Groceries Code Adjudicator

Kevin Hollinrake Excerpts

Tuesday 5th March 2024 Commons Chamber

[The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)]

It is a pleasure to serve with you in the Chair, Mr Deputy Speaker. This debate is very important to me personally. My father was a hill farmer, and I represent a rural constituency with many farmers who are experiencing many of the pressures that the right hon. Member for Orkney and Shetland (Mr Carmichael) referred to; indeed, he described them as a perfect storm. I congratulate him on securing the debate and on all the work he does in this area, of which I am only too aware. He mentioned the pressures that farmers and those in the farming community face making a living, and the competition for land from different land uses, with which we should be careful in ensuring that we have food security as well as energy security and the other things that we need to retain in this country.

The right hon. Gentleman is of course familiar with the Groceries Code Adjudicator, but it might be worthwhile setting out exactly what it is there to do, how it can help get a fair deal for farmers, and what else we are doing to ensure that that is the case. The role of the GCA is to enforce the groceries supply code of practice. It does so by providing advice and guidance to both suppliers and large retailers on matters relating to the code, arbitrating in disputes between large retailers and their direct suppliers, investigating issues to ascertain whether there has been non-compliance with the code, and imposing sanctions and other remedies for breaches of the code.

The code applies to the 14 largest grocery retailers in the UK, which have an annual turnover in groceries of £1 billion or more. As the right hon. Gentleman rightly pointed out, the code was put in place following a detailed market investigation by the Competition Commission between 2006 and 2008, which found that direct suppliers of groceries to large supermarkets faced unfair risks that adversely affected competition and, ultimately, consumers. The code regulates designated retailers’ interaction with their direct suppliers, including some but not the majority of farmers.

While the code prevents the unilateral variation of supply agreements, such as on wastage and forecasting errors, and requires retailers to pay invoices on time, it does not cover prices agreed between a retailer and a supplier, which, as the right hon. Gentleman says, are a matter of commercial negotiation. However, the code does help ensure that negotiations are conducted fairly and transparently, and the GCA has an interest in ensuring that negotiations on cost price pressures do not lead to non-compliance with the code.

Of particular note are the GCA’s seven golden rules, which all the regulated retailers have signed up to and which safeguard the requirements of the code in discussions about price and cost pressures. There is strong evidence to show that the GCA has been highly effective since it was established in ensuring compliance with the code and changing the behaviour of retailers to ensure fairness for suppliers.

Stakeholders have expressed a positive view of the GCA and their input has helped inform the statutory review of the performance of the GCA that the Government conduct every three years. Indeed, I met many of those suppliers and they spoke very clearly about the benefits of the GCA that they see. Those suppliers represent many of the primary producers referred to by the right hon. Gentleman.

The third such review concluded in July 2023 and I hope the right hon. Gentleman’s constituents felt able to submit their views. The review considered publicly available evidence and the responses submitted by 71 stakeholders, including from 27 individual suppliers and their representative bodies, and 30 other trade associations, organisations and individuals. Most of the suppliers who responded to the review said they believed the impact of the GCA on the groceries market had been positive as retailer behaviour had improved. They also said the adjudicator had addressed the previous imbalance of power and made the grocery market fairer to operate in. For instance, in 2014, just after the GCA was set up, four out of five direct suppliers responding to the GCA’s first annual survey said they had experienced an issue with the code. That is now down to one in three, and the issues that concern suppliers are down in practically all cases. Suppliers, including small and medium-sized enterprises, feel better protected against any poor behaviours from retailers following the best practice put in place by the GCA. In 2022, more than two thirds of direct suppliers felt that retailers covered by the code conducted relationships fairly.

Overall, there is a consistently high level of awareness among suppliers of the GCA and the code. I have met the current adjudicator, Mark White, several times and have been extremely impressed by his pragmatic approach to ensuring the compliance of the designated supermarkets, which has helped to stop problems escalating and reduced the need for time-consuming and expensive formal dispute resolution.

I am aware that some Members have asked whether the GCA has the necessary powers and resources. I know that Mark White believes his current powers provide the necessary tools to enforce the code and change retailer behaviour. He is also responsible for determining the level of resources that he needs and setting the levy of regulated retailers to fund his work. While Ministers are responsible for approving the proposed levy, the Government have always accepted the adjudicator’s levy business case and will of course give careful consideration to future requests.

[Mr Carmichael]

I am pondering the words the Minister has used. I think he is right that the adjudicator does have the powers to investigate and enforce the code of practice, but there are still big areas that are not covered, and that comes to the concern that farmers, producers and processors have.

[Kevin Hollinrake]

I am not ignoring the right hon. Gentleman’s concerns at all. I recognise them and, as I said earlier in my speech, the vast majority of the market in terms of primary producers is not covered by the code. I will come on to that shortly. The right hon. Gentleman will be aware that there would be challenges in the GCA being the custodian or overseer of thousands upon thousands of business contracts, with the complexity and bureaucracy that would flow from that, which neither of us would wish to see. That would, of course, result in an impact on prices as well. I will address that later.

We recognise that, despite the GCA’s effectiveness and successful interventionist approach, we have not yet stamped out all unfair practices. The impact of the recent cost price pressures in the food sector has demonstrated how external factors can affect relationships and behaviours. As such, we recognise the continued need for the GCA’s role in ensuring fair treatment of suppliers to supermarkets through enforcement of the code. We are aware that some poor practices are affecting producers across several agricultural sectors not covered by the code and that primary producers, such as farmers, have felt unfairly treated. The Government also want farmers to get a fair price for their products—that was the opening and closing argument of the right hon. Gentleman—and we are committed to tackling contractual unfairness that can exist in the agrifood supply chain.

Powers in the Agriculture Act 2020 enable the introduction of statutory codes and contractual practice to protect farmers. Those codes would apply to any businesses purchasing agricultural products directly from farmers, including processors, consolidators and other intermediaries, providing greater certainty for farmers by ensuring that clear terms and conditions are set out in contracts. That will seek to improve the negotiating position of farmers to achieve fairer prices and greater transparency and accountability in supply chains. Ministers in the Department for Environment, Food and Rural Affairs are exercising the powers under the 2020 Act in a sector-specific approach, acknowledging that the problems experienced by each sector differ widely and avoiding broad regulation that places burdens on sectors that may not require intervention.

The first sector-specific regulations for the dairy sector were laid in draft in February 2024 and regulations for the pig sector are expected to be introduced later this year. Work is also progressing on regulations for the egg sector, and DEFRA carried out a fresh produce review, which the right hon. Gentleman referred to, in December 2023, and the response to that will be published shortly. I cannot give a more definitive timescale than that, I regret—if it was all in my gift, perhaps I could, but it is not. He is probably pretty familiar with the term “shortly”. Crucially, the recruitment is under way for an agricultural supply chain adjudicator, who will be responsible for enforcing the new regulations.

As I touched on earlier, it may be that the GCA’s effectiveness is the reason why some think we should extend its role to ensure the better protection of primary producers in the grocery supply chain, such as farmers. Requiring the GCA to regulate the many thousands of transactions throughout diverse supply chains would risk diluting the adjudicator’s tight focus on the 14 largest supermarkets and could undermine its record as a highly effective regulator. In terms of what it does, if something is not broken, don’t try and fix it. However, we do understand that parts of the system are broken, and that is why we are bringing in the sector-specific supply chain remedies.

It is important to safeguard the GCA’s ability to remain vigilant on the compliance of the 14 designated retailers. The Government therefore have no plans to extend the adjudicator’s remit, but instead seek to learn from and emulate the GCA’s approach and effectiveness, so that it can be replicated for the sector-specific codes.

Question put and agreed to.

Post Office Board and Governance

Kevin Hollinrake Excerpts

Wednesday 28th February 2024 Commons Chamber

[Marion Fellows (Motherwell and Wishaw) (SNP)]

(Urgent Question): To ask the Secretary of State for Business and Trade if she will make a statement on what steps are being taken to restore public confidence in the Post Office board and governance following evidence taken at yesterday’s Business and Trade Committee.

[The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)]

I sat there for five hours listening to all the evidence that was given to the Select Committee yesterday. Several serious allegations have now been made against the Government, my Department and its officials by Henry Staunton. His most recent revelation is that there is an ongoing HR investigation that involves both him and the Post Office CEO Nick Read. I have to say as a former chair that I clearly found that statement to the Select Committee highly unprofessional.

The fact that Nick Read is being investigated is evidence that no one is untouchable and the Post Office culture is changing. An investigation is of course not evidence that allegations are accurate. While Nick Read has co-operated fully, Mr Staunton tried to block the investigations looking at his conduct. It was this action, as well as his attempt to bypass the formal process to appoint a new director to the board, which led the Secretary of State to lose confidence in Mr Staunton. As was said in the Business and Trade Committee yesterday, board members felt so strongly about Mr Staunton’s conduct that they were going to resign. It was right that the Government decided to act.

Mr Staunton has now made a series of allegations which we strongly reject. He is using the Nick Read investigation to divert attention from the issues the Select Committee was discussing about his dismissal. The allegations made are also proving to be a further distraction from the victims of this injustice. His central allegation is that the Government told him to slow down compensation payments. Not a single person backed him up on this claim. My officials are clear that they have never been instructed to do this. Post Office executives are clear that such an instruction was never passed on to them. We have provided a letter from June 2023 from my Department to Mr Staunton telling him the opposite. His only evidence is a note of a conversation which is clearly about operational financing of the Post Office business; this is entirely different from compensation to sub- postmasters. The permanent secretary wrote recently to give her truthful account of what happened. We also released her office’s contemporaneous notes of that meeting.

Mr Staunton alleged that the Secretary of State refused to apologise to him after he learned of his dismissal from Sky News; this was not the case. He claimed there was pressure on Nick Read to send a letter to the Justice Secretary; this was not the case. He claimed the Secretary of State told him that someone has got to take the rap for the Horizon scandal and that was the reason for his dismissal; this was not the case.

The Post Office faces unprecedented challenges and needs to work at pace to deliver compensation to the thousands of postmasters who fell victim to a flawed IT system as well as continue the essential work to implement the necessary operational and cultural changes needed within the business. As we have repeatedly said, Post Office governance is a priority for the Government; that is why we acted swiftly to remove a chair about whom there were serious concerns and allegations and why we are working at pace to appoint an interim chair.

We of course recognise the seriousness of an investigation into individuals at the Post Office. I also recognise parliamentary and public concern and the need to ensure there is confidence in the Post Office leadership. I will therefore ask the Post Office to provide me with the findings of the investigation once it is completed. However, it is right to wait for this investigation to conclude before making any further judgment.

[Marion Fellows]

I am really disappointed that the Secretary of State herself is not here, but I thank the Minister the hon. Member for Thirsk and Malton (Kevin Hollinrake) for everything he does for post offices and am happy to work with him going forward.

Prominent Horizon victims are still saying financial redress is far too slow. Legal representatives of victims said yesterday that redress schemes are not working for victims—too much “lawyering” going on, too much obfuscation. Lawyers say complete claims might have settled for less than they were entitled to and might need to be revisited. Neil Hudgell suggested that August deadline target will not be met and the current compensation impasse could continue for another one or two years.

Henry Staunton’s claims persist. Why has the Prime Minister refused to back up the Secretary of State, refusing to repeat the claim that Staunton lied? This is the third time we have been here to find out about the circumstances of Mr Staunton’s departure. The last time the Secretary of State mentioned investigations into Staunton but failed to reveal an 80-page investigation into current CEO Nick Read. With all we have seen about the Secretary of State’s past assurances being undermined, how can we trust her firm assurances now?

Does the Secretary of State have faith in the Post Office board, which is clearly in total disarray? There were even claims that the chief executive officer, Nick Read, had threatened to resign over pay. Victims and the public have lost faith in the Post Office board and governance. When more than £1.2 billion of public money is being spent on financial redress, the taxpayer ought to have confidence that costs will not be driven up further by mismanagement. The evidence from yesterday’s Business and Trade Committee shows that the public and victims have no reason to be confident, as incompetence and obfuscation has marred the process until now. Sub-postmasters say that redress schemes are not working. Victims agree. The lawyers say that they are not working and the former chair of the Post Office says that they are not working. Why should we trust the Government, and what will the Minister do to fix this?

[Kevin Hollinrake]

I should say that the Secretary of State is abroad at a World Trade Organisation conference.

I thank the hon. Lady once again from this Dispatch Box for all that she does on behalf of postmasters. Interestingly, in his evidence yesterday, Mr Staunton said that he had no concerns over the speed of compensation, which I think astounded both the hon. Lady and me. We have been fighting for years to try to improve the speed of compensation. That is just one more concern that people might have with Mr Staunton’s evidence, but it was clearly stated in one of his responses.

It is right that we constantly seek to improve the speed of compensation and to make sure that it is full and fair and is seen to be so. One reason that I spent all day listening to the evidence yesterday was to make sure that we are doing everything possible to accelerate compensation. I heard some interesting conversations in the evidence session, including ideas from Mr Hudgell and others on how we can accelerate compensation, which we are very keen to do.

The hon. Lady will know that the latest figures were quoted yesterday at the Select Committee hearing. On the group litigation order scheme, for example, 106 full claims have been submitted, 104 offers have been made, and 80 have been accepted without reference to the independent panel, which would tend to indicate that the offers being made are fair. The hon. Lady will also recognise from the announcements that we made on Monday during the statement that we have introduced a £450,000 interim compensation figure for when people submit their full claim for the overturned convictions. When an offer is made, we will provide 80% of that initial offer to claimants in the GLO scheme.

Interestingly, Henry Staunton seemed to think that the biggest concern with the compensation schemes was around the overturned convictions—he clearly said that yesterday—when the hon. Lady and every Member of this House knows that we announced legislation on Monday, and previously, that will overturn the convictions en masse, which is unprecedented. Obviously, that is the key to unlocking compensation. For all those reasons, we should not take Henry Staunton’s evidence at face value.

[Julie Marson (Hertford and Stortford) (Con)]

Mr Staunton continues to insist that he was told to delay compensation for the postmasters, but at the Select Committee hearing yesterday he said that, unlike his own notes, the published notes of the meeting with Sarah Munby were not contemporaneous. Can the Minister undertake to provide a contemporaneous note of that conversation to put this accusation to bed once and for all?

[Kevin Hollinrake]

I thank my hon. Friend for her question and for her work on the Select Committee. It is one thing to criticise Ministers, but entirely another to sully the good name of a civil servant. Sarah Munby has been very clear in her letter that she published on this matter that Mr Staunton is wrong. She has also been very clear that she has contemporaneous notes of that meeting, and we will be publishing those notes that will clarify and back up the fact that Henry Staunton is wrong and that Sarah Munby is right.

[Mr Speaker]

I call the shadow Minister.

[Rushanara Ali (Bethnal Green and Bow) (Lab)]

What we saw yesterday was unedifying and, at points, a fiasco. Sub-postmasters watching will have rightly been dismayed and will have felt that, if anything, they were moving further away from justice. The ongoing conflict at the top of the Post Office and the failure of the Government to get a grip is helping no one and is only further eroding trust in this process. The Secretary of State should reflect on how her approach to the news of recent weeks has only exacerbated that. We, and especially victims, have all had enough of the “He said, she said”. Does the Minister now recognise that the best way to end this is by fully clarifying what the Government have or have not said, through an independent Cabinet Office investigation?

May I also pick up on some very worrying evidence given yesterday by Carl Creswell, the director of business resilience in the Department for Business and Trade? When talking about the financial provisions set aside for Horizon compensation, he said:

“I personally think we will end up spending more money on compensation overall than that £1 billion figure, which was modelled at an earlier stage.”

