’s core funding, its day-to-day operations or its viability in any way, given the vital role that it performs in many, if not all, our communities? The Minister knows that, across this House, we have called for those involved to be held accountable. Can he update the House—he has a little already—on the ongoing investigations, specifically into Fujitsu and others involved in the technology that led to this failure? Has Fujitsu been sanctioned? Have any of its other contracts been re-evaluated, checked or looked at?