Post Office: Horizon Compensation

Monday 10th January 2022 Lords Chamber

Question

14:45

Asked by

[Baroness Bakewell]

To ask Her Majesty’s Government what steps they are taking, if any, to expedite the payment of compensation due to postmasters and mistresses as a result of the Post Office Horizon IT scandal.

[The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Callanan) (Con)]

My Lords, the Government are working closely with the Post Office to ensure that the approach and processes adopted are being designed to ensure that postmasters receive fair settlements as swiftly as possible. Of the 72 postmasters who have so far had their convictions quashed, 66 have applied for interim payments, of which 62 have received offers; 57 of those have been paid. The Government are also ensuring that the historical shortfall scheme is delivering in line with its objectives.

[Baroness Bakewell (Lab)]

My Lords, the Post Office scandal involved some 732 prosecutions over a 20-year period. Many convictions have since been overturned. Can the Minister say how many claims have now been settled, how many remain outstanding and what the total cost will be?

[Lord Callanan (Con)]

I gave the noble Baroness the figures on those who have had their convictions overturned so far. Interim payments of £100,000 each have already been made to many of them. We are attempting to negotiate with the rest of them; payments will be made as quickly as possible. It will then go to the dispute resolution process, which we think will be quicker than any ongoing further court action, to negotiate appropriate settlements with those sub-postmasters who were wrongly convicted.

[Lord Arbuthnot of Edrom (Con)]

My Lords, what matters will be covered by the compensation announced last month for those sub-postmasters who have had their convictions overturned? It will include financial loss, obviously, but will it also cover loss of reputation, pain and suffering, and consequential loss? How will the Government ensure consistency over the many different types of cases that there will be?

[Lord Callanan (Con)]

I start by paying tribute to the work of my noble friend in both this House and the other place in drawing attention to this scandal when many others were not discussing it; he was right to do so, along with many other Members on all sides. I can confirm that, when negotiating compensation for postmasters with overturned convictions, the Post Office will consider claims for financial and consequential losses as well as non-financial losses, such as reputational damage and mental distress. In terms of consistency, each case will necessarily be decided on the particular circumstances of the individual postmaster but, to ensure broad consistency, the Post Office and its legal advisers will seek to agree a consistent approach in assessing the different heads of loss with legal representatives.

[Lord Berkeley (Lab)]

My Lords, my noble friend Lady Bakewell said in her follow-up question that there had been 732 convictions. From the Minister’s Answer, I get the impression that only 10% of those convicted have actually had their cases heard. Is that correct? When does he see that the whole process will be completed?

[Lord Callanan (Con)]

The noble Lord makes a good point but this is in the hands of the court. So far, 72 people have had their convictions overturned. As soon as the others have had their convictions overturned, we will proceed with offering compensation to them as well.

[Baroness Hoey (Non-Afl)]

My Lords, the postmasters and postmistresses were treated shockingly by the Post Office. Can the Minister tell us whether anyone in the Post Office seniority has been reprimanded or sacked or had money taken off them? Has anything happened to anyone? Has anyone in the Post Office taken responsibility for this appalling treatment of men and women?

[Lord Callanan (Con)]

“Shockingly” is almost an understatement of the full extent of the terrible injustices that went on for sub-postmasters over many years and many different Governments, Ministers et cetera. Most of the senior executives of the Post Office who were responsible are not there anymore, but the appropriate mechanism to find out exactly who was to blame and who was responsible is the independent public inquiry with full statutory powers, which is currently considering these matters.

[Lord Fox (LD)]

My Lords, this is not the first time that your Lordships have had to discuss this, and already this year we have this Question again. I am sure that the Minister would agree that, for these people to start to live the rest of their lives, they need to draw a line and be able to move on. This process is dragging on, so does the Minister agree that by setting a target—a political target that the Minister can set—with his department, with the lawyers and with the Post Office, we could get this done? Will he undertake to do that, and make sure that this is done in the first half of this year, so that the line can be drawn?