That is incredibly serious. Does the Minister share that view held by one of his senior civil servants? If so, what conversations has he had with Government colleagues and will we see that reflected in next week’s Budget?

Will the Minister clarify whether he or the Secretary of State were aware that Nick Read was also under investigation, as was allegedly stated in the 80-page document referred to by Henry Staunton in yesterday’s Select Committee hearing? In response to me during an urgent question on 29 January, the Minister said that Henry Staunton’s sacking was not due to a falling out, but that it was

“about very serious governance issues related to the person who headed the board of the organisation, which are obviously confidential human resources issues.”—[Official Report, 29 January 2024; Vol. 744, c. 612.]

Will the Minister confirm whether he had sight of the confidential human resources report referred to in yesterday’s Select Committee hearing? If so, why was he selective in his update to the House?

Finally, it is very important to make sure that we restore trust, by urgently bringing forward legislation. I hope that, unlike yesterday’s unseemly events, our focus can return to making sure that we exonerate the sub-postmasters and deliver the recompense that they rightly deserve.

[Kevin Hollinrake]

When the hon. Lady says that I was “selective” about what I said, is she accusing me of being economical with the truth? If so, I would take exception to that. It would be absolutely wrong for anybody in this House to disclose information about an investigation that has not concluded and where the presumption of innocence must apply for the individuals concerned. If she thinks I should come to this House to talk about those kind of sensitive, confidential matters, she does not understand how the corporate world works.

[Rushanara Ali]

rose—

[Kevin Hollinrake]

I will not give way, as I am answering the hon. Lady’s question.

[Mr Speaker]

This is not a debate.

[Kevin Hollinrake]

I did find what happened yesterday unedifying, but that was about one person; everybody else who gave evidence yesterday was clear that there was no sense ever of trying to slow down compensation. Neither do I think the hon. Lady is right to say that postmasters are further away from getting compensation; it is quite the opposite. To imply that and so raise questions about the compensation scheme could lead to people not coming forward. We welcome the fact that 1,000 more people have come forward since the ITV series. People are closer to compensation, not further away, and the actions we are taking, through the compensation advisory board, the overturning of convictions, the Horizon shortfall scheme, which is nearly completed, and the GLO scheme are all moving on. If she wants to end the, “He said, she said”, perhaps she should end it, because we want to move on and pay compensation.

As for the figure of £1 billion, is the hon. Lady saying it is serious if we have no cap on compensation? I do not think that is serious at all; of course we have no cap on compensation. The £1 billion is a maximum budget, but if that needs to be increased, it should be. If she is saying that we should not increase it if people deserve more, she should put that on the record. It would be an entirely irresponsible thing to do. Every time I have dealt with this matter over the Dispatch Box with shadow Ministers, it has been constructive and collaborative, and I resent the tone she has taken in this case.

[Mr Speaker]

Let me say, in fairness to the Minister, that he has come here on more occasions than anybody else I have known. He has absolutely ensured that the House has been kept informed—he goes without question on this.

[Mark Pawsey (Rugby) (Con)]

I commend the Minister, not only for the consistent and compassionate approach he has taken to this matter, but for his attendance at yesterday’s session. It lasted for five hours and he was there for the greater part of it. He is right to say that much of what we heard yesterday was a real distraction from the key objective of the Government and the Committee of making sure there is speedy compensation for our postmasters. It was clear that the former chairman and possibly the chief executive exhibited limitations in their roles and were perhaps unsuitable for the roles to which they were appointed, so are there any broader lessons we might deduce on how we go about recruitment for publicly owned organisations such as the Post Office?

[Kevin Hollinrake]

I thank my hon. Friend for his question and for his work on the Select Committee. He is a doughty champion in this area and many others relating to the Committee’s work. There are some lessons we need to learn; the Post Office certainly requires the right kind of skills and the right kind of person to turn it around. That is clearly a work in progress and I do not think people will be confident that that is happening until it has actually happened. Words are no longer enough; we need actions, be it on the turnaround of the Post Office or on the compensation schemes.

[Mr Deputy Speaker (Sir Roger Gale)]

I call the Chairman of the Select Committee.

[Liam Byrne (Birmingham, Hodge Hill) (Lab)]

I am grateful to the Minister for joining us for most of the five hours of hearings yesterday, but he will know as well as I do that what we saw yesterday was complete chaos at the top of the Post Office, when what we needed was a clarity of purpose about paying redress fast and fairly. Not a single witness yesterday said that they were satisfied with the speed of any one of the three processes. In fact, the lawyers for the claimants said that it may now take one to two years in order to complete the payment of redress, and we heard evidence of offers being made that were, frankly, insultingly low. That is true across each of the three schemes.

Most worryingly, we heard that the Post Office chief executive had not had regularly meetings with the Secretary of State or received a clear written instruction to accelerate every one of the three schemes; there were no deadlines and no targets, and there are no incentives to get the redress schemes done and dusted. That is not good enough. Will the Minister again reflect, when he brings his Bill before the House, on the need to eliminate the Post Office from this process to the maximum possible extent and ensure that there are a legally binding set of timescales under which claims are given the information they need and processed, with offers made and offers settled? I say that, because we cannot go on like this.

[Kevin Hollinrake]

I do think the chaos was caused by one individual. I sat through the whole session; for the bit I was not in the room with the right hon. Gentleman, I was watching on television. It is right for people to be able to say that they are not satisfied with the speed of compensation. I have said that time and time again from this Dispatch Box, and we are keen to accelerate the process and make sure it is fast and fair.

We are aware of the recommendations from the right hon. Member for North Durham (Mr Jones) on an appeals mechanism for some of the schemes where people feel the compensation is too low. We are looking and will continue to look at that. Every compensation scheme I have dealt with, such as the Royal Bank of Scotland global restructuring group scheme and the Lloyds-HBOS scheme, has been too slow, because of some of the complexity involved. We heard some good suggestions yesterday about how we might remove some of that complexity, which I am very keen to do. We heard some positive remarks from the individuals concerned, for example, from some of the solicitors, and from the Post Office on the fixed-sum awards—the £650,000 for the overturned convictions and the £75,000 for the GLO scheme. We heard how that was reducing the amount of disclosure that was required—that is one of the limiting factors. This should mean that the timescales that some people put on the table of one to two years should be rapidly reduced, and I am very keen to build on that work.

As the CEO confirmed to the right hon. Member for Birmingham, Hodge Hill (Liam Byrne) yesterday, I meet him every month, and we speak about the need to accelerate compensation every single time. We have targets for when to pay the compensation by: August for GLO cases, and for all cases ideally by the end of the year. As we heard yesterday, 1,000 new claimants have come forward since the ITV series, which makes it difficult to put deadlines on payment. I am aware that the right hon. Gentleman wants a legally binding target. I am happy to discuss that with him, but we have just removed one legally binding target because not everything within the process is within our gift.

[Dean Russell (Watford) (Con)]

I know that my hon. Friend has a passion to get this right, and to right the wrongs of the past. Does he agree that we must do all that we can to ensure that sub-postmasters who were victims of the awful Horizon scandal are exonerated, and compensated fully, fairly and with haste?

[Kevin Hollinrake]

I thank my hon. Friend for his work on this issue as one of my predecessors; I know that he was as keen as I am to ensure that full and fair compensation is paid to all individuals. As I said, there is no limit to the amount of compensation that we will set aside to ensure that people are compensated properly for this horrendous scandal.

[Richard Thomson (Gordon) (SNP)]

In the week that we heard that more than 250 postmasters whose lives and reputations were damaged by Post Office Ltd died before they could get justice, yesterday we found another layer of Post Office Ltd’s organisational dysfunction. On 19 February, the Secretary of State informed the House of bullying accusations against Mr Staunton, only for us to find out yesterday that those accusations related to another individual entirely. Could I first ask the Minister, for whom I have the greatest respect—not just for the manner in which he goes about his business with regard to the Horizon scandal—whether the Secretary of State misled the House by telling Members that Mr Staunton was under wider investigation for bullying? Secondly, will the Minister now respond positively to requests from the Scottish Government and the Northern Irish Executive to reconsider introducing legislation that could lead to a swift UK-wide exoneration for the postmasters affected?

[Kevin Hollinrake]

To be clear, we terminated Mr Staunton’s role as chair of the Post Office not because of bullying accusations. There was an 80-page report, which he referred to yesterday, and which I have not read. He freely admitted in yesterday’s evidence session that he was named in that report. To what extent, I do not—[Interruption.] Well, that is what Mr Staunton said; he said that it was to a very minor extent. I do not know that, I do not think the hon. Gentleman knows that, and I think we should wait for the investigation to conclude before we make a judgment on that. The point was not about the allegation itself; the point was that, as Mr Staunton admitted yesterday, he interfered with the investigation. That is unacceptable, and if we had not acted in the way that we did, I think that the hon. Gentleman and others would be calling us to account for why we did not act when somebody had tried to suspend or interfere with an investigation into his own conduct.

I am aware of the Scottish and Northern Irish Governments’ position on legislation. Of course we will continue to discuss that with them. There are some separate devolved issues around the judicial systems in Scotland and Northern Ireland. That is the reason we have done it differently. We are happy to continue our dialogue on it.

[Jane Stevenson (Wolverhampton North East) (Con)]

From my time as a Parliamentary Private Secretary in the Department, I know the determination of the Minister and the Secretary of State to get compensation to these wronged postmasters as quickly as possible. In yesterday’s Select Committee session, Mr Staunton spoke about lobbying for a pay rise for Mr Read, which I know must have been quite galling to many of the sub-postmasters. The Minister reportedly refused to grant that pay rise. What sort of pay rise did Mr Staunton think would be a fair, equitable agreement at that time?

[Kevin Hollinrake]

I think on two occasions Mr Staunton lobbied for a pay increase for Mr Read. He sought to double the overall package of Mr Read on those occasions.

[Ian Lavery (Wansbeck) (Lab)]

Yesterday’s Committee meeting was bizarre in many ways. It was five hours long and, as happens only rarely, the people in front of the inquiry had to swear on the Holy Bible. That is how bad it was. The recently dismissed former chairman revealed a number of things that were quite alarming. First, he revealed that the current chief executive is under investigation. Perhaps the Minister can explain why we were not aware of that. Secondly, he revealed that the current chief executive had threatened to resign on more than four occasions, not because of the lack of progress on any financial redress for postmasters and postmistresses, but because he said his wages were too low. The chief executive also said that he was proud that he had a hardship fund for workers in the Post Office. Can the Minister clarify whether there has been an approach by anyone on behalf of the current chief executive for a pay rise, and what the response was?

[Kevin Hollinrake]

First, may I correct the record? In response to the Chair of the Business and Trade Committee, the right hon. Member for Birmingham, Hodge Hill (Liam Byrne), I said that the fixed sum award was £650,000; it is £600,000.

It would be wrong to disclose an investigation into somebody’s conduct before that investigation had concluded. It would be extraordinary to do that in any work context, be it in the public or private sector. I am happy to have a conversation with the hon. Member for Wansbeck (Ian Lavery) about the hardship fund. If he is talking about the Post Office paying salaries to postmasters, most postmasters are self-employed, not paid a salary directly, and have a number of different streams of income into their business. These are businesses in their own right, of course, but there is a hardship fund for certain postmasters in certain situations.

[Sir Oliver Heald (North East Hertfordshire) (Con)]

I echo the comments about the Minister and his assiduous work on this issue, both as a Back Bencher and now as the Minister. Does he agree that perhaps it is necessary to look at how many people are working on the compensation scheme on the Post Office’s side? I have raised the matter with him before. A lot of it is expert work, but if anything can be done to build the resource, that would be helpful, particularly for my constituent, whom we have discussed before. On disciplinary and grievance procedures, is it not normal that they are private until the point when a decision is made?

[Kevin Hollinrake]

On the last point, my right hon. and learned Friend is absolutely right; he clearly understands these situations very well. They should of course be kept confidential, which is why it was highly unprofessional of Mr Staunton to say what he said yesterday. On my right hon. and learned Friend’s first point—I cannot remember what it was now.

[Sir Oliver Heald]

Resource—getting more lawyers in.

[Kevin Hollinrake]

We are absolutely committed to ensuring that we have the resources available to settle compensation claims quickly. Certainly, a file note that I took away from yesterday’s session was about the number of individuals looking after compensation from Addleshaw Goddard’s end, although it is turning around the offers increasingly quickly. Responses to full claims now happen within 40 days in 85% of cases. There has been an improvement. We are keen to ensure that every part of the process has the resources it needs to pay the compensation fairly and quickly.

[Mr Alistair Carmichael (Orkney and Shetland) (LD)]

Surely what we saw yesterday was a glimpse of senior management in the Post Office who are now completely dysfunctional. As such, it is difficult to see how anyone can have confidence in their administration of the various compensation schemes. Would it not be a sensible first step to restore confidence in that most important national institution—the Post Office—to take all role for them out of the administration of the compensation schemes and appoint an independent commissioner? Nothing starts to get better for the Post Office until the schemes are successfully delivered and wound up.

[Kevin Hollinrake]

I think what we actually heard and saw was a dysfunctional former chair of the Post Office; that is what we saw. Interestingly, to the right hon. Gentleman’s point about compensation schemes, the former chair said at one point during his evidence that he had no concerns about the speed of delivery of the HSS—which was extraordinary, because I have many concerns about it.

I hear loud and clear calls from across the House about the role that the Post Office is playing in compensation schemes. These are sensitive matters, because people in the Post Office are employed to manage and administer the compensation schemes. I hear the point made by the right hon. Member for Orkney and Shetland (Mr Carmichael) loud and clear. We are looking at it, but I reassure him that all three schemes have independence in them: an independent panel in the HSS; an independent panel and a reviewer, Sir Ross Cranston, on the GLO scheme; and the independence on the overturned convictions in Sir Gary Hickinbottom. Both latter people are retired High Court judges, which should give claimants and the right hon. Gentleman, I hope, some confidence that the schemes will operate properly.

[Sir Christopher Chope (Christchurch) (Con)]

My hon. Friend the Minister has referred to Mr Staunton, who it seems had serious character defects. How was he ever appointed in the first place, and who provided the character references and oversaw that appointment process? May we have an inquiry into that?

[Kevin Hollinrake]

Thankfully, not me. I have nothing against Mr Staunton personally. He had a strong track record as the chair of various large organisations, as he said yesterday. I think we would all agree that the Post Office is a specific organisation with specific challenges. Yesterday’s evidence from Ben Tidswell, the senior independent director, was interesting. He felt that Mr Staunton’s behaviour changed in November last year and became far more “erratic”—his word. I do not know the reasons for that specifically, although Mr Tidswell suggested some yesterday. Whatever the reason, Mr Staunton’s recent conduct is not consistent with remaining chair of the Post Office. That is why we decided to act.

[Andy McDonald (Middlesbrough) (Ind)]

I thank the Minister for his work in this area. He has been assiduous in his attention to detail—I cannot say the same of the Secretary of State. Nevertheless, yesterday was unedifying, and we are sick to death of the “He said, she said” business—we are not interested, except that two witnesses yesterday took the oath and spoke to the same issue: as to whether Mr Read had ever tendered his resignation or threatened to. It was totally conflicting evidence from the two people; they both cannot be right, so I suggest that one might have been a little economical with the truth. From Dr Neil Hudgell, though, the message came loud and clear: these schemes are way too “over-engineered” and far too “bureaucratic”, and that has led to the delay in getting the money out of the door. I have to correct the Minister—only 20% of the fund is out of the door as yet. We have to speed it up.

