Blair failed to halt 'flawed' Horizon rollout despite warnings
Former Prime Minister Tony Blair failed to stop the flawed Horizon software rollout despite warnings, leading to devastating consequences for over 900 sub-postmasters, inquiry heard.
Sir Tony Blair failed to put a brake on the Horizon rollout although the former prime minister had been warned the Post Office IT software was flawed, the inquiry heard on Wednesday (13).
In a witness statement, Lord Mandelson, who served as business secretary in Sir Tony’s cabinet, said the “integrity of the new system itself” was not “called into question” ahead of the 1999 rollout of the software. The Labour peer’s account comes 10 months after the public inquiry into the scandal was shown a note drafted by Geoff Mulgan, special adviser at Downing Street, and sent to the then prime minister in December 1988, which described the system as “increasingly flawed”.
Sir Tony jotted a handwritten note on the document itself, asking for a “clear view” on its reliability.
On Wednesday, the final hearing of the last phase of the Post Office inquiry took place and 80 additional witness statements were published – including Lord Mandelson’s. In his witness statement to the inquiry, the Labour peer wrote, “Concerning the integrity of the new system itself, this was not called into question.
“The external review’s findings were accepted both within my department and in No 10, albeit with some conditionality.”
He added: “The recommendation to confirm the Horizon system was made to the Prime Minister and the final decision was his. I do not remember No 10 putting a brake on the programme at any stage.”
By 1998 the Horizon project, which was launched under John Major’s government, had been running more than two years behind schedule. As a result, the project was referred to Sir Tony to decide if it should continue. In his own witness statement submitted to the inquiry, the former prime minister said he was unable to recall some details of the period.
However, he wrote: “I have learnt that it is crucial to obtain advice from experts with deep experience in the field who can provide the necessary assurance. As I have explained, I sought and obtained assurances as to the reliability of the product being developed.
“It is now clear that the Horizon product was seriously flawed, leading to tragic and completely unacceptable consequences, and I have deep sympathy with those affected.”
More than 900 sub-postmasters were wrongfully prosecuted as a result of the Horizon scandal, which saw the faulty software incorrectly record shortfalls on their accounts.
The government has on Tuesday officially recognised Capture, the software which preceded Horizon, could have created shortfalls affecting postmasters.
It has asked the Post Office to urgently review its files and evidence so the Criminal Cases Review Commission (CCRC) and the Scottish Criminal Cases Review Commission (SCCRC) can ensure no one was wrongfully convicted of a Horizon-style injustice.
Responding to the independent Kroll report into the software, the business secretary has promised to provide redress for postmasters who suffered losses as a result of Capture. The government said it will work swiftly with victims to determine its form and scope, alongside eligibility criteria, by Spring 2025.
The Capture accounting system was rolled out across some Post Office branches from 1992 before it was replaced by Horizon in 1999. The government commissioned the independent report following postmasters coming forward publicly in January indicating they had faced detriment due to the Capture system. In its report, Kroll concluded Capture could have created shortfalls.
The response comes as the government marks £500 million paid to more than 3,300 Horizon victims.
“It is thanks to testimony of postmasters that this has been brought to light and failings have been discovered,” business and trade secretary Jonathan Reynolds said.
“We must now work quickly to provide redress and justice to those who have suffered greatly after being wrongly accused. I’d like to encourage anyone who believes they have been affected by Capture to share their story with us so we can put wrongs to right once and for all.”
Post office minister Gareth Thomas added: “It’s taken a long time to reach this point which is why my priority now is to deliver justice and redress to postmasters as swiftly as possible. We will do everything we can to correct the mistakes of the past and ensure they are not repeated.
“Postmasters have raised concerns with me that their income has not kept up with inflation over the past decade. The government therefore welcomes that the Post Office is going to make a one-off payment to postmasters to increase their remuneration.”
Due to the length of time which has passed since the Capture system was in use several issues have complicated the investigation including:
Far greater timescales, meaning a greater population of the users may have sadly died
Loss or destruction of relevant evidence for example relating to shortfalls, suspensions, terminations, prosecutions, and convictions
At least 19 different operational versions of the Capture software during the period
Ambiguous number of users during this period
Unlike Horizon, it is currently uncertain how many criminal prosecutions were based on Capture evidence. These challenges also mean it will be difficult for claimants to corroborate their claims with evidence.
