Post Office Horizon IT Scandal: Compensation

(Urgent Question): To ask the Secretary of State for Business and Trade if she will make a statement on the interim report of the Post Office Horizon IT scandal inquiry relating to compensation.

I thank the right hon. Member for his question and his tireless campaigning on this issue. I am also grateful to Sir Wyn Williams for his work and for publishing his interim report. We will, of course, consider that properly in the coming days and provide a formal response to the House.

Sir Wyn’s report recaps the progress made in delivering compensation. He notes our repeated commitment, which I reiterate again, that that compensation should be full and fair. He notes allegations from some lawyers that there are impediments to providing such compensation, but says that he cannot see any legal reason why we cannot deliver our commitment. He is right, and that commitment will be delivered.

Sir Wyn’s first four recommendations deal with the advisory board, of which the right hon. Gentleman is a member. As he knows, the board was established at the instigation of my Department, and its composition and remit were extended as a result of discussions between Ministers, officials, himself and the rest of the board. It has already performed a very valuable service. Notably, its last meeting made recommendations about an appeals process independent of the Post Office. We are considering that recommendation and will reply in due course.

Sir Wyn also refers to the tax treatment of compensation payments. The right hon. Member will acknowledge that when we worked with him and the board on that matter, it resulted in £26 million of additional payments in the historic shortfall scheme, and exemptions from income tax, capital gains tax and national insurance contributions. Sir Wyn also suggests that we should legislate to extend the deadline for the group litigation order compensation scheme.

As we have stated, we will not let an arbitrary date stand in the way of paying full and fair compensation to postmasters. As compensation is being delivered under the sole authority of the Appropriation Act, spending on it is limited to a two-year window that closes in August next year. The Government are determined to deliver compensation by that date. That remains perfectly possible, but challenging. If it seems likely that we will not be able to compensate everyone in time, we shall of course consider legislation, as Sir Wyn recommends. I want to deliver by that date not for some legalistic reason, but in the interests of postmasters who have waited too long for justice.

May I start by declaring an interest, as a member of the Horizon compensation advisory board? I thank the Minister for his remarks and for the positive and constructive approach with which he has addressed this issue. I also thank Sir Wyn and the inquiry for their ongoing work. I agree with many of Sir Wyn’s recommendations. I would be interested to know exactly when they will be responded to, especially because a lot of them were in the note that the advisory board sent to the Minister at the last meeting.

The three compensation schemes have become unwieldy, but the fundamental point is that equal and fair compensation has to be paid to all the people across the three schemes. I would be interested to know from the Minister when the recommendations will be addressed, particularly on extending the remit of the advisory board. I accept what he says: our aim—and certainly his—is to get compensation to people as quickly as possible.

The elephant in the room that needs to be addressed is the continued obstructive role of the Post Office. I found it remarkable that yesterday on BBC radio, the chief executive, Nick Read, said that the “sheer scale” of the problem has

“gone above and beyond anything that anybody could realistically expect”.

That begs the question of what he has been doing for the last four years and why he has been accepting bonuses for his and his management’s role in the inquiry.

The inquiry was stalled last week because again, the Post Office failed to disclose documents to it. When is this issue going to be dealt with? It either gets dealt with, or Nick Read and the entire board have to be sacked. The Minister knows, because he has met many of the people who are waiting for compensation, that they have gone through a lot. They need justice, and they need action. Ill-conceived comments from the present chief executive of the Post Office are rubbing salt in the wounds of the victims. Either he has to go, or something has to radically change at the Post Office.

I am grateful to the right hon. Gentleman for his work. He is right to say that there are three schemes, which might be described as suboptimal. As Sir Wyn has said on this occasion and previous occasions, we are where we find ourselves, and we must push on. That is the easiest way and the best way to get compensation for those affected.