Finally, I ask him to take on board the words of the predecessor Select Committee, the Business, Energy and Industrial Strategy Committee, in February 2022, which said that the best way through this was to remove the Post Office from the system. Now, it may be too late to do that, but my goodness, was not the Committee right to say that? Can we find ways to relegate the role of the Post Office, because that is the only way we will get justice for postmasters? Ultimately, that is what this is about—getting them compensated.

[Kevin Hollinrake]

I totally agree with the hon. Gentleman’s final point, and a number of the points he made. It is fair to say that on the compensation schemes, we could use the old phrase, “If you were going there, you wouldn’t start from here.” I think that Sir Wyn Williams has said that, but the best way now is to say, “When you’re going through hell, keep going.” We have to improve the schemes we have got. The hon. Gentleman made an interesting point about the Post Office, and he will have heard what I said earlier. I think the fixed-sum awards do take the Post Office out of the schemes completely, because no disclosure is required for them.

On tendering resignation—again, I thought it was extraordinary that a chair would disclose confidential and private conversations that he has had with the chief executive. I have to say for the record that Mr Read has never tendered his resignation to me or to the Secretary of State. Others would be better than me to comment on the nature of those conversations, but I do not think that it was right for Mr Staunton to comment at all.

I assure the hon. Gentleman that the Secretary of State has given me 100% support in everything I have done in trying to address these matters. I accept what Neil Hudgell said—I spoke to him afterwards, and we have spoken before about the schemes being over-engineered—and he suggested some ways to try to accelerate compensation. We are of course looking at those to see what the best way is to ensure that they are not over-engineered, but deliver rapid and fair outcomes as quickly as possible.

[Ian Paisley (North Antrim) (DUP)]

My primary interest is in compensation payments being made expeditiously across the entire United Kingdom, and in Northern Ireland in particular, where I have been lobbied directly by a number of the sub-postmasters who have been treated so vilely. After the statement of 10 January, I asked whether the Minister would ensure that no delays would be allowed whatever, and he affirmed from the Dispatch Box that that was exactly the Government’s intention. Will he reaffirm that no delays will be allowed, irrespective of the devolution settlement in Northern Ireland? No devolved Minister or devolved court was involved at that time. Will he reaffirm that the payments will be made, and that our sub-postmasters will not have to wait a day longer than anyone else?

[Kevin Hollinrake]

I will be very pleased to ensure that that happens. I met the Northern Ireland Justice Minister virtually a few days ago to discuss these matters. I know that the Northern Ireland Administration’s preference is for UK-wide legislation; we do not think that is the right approach, but we will continue to work with the Administration to ensure that they can deliver the right legislation or process to make sure that the compensation is paid. Clearly, once convictions are overturned anywhere in the United Kingdom, people enter exactly the same compensation scheme—they can get rapid compensation through the fixed-sum award of £600,000, or go through the full assessment process. We are determined to make the process quicker, easier and fairer. I am happy to work with the hon. Gentleman to ensure that that is the case.

[Dame Nia Griffith (Llanelli) (Lab)]

I thank the Minister for his work on the Horizon scandal, and for answering my letter concerning a constituent. In that answer, he confirmed that former post office clerks and those working for a franchise who lost money, jobs and reputation through the Horizon scandal are not eligible for compensation under the current scheme. Will he look into ways to include them in a compensation scheme?

[Kevin Hollinrake]

I thank the hon. Lady for her question and for representing her constituents so effectively. I am keen to have continued conversation with her. All the schemes that have been established thus far require a contractual relationship between the Post Office and the individual, and I know that was not the case for her constituent. A number of Members of this House have addressed the issue, and we will continue to look at it.

[Kirsten Oswald (East Renfrewshire) (SNP)]

Whether we are talking about my constituent Roger, a former postmaster whose case certainly needs review, constituents in communities such as Clarkston and Neilston, who have experienced the most recent post office closures in East Renfrewshire, or the brilliant postmasters operating locally, none of them deserves this mess. This is turning into a regrettable circus to all looking in from the outside. What assurances can the Minister give me today that that will not be allowed to divert or distract from a genuine focus on the swiftest possible resolution, and on delivering a sustainable future for the Post Office?

[Kevin Hollinrake]

I thank the hon. Lady for making that point and for representing her constituents so well. Yes, absolutely, we understand that this is distracting, or could distract, from work to ensure not just that we make right the wrongs of the past, but that the Post Office has a strong future, as she put it. I totally agree. We think that the Post Office does have a strong future. Revenue streams have been affected by changes in how and where people acquire certain things or access certain services, but the banking framework—we encourage the Post Office to be more ambitious in its negotiations with the banks on the remuneration that flows from the framework to postmasters—and the parcel hubs are an opportunity for the future. We believe that the Post Office has a strong brand and strong future. We are keen to support its efforts to ensure that the future is bright for all postmasters.

[Mr Kevan Jones (North Durham) (Lab)]

I declare my interest as a member of the Horizon advisory board. Welcome back to the Minister. He should bring in his sleeping bag—he is here that often. I was at the five-hour marathon yesterday, and I was totally unconvinced by Henry Staunton’s accusations, and his allegations about delaying compensation. Like the hon. Member for Christchurch (Sir Christopher Chope), I wonder why Mr Staunton was appointed in the first place—to any board, for that matter. However, to come to the point, Mr Staunton did raise the point that the chief executive is under investigation, following an 80-page report. I accept that the Minister cannot talk about that individual—that would be wrong—but he knows that the culture at the Post Office is rotten, and it is important that the cloud be lifted quickly. When the Secretary of State came to the House on 19 February, did she and the Minister know that Nick Read was under investigation? Is it true that the former HR director who wrote that report has left the Post Office with a settlement, and does that settlement include a non-disclosure agreement?

[Kevin Hollinrake]

I am very happy to come to the Dispatch Box any time I am required to, or feel that there is a need to, which, as the right hon. Gentleman says, is quite often at the moment.

I was aware of the investigation relating to Mr Read and Mr Staunton. That was not the reason why the Secretary of State decided to part company with the chair; that was about interfering with the investigation. The right hon. Gentleman asks about the HR director. I do not know about those matters, but I am happy to look into them and come back to him.

[Christine Jardine (Edinburgh West) (LD)]

I am sure that the Minister will agree that everything we are seeing and hearing about the Post Office inquiry is further undermining the confidence of those who were affected by the Horizon scandal. As the Minister says, 1,000 more people have come forward; they have no more confidence than anyone else in the governance of the Post Office. One of them, a constituent of mine, had been with the Post Office for almost 20 years, and was about to be offered redundancy. She was asked to take over a sub-post office for two months to make up the 20 years. During those two months, she became embroiled in the Horizon scandal. She was not charged, because her Post Office managers pleaded on her behalf, but she lost her redundancy, and she is now completely confused about where she stands, and has no faith in the governance to fix the problem. Is the Minister prepared to meet me to discuss that case, so that I can assure my constituent that it is being dealt with?

--- Later in debate ---

[Kevin Hollinrake]

Yes, of course I would be very happy to meet the hon. Lady and her constituent. Given what the hon. Lady has said, the place for her constituent to go is the Horizon shortfall scheme, which will be happy to look at that particular situation. Of the 2,417 people who applied to the original scheme, 100% have had offers and 84% have accepted those offers, so she can be assured that there will be fairness. We are looking to ensure that the scheme is fair and is seen to be fair.

The other schemes are also delivering outcomes more quickly than they were. There were 106 claims in the group litigation order scheme; 80 offers have been accepted, and compensation for overturned convictions is a fixed-sum award of £600,000. The fact that 1,000 people have come forward for compensation since the ITV series indicates that people do have confidence that they will be compensated fairly, but I absolutely understand that we have work to do to ensure that people feel that way across the board.

[Jim Shannon (Strangford) (DUP)]

The Minister has been incredibly honest and forthright in all his answers, and we have every faith in him, given his conduct and all the information he has brought to the Chamber, for which I thank him. As locally elected representatives, we are accountable to our electorates. How will the Minister ensure that those who are paid from Government funds are accountable in the same way? What more can be done to hold those decision-makers to account?

[Kevin Hollinrake]

As ever, I thank the hon. Gentleman for his contribution. On the point about Government funds, I guess that he is referring to executives in the Post Office. Clearly, that is the Government’s responsibility as the single shareholder. We have a representative on the board in Lorna Gratton from UKGI, in whom I have a great deal of confidence. I think it fair to say that my Department and its officials have learned a lot from the process and from what has gone on, and that is right. We should be clear that mistakes have happened, and apologise for the way that they have contributed to the scandal.

I am very keen to ensure that there is continued accountability. We have, at significant expense to the taxpayer, set up the public inquiry, which was called for by Members across the House. It will take evidence in public, so that the public can see what is happening, and will conclude by the end of this year and report next year. We will then have a lot more answers to the hon. Gentleman’s question, as well as accountability not just for Post Office executives in future, but for Post Office executives of previous years.

[Mr Deputy Speaker (Sir Roger Gale)]

That concludes proceedings on the urgent question. I thank the Minister for his now daily appearance, as well as the Opposition Front Bencher, the hon. Member for Bethnal Green and Bow (Rushanara Ali).

Draft Paternity Leave (Amendment) Regulations 2024

Kevin Hollinrake Excerpts

Tuesday 27th February 2024 General Committees

[The Lord Commissioner of His Majesty's Treasury (Mike Wood)]

I beg to move,

That the Committee has considered the draft Paternity Leave (Amendment) Regulations 2024.

[The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)]

It is a pleasure to serve with you in the Chair, Mr Hosie. The draft regulations were laid on 10 January 2024. I am pleased to be here today to debate these measures, which will benefit families by working alongside the paternity pay regulations to provide valuable additional flexibility to paternity leave, effectively making it easier and more useful for parents while putting minimal burdens on businesses.

Currently, eligible employed fathers and partners are entitled to one or two consecutive weeks of statutory paternity leave and pay to care for their baby or to support the mother. This must be taken within eight weeks of birth or placement for adoption. The regulations recognise the importance of fathers and partners spending valuable time with their children in the first year following birth or adoption and will make it easier for parents to take their full paternity entitlement.

Some 64% of respondents to the 2019 consultation, “Good Work Plan: Proposals to support families”, wanted greater flexibility in when and how paternity leave could be taken. Allowing fathers and partners to take their leave up to a year following birth or adoption was the most commonly suggested measure to accomplish that. Our changes will provide that much-needed flexibility and will fulfil our 2019 manifesto commitment to make paternity leave easier to take.

Our first change will allow fathers and partners to take their leave in non-consecutive blocks. Currently, only one block of leave can be taken, which can be either one or two weeks. Our change will remove that barrier by enabling parents to take two non-consecutive weeks of leave. We hope that providing fathers and partners with the flexibility to take their two weeks of leave non-consecutively means that they will find it easier to use their full entitlement.

For some parents, taking two weeks of leave in one go is challenging due to pressures of work or other reasons. Enabling parents to take their leave non-consecutively means that they can take it at a time that works best for them and could lead to an increase in parents taking their second week of paternity leave.

Our second change will allow fathers and partners to take their leave and pay at any point in the first year after the birth or placement for adoption of their child. This represents a big increase from the eight weeks in which parents currently have to take their leave following birth or adoption. This change gives parents more flexibility to take their paternity leave at a time that works best for their family.

For example, this change could enable a father or partner to take time off work to be the primary care giver when the mother returns to work. This is important, as evidence shows that fathers who spend time solo parenting are more likely to play a greater role in caring for their children in later years.

Our third change will shorten the notice period required for each period of leave. The new regulations will require an employee to give only four weeks’ notice prior to each period of leave, instead of 14 weeks before the expected week of childbirth. This means that a parent can decide when to take their leave at shorter notice to accommodate the changing needs of their families. This will apply to parents in birth and surrogacy scenarios, as the notification rules are different for adopters. It will also allow fathers and partners to change the number and dates of blocks of leave they plan to take. Responses to the “Good Work Plan” consultation show that both employer and employee groups considered that to be a fair and practical option.

The Government have in place a range of leave and pay entitlements to support parents to balance their work and family responsibilities in a way that works best for them. For families who would prefer a father or partner to take a longer period of leave, shared parental leave may be available. This entitlement allows eligible parents to share up to 50 weeks’ leave and up to 37 weeks of pay between them. Parents can choose whether to take time off together or to stagger their leave and pay.

The Government are also introducing new entitlements to enhance the current provision for working parents, including additional protections against redundancy, which will be available from 6 April for pregnant women and parents who are returning to work after a period of eligible parental leave. There are also improvements in flexible working. From 6 April, employees will be able to request flexible working from their first day of employment, and the new entitlement of carer’s leave will give unpaid carers one week of leave from work from their first day in a job. That can be used to provide care or to make arrangements for the provision of care for a dependant with a long-term care need.

We are also introducing new leave and pay entitlements for parents with children who spend time in neonatal care. That will give each eligible employed parent up to 12 weeks of additional paid leave on top of their existing entitlements if their baby is admitted to neonatal care in its first month of life. That will ensure that parents no longer find themselves in the incredibly difficult position of having to choose between risking their job and spending time with their baby during such a stressful time. I commend the regulations to the Committee.

--- Later in debate ---

[Kevin Hollinrake]

Before I respond to hon. Members, may I apologise for the late change in Committee attendance? The hon. Member for Bethnal Green and Bow made an interesting point and I welcome her challenge. She mentioned pregnancy and maternity discrimination. As I said in my speech, we have recently legislated for that, to provide more protections in pregnancy and on return to work. On the take-up of shared parental leave, those are very much a floor and not a ceiling, and many employers go much further in both the private and the public sector. Take-up of shared parental leave is in line with expectations and, indeed, has doubled in recent years.

There are obvious reasons for not going further. We tread carefully when placing extra burdens on business and we are clear about that. A strong labour market is in workers’ as well as employers’ interests, so it is about striking a balance. In addition to these regulations and others, we have brought in measures that create extra burdens for businesses, such as flexible working, day-one rights, carer’s leave and neonatal care. Those are on top of other burdens that businesses face, such as cost of living pressures and the rise in the national living wage, which has increased by historic amounts. We believe that we have struck the right balance.

The Opposition may differ and set out, as they have, to go much further if they are ever in government. I am interested in their intention to have a day-one right to unfair dismissal. Employers should look carefully at that as it might upset the delicate balance between workers and employers, to the detriment of workers. We have to guard against that.

On delays, we would have liked to introduce the regulations more quickly, but it is fair to say that we have been dealing with covid and its aftermath. That is not just about the administration of some of the measures but the impacts on business, and we have to tread carefully in that regard.

The SNP spokesman, the hon. Member for Gordon, made some interesting points, and asked why we cannot go much further on parental leave, citing Norway and Sweden. Looking at work by the Institute for Fiscal Studies, the average tax take in Norway and Sweden is 43% of GDP. In comparison, it was 32% of GDP in the UK in 2021. The hon. Member may want to go 13% higher with our taxing of businesses and people; we do not and that is very clear. It is clearly the direction of travel in Scotland under the SNP. Under our Government, however, we want to keep taxes low. Where there are those kinds of measures, they have to be paid for by somebody, and inevitably that is the taxpayer. We therefore think we should tread carefully.

We support the regulations, which deliver on our manifesto commitment. We want the UK to be one of the best places to work and to start and grow a business. We want to build skills, increase productivity and move to a high-wage economy that delivers this ambition. We will continue to prioritise labour-market policies, such as these changes to paternity leave, which have the potential to benefit the most people, the most firms and the most jobs while at the same time ensuring we balance burdens on business and taxpayers. The changes to paternity leave brought forth today will advance our progress towards those objectives. I thank hon. Members for their contributions and I commend the regulations to the Committee.