The Post Office has indicated it holds further information on convictions and prosecutions during the Capture period. The government has asked them to carry out their review of these records urgently and send information to the CCRC and SCCRC.
£20 million boost to postmasters
Minister Thomas has also announced the government will support the Post Office network with a further £37.5 million subsidy. It comes as the Post Office today announced a £20 million boost for postmasters to address their concerns that their income has not kept up with inflation over the past decade.
“This government is committed to strengthening the Post Office and making sure postmasters receive the income they deserve for the vital services they provide for communities across the country,” Thomas said.
“That’s why we are providing a further £37.5 million of network subsidy this financial year which is essential to stabilise the organisation. I welcome the Post Office’s one-off payment this month to postmasters, which will go a long way in easing the burden they face ahead of Christmas.”
The £20 million boost to postmaster remuneration comes as the Post Office moves quickly to deliver on its ‘New Deal for Postmasters’ following its Transformation Plan announcement on 13 November.
Both independent postmasters and Post Office’s retail partners that operate branches on its behalf will receive the top-up payment ahead of Christmas. The top-up payment will be based on both the standard fixed and variable remuneration the branch received in November.
“As we implement our ‘New Deal for Postmasters’ we are fast-tracking payments to postmasters in recognition of the challenging trading conditions they are currently experiencing. Our customers want services in the run-up to Christmas that are convenient and in-person, and that’s what our postmasters and retail partners offer. We want our postmasters to focus on what they do best, serving their communities, and not to be worried about making ends meet,” Neil Brocklehurst, Post Office acting chief executive, said.
Calum Greenhow, chief executive for the National Federation of SubPostmasters, welcomed the announcement.
“The NFSP has long campaigned for a significant increase in postmasters’ remuneration to reflect the value of the vital public services that postmasters deliver to communities. We know that right now many of our postmasters are struggling and are very worried about their ability to pay bills and provide for their families,” Greenhow said.
“This £20m as a one-off payment in December is not only well timed but very much required. We look forward to working with the government and Post Office to deliver a further £100m uplift in annual remuneration by March 2026.”
Subject to the government funding, the Post Office’s Transformation Plan provides a route to adding an additional quarter of a billion pounds annually to total postmaster remuneration by 2030 by dramatically increasing postmasters’ share of revenues.
As part of the plan, postmasters can expect up to £120m in additional remuneration by the end of the first year of the Plan, representing a 30 per cent increase in revenue share. The ambition is to double average annual branch remuneration by 2030 with the right market and regulatory landscape.
The Post Office scandal continues to have a “severe” impact on the mental health and lives of the loved ones of victims, new research shows, calling on for tailored support for “secondary victims”.
Children (now adults), partners (including former partners), and other family members of those wrongly pursued by the Post Office, show high levels of PTSD and depressive symptoms as well as ongoing anxiety and stress.
This research indicates there is an urgent need for dedicated and tailored support for “secondary victims” impacted by this miscarriage of justice and the generational trauma that has followed as a result.
Experts examined the “ripple-effect” of harms on these “secondary victims”. As part of this work they used six clinical measures to gain insight into the impacts the Post Office scandal has had on participants’ mental health, life experiences, attitudes and beliefs.
The study was carried out by Dr Sally Day, Professor Rebecca Helm and Professor Richard Moorhead from the University of Exeter, Dr Emily Spearing, from the University of Western Australia and Dr Karen Nokes, from UCL. It has been shared with the official Inquiry, the victim core partipicant legal teams, and the Horizon Compensation Advisory Board.
Professor Helm said, “Our work suggests secondary victims of the scandal experience mental illness symptoms at worryingly high levels compared to the general population.”
At the end of the survey, participants were provided with the opportunity to share any further thoughts about the impact of the scandal. A total of 51 completed every part of the survey and 108 started it. Some indicated that they were not able to complete it due to acute suffering related to the scandal.
Clinical scales were not used to suggest or confirm medical diagnoses, but instead to develop knowledge of the variety and extent of possible harms caused by the scandal.