I referred in my initial remarks to the request that the right hon. Gentleman has made for an appeal mechanism. We are considering that carefully. I think he would acknowledge that whenever he has come to me with something that he thinks we should consider, we have always done that and are keen to deliver the mechanisms that the board requires.

The delays in disclosure were unacceptable, without question, and the Post Office has apologised for that. You are only as good as your last game, and the Post Office has to up its game; there is no doubt about it. We have a governance review into earlier issues around remuneration and the metrics regarding bonuses, which were found to be completely inappropriate. We are waiting for that report, which I should receive by the end of this month. We will take that under advisement, as we do any other evidence we receive about the operation of the board of the Post Office.

I thank my hon. Friend for the update. Some 555 individuals have suffered incredible destitution and injustice for far too long. This has gone on for more than 20 years, and some people have died during this process. Will he ensure that the Post Office owns up to what it has done and that the individuals who were responsible for covering this up 20 years ago are brought to justice, rather than this leaving a stain on the reputations of the postmasters and postmistresses, who are totally innocent of any crime?

I am grateful to my hon. Friend for his work on this issue. He is right: 62 people have passed away while awaiting compensation. It is simply unacceptable. My Department is looking at creative ways of accelerating the process of providing compensation to the victims.

I agree with my hon. Friend about the need for people to be held to account, and I spoke about that on a number of occasions from the Back Benches. It is right that people are held to account. It is also right that due process is followed. Sir Wyn Williams’s inquiry is there to identify what went wrong and why and who was responsible, and once that is done we should make a judgment about what happens to those people, but I am keen, like my hon. Friend, that people are held to account.

I call the shadow Minister.

Nine hundred prosecutions—all the postmasters involved have their own stories of dreams crushed, careers ruined, families destroyed, reputations smashed and lives lost. Innocent people have been bankrupted and imprisoned. This may well be the largest miscarriage of justice in our country’s history, and I pay tribute to Members on all sides of this House who have worked for justice, none more so than my right hon. Friend the Member for North Durham (Mr Jones). I also thank the advisory board and Sir Wyn for their work, as well as the Minister for the constructive approach he has taken on this issue to date.

However, as Sir Wyn’s interim report makes clear, the compensation schemes for postmasters are a mess. The commitment to give fair compensation should apply to all postmasters. Sir Wyn specifically recommends that terms of reference should enable the monitoring of individual cases. Can the Minister say that he will act on that recommendation, and when can we expect him to respond in full to the report’s recommendations, including maximising the use of the Horizon compensation advisory board and providing clarity about the tax status of compensation payments? Can he also provide a final figure for claims that have been made to the historical shortfall scheme and how much the Government anticipate the final compensation will cost?

I also ask the Minister what he is going to do about Post Office management. As the only shareholder in the Post Office, does his Department take responsibility for addressing those management issues? The leadership team accepted bonuses for their work on the inquiry, which is just unacceptable. When will the Minister deal with this? Sub-postmasters have had their lives ruined: they must be confident that lessons will be learned from those failures. Sadly, it seems that the Post Office has failed to do so.

I add my thanks to the advisory board and the right hon. Member for North Durham, but also to Lord Arbuthnot—who is a tremendous campaigner in this area—and other individuals such as Professor Moorhead, who we were keen to include on the advisory board. I also thank campaigners on both sides of this House who made sure that the issue came to light and that action was taken to address these horrendous situations.

On individual cases, as I said to the right hon. Member for North Durham, we are looking at Sir Wyn’s recommendation. There is an appeals mechanism, and condition D of the terms of reference does not prevent us from looking to make sure that claims have been settled fairly and fully. That is something we are looking at and we will respond in due course. On the tax position, as I said earlier, we have provided an extra £26 million to address that. We are keen to make sure that not only all the settlements, but all the tax treatments of those settlements are fair across the board. On the totals for the historical shortfall scheme, we have made offers totalling over £100 million in value and £72.8 million has been accepted, so we have made good progress, but we are keen to make further progress on the remaining claims that are yet to be accepted.