Question put and agreed to.

Post Office Horizon: Compensation and Legislation

Kevin Hollinrake Excerpts

Monday 26th February 2024 Commons Chamber

[The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)]

With permission, Mr Speaker, I shall make a statement to update the House on the progress that has been made to support victims of the Horizon scandal.

Since this terrible miscarriage of justice was first exposed, the Government have been working tirelessly to put matters right for postmasters. We have set up an independent inquiry and funded various redress schemes that we have continuously improved to speed up compensation for all affected. That work has been taking place for many months, and long before ITV aired the excellent programme “Mr Bates vs The Post Office”. The work included our announcement last autumn of the optional £600,000 fixed-sum award for those who have been wrongfully convicted. We continue to develop our response to the scandal, and on Thursday I made a written statement detailing the way that we plan to legislate to overturn Horizon-related convictions en masse. We expect to introduce that legislation as soon as possible next month.

My statement set out that the new legislation will quash all convictions that are identified as being in scope, using clear and objective criteria on the face of the Bill. Convictions will be quashed at the point of commencement, without the need for people to apply to have their convictions overturned. The criteria will cover the prosecutors, extending to prosecutions undertaken by Post Office Ltd and the Crown Prosecution Service, as well as offence types, ensuring that those align with offences known to have been prosecuted by the Post Office. That means that only relevant offences such as theft and false accounting will be in scope. On offence dates, a set timeframe will ensure that convictions are quashed only where the offence took place during the period when the Horizon system and its pilots were in operation. The criteria will also cover the contractual or other relationship of the convicted individual to Post Office Ltd, so that only sub-postmasters, their employees, officers or family members, or direct employees of the Post Office will be within the defined class of convictions to be quashed. On the use of the Horizon system at the date of the offence, the convicted person will need to have been working, including in a voluntary capacity, in a post office that was using Horizon system software—including any relevant pilot schemes—at the time that the behaviour constituting the offence occurred.

Such legislation is unprecedented and constitutionally sensitive, but this scandal is unprecedented too. I am clear that this legislation does not set a precedent for the future, and nor is it a reflection on the actions of the courts and the judiciary, who have dealt swiftly with the cases before them. However, we are clear that the scale and circumstances of the miscarriage of justice demand an exceptional response. We are also receiving invaluable support from the Horizon compensation advisory board in this effort. Once again, I thank the right hon. Member for North Durham (Mr Jones) and his colleagues on the board, including Lord Arbuthnot. The board met on Thursday. We were joined by Sir Gary Hickinbottom and Sir Ross Cranston, who will be the final arbiters of claims in the overturned convictions and GLO schemes respectively. At the meeting, the board strongly supported the proposals in my written statement for legislating to overturn convictions. They also proposed sensible measures to accelerate compensation for those impacted.

One of the biggest constraints on the speed of redress for those who choose to take the full assessment route is that it takes time for claimants and their representatives to gather evidence and develop their claims. To encourage early submission of claims, once the Post Office receives a full claim from someone with an overturned conviction, it will forthwith top up their interim redress to £450,000. Of course, if they have opted for our £600,000 fixed-sum award, they will get that instead. Similarly, on the GLO scheme, where claims are typically smaller, we have implemented fixed-sum award offers of £75,000, helping claimants to move on with their lives. Those who are not satisfied with this fixed offer can continue to submit larger claims, and they will be assessed on a case-by-case basis. We have committed to provide offers on a fully completed claim within 40 working days in 90% of cases. If initial GLO offers are not accepted and independent facilitation is then entered, we shall forthwith pay postmasters 80% of our initial offer, to help ensure that they do not face hardship while those discussions are completed.

We have always been clear that our first offers of compensation should be full and fair. It is early days, but the numbers suggest that in the GLO scheme we are achieving that. More than 70% of our offers in that scheme are accepted by postmasters without reference to the independent panel. We will also ensure that postmasters are kept regularly up to date with the progress of their claims.

The advisory board has made a number of other helpful proposals. Those are set out in the report of the meeting, which my Department is publishing today. I have undertaken to give them serious consideration. I will advise the House when we reach decisions about those proposals, and I will doubtless return again with further updates as part of our unceasing determination to deliver justice for everyone caught up in this long-running and tragic scandal. I commend this statement to the House.

[Mr Deputy Speaker (Sir Roger Gale)]

I call the Opposition spokesperson.

[Rushanara Ali (Bethnal Green and Bow) (Lab)]

May I thank the Minister for advance sight of his statement? The Horizon scandal has rightly left the public outraged by the scale and shocking details of the injustice that has been committed. The scandal is one of the greatest miscarriages of justice in British history. It has robbed innocent people of their livelihoods, their liberty and, sadly, in numerous cases, their lives. More than 20 years on, the victims and their families are still suffering the consequences of the trauma of all that they have been put through. Until recently, there has been little progress and delays at every turn, which has caused even further distress.

Victims and their families have been trapped in a nightmare for too long. We all want to see the exoneration of all the remaining convictions, and the delivery of rightful compensation to all those affected sub-postmasters as quickly as possible. On the Opposition Benches, the Labour party has made it clear that we want to see a swift and comprehensive resolution to this insidious injustice, and we are committed to working with the Government to ensure that happens.

I recognise the important work that the Minister has done, both on the Back Benches and in his current role. The unprecedented scale of the legal work being carried out will be possible only with cross-party working and cross-party support. I want to take the opportunity to thank the advisory board for its tireless work in supporting the Government in getting this right, as well as hon. Members on both sides of the House and in the other House.

I welcome the Minister’s commitment to progressing the legislation. Labour is committed to working with the Government to deliver rightful exonerations, but I know that many Members will have had questions following last Thursday’s written ministerial statement, so I welcome the Minister returning to the House. I have a series of questions to pose to him. First, in the light of what he has said today, what further details can we expect on the legislation being tabled? Will he further clarify why convictions prosecuted by the Department for Work and Pensions are excluded from the legislation and what steps he will take to get the Department to deliver exonerations as soon as possible?

The Minister’s proposals set a very difficult precedent, as he said, on the relationship between the legislature and the judiciary. Will he outline what conversations he has had with the Lord Chancellor about this matter and his views on it, which might alleviate some people’s continued concerns?

As the Minister mentioned, there are also issues around precedent that could be exploited in the future for less appropriate purposes. Although I appreciate the assurances that he has provided on that, it would be helpful to understand and get clarification on what specific safeguards will be put in place to avoid this becoming a precedent. The cross-party nature of this work is critical to ensure that happens. However, some people are asking whether he considers that this particular example could be relevant in the future for other worthy causes.

May I also ask the Minister about the pre-Horizon system, Capture? Will he confirm whether prosecutions were made using Capture data and whether any sub-postmasters lost money due to Capture failings? If so, will he commit to those convictions being in the scope of the legislation and compensation schemes?

[Kevin Hollinrake]

I thank the hon. Member for her collaborative comments. I am keen to work with her going forward, as we have every step of the way on this issue. I do not accept that we have made little progress. Let us be clear that 78% of all full claims that have been submitted have been settled—that is 2,700 claims that have been settled. Nor do I accept that there have been delays at every turn. That is not a correct characterisation of the situation.

With regard to our next steps, as I said, we expect the legislation to be tabled next month, which is as quickly as possible. I am working on this on very much a daily basis. On the differences between Post Office and CPS cases—those we are seeking to overturn with this legislation—and DWP cases, I think it is fair to say there was a different standard of evidence. Those DWP cases relied on evidence independent of Horizon such as the surveillance of suspects, collation and examination of cashed orders from stolen benefit books and girocheques, handwriting comparisons and witness statements. Those cases were very much not simply relying on Horizon evidence.

My engagement with the Lord Chancellor has been extensive, and our engagement with other stakeholders—including the hon. Member’s shadow Front-Bench colleagues—has also been extensive. We decided that was the right thing to do. Having said that, these are unprecedented steps. I think that again speaks to the fact that we are keen to make as much progress as possible, rather than as little.

The hon. Lady mentioned safeguards. The standard of evidence is critical to get to this point. It is fair to say that the trailblazing 555, who successfully took their case to the courts in the first place, set a high bar for anyone to emulate or replicate. We will be clear in the legislation that convictions will be overturned based on objective criteria, as another way to deal with this. That speaks to the hon. Lady’s last point on Capture, which I am very aware of and I have discussed with the right hon. Member for North Durham (Mr Jones) on several occasions, including immediately prior to this statement. We need to ensure that we have the right evidence base. I am happy to continue the dialogue on that, but it is important that we do not include cohorts where we do not have the evidence base, as we have for the cohorts that we have set out—where the CPS and the Post Office prosecuted cases. We are taking very serious measures to overturn the convictions. We should never resort to this kind of approach lightly.

[John Redwood (Wokingham) (Con)]

Will the Minister take UK Government Investments out of its role of controlling and supervising the Post Office? It has allowed these gross injustices to go on for too long, allowed the Post Office senior managers to rack up huge losses of £1,391 million to last March, with more to come this year, and given the executives bonuses for losing us that much money. It has left the Government with a great financial black hole. Would it not be better to change the Post Office management, to have it report directly to the Minister, and to make its No. 1 task giving justice to the sub-postmasters?

[Kevin Hollinrake]

I thank my right hon. Friend for his question. He and I have had serious conversations about the future of the Post Office, which I am keen to continue to engage on. The current UKGI representative who sits on the Post Office board is Lorna Gratton, for whom I have a great deal of time and respect. Clearly it is important that the inquiry does its work to determine who did what in the past. As we look to the future, there are different opinions on how the Post Office should be governed. I am happy to keep those discussions ongoing with my right hon. Friend.

[Marion Fellows (Motherwell and Wishaw) (SNP)]

I thank the Minister for advance sight of his statement. Under successive Labour, Tory and Liberal Ministers, Post Office Ltd has overseen the largest miscarriage of justice in UK history. The Horizon scandal is just appalling. Unusually, both the Scottish and Northern Irish Governments have written to the UK Government, calling on them to rule on devolved affairs. It is vital that the UK Government work to ensure that exonerations in Scotland and Northern Ireland take place at the same time as those in England and Wales. [Interruption.] I do not find this amusing at all, but obviously the right hon. Member for Wokingham (John Redwood) does.

--- Later in debate ---

[Marion Fellows]

The devolved Governments have no power or locus in the UK Post Office, so we really need to get this together. When will the legislation for both the exoneration and the redress schemes be published? The Scottish and Northern Irish Governments have written to ask for UK-wide legislation. We need the UK Government to act, because otherwise we cannot guarantee simultaneous legislation that is compatible and comparable with UK Government schemes. When will there be a response to the Scottish Government? This is really important.

There were reports yesterday that Post Office Ltd has only now brought in external investigators to investigate its internal investigators. Does that not seem quite late to the Minister? Why was that not done earlier? Is it just to avoid the appearance of continued cover-ups in Post Office Ltd?

[Kevin Hollinrake]

I thank the hon. Lady for her work and for her points, including on the devolved issues around Scotland and Northern Ireland which she is right to raise. We considered that very carefully. When we originally set out to legislate, we were very clear that it would be for England and Wales only, but that we would work with our counterparts in the other parts of the United Kingdom on what they might do. Indeed, we have responded to them already. We met them last week before we announced the legislation in this statement to the House. We decided to legislate for England and Wales only, because justice is a devolved matter. As she said, the Post Office is UK-wide, but justice is a devolved matter in Scotland and Northern Ireland, and of course they have different legal systems in those areas and different prosecutors. Taking action to interfere with the independent judiciary is a very, very serious thing to do, of course, but we believe that it is the right way. We are working closely with our counterparts in the devolved Administrations to ensure they understand our legal approach and we are very happy to assist with any legislation they may seek to undertake in their own Parliaments.

On redress, there is a single UK-wide scheme, so once somebody’s conviction is overturned they can access redress in exactly the same way as anybody in England and Wales. On the investigation or investigators, that is initially a matter for the Post Office but also for the inquiry to see what happened in the past. There is little point in the huge expense of setting up a public inquiry, as Members called for, and then seeking to do the inquiry’s work ourselves. We need to see exactly what the inquiry makes of that and of many other issues.

[Mark Pawsey (Rugby) (Con)]

I commend the Minister and the Secretary of State for the firm and consistent approach the Government are taking to getting justice for the affected sub-postmasters. We heard earlier about precedent. The Minister will know that many of us have concerns about precedent in bringing forward special legislation in this case, although we know, of course, that many hundreds of innocent sub-postmasters have suffered the most serious miscarriage of justice. The Minister just said that the scale and circumstances of the Post Office’s actions in this case rightly require an exceptional response. Will he set out how using that mechanism will ensure that the people we are bothered about, the sub-postmasters, benefit speedily and accurately from those measures?

[Kevin Hollinrake]

I thank my hon. Friend for his point and for his work on the Select Committee. He is right that we will take those steps very carefully and very much as a last resort. He concluded his question on exactly the right point. This is about sub-postmasters and the speed of overturning those convictions: the speed to justice. We looked at doing that through other means, but did not feel that they would achieve the same level of speed. He may be aware that hundreds of people have passed away—there was a report in the newspapers over the weekend—waiting for compensation and justice. That is just not acceptable. We made the difficult decision to deal with this situation in this particular way. As we have often described it, this is the least-worst option but it is still the right option.

[Mr Deputy Speaker (Sir Roger Gale)]

I call the Chair of the Business and Trade Committee.

[Liam Byrne (Birmingham, Hodge Hill) (Lab)]

May I put on record my gratitude to the Minister for the speed and attention he is paying to this issue? The bottom line, however, is that redress is too slow and the offers are too low. Papers that the Select Committee is publishing this afternoon show that at the core of the problem is a toxic culture of disbelief of sub-postmasters, which still persists at the top of the Post Office. Indeed, the board minutes for March last year show that board members lamented that the board was tired and constantly distracted by historical issues and short-term crises. I am afraid that that is not good enough when only 40% of the allocated budget for the Horizon scheme has been paid out and only 4% of the budget for the overturned conviction scheme has been paid out. When the Minister brings forward his Bill, will he make sure that the Post Office is now taken out of every single one of the compensation schemes, and that a hardwired instruction to deliver, with a fixed, legally binding timetable to deliver compensation agreements, is written on the face of the Bill?

[Kevin Hollinrake]

I thank the right hon. Gentleman for his points, his kind words earlier, and his work on this matter. I know that he will be chairing a Select Committee session on it tomorrow, and I look forward to his recommendations.

I agree that compensation has been delivered too slowly. We are trying to accelerate its delivery every single day, and we are, I think, doing good work with the advisory board to ensure that that happens. I do not accept that the offers are too low, although I am not saying that there are no exceptions; no compensation scheme will be 100% perfect. In respect of the GLO scheme, for example, 58 full claims have been submitted and 41 have been accepted without reference to the next stage of the process, involving the independent panel, which would seem to indicate that the offers that have been made are fair. Of course people will not take my word for it—they will only accept it when those cases have been resolved—and there are bound to be high-profile cases, as indeed there have been, in which people say that the offers are too low. However, we are determined to ensure that everyone has full compensation that is also fair to the individual, fair to the other individuals within the schemes and, of course, fair to the taxpayer.

As for the people who are running the scheme, as the right hon. Gentleman knows, the Horizon shortfall scheme was set up as a scheme run by the Post Office, with an independent panel including eminent KCs such as Lord Garnier. I have met its members, as has the right hon. Member for North Durham (Mr Jones), and we have confidence in it. Nevertheless, we are looking at recommendations from the advisory board for an independent appeal process. The GLO scheme is independent of the Post Office; it is within our Department, and we are working to ensure that the offers are fair. As the right hon. Gentleman suggested, we are considering bringing the overturned conviction scheme back in-house, and we will have more to say about that in due course.