Many respondents met the clinical cut-off for post-traumatic stress symptoms (66.7 per cent of the 54 respondents answering the relevant questions) and depressive symptoms (69.8 per cent of the 53 respondents asking the relevant questions).
A total of 54.7 per cent of the 54 respondents who completed the anxiety-related questions met the cut-off point for requiring evaluation for high levels of anxiety (with 41.5 per cent of participants meeting criteria indicating severe anxiety).
Professor Moorhead said, “Our research clearly demonstrates how large the scandal looms in the lives of close family members of the subpostmasters and mistresses. The pain they live with is beyond sobering.
“Some family members told us they felt invisible in terms of accessing professional support services and experienced a lack of official recognition of their needs.”
The partners of those affected spoke of how lives had been “ruined” and futures altered by the impacts of the scandal. Children of former subpostmasters reported mirroring their parents’ strategies for coping, often feeling unable to disclose difficulties and access support.
Many reported feeling as if their childhoods had been “stolen” by the Post Office.
Respondents spoke of the care they hold for their family member who was a direct victim of the scandal, and how many live with a constant dread, fear, and anxiety that their family member was still at risk of having a serious mental health crisis, a nervous breakdown, and/or taking their own life.
Dr Day said, “This research highlights the ongoing mental health vulnerabilities generated from the scandal that families are forced to manage in their daily lives, largely on their own, and the potential for official responses to play a role in addressing some of the harm caused by the scandal.”
Police investigating crimes linked to the Post Office Horizon IT scandal are looking at "dozens" of potential suspects, but don't expect trials to begin until 2027. The police will also await the publication of Sir Wyn Williams’ public inquiry into the Post Office Horizon IT scandal before moving forward to charging, stated recent reports.
The investigation, which the police describe as unprecedented in size and scale, is in the first instance examining potential offences of perjury and perverting the course of justice by those involved in making “key decisions” on Post Office investigations and supporting prosecutions of branch owner-operators.
However, a second phase, which is being developed concurrently, is looking at “wider offences” and decision-makers involved more broadly at the Post Office, as well as at Fujitsu, which developed the controversial Horizon accounting software.
Three suspects have already been interviewed under caution and there are plans to interview others next year, according to police.
But no one will be charged until officers have read the final report from the separate public inquiry, almost 30 years after concerns were first raised.
Stephen Clayman, the Met commander overseeing the police investigation, said officers were “looking at the actions of prominent individuals” beyond those directly involved in making decisions on Post Office investigations and supporting prosecutions.
“We will go where the evidence takes us,” The Guardian quoted Clayman as saying. “We are looking at the Post Office and Fujitsu and anything wider. We will cast the net wider in terms of culpability.”
“The scale of the task ahead is unprecedented. I do know that if you take into account Post Office criminal and private prosecutions, civil claims and contract withdrawals, there are potentially thousands of victims who we are working hard to identify.”
Clayman added, “No key decisions will be made around submissions and charging decisions until the final report is delivered and thoroughly reviewed by the investigation team and the Crown Prosecution Service. We are looking at 2027 [for trials] realistically.”
“We have been building a larger investigation team made up of officers across all forces. All forces are contributing to the build of a national team. This is a truly national operation in scale and should be resourced as such.”
Michael Norman, the senior investigating officer, added that police were also looking at “investigators, solicitors, barristers and people within Fujitsu as well”.
“As others [persons of interest] come into scope we will look at those as well, if they become raised to suspect status,” Norman said. “It is very fluid. The issue of corporate liability, corporate culpability, is always open.”
Norman said that to date the police had interviewed three individuals under caution, dating back to 2021, with the most recent in September this year. Clayman said prosecutions would not reach trial until 2027, in part due to the “unprecedented” scale of the investigation, which is reviewing more than 1.5 million documents.
More than 900 post office operators were prosecuted between 1999 and 2015 because of faulty Horizon accounting software that made it look as though they had been committing fraud.
The Post Office is predicting that close to £1 billion worth of cash will be withdrawn over the counter at its branches in December.
Last December, Post Offices handled a then record £930 million worth of personal cash withdrawals at its branches.