[Lord Callanan (Con)]

I can speak for my colleague Paul Scully, the postal affairs Minister, that we want to see this settled as quickly as possible in order, as the noble Lord said, to draw a line under it for the benefit of those people who were so badly affected. Of course, we are in the hands of the courts initially for the convictions to be overturned, but as soon as they are—if that is the judgment that the courts come to—we want to use the ADR process to try to get compensation offers to these people as quickly as possible.

[Lord Polak (Con)]

My Lords, I have raised the plight of my friend Rita Threlfall on a number of occasions. She is one of the 555 sub-postmasters and mistresses who initiated the group litigation. They won, and were awarded £57 million. However, £46 million went on costs and funding the action—action that helped lead to today’s situation. They were thanked by the Government, but their compensation was woefully inadequate. Will the Minister ensure that the 554 plus Rita are properly compensated? At the moment, their feeling is not of compensation but of discrimination.

[Lord Callanan (Con)]

I totally understand the point that my noble friend is making; we have spoken about it on a number of times in the past. The problem, of course, is that this compensation settlement that was reached in a civil action was in full and final settlement of the claims. However, having said that, my colleague Paul Scully has met with them many times and has said that we are in active discussions with them to see what more could be done. Indeed, officials are meeting this week with lawyers representing them to discuss it.

[The Lord Bishop of Leeds]

My Lords, will the Minister say whether, following on from that question, those who are currently negotiating compensation with the Post Office for some form of redress are having their legal costs paid, or are they expected to pay them and then try to claim them back later?

[Lord Callanan (Con)]

I am not sure of the precise details of that; I assume the right reverend Prelate means those from the historical shortfall scheme or those who have had their convictions overturned. My understanding is that all of their costs will be met, but if that is not right, I will write to him.

[Lord McNicol of West Kilbride (Lab)]

My Lords, hundreds of sub-postmasters and mistresses were sacked and prosecuted over the space of 16 years and wrongfully labelled as thieves and fraudsters by the Post Office and by our judicial system. Just to take the noble Baroness’s Question a bit further, what action if any has been, or will be, taken against Her Majesty’s Government’s representatives who sat on the board of the Post Office throughout this terrible situation?

[Lord Callanan (Con)]

I totally agree with the noble Lord on the first part of his question. The correct answer to that is to wait for the outcome of the inquiry. As we have discussed before, this went on for decades, and exactly who was responsible at the time, and who knew what and when, is a hugely complicated issue. Of course, many of the people responsible at those times are no longer in government, in the department or in the Post Office. It will be important to find out who exactly who was responsible over a long period of time, and then we can pin the appropriate blame.

[Lord Anderson of Swansea (Lab)]

My Lords, to accelerate things and bring an end to the scandal, would the Government consider a scheme similar to that which applies to personal injury cases, to agree guidelines or bands within which a settlement could be reached so that legal advisers can properly give advice to those who have suffered as a result of the Post Office injustice?

[Lord Callanan (Con)]

As I outlined in my earlier answer to my noble friend Lord Arbuthnot, we will of course take all the circumstances into account, but necessarily it is important to look at the individual circumstances of each of the postmasters who were wrongly convicted and had their conviction overturned. We want to ensure that everybody is appropriately and fairly compensated within the appropriate bands and will do so.

[Baroness Redfern (Con)]

My Lords, we hear many tragic cases of people who have lost their liberties and lives and faced years of financial hardship. Can the Minister clarify what role the National Federation of SubPostmasters played in the Horizon scandal, in terms of representing affected sub-postmasters, and the damage that Horizon has caused to the relationship between the Post Office Ltd and postmasters? Finally, will this impact on the post office network, going forward?

[Lord Callanan (Con)]

The answer to my noble friend’s last question is no. The funding for the post office network is separate to this. It provides a vital service, and we must ensure that it continues. I do not know the answer to her question on the precise role played by the National Federation of SubPostmasters, but from discussions that I have had with senior management of the Post Office I know that they are very keen to ensure that relations with people who provide the day-to-day services for their organisation is improved and they are much better represented in the future than they were in the past.