The right hon. Gentleman mentioned 40% of the budget. We set a maximum budget of £1 billion—not a cap, but a maximum budget at this point. Part of the reason why only 4% of overturned convictions claims have been settled is the fact that the convictions have not in fact been overturned, which is why we are legislating in this way. Once those hundreds of convictions have been overturned, en masse, people will have access to rapid compensation via either the fixed-sum award, whereby compensation takes only days, or the full-assessment route, which takes longer.

The right hon. Gentleman spoke about a legally binding route, and of course we will look at all the various suggestions that are made. We have just legislated to extend the timescale for GLO compensation because we did not want to be bound by an arbitrary date, and I think he supported our legislation. I would therefore caution him against suggesting a legally binding date, because not everything is in our gift, in terms of when we receive a claim and how fast it can then be processed.

[Priti Patel (Witham) (Con)]

The Minister will be aware from my correspondence of the case of my constituent Mr Graham Ward—one of the 555 in the GLO. He has been in touch with me in the last week, and I think it fair to say that he has expressed his deep frustration about the processes that the House is currently discussing in respect of redress and access to compensation. The £75,000 fixed-sum offer is less than the impact that he has experienced. In his statement, the Minister referred to the 40-day process that people might wish to go through rather than accepting the lump sum. May I suggest to him that that should be looked into? Graham is having to undergo medical assessments and various doctors’ appointments, and all this is a terrible ordeal that continues for him, but so many others have also been part of this. I urge the Minister to bring a human element to his considerations, and to recognise that £75,000 does not even scratch the surface when someone has lost their business, their livelihood, the goodwill and their reputation. That is what we must restore sooner rather than later.

[Kevin Hollinrake]

I thank my right hon. Friend for her constant correspondence and engagement with Mr Ward. I wrote to her recently about the case, and asked to be kept updated on his progress.

The £75,000 is one of two routes that people can take. If they feel that their claim is below £75,000, they do not have to submit any evidence and can simply opt for the £75,000, take that money off the table, and move on with their lives. If they feel that their claim is significantly higher than that, they can opt for the full-assessment route, which inevitably takes more time because assessing someone’s loss is a complex process. The submission of a claim for financial loss will require forensic accountants on behalf of the claimant, and other assessments of the type that my right hon. Friend mentioned will also be needed. All the compensation schemes with which I have been involved during my time in this place have been complicated, but we are trying to simplify this one. Only last week we discussed with the advisory board measures to accelerate the process, but the fundamental principle is that claimants such as Mr Ward should always be given the benefit of the doubt.

[Mr Kevan Jones (North Durham) (Lab)]

I declare my interest as a member of the Horizon compensation board, and I thank the Minister for his statement. It is welcome to see him, rather than the Secretary of State, present today’s statement. I welcome the approach that the Government are taking on overturned convictions, but I note that it includes pilots.

I have given evidence to the Minister and the public inquiry about the Capture system. Those affected need to be included in any overturned convictions and to get compensation. I am slowly getting the evidence out of the Post Office and from individual cases, and it comes back to a point that the Chair of the Select Committee just made about the role of the Post Office. The Minister wrote a letter at the weekend to the Select Committee, saying that the culture at the Post Office has changed, but it clearly has not; the toxic culture is still there. Until the Post Office is taken out of this process altogether and forced to regurgitate the information, nothing will change. The Minister knows that one of the advisory board’s recommendations is to do exactly that. Until we do it, postmasters will not have any faith in the process.

[Kevin Hollinrake]

I thank the right hon. Gentleman again for his tireless work over the years and, indeed, for his work in recent months on the advisory board. It is hugely important for accelerating this process.

We have discussed Capture on a number of occasions. It is important that we have the right body of evidence on that, and I am keen to work with the right hon. Gentleman to make sure that we do. Clearly, intervening in matters that were independently decided by the courts is a step we take very rarely—it is unprecedented in this context—but I am happy to discuss that further with him and to help him seek evidence from the Post Office where he needs more evidence on this issue. We discussed it last week, and I am keen to make sure that we have the process running as independently as possible.

I can assure colleagues, any claimants out there and the wider public that every single process—not least the GLO scheme and the overturned convictions scheme—has an independent reviewer. It is Sir Gary Hickinbottom for the overturned convictions scheme and Sir Ross Cranston for the GLO scheme. These are very highly regarded individuals, who will make sure that postmasters who come forward are fairly treated and get the redress they deserve.

[Siobhan Baillie (Stroud) (Con)]

I welcome the care that has been taken to set out how extraordinary this circumstance is and the fact that we are not leading ourselves into setting any precedents. I also welcome scrutiny of the Bill as it comes forward.

On compensation, it is right that evidence is checked and that we are thorough, but I am concerned that the Government’s payment clock will start to run only when they are satisfied that they have all the information on individual cases. It is very difficult for some postmasters to collate documents covering 20 years, some of which have been destroyed or damaged. This is causing a lot of stress, in a similar way to what my right hon. Friend the Member for Witham (Priti Patel) described. Will the Minister explain the Government’s position regarding evidence? Given the process of trying to speed up the payments, are we able to get to the point at which we are taking a view on claims, so that we can kickstart the 40-day process and get the money out the door?

[Kevin Hollinrake]

I thank my hon. Friend for her engagement with this issue and for her work on behalf of her constituent, whose case I am very aware of. Yes, we absolutely should be taking a view where evidence is impossible to obtain. Of course, it is fair to request certain bits of information to support a claim, but where such information is not available because it pertains to 20 or 25 years ago, it would be unreasonable to expect that as the basis for a claim. As I said earlier, where there is an absence of evidence but a broader claim that is compelling, there is no doubt that the claimant should get the benefit of the doubt, and I am very keen to make sure that her constituent gets compensation as quickly as possible.

[Andy McDonald (Middlesbrough) (Ind)]

I thank the Minister and his predecessor for their work on this. I know that he has been paying a lot of attention to it. On the issue of full and fair compensation, may I express a worry about the £600,000 option? It has been said that this is a complicated process, but it does not have to be. Schedules of past and future loss are regular events when calculating these matters, and if ever there were a case for aggravated and exemplary damages, surely this is it. My fear is that people who are up against time limits and perhaps getting older will want to accept the £600,000, which will be a vast undersell of the true value of their claim. What mechanisms is the Minister putting in place to ensure that people do not undervalue their claim and take that easy option to bring the matter to a close?

[Kevin Hollinrake]

The hon. Gentleman makes a fair point. Full and fair compensation lies at the heart of this matter, and we do not want people to feel that the £600,000 is the only option for getting compensation in quick time. It is there for those who want to take the money, walk away and draw a line under the matter, particularly where they think their claim is below that figure. As the hon. Gentleman might have heard me say earlier, on the recommendation of the advisory board and others involved in the process, as soon as a full claim is received, individuals in the overturned conviction cohort will get their interim compensation of £163,000 topped up immediately to £450,000. That will ease the financial pressure and reduce what he suggests might be an incentive for people to take a lower amount than they deserve. A significant amount of money will be paid forward on that basis while the remainder of the compensation claim can be properly assessed.

[Duncan Baker (North Norfolk) (Con)]

I echo some of the words of the shadow Minister, the hon. Member for Bethnal Green and Bow (Rushanara Ali). I had an email overnight from a lady in Australia whose father was prosecuted by the DWP. He had been extremely ill, and he was given a six-month prison sentence for a crime he did not commit. From the statement this afternoon it is clear that the scope of the Bill will apply only to prosecutions from the CPS and Post Office Ltd. Those who received a sentence from the DWP will therefore be outside the scope of the new law. That cannot be right, Minister.

[Kevin Hollinrake]

We have looked at this very carefully. In all the appeals based on DWP cases, the convictions have been upheld thus far. Clearly it is rare that we take the kind of route that we are taking now, in summarily overturning convictions. We see that the evidence bar was much higher in those cases. As I said earlier, there was surveillance of suspects and collation and examination of cash orders from stolen benefit books and girocheques, so there is a significant evidence base for these convictions. I would point out that people can still technically appeal their convictions. They can go through the normal Court of Appeal route. I would be happy to have a discussion with my hon. Friend afterwards to discuss this further if that would be helpful.

[Andrew Bridgen (North West Leicestershire) (Ind)]

After 14 years of campaigning on behalf of my constituents, Mr and Mrs Rudkin, and the other sub-postmasters who were victims, I welcome our now having almost a weekly update on the compensation scheme. I also welcome the Minister’s announcement of more generous interim payments for the victims, but I have to disagree when he says that the sub-postmasters Horizon scandal is unprecedented. I am thinking of the infected blood scandal, the so-called Gulf war syndrome repayment scandal and the banking fraud scandal, and of course the House will have the vaccine deaths and vaccine harms scandal to look forward to, which will overshadow everything that has come before. Does the Minister think that those would benefit from a docudrama?

[Kevin Hollinrake]

The hon. Gentleman outlines particular scandals, but my responsibility extends only as far as the Post Office in that regard. As he knows, I come to the House quite often and I probably have enough on my plate in dealing with this issue right now. I thank him for all the campaigning he has done from the Back Benches on this issue and I very much hope that Mr and Mrs Rudkin get the compensation they deserve as soon as possible.

[Dame Diana Johnson (Kingston upon Hull North) (Lab)]

The Minister often comes to the Chamber to discuss this scandal, and I just wish that Ministers in other Departments, dealing with other scandals, came as often as he does, for which I compliment him. Will he Minister confirm that all those with overturned convictions will be compensated before the general election?

[Kevin Hollinrake]

I thank the right hon. Lady for all her work on this subject and on the infected blood scandal. I contributed to that work as a Back Bencher, and I understand that £400 million has been paid out in interim compensation, but I know she will not rest until all the people she represents get full and final compensation.

On overturned convictions, not everything is within our gift. We are summarily overturning convictions en masse, and we hope to do that very quickly. We plan to table legislation next month, and we hope to overturn all the convictions by July. That will open the door to compensation through the two different routes. We are somewhat at the mercy of claims being submitted, which can take time. The £600,000 route is much quicker. I cannot say when the general election will be, so I cannot answer yes to the right hon. Lady’s specific question, but I very much hope we will do so. Our original date was August, and we hope to get everybody compensated by the end of this year. We will do everything we can to ensure that is the case.

[Sarah Olney (Richmond Park) (LD)]

We understand why the legislation to overturn convictions must be limited, but we have heard today from the right hon. Member for North Durham (Mr Jones) and the hon. Member for North Norfolk (Duncan Baker) about convictions that were secured through other systems and other prosecutors. What assessment has been made of the likely number of people who have been wrongfully convicted outside the boundaries that have been set? What might be made available for people who want to bring their own appeals against wrongful convictions but who cannot make use of the forthcoming legislation?

[Kevin Hollinrake]

It is fair to say that we can all now see a significant body of evidence showing that these were wrongful convictions, which is why we are acting in this unprecedented way. If the hon. Lady is referring to the Capture cases, we do not have that body of evidence thus far. We think the DWP cases are a different cohort because of the evidential standard. We are acting in this way because we do not think the evidential standard for Horizon was of the right level, and clearly a number of different factors were involved in these convictions. The DWP cases are different. There are around 70 to 100 cases in the DWP cohort, which means that the vast majority of the 983 convictions will be overturned by this legislation.

[Barbara Keeley (Worsley and Eccles South) (Lab)]

I want to raise again with the Minister the shortcomings of the Horizon shortfall scheme. My constituent, Mr Pennington, was a sub-postmaster for over 20 years, and for 11 of those years he had the stress and worry of continually having to pay back shortfalls generated in error by the Horizon system. He has not received back all that he was forced to pay in, and he was offered only a derisory £1,500 for 11 years of stress and financial distress. I wrote to the Minister about this case five weeks ago, and I have still not received a response. Last week, the Business Secretary said that I will receive a letter very soon. How long will Mr Pennington have to wait for answers to his questions after so many years of financial stress and worry?

[Kevin Hollinrake]

I will chase that correspondence as soon as I leave the Chamber. I thought I had signed the correspondence, and I apologise if the hon. Lady has not received it. I will ensure that she receives it at the earliest possible opportunity.

I am familiar with the hon. Lady’s case, having read about it and about the times she has raised it in the House and elsewhere. I am keen to look at this. The advisory board made recommendations about how we can make sure everyone feels that their settlement is fair. We are looking at those recommendations, and I will get the letter to her as soon as I can.

[Sammy Wilson (East Antrim) (DUP)]

I thank the Minister for the urgency he has brought to trying to resolve this terrible injustice. It seems that this has been against resistance from within the Post Office, where an attempt is still being made to cover up the negligence and incompetence of the management. May I take him back to the points he has made about this legislation applying to Northern Ireland? I am not convinced of the reasons he has given: first, that this is a devolved issue; secondly, that the justice system is different in Northern Ireland; and, thirdly, that he does not want to step on the feet of the judges in Northern Ireland. In the past, legislation has gone through this House that has related to the Department of Justice in Northern Ireland, with Northern Ireland being included as the result of a legislative consent motion. Has he explored that opportunity with the Minister and the Executive in Northern Ireland? Has there been resistance from the Department of Justice in Northern Ireland or is it willing to co-operate if Northern Ireland were to be included?

[Kevin Hollinrake]

I thank the right hon. Gentleman for his points. I believe he has contributed to every debate in which I have been involved in this House on this matter, so I thank him for his work. Clearly, justice and the judicial system are devolved to Northern Ireland. The difference here is that this is not simply legislating for general matters across the piece; it is about overturning individual cases, which I understand is unprecedented—it certainly is in my experience. We have engaged with the Department of Justice in Northern Ireland, and I am happy to continue to do so and to talk to the right hon. Gentleman about the points he has raised. These are difficult decisions to make. This was the decision we have taken but, as I say, I am happy to have a further conversation with him.

[Kate Osborne (Jarrow) (Lab)]

The sub-postmasters have no trust or faith in the compensation processes being handled by the Post Office or the Government. Today’s commitments will still not deal with all the inequalities in the schemes or the undue influence that the Post Office still has on the process. Echoing the sentiments of some of my hon. Friends, may I ask the Minister to agree to place the compensation schemes into an external independent body, completely outside the influence of the Post Office? I asked the Prime Minister, as my hon. Friend the Member for Bethnal Green and Bow (Rushanara Ali) has asked, about the timescales for the legislation to overturn the convictions, but we still have not got an answer. If it is not before the general election, will it be before the summer recess? Finally, when will people be held to account for this miscarriage of justice, be it within the Government, the Post Office or Fujitsu?

[Kevin Hollinrake]

I thank the hon. Lady for her campaigning on this issue. Again, she has been a key part of the campaign to ensure that people receive justice. Let me deal with the point about fair compensation. As I say, on the GLO scheme, 41 of the 58 full claims that have been submitted have been accepted without even going to the next stage. That would tend to indicate that those first offers are fair. I am aware of some people who feel that their offers are not fair, but I think it is wrong to look at individual cases in this context; it is right that we look to make all the schemes fair. As for undue influence, let me be clear that every part of this process has an independent element to it. Under the GLO scheme and the overturned convictions schemes, that is provided by retired judges, Sir Ross Cranston and Sir Gary Hickinbottom, in order to ensure that those schemes are independent of any “undue influence”, as she puts it. Clearly, the GLO scheme is not being run by the Post Office; it is run by my Department. We are looking at recommendations from the advisory board about what we do with new cases of overturned convictions. On timescales, we have been clear today that we will table the legislation in March and we hope it completes its passage through both Houses by July at the latest. Again, that is not entirely within our gift.