On the Post Office management, there have been a number of unacceptable matters relating to what has happened in the governance of the Post Office. That is why we put in place a governance review, which is being conducted by a very competent legal firm. It is due to report by the end of this month. We will study that review carefully and respond accordingly.

The Minister in place at the moment will realise that former colleagues have stood at the Dispatch Box and given excuses. The procrastination from his Department has been terrible and the effects are ongoing. Fulsome and full compensation is to be welcomed, but the word that was missing from the Minister’s statement was “timely.” Therefore, the first part of my question is this: why two years? Why not two months or two weeks? Pay the compensation to the postmasters affected.

The second part of my question is about the senior management team. So far, they have got away with it. They need to be held to account, as do their IT consultants. When will something positively be done to bring those people to book?

Again, I know my hon. Friend was one of the key campaigners on this particular issue. I cannot speak for previous Ministers—although I have a great regard for my immediate predecessor certainly—who have dealt with this issue. I have not seen any procrastination and we are driving this as quickly as possible within the Department.

On why not two weeks, rather than two years, settling compensation claims is complicated. It is about specific instances of pecuniary losses and non-pecuniary losses; it is complicated. We are keen to get that money out the door as quickly as possible and, as I have said, we are looking at creative ways to do that. I am just as ambitious as my hon. Friend is to get that money into the hands of the people who need it. There have been interim payments of around £20 million on both outstanding schemes—the GLO and overturned convictions schemes. Nevertheless, full and fair compensation is what we desire.

On people being held to account, I refer my hon. Friend to what I said earlier. We need to see the results of the inquiry—that is what Sir Wyn Williams is there for and we need to see the outcome of his inquiry—and, where he can identify blame, we are very keen to make sure those people are held to account.

I call the SNP spokesperson.

I do not know where to start—there is so much—but here I go. The SNP welcomes Sir Wyn Williams’s interim report on compensation. His recommendations would go a huge way to ensuring that victims are fully and fairly compensated, and it is about time. The enhanced role for the Horizon compensation advisory board is welcome as well. But the question, as one hon. Member has already said, is: when is this all going to happen? I know the Minister cannot give us an answer to that today, but he updated something I had in my notes: it is now 62 claimants who have died without receiving full and fair compensation. We need to move this on.

Funnily enough, we had a meeting of the all-party parliamentary group on post offices this morning, at which the chief executive officer of Post Office Ltd appeared and answered some questions. The culture at Post Office Ltd has not changed since the new CEO took on his role in 2019. He promised to change the culture; he has not yet done so. We are mired in obfuscation still, and we cannot get to the truth of stuff because of the delay in providing evidence to Sir Wyn’s inquiry. Will the Minister agree to put pressure on the CEO to get this done?

The hon. Lady is one of the Members of Parliament I engage with more often than not in this place and she does a fantastic job, not least in chairing the all-party parliamentary group on post offices, so I thank her for her work. I agree with everything she said about the pace of delivery, the quality of delivery from the Post Office and making sure it meets its obligations. We have this constantly under review and we are driving this issue. We are determined to look at creative ways to accelerate compensation for all those affected by this, so we can finally draw a line under the matter. I accept we will not draw a line under it until we have held people to account for what has gone wrong, so that is something we are extremely keen to do.

Where there has been such a grave miscarriage of justice, it strikes me that we should be pulling out all the stops to ensure that justice is done and in a timely fashion, so perhaps the Government might consider bringing criminal charges against the Post Office and its IT advisers as a way of accelerating the process.

On pulling out all the stops, I could not agree more, and that is definitely what we are doing in the Department. My days are never without one or other post office issue, which is not the situation we want. On bringing forward criminal charges, of course the Government do not do that, but when our enforcement agencies determine that there have been criminal actions, wherever those criminal actions have emanated from, we would of course expect them to take action.

I call the Chair of the Business and Trade Committee.