New figures released today (10) reveal the impact ‘Storm Bert’ had on cash transactions at PostOffices in November. Just over £3.5 billion in cash deposits and withdrawals were handled by branches in November. This compared with £3.7 billion in October and PostOffice has attributed this month-on-month fall to ‘Storm Bert’ which impacted Wales, the South West of England, Central England and Scotland at the end of November.
Personal cash deposits totalled £1.45 billion which was down 4.5% month-on-month (£1.52 billion, October 2024) but was up 12.3 per cent year-on-year (£1.29 billion, November 2024). Business cash deposits in November totalled £1.12 billion which was down 7 per cent month-on-month (£1.21 billion, October 2024) but was up 1.5 per cent year-on-year (£1.11 billion, November 2024).
Personal cash withdrawals totalled £916 million in November which dipped 1.3 per cent month-on-month (£928 million, October 2024) but was up 4.3 per cent year-on-year (£879 million, November 2024).
Ross Borkett, Post Office Banking Director, said, “Following the large-scale disruption caused by Storm Bert last month, postmasters and their teams are on hand to support small businesses who desperately rely on cash takings in the run-up to Christmas. Our branches provide somewhere convenient and secure where they can deposit their cash.
“Many people rely on cash in order to budget in the run-up to Christmas Day and the trends we’re seeing indicate that personal cash withdrawals will be greater in December than the previous year.
"People can withdraw the cash they need, to the penny, at our branches with many open long hours and on the weekend.”
Post Office Cash tracker data – November 2024
Cash deposits value (business & personal)
MOM%
YOY%
Cash withdrawals value (business & personal)
MOM%
YOY%
Total cash deposits & withdrawal value for November 2024
As at 16 October, 88 hubs have been opened in partnership between Cash Access UK and the Post Office. 168 Banking Hubs have now been announced by LINK with further openings planned for later this year.
Two serving postmasters, Brian Smith and Sara Barlow, have been elected to the Post Office board as non-executive directors.
This is the second time in the Post Office’s 360-year history that serving postmasters have been elected to the board. Smith and Barlow will replace Elliot Jacobs and Saf Ismail who were first elected to sit on the board in 2021.
The appointment of Smith and Barlow follows approval from business and trade secretary Jonathan Reynolds. It comes after the Post Office chair Nigel Railton set out an ambitious five-year Transformation Plan for the Post Office to deliver a ‘New Deal for Postmasters’.
Brian Smith is the postmaster for Clocktower Post Office on the Shetland Islands. He has run the branch for 19 years. He said: “I am eager to bring my unique insights, diverse skills, and unwavering commitment to the Post Office's mission to the board. My passion for community engagement, drive for innovation, and a deep understanding of the retail landscape, will all aid me to support the Post Office on its path to modernisation and continued success.”
Sara Barlow is the postmaster for Rainhill, Merseyside. She has run the branch for six years and has been awarded a British Empire Medal for services to business and the community. Barlow said: “I have been an active participant in many postmaster working groups, forums and associations. Whether it’s through Peer Support or in my role on the Wellbeing initiative team, I am driven to help support postmasters on a wide range of issues from remuneration improvements to emotional support.”
Voting to elect two new postmasters as non-executive directors to the Post Office board took place between 30 September and 16 October.
Commenting, post office minister Gareth Thomas, said: “It’s absolutely right that postmasters should play a leading role in shaping the future of the Post Office, providing invaluable experience to ensure it serves the needs of communities across the country. Brian and Sara will make excellent additions to the leadership team, helping to further bridge the gap between branches and the board.”
Railton added: “I am delighted to be welcoming Brian and Sara to the board. We have an ambitious five-year Transformation Plan for the Post Office and both will bring critical real-life experience to the role helping us deliver a ‘New Deal for Postmasters’ that will also benefit the nine million customers that visit our branches every week and who rely on the essential products and services postmasters and their teams provide.”
Following an induction and training programme, covering the corporate and legal aspects of fulfilling the duties of a non-executive director, Smith took up his position on the Board on 4 December and Barlow will take up her position on the board on 28 January 2025.
Current postmaster non-executive director Elliot Jacobs tenure on the board has been extended to bring business continuity to the board alongside Smith and Barlow. Saf Ismail has stepped down from the board.