[Stephen Farry (North Down) (Alliance)]

Around this time last week, I reiterated my call on the Government to include Northern Ireland in this legislation, so I was disappointed to see that it applies only to England and Wales. There is a cross-party consensus in Northern Ireland for this House to take the legislation forward, and that includes my colleague the Justice Minister, the First Minister and the Deputy First Minister. The Executive has just been restored and they have a large work programme to get through. We have a small number of cases in Northern Ireland. Doing our own legislation would require disproportionate effort and would involve considerable delay, which would remove equity across the UK. Let me reinforce the points made by my colleague the Justice Minister and ask: will the Minister reconsider the position as regards Northern Ireland and include it in the legislation? I understand that that is relatively straightforward to do.

[Kevin Hollinrake]

I thank the hon. Gentleman for his points and I am sorry to disappoint him. I understood last week that he might be disappointed in what we were about to announce later that day. I spoke to the Justice Minister in Northern Ireland that day, as I wanted to talk to her before I informed the House of our intention. I will continue to engage with the hon. Gentleman and the Justice Minister, as will my colleagues and officials, to ensure there is no delay for the people affected in Northern Ireland. Of course I am happy to have a continued conversation with him about that.

[Amy Callaghan (East Dunbartonshire) (SNP)]

I thank the Minister for his statement and his continued dedication to the victims of Horizon. Will he apologise to my constituent Louise Dar, former sub-postmistress in Lenzie, for the devastating damage that Post Office Ltd and Horizon did to her and her family’s life and livelihood? Will he ensure compensation is swiftly given to Louise and all other sub-postmasters?

[Kevin Hollinrake]

I apologise without hesitation. What happened to Louise and her family is a disgrace. It should never have happened, and we should not be in this situation, but we are where we find ourselves. We now need to do exactly what the hon. Lady has set out: seek to deliver compensation as quickly as possible. If she would like a conversation about that case, I am happy to help where I can.

[Clive Efford (Eltham) (Lab)]

I come to the House virtually every time we have questions on this subject, or it is before the House, and I am taken in by the Minister’s mellifluous bromides about the compensation scheme. However, a letter from the chief executive of the Post Office, Nick Read, suggests that over half the convictions are safe and that the Post Office would defend them. Furthermore, he says that the Post Office is taking on expert police investigators to investigate the investigators, which is pouring even more good money after bad. How can the sub-postmasters who have been convicted and those who have been wronged by the Horizon scandal have any confidence in a scheme that is influenced by the Post Office in any way? In making decisions, how much are the Government relying on information from investigations by the Post Office?

[Kevin Hollinrake]

The hon. Gentleman does contribute virtually every single time the issue is discussed, and I thank him for that. It is hugely important for postmasters in his constituency and further afield that his voice is contributing to those calling for the remedies needed. I am aware of the letter on this issue from the Post Office’s chief executive officer, and what he says; it was his choice to write that letter. Today’s statement, and the one on Thursday, illustrate that the letter had no influence on us; we think that introducing legislation is the right thing to do. We have always been clear that some guilty people will be made innocent through the process. We think that is a risk worth taking—the least worst option. As for the influence on compensation and other matters for individuals, we have ensured that there are independent processes running right through the compensation schemes. The advisory board is holding our feet to the fire very effectively, and I welcome its work.

[Carla Lockhart (Upper Bann) (DUP)]

I thank the Minister for his statement and his efforts. He will be aware of correspondence from the Northern Ireland Executive and the Department of Justice; my Northern Ireland colleagues have alluded to it. It is a rarity for three parties in Northern Ireland to agree on something, but I believe it is outrageous that Northern Ireland is being excluded from the legislation. Will the Minister redouble his efforts and rethink that? This Parliament is sovereign. Time and again, this Parliament has intervened with laws and legislation on devolved matters in Northern Ireland, so will he go away and urgently relook at this situation?

[Kevin Hollinrake]

I thank the hon. Lady for her question. I can assure her that I will continue to engage with her on this matter, along with the relevant representatives from the Department of Justice in Northern Ireland, as will our officials. I understand her disappointment. I understand her preference, and the preference of some Ministers in the Justice Department, but we will continue that engagement and try to make sure that compensation in Northern Ireland is not denied or delayed; we do not want that in England and Wales, either.

[Jim Shannon (Strangford) (DUP)]

I thank the Minister for the update. He referred to officers, family members and direct employees. I wish to ask this on behalf of family members. The news over the weekend indicated that 250 victims of the Post Office Horizon scandal have passed away; some of them had no knowledge whatsoever that their name would ever be cleared, or that compensation would come. Will the Minister say that every one of those people will have their family members compensated, that help and advice will be available, that they will receive an apology on behalf of their loved ones, and that this will be done as soon as possible?

[Kevin Hollinrake]

I certainly apologise to all those people to whom the hon. Member refers. I read the reports this weekend about the number of people who have passed away. Indeed, one of my constituents, Sam Harrison of Nawton in Helmsley—one of the original 555—passed away last May prior to receiving compensation, which was devastating for the family. Just to be clear, those claims can still go forward and their estates will be compensated to the same degree. Nevertheless, that is slim comfort in that situation. “Family members” are those who have been directly affected by someone being convicted or prosecuted by the Post Office or the Crown Prosecution Service. Other family members can be compensated under the wider process—for example, where a house has been lost or a bankruptcy has happened. They can benefit through routes for compensation to the family in general. I am happy to have a discussion about everything that we need to look at in that area.

[Jonathan Gullis (Stoke-on-Trent North) (Con)]

On a point of order, Mr Deputy Speaker.

Post Office: Proposed Legislation and Financial Redress

Kevin Hollinrake Excerpts

Thursday 22nd February 2024 Written Statements

[The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)]

On 10 January, the Prime Minister and I announced a major step forward in response to the Horizon scandal. The Prime Minister confirmed that the Government will introduce new primary legislation to make sure that those convicted as a result of the Horizon scandal, which began in the 1990s, are swiftly exonerated and compensated. Our announcement attracted widespread support in both Houses of Parliament and beyond.

With a number of the cases over 20 years old, some of the victims have sadly passed away, and many others are in declining health or have lost faith in the system and do not wish to engage further with it.

The Government recognise the constitutional sensitivity and unprecedented nature of this legislation. The Government are clear that this legislation does not set a precedent for the future relationship between the Executive, Parliament and the judiciary. The judiciary and the courts have dealt swiftly with the cases before them, but the scale and circumstances of this prosecutorial misconduct demand an exceptional response. We are keen to ensure that the legislation achieves its goal of bringing prompt justice to all of those who were wrongfully convicted as a result of the scandal, followed by rapid financial redress.

Progress to date

Over the last 6 weeks, the Department for Business and Trade and the Ministry of Justice have been working at pace to determine the most effective approach to this unprecedented intervention, which will deliver long overdue justice to postmasters, respectful of the separation of powers and constitutional balance. This has included consultative engagement with relevant stakeholders across interested groups as well as parliamentarians, including the Chairs of the relevant Select Committees. In addition, detailed work has been undertaken to collect and analyse the available data from the Post Office, the criminal justice system and others to establish suitable criteria and understand the impacts of this intervention.

Scope of legislation

The legislation, which will be brought forward shortly, will quash all convictions which are identified as being in scope. That scope will be defined by a set of clear and objective criteria which will be set out in the legislation and will not require any element of discretion or subjective analysis in order to be applied. The legislation will prescribe criteria, each of which will need to have been met, to determine the convictions to be quashed.

The criteria will include:

Prosecutor(s): the legislation will specify who the prosecutor was in the relevant case. The Horizon inquiry has heard evidence of the egregious behaviour of the Post Office’s investigatory practices. It is therefore proportionate that the Government legislate to quash these prosecutions where the prosecutor is, in effect, discredited. In addition, two cases have been quashed by the Court of Appeal which were prosecuted by the Crown Prosecution Service (CPS) but based on evidence provided by the Post Office. It is therefore reasonable to include CPS cases within the Bill’s scope. However, we will not include any convictions from the Department for Work and Pensions (DWP). No convictions prosecuted by DWP have been quashed. Due to the nature of these cases, most DWP convictions relied on physical evidence; and when Horizon data was used it was not relied on, this evidence was corroborative of, rather than essential to, the case. The existing and established Court of Appeal processes remain available to those cases.

Offence dates: a set timeframe will ensure convictions are only quashed where the offence took place during the period that the Horizon system (and its pilots) was in operation (with exact dates confirmed in due course).

Offence types: the legislation will specify which offences are in scope, ensuring these align with the offences known to have been prosecuted by the Post Office. This means that only relevant offences such as theft and false accounting will be in scope. Non-related offences such as offences against the person will be excluded.

The contractual or other relationship of the convicted individual to Post Office Ltd: only sub-postmasters or their employees/officers or family members, or direct employees of the Post Office will be within the defined class of convictions to be quashed.

Use of the Horizon system at the date of the offence: the convicted person will need to have been working (including working in a voluntary capacity) in a Post Office that was using the Horizon system software (including any relevant pilot schemes) at the time the behaviour constituting the offence occurred.

It is intended that the convictions in scope of this legislation will be quashed at the point of commencement.

Territorial Extent

At the time of the original announcement, it was stated that the Bill would legislate on an England and Wales only basis. Since then, we have been working closely with other jurisdictions on this important matter and wish to see equitable outcomes for postmasters delivered across the whole of the UK.

In Scotland and Northern Ireland, prosecutions in this matter were undertaken by the relevant authorities in those legal jurisdictions. The Scottish Parliament and Northern Ireland Assembly have the responsibility of holding those systems to account. We believe victims in those jurisdictions are best served by local decisions tailored to the judicial systems in Scotland and Northern Ireland; as such, the UK parliamentary legislation will proceed on an England and Wales basis.

While it is for the Scottish Government and Northern Ireland Executive to decide on, and progress, their own approaches to the quashing of convictions, we will work with them to ensure those are compatible with the UK compensation scheme, so that compensation can be paid to victims across the whole of the UK.

Financial Redress

As noted in my statement on 10 January, the legislation is likely to exonerate a number of people who were, in fact, guilty of a crime. The Government accept that this is a price worth paying in order to ensure that many innocent people are exonerated. The Government will seek to mitigate the risk that such people will receive financial redress when they have not been wronged. That mitigation will require, as a condition of access to financial redress, that the individual signs a statement to the effect that they did not commit the crime for which they were originally convicted. This and any other aspects of the process will be in line with best practice principles on fraud prevention. This statement will be part of their wider application for redress. Any person found to have signed such a statement falsely in order to gain compensation may be guilty of fraud. Along with other aspects of the financial redress arrangements, this will not need to be part of the legislation.

Outside the legislation, we shall provide a route to full, fair and rapid financial redress for quashed convictions. This will be paid on the same basis across the UK, regardless of where or how the conviction was quashed. Claimants receive an interim payment of £163,000 within 28 days of applying. They can then choose between an up-front settlement offer topping up their redress to £600,000, or having their financial redress considered on an individual basis. Their reasonable legal costs will be met.

The Government will continue to engage closely with relevant stakeholders as they continue to prepare the legislation for introduction to Parliament, with the aim of achieving Royal Assent as soon as possible before summer recess. As the quashing of convictions is processed, the resultant financial redress will be delivered as swiftly as possible.

[HCWS283]

Post Office Horizon Scandal

Kevin Hollinrake Excerpts

Thursday 22nd February 2024 Commons Chamber

[Mr Kevan Jones (North Durham) (Lab)]

(Urgent Question): To ask the Secretary of State for Business and Trade if she will make a statement on financial redress for sub-postmasters and outstanding issues relating to the Post Office Horizon scandal.

[The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)]

As a Back Bencher, I first spoke on the matter of compensation for victims in March 2020, which is obviously long after the right hon. Gentleman first campaigned for it. I pay tribute to his campaigning on this subject, which remains undiminished. My appetite for compensation for postmasters is equally undiminished, although I accept the need to increase the pace of delivery.

As of this month, £160 million has been paid in financial redress to more than 2,700 victims affected by the Horizon scandal. More than 78% of eligible full claims received have been settled as follows: 102 convictions have been overturned, and 42 full claims have been submitted, of which 32 have been settled; 2,793 applications to the Horizon shortfall scheme have been received, and 2,197 have been settled; 58 full claims have been submitted to the group litigation order scheme, and 41 have been settled.

Our top priority remains ensuring that victims can access swift and fair compensation. We have introduced optional fixed-sum awards of £600,000 for victims with overturned convictions and of £75,000 for group litigation order members as a swift means of settlement, and 100% of original applicants to the Horizon shortfall scheme have received offers of compensation. Today we are discussing what other measures can be taken to speed up compensation with the Horizon compensation advisory board, on which the right hon. Gentleman sits.

Since the Prime Minister’s announcement on 10 January, officials in the Department for Business and Trade and the Ministry of Justice have been working at pace to progress legislation for overturning convictions related to the Post Office’s prosecutorial behaviour and Horizon evidence. I will provide a further update to the House very soon.

[Mr Jones]

Thank you, Mr Speaker, for granting the urgent question. I draw the attention of the House to my interest as a member of the Horizon compensation advisory board.

I like the Minister. He campaigned on this issue before he was a Minister, and he has been a very good Minister, but a lot of that good work was undone on Monday by the performance of the Secretary of State for Business and Trade. I am disappointed that he has not taken the opportunity today to talk about the overturned convictions. I understand that later today, at 12 o’clock, there will be a written ministerial statement on the subject. I do not think that is the way to do it, as the House needs an opportunity to discuss the overturned convictions.

I will ask the Minister a few questions. It is quite clear now that Nick Read, the Post Office chief executive, wrote to the Lord Chancellor basically opposing the overturning of all convictions, saying that up to 300 people were “guilty”. It is not yet clear who instructed him to do that. On Monday, the Secretary of State said it was done off his own bat. I would like to hear what the Minister has to say on that.

If there are to be overturned convictions, they cannot just be about Horizon; they should also be about Capture. Evidence that I have put to the public inquiry and sent to the Minister yesterday clearly indicates that the scandal predates Horizon. Those affected need to be included in both the compensation scheme and among those with overturned convictions.

The board is meeting this afternoon, and we have made recommendations to the Minister on how to simplify and speed up the compensation scheme. Will he give an assurance to the House that once the recommendations are agreed, we can announce them quite quickly, primarily to restore to the sub-postmasters some faith, which was wrecked by the performance of the Secretary of State on Monday?

If the Minister’s written ministerial statement at 12 o’clock is about overturning convictions, will he give a commitment to come back to the House on Monday to give an oral statement, so that the House can interrogate him and discuss that issue?

[Kevin Hollinrake]

I thank the right hon. Gentleman for his question. The overturned convictions are a key priority for me and my Department. I am always keen to update the House whenever I can. There always has to be a sequence to ensure that we follow proper process. What we are doing potentially affects the devolved Administrations, so it is really important that we engage with them properly. That is one of the reasons why we need to make the written statement later today. I have never been unwilling to come before the House and report on what we are doing. I will, of course, continue to do that.

On the letter from the chief executive to the Justice Secretary, I am aware of the allegations by Mr Staunton. They are very serious allegations that should not be made lightly or be based on a vague recollection. If the right hon. Gentleman looks at the letter from the former permanent secretary, it is clear that she believes the allegations are incorrect, and that there was never any conversation along the lines referred to by Mr Staunton. I think it is pretty clear that those allegations are false.

The right hon. Gentleman has regularly brought up Capture. We are keen to continue to engage with him on that to ensure that those affected are included in any compensation where detriment has occurred. I note his point about an oral statement. As I say, I am always keen to give such statements whenever possible, and to be interrogated on our plans. I do not think he will be disappointed by what we announce later today.

[Paul Scully (Sutton and Cheam) (Con)]

Now that the then permanent secretary has outlined that she did not implicitly or explicitly tell the then chairman of the Post Office to slow down compensation, I hope we can spend time less time talking about someone who has lost his job and more time talking about postmasters who have lost everything. Will the Minister, who is doing great work in sorting this out, recommit to August as his target date for getting compensation—life-changing compensation —out of the door as soon as possible?

[Kevin Hollinrake]

I thank my hon. Friend for his work on this matter; as my predecessor, he did a tremendous job. The most concerning allegation we heard over the weekend was about the delay in the payment of compensation. In her letter, which is publicly available, the permanent secretary wrote:

“It is not true that I made any instruction, either explicitly or implicitly. In fact, no mention of delaying compensation appears in either note.”

So I agree with my hon. Friend that we should move on from that and focus on what really matters, which is getting what he rightly described as life-changing compensation to postmasters as quickly as possible. That is his, and will remain our, No. 1 priority.

[Mr Speaker]

I call the shadow Minister.

[Mr Tanmanjeet Singh Dhesi (Slough) (Lab)]

Let me first pay tribute to my right hon. Friend the Member for North Durham (Mr Jones) for securing the urgent question, and indeed for all the work he has done over many years, along with other Members, in trying to secure justice for sub-postmasters.

The Post Office Horizon scandal is one of the most insidious injustices in our country’s history. It has robbed innocent people of their livelihoods, their liberty and, all too sadly, their lives. At least 60 sub-postmasters have died without seeing justice or receiving compensation, and at least four have taken their own lives. More than 20 years on, the victims and their families are still suffering from the consequences and the trauma of all that they have been put through. They have been trapped in a nightmare for too long. We all want to see the exoneration of all who remain convicted, and the delivery of rightful compensation to all affected sub-postmasters, as quickly as possible. Labour wants to see a swift and comprehensive solution to this insidious injustice, and we are willing to work with the Government to ensure that happens.

Will the Minister please provide an update on the timeline to which he is working to amend the seismic damage that this scandal has caused, and will he please give an assurance that he is acting with the appropriate speed that is required for necessary legislation to go through? Victims have already waited too long for justice, and we must act now, with the speed and urgency that this awful scandal requires.

[Kevin Hollinrake]

I thank the hon. Gentleman for the way in which he has approached this matter. There was nothing in his remarks that I disagree with. As I said earlier, 78% of claimants have received full and final compensation, but we fully share his wish, and that of his party, for a swift resolution and a swift end to this, and we have engaged significantly and extensively with his colleagues on the Front Bench. As for how we overturn convictions, the measures that we are taking are clearly unprecedented, but this is an unprecedented situation.

The hon. Gentleman asked about the timeline. We have always said that it is weeks, but it is fewer weeks now than it was. I do not think he will be disappointed— I said this to the right hon. Member for North Durham as well—by what we will say, hopefully, later today, but this has taken too long. We are working daily to resolve these issues, and the overturning of convictions, the legislation and the compensation cannot come too quickly.

[Dr Thérèse Coffey (Suffolk Coastal) (Con)]

My hon. Friend has done a great job, but I am conscious that there are still many people waiting to settle. Much of that is due to the fact that the Post Office is not releasing information that has been requested by my constituents or, indeed, their solicitors. I hope that my hon. Friend can put across to the chief executive of the Post Office how critical it is to regain trust by releasing that information, because I fear that other sub-postmasters, or people who might otherwise have been interested in dealing with the Post Office, will start either to move away or not to take up those business opportunities, which would also damage communities—and that is already happening in my constituency.

[Kevin Hollinrake]

I thank my right hon. Friend for her question and for making that point; she is absolutely right. Disclosure both to the inquiry and on individual cases, which is required to be able to compile claims, has been too slow. If Post Office Ltd and its management team are going to rebuild trusts with claimants and the wider public, it is absolutely incumbent on them that this is done properly and that the governance around it is done properly. That is part of the reason why the Secretary of State acted as decisively as she did, but I absolutely concur with my right hon. Friend. Alongside her, I urge Post Office Ltd to deliver disclosure more quickly.

[Mr Speaker]

I call the SNP spokesperson.

[Marion Fellows (Motherwell and Wishaw) (SNP)]

Documents published this week by the BBC reveal that the Swift review, dated February 2016, noted that Post Office Ltd “had always known” about the balancing transaction capability that allowed transactions to be addended remotely, which is what happened. The lawyers for Post Office Ltd did nothing about that, and many people still do not trust it. A letter has been circulated, and the right hon. Member for North Durham (Mr Jones) deserves all the praise we can give him today. I have a copy of his memo, which says that anyone can write to him on any issue and get advice on how to pursue claims.

The Minister has given us a list of percentages and so on, but it is still not fast enough. It is still not good enough, and one of the reasons is that Post Office Ltd is still not trusted; people want nothing to do with it. I cannot fix that, but I do not think that the spat between the Secretary of State and Henry Staunton this week did anything to increase sub-postmasters’ confidence, and we really need to get this sorted. Yes, the Horizon shortfall scheme has been well managed in some regards, and claims are going through and being paid, but how much is being paid? So many sub-postmasters are getting derisory offers—not just people in the GLO scheme, but normal, everyday sub-postmasters who have been putting in money for years. We need to get this sorted. I appeal to all sub-postmasters affected to put in a claim.

[Kevin Hollinrake]

I entirely agree with the hon. Lady on that point and on a number of other points she raised, and I thank her again for the work she has done in this area for many years. I, too, am concerned about some of the information that came to light this week, and the public inquiry is there to examine any allegations relating to who knew what and when. It would be wrong of us to duplicate the inquiry’s efforts, because it is a public inquiry that has the powers to summon witnesses to give evidence and to carry out other forms of evidence gathering, which is the right way to do this. I agree with the hon. Lady that compensation cannot come fast enough and that Post Office Ltd has to rebuild trust not just with the wider public; key to this are the postmasters.

Yes, of course we want to make sure that people get fair compensation. May I point gently to the performance so far of the group litigation order scheme? Fifty-eight full claims have been received, 48 offers have been made and 41 have been accepted without going to the next level, which is the independent panel. That tends to indicate that those offers are fair, because people have recourse to the appeal process. I am aware of one or two high-profile cases where people say they have not been offered a fair amount. I cannot talk about individual cases, but we urge any of those individuals to go to the next stage of the process, which is the independent panel. The whole scheme is overseen by Sir Ross Cranston, who has a very good reputation both in this House and further afield. We absolutely believe that the process will offer fair compensation, but we urge people to return to the table and ensure that their claim is properly considered by all means available.

[Bob Blackman (Harrow East) (Con)]

I thank my hon. Friend for all the work he has done on this issue—not only on the Front Bench, but on the Back Benches. No amount of compensation can compensate the victims of this complete scandal. However, it does help, and speeding up the process is obviously important. Will he, during the passage of the legislation that the Government have promised to introduce, ensure that innocent victims are not only compensated, but completely exonerated? In their communities, they have suffered the stigma attached to all this, and they need to have their names cleared and their reputations restored.

[Kevin Hollinrake]

I thank my hon. Friend for his regular contributions on this subject, which he frequently raised prior to the ITV series. I appreciate his work.

My hon. Friend is right to say that no amount of compensation can make up for what happened to many people’s lives. We want all the innocent people to be exonerated. We know there is nervousness, with some victims not trusting the process—they have simply had enough. We met Howe & Co., one of the solicitors, to talk about this issue yesterday, and its contention is that around 40% of the people who received a letter saying, “We will not oppose an appeal,” still will not come forward. We need a process that does not require people to come forward if we are to have a mass exoneration of those affected by this horrendous scandal. We hope to announce that later today.

[Mr Speaker]

I call the Chair of the Business and Trade Committee.

[Liam Byrne (Birmingham, Hodge Hill) (Lab)]

I associate myself with the words of praise for the Minister’s speed and attention on this issue. I think a legally binding instruction for the Post Office and the Department to deliver at speed is a necessity in the new Bill. The Minister has told us today that about £160 million has been paid in compensation, but there is provision for about £1.2 billion, which means that only 13% of the money has been paid out. He updated the House on the number of claimants, and there were 555 people in the GLO group and 700 who were convicted. As the Minister told us, only 73 people have had their final compensation fully paid, which is only 6% of the two groups.

The confusion at the beginning of the week about who said what to whom shows there is confusion about the instruction to deliver at speed. When the Bill comes before us, will the Minister reflect on the necessity for a legally binding deadline under which the Post Office must make information available in 20 to 30 days and an offer must be made to settle within 20 to 30 days, with a legally binding deadline for final resolution? Otherwise, frankly, I worry that the ambiguity will still cause delays. He knows as well as I do that justice delayed is justice denied.

[Kevin Hollinrake]

I thank the right hon. Gentleman for paying regular attention to this issue. I know that the Committee has a session next week and will be asking some of those questions.

We are keen to get compensation to victims as soon as possible. We are somewhat at the mercy of claims, and we cannot offer compensation if claims do not come in. Like others, I am very keen for people to come forward to submit a claim. One of the reasons why we put forward the fixed-sum awards of £600,000 for overturned convictions and £75,000 for members of the GLO scheme is to try to accelerate the payment of compensation, which contradicts the claim that people are trying to slow things down.

I am meeting the Horizon compensation advisory board this afternoon to look at its recommendations for accelerating compensation. We have taken nothing off the table, and I remind the right hon. Gentleman that the House recently voted to extend the compensation deadline from 4 August, on the recommendation of Sir Wyn Williams, because we do not want people to be timed out of compensation. The maximum budget for compensation has, thus far, been set at £1 billion.

One of the issues we are trying to resolve urgently is the fact that people are reluctant to come forward to have their convictions overturned by the Court of Appeal, which is one of the reasons why we have not compensated enough people with convictions. We cannot compensate them until we overturn their convictions, which is exactly why we have proposed the legislation. Once we have done that, the door will be opened for compensation to flow freely. That is exactly what the right hon. Gentleman and I want to see.

There has never been any confusion in our mind about the need to deliver this quickly. I have focused on that every single day, both since I have been in office and before. I have never been resisted by anyone in my Department or in other parts of Government. There may be confusion, but I promise that there has been no confusion in Government.

[Andy Carter (Warrington South) (Con)]

I add my thanks to the Minister for his work in helping me to advise my constituents who have come forward asking many questions about the situation that they found themselves in. I am very pleased that the Government are working to compensate postmasters who were convicted in a court of law, but there are many individuals who worked for the Post Office and faced disciplinary proceedings who did not end up in court. However, their professional reputations were trashed, they had no ability to find jobs when they were dismissed, and they were significantly out of pocket. The Post Office must know whom it disciplined; it must have records through the disciplinary procedure. Will the Minister outline what steps the Post Office has taken to contact those individuals so that they can get the compensation that they rightly deserve?

[Kevin Hollinrake]

I thank my hon. Friend for so ably representing his constituents who have fallen victim to this scandal. People do not need to have gone before a court of law to be compensated. A postmaster with a contract with the Post Office can access either the Horizon shortfall scheme or the GLO. A prosecution of any form is not required to be able to claim through those schemes. I think he raises a point about somebody who worked for a postmaster or for the Post Office. That is separate and I am very happy to talk to him about that point, which has been raised by a number of Members. The Post Office would not necessarily know whether a postmaster who is working independently and runs an independent business had disciplined their members of staff, so it might not be as straightforward as he sets out. Nevertheless, I am happy to engage with him on that.

[Mr Alistair Carmichael (Orkney and Shetland) (LD)]

The problem for many sub-postmasters and sub-postmistresses is the quantification of what they are due to be repaid under the shortfall scheme, because payments were made out of their own pocket on several occasions over a long period. It is difficult in those circumstances for the claimants to know that they have been properly compensated, because the Post Office cannot tell them how much it should be repaying. To take a step back, is it not apparent that we cannot continue to leave the Post Office to mark its own homework and that the independent elements of scrutiny need to be strengthened? Somebody independent of Government and the Post Office must be put in charge of not just sorting this out, but doing so at speed.

[Kevin Hollinrake]

I agree with the right hon. Member’s points, and he is right that quantification is very difficult. These situations are complex. It is about not just financial loss, but the personal impact, including the impact on mental health, physical health, reputation—all those things. In those situations, we should give the claimant the benefit of the doubt where this cannot be evidenced. In many cases, the records are no longer available.

We have independent people in all parts of the process. Members of the Horizon shortfall scheme include eminent KCs, such as Lord Garnier from the other place. We have Sir Ross Cranston overseeing the GLO scheme, and in the overturned convictions scheme, we have Sir Gary Hickinbottom—they are eminent retired High Court judges. I have great faith in their holding our feet to the fire and getting the right quantum of compensation to the right people at the right time. Indeed, the Horizon compensation advisory board, with the right hon. Member for North Durham (Mr Jones) and Lord Arbuthnot, is also holding our feet to the fire, making sure that we do the right thing and deliver the right amounts of compensation. I will meet it again later today.

[Mrs Emma Lewell-Buck (South Shields) (Lab)]

I know that the Minister means well and that he also understands that my affected constituents have had enough of being told that the Government are working hard to get them the justice they deserve and promises of swift compensation. One of my constituent’s claims was submitted in October. She heard the Minister say in January that all claims would have offers within 40 days, but she still has not had an offer. She is right to conclude that the allegations of delaying payments to benefit the Treasury are true, is she not?

[Kevin Hollinrake]

I am sorry that the hon. Member has taken that tone, but that is not true. As I set out, I think Henry Staunton has got this completely wrong. It is not the case, and there has never been any situation while I have been in this role—my predecessors have said the same—where we have tried to delay compensation. If the hon. Member wants to write to me, I am very happy to look at an individual case. Our commitment on the GLO scheme is that once we have received a full claim, we will respond to 90% of cases within 40 days. Some cases are more complex, but I am very happy to look at her specific case, as I have for other Members when people have contacted us directly. I am very keen to make sure that we get a resolution to her constituent’s case as quickly as possible.

[Sir Christopher Chope (Christchurch) (Con)]

I congratulate the Minister on his tenacity in relation to this issue. When does he expect the inquiry to be completed? It seems that Fujitsu is hiding behind that inquiry and is unwilling to commit itself to compensating the taxpayer for the compensation the taxpayer will be paying.

[Kevin Hollinrake]

I thank my hon. Friend for raising that important point. The inquiry is due to conclude by the end of this year and to report some time—early, I hope—next year. At that point, we will know more about Fujitsu’s exact role and the amount of the final compensation bill. I welcome the fact that at the Select Committee Fujitsu acknowledged its moral obligation to the victims and the taxpayer in contributing to the compensation bill, and we will hold it to its promises in that regard.

[Andrew Bridgen (North West Leicestershire) (Ind)]

The Minister is a perceptive man: he must see the problem of his reassuring the House from the Dispatch Box on a Thursday, after the Secretary of State’s reassurances at the Dispatch Box on a Monday. The House and the country’s patience is wearing thin. Many of the sub-postmasters, who are the victims in all this, including my constituents, have had their lives blighted and scarred for well over a decade. The delays to the compensation scheme are only exacerbating the pain and the problem. The public can see a pattern, whether it is the Horizon compensation scheme, the infected blood compensation scheme or the vaccine harm compensation, and it does not reflect well on the Government.

[Kevin Hollinrake]

I will be the first to admit that we want to deliver compensation more quickly than has happened in the past. As I said, 74% of claimants have received full and final compensation. It is absolutely right that the remaining 26%— as well as any more who come forward, and I am pleased that more are coming forward—receive that compensation too. It has never been a case of our trying to delay compensation. I do not believe there is a pattern here. These issues are complex but we are doing much to accelerate the process.

We did much to accelerate compensation payments prior to the ITV series, which is critical. The £600,000 fixed-sum award, which has been very effective in delivering rapid compensation, was brought in last October. We were looking at a blanket overturn in convictions some months before that series. We are trying to deliver the scheme at pace. It is not always straightforward to do that, but the hon. Gentleman has my commitment that we will do everything we can to deliver that compensation as quickly as possible.

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

The Post Office Horizon scandal is now commonly called one of the greatest miscarriages of justice in British history—so many lives devastated, some lost. An inevitable consequence of that is to undermine public confidence in the Post Office, in technology, as misrepresented by the Post Office and Fujitsu, and in the Minister’s Department, particularly following the performance—that is the right word for it—of the Secretary of State on Monday. What is he doing to restore public confidence in the Post Office, in technology and in his Department? Does he recognise that swift payment of compensation is an important part of that?

[Kevin Hollinrake]

Yes, it is the most important part of that. It is right that the Secretary of State responded to the serious and false allegations in the newspapers over the weekend. I hasten to add that those allegations were not about the Secretary of State but about a senior civil servant, who has been very clear that the allegations are false. The No. 1 way we can give confidence to those who might be submitting a claim, or have done so, is the fact that the processes do work for the vast majority of claimants. Of course, we want to improve the processes but we also want to reassure claimants that there is independence running through every single part of them. The No. 1 message we can give from the House is that if people come forward, they will be treated fairly and receive compensation as quickly as possible.

[Allan Dorans (Ayr, Carrick and Cumnock) (SNP)]

How can the public have trust in the Government to stand up for whistleblowers when, by her own account, the Secretary of State attempted to cover up the departure of Henry Staunton?

[Kevin Hollinrake]

I do not think that is an accurate portrayal of events at all. I am very happy to talk to the hon. Member about that particular issue. It was decided that Henry Staunton was no longer the right person to lead the Post Office. He then decided to make some allegations about what happened during his tenure, which have proven, in my view, to be completely false. I do not believe that Mr Staunton is a whistleblower. He spoke out, but I think the allegations he made have been clearly demonstrated to be not accurate. What the hon. Gentleman has just said is not an accurate portrayal of events. The No. 1 thing we should all focus on now is ensuring that people are properly compensated, that the inquiry is allowed to do its work and identifies those responsible, and that those responsible—be they individuals or corporates—are held to account.

[Helen Morgan (North Shropshire) (LD)]

I have a constituent who was part of the group litigation order. They were not convicted, because the process was paused in 2015, but they have pretty much lost everything, having borrowed substantial amounts of money to make up the shortfall over a long period of time. They have now been told that the £75,000 up-front payment would be net of any interim payment that they have received. They are not confident to go forward with the full assessment, because of some of the highly publicised very low—derisory—compensations that have been offered. Can the Minister offer my constituent any reassurance that it is worthwhile pursuing that extensive and independently assessed claim? My assessment is that they have lost significantly more than £75,000.

[Kevin Hollinrake]

If that is the case, they should definitely submit a claim. I am very happy to meet the hon. Lady to talk about her particular constituent. I am aware that some individuals have come forward and said that they received derisory offers. We urge them to engage with the rest of the process, which has not yet happened. There is an independent panel for the GLO scheme. Again, I would direct her to the actual performance of the GLO compensation scheme so far: 58 full claims received; 48 offers made; and 41 offers accepted without reference to the independent panel, which would tend to indicate that the offers being made are fair. However, I do understand that the people affected by this will not be satisfied by my assurances until they have gone through the process. I urge her to tell her constituent to do exactly that.

[Jim Shannon (Strangford) (DUP)]

May I also add my thanks to the Minister for his very dedicated response to all the questions that we have asked and for his energy in trying to make this scheme a success for those who have been victimised? On those who have had to take out loans to repay moneys that they never owed anyway, will calculations be carried out to allow repayment of not simply substantive amounts but moneys borrowed from family, friends or banking institutions, and the interest that they have had to pay them?

[Kevin Hollinrake]

I thank the hon. Member for all the work that he has done in this area. I think he has spoken in every single debate that I have responded to in the House on this particular matter. [Laughter.] And every single debate across this House as well. That was also the case when we were working together, fighting for justice for banking victims. I pay tribute to all the work that he has done in this House in all these different areas.

On the hon. Member’s question, the key principle is that somebody is returned to the position that they would have been in financially prior to the detriment taking place. That could take into account, for example, consequential losses, pecuniary losses—financial losses—as well as non-pecuniary losses, which are other impacts such as those on reputation or on health. The short answer to the hon. Member’s question is, yes, absolutely.

[Mr Speaker]

That completes the urgent question. We now move to the next one.

Draft Carer's Leave Regulations 2024 Draft Maternity Leave, Adoption Leave and Shared Parental Leave (Amendment) Regulations 2024

Kevin Hollinrake Excerpts

Wednesday 21st February 2024 General Committees

[The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)]

I beg to move,

That the Committee has considered the draft Carer’s Leave Regulations 2024.

[The Chair]

With this it will be convenient to consider the draft Maternity Leave, Adoption Leave and Shared Parental Leave (Amendment) Regulations 2024.

[Kevin Hollinrake]

It is a pleasure to serve under you in the Chair, Mr Hollobone. The Carer’s Leave Act 2023 and the Protection from Redundancy (Pregnancy and Family Leave) Act 2023 received Royal Assent on 24 May last year. These accompanying regulations were laid on 11 December 2023. I would like to take this opportunity to thank everyone who has played a role in taking these measures through Parliament. I thank in particular the promoters or sponsors of the private Members’ Bills that enable these regulations: the hon. Member for North East Fife, who is with us today, the hon. Member for Barnsley Central (Dan Jarvis), Lord Fox, Baroness Tyler and Baroness Bertin. The legislation that they helped to enact recognises the importance of unpaid carers and the significance of providing improved job security for pregnant women and new parents.

Statistics from the family resources survey 2021-22 showed that there were 4.9 million adult informal carers in the UK. Just over half of those are also holding down a job. That is about 2.5 million people trying to balance work with their caring responsibilities. According to research by the then Department for Business, Innovation and Skills and the Equality and Human Rights Commission, one in nine mothers reported that they had been dismissed, made compulsorily redundant where others had not been, or treated so poorly that they felt they had to leave work. If scaled up to the general population, that could mean that as many as 54,000 mothers a year are pushed out of the workforce. Although that data is from some time ago, we know that the problem persists. Put simply, that situation is unacceptable.

Delivering both these sets of regulations will fulfil our 2019 manifesto commitments to introduce one week of leave for unpaid carers and to introduce new protections for pregnant women and new parents. I will turn first to the carer’s leave regulations. Before getting into the substance, may I use this opportunity to flag a correction slip? The first line of regulation 5(1) on page 2 of the SI previously read “is entitled one week”, but now reads “is entitled to one week”.

Unpaid carers play a vital role in our society. There can be real challenges in balancing work with caring responsibilities. These regulations acknowledge some of those challenges and put in place measures that will help to ease the situation for a group of people who we know can be time-poor.

Carer’s leave will be a day one right for employees, who can then provide care, or make arrangements for the provision of care, for a dependant with a long-term care need. The definitions of care and care need have deliberately been kept wide to encompass a broad range of circumstances. Unpaid carers will be able to take their leave in a flexible manner, spanning from half a day to an entire week. That flexibility gives carers the most choice of how to manage their leave, based on their specific needs.

When applying for the leave, there will be no need to provide evidence indicating how the leave will be used or for whom. That will help to minimise any pressure on the carer, including any apprehension they might have about disclosing potentially sensitive third party information. It will also reduce the administrative burden for employers and eliminate red tape. Unpaid carers applying for the leave will have to provide advance notice, similar to the situation with the existing annual leave requirements, subject to a minimum notice period of three days.

Employers will not be able to deny the request for carer’s leave. However, they may postpone it. When doing so, they must let their employee know as soon as reasonably practicable and, following consultation, confirm a new date on which they can take the leave within a month of the original date. Lastly, on carer’s leave, safeguards will be in place, such as protection from dismissal or detriment as a result of having taken carer’s leave.

Turning to the draft Maternity Leave, Adoption Leave and Shared Parental Leave (Amendment) Regulations, as I said, it is not right that for a significant number of pregnant women and new parents, fearing losing their job unjustly is another worry they have to deal with. Under existing regulations—the Maternity and Parental Leave etc. Regulations 1999, often referred to as MAPL—before making an employee who is on maternity leave, adoption leave or shared parental leave redundant, employers have an obligation to offer them a suitable alternative vacancy where one is available, not just to invite them to apply for a role. In effect, that gives a parent taking one of those forms of leave priority over other employees, who are also at risk of redundancy. The point of these draft regulations is to extend that additional redundancy protection into pregnancy and for a period once the parent has returned to work.

[Caroline Ansell (Eastbourne) (Con)]

To start, I am 100% behind all the important measures that the Minister has outlined. I was pleased to work with the hon. Member for North East Fife on the Bill Committee to bring forward carer’s leave. Is the Minister aware of the active consideration of, and some of the challenge around support for, kinship carers? A recent study shows that 50% of kinship carers have been forced to give up their work, and that there are 130,000 kinship placements. I support every measure that he is outlining, but will he reassure me that active consideration is being made for that important and significant group? The needs of children are well met by the support of their wider family, but it is generally in traumatic and difficult circumstances.

[Kevin Hollinrake]

I thank my hon. Friend for her work. I, too, have kinship carers in my constituency. I know the important work they do and the saving they make to society, but also the help they give to children in such a situation. I am sympathetic. I have met the Minister for Children, Families and Wellbeing on a number of occasions, and I continue to do so. We are engaging to see what extra workplace entitlements we might make available to people in that situation, while trying to ensure that we do not add too many extra burdens to employers, in particular at this time when many face some difficulties. I thank my hon. Friend for her comments and am keen to continue to work with her on this particular area.

The provisions will help to alleviate some of the anxiety about job security that a pregnant woman or new parent may face. For the purposes of the draft maternity leave regulations, pregnancy is defined as the period from when a woman informs their employer of their pregnancy until two weeks after the pregnancy ends, for whatever reason. The additional redundancy protection continues for 18 months after the birth of the child, encompassing any period of relevant leave.

The 18-month period serves two purposes. First, it ensures that a mother returning from 12 months of maternity leave will receive six months of additional redundancy protection when she goes back to work. That meets the commitment that the Government made in their consultation response. Secondly, a single, consistent and clear period of protection is a simple way to accommodate the flexibility of shared parental leave and the interaction between shared parental leave and other types of parental leave. Creating a bespoke approach for those and other scenarios would have introduced considerable complexity into the regulations. That is why we opted for the simplicity and clarity of a single period of protection.

The period of protection for redundancy on return to work is activated immediately someone returns to the workplace following a period of maternity or adoption leave. However, the new draft regulations will introduce a minimum qualifying period for those taking shared parental leave alone—by “alone”, I mean that they have not previously taken a period of maternity or adoption leave. That is to avoid the situation where a parent who has taken just a few weeks of shared parental leave receives 18 months of additional protection in a redundancy situation. When we spoke with our stakeholders, they considered that it would be disproportionate to extend that level of protection to someone who had taken only a short period of shared parental leave. For that reason, the draft regulations require a parent to have taken a minimum period of six continuous weeks of shared parental leave—unless they have taken maternity or adoption leave—to activate the additional redundancy protection once they have returned to work.

Together, these measures will provide additional support and protection for pregnant women and new parents, and for those with caring responsibilities beyond childcare. The Government were pleased to support the Carer’s Leave Act 2023 and the Protection from Redundancy (Pregnancy and Family Leave) Act 2023, which were introduced as private Members’ Bills. We are pleased to have laid these regulations and look forward to their coming into force.

[Justin Madders (Ellesmere Port and Neston) (Lab)]

It is a pleasure to see you in the Chair this afternoon, Mr Hollobone. I thank the Minister for his introduction. We will not be opposing the regulations today, although that is not to say that I do not have a few questions and comments—I know the Minister would have been disappointed if I did not have anything to say. Let me start by paying tribute to the hon. Member for North East Fife and my hon. Friend the Member for Barnsley Central (Dan Jarvis) for their work on the private Members’ Bills that led to these regulations.

As the Minister highlighted, the draft carer’s leave regulations will provide employees from day one—we in the Opposition certainly like day-one rights—the right to a maximum of one week’s leave per year to care for a loved one, without any requirement to provide evidence. As we know, the entitlement can be taken in chunks as small as half a day or as one week’s continuous leave, and it cannot be refused by an employer, nor can an employee be detrimentally treated as a result of taking such leave, in common with many other protections in employment law.

Campaigners have pushed for many years for the right to statutory care leave, but until now there has been no such right. We know that there is a whole range of reasons why carers might need to take time out; the regulations will hopefully allow them to provide assistance with a doctor’s appointment or recovery after surgery, for example. The regulations are undoubtedly a step forward, and they should make a difference to those with caring responsibilities who are in paid work.

As we heard, the number of people potentially affected by the regulations is not insignificant. There are millions of people who are both in work and responsible for caring. Carers UK found that before the pandemic almost 5 million people were juggling work and caring, and that increased to 7 million during the pandemic. The Chartered Institute of Personnel and Development estimates that the figure is closer to 3.7 million people, while the impact assessment published alongside the regulations states that the total number of carers—not just those who are in work—stands at 4.2 million. There are, therefore, several different estimates of the number of people who will be impacted by the regulations, and I will return to that briefly later on, but whatever figure we choose, it represents a substantial proportion of the total population, let alone of the number of people actually in work. Given that, at the latest count, there were about 33 million people in work, around 11% to 15% of the overall workforce may benefit from the regulations.

There is a large amount of evidence that good employers already have informal care leave practices in place, but of course many employees do not have that option and, unfortunately, often take caring leave in the form of annual leave or sick leave. That was uncovered during the Government’s 2020 consultation, which found that two thirds of carers had had to use annual leave to provide care for their dependants. In essence, until that point the issue was hidden: carers would use annual leave or find another way, by hook or by crook, to take the time out that they needed. We should make it very clear that annual leave is meant for rest and recuperation, not caring responsibilities.

A 2018 report by the Work and Pensions Committee summed up that unfortunate practice as “detrimental” to carers’

“own physical and mental well-being,”

and said that, in the long run, it would increase

“the risk of sickness, exhaustion and ‘burnout’.”

Those warnings appear to be accepted in the summary of the “do nothing” approach in the impact assessment published alongside the regulations, although I cannot help but point out to the Minister the irony of the Government’s being alive to the importance of a worker having the option and the ability to take annual leave in the context of caring, just a couple of months since the introduction of reforms to rolled-up holiday pay, which will have the opposite effect.

All hon. Members here will appreciate how taxing such caring efforts will be for workers, and many will, of course, have personal experience of such difficulties. Research published by the CIPD in 2021 found that almost one third of working carers provide at least 30 hours of caring per week, meaning that they are effectively undertaking another full-time job on top of their full-time caring responsibilities. Of those working full time, 28% provided at least 30 hours of care. Understandably, for many that can take a huge physical as well as psychological toll, not to mention the need to balance such personal challenges with the development of a career.

For many the situation can seem insurmountable, and people often reduce their working hours or give up work entirely. I hope the regulations stop that happening as much as it has been to date, but according to research 9% of the population have had to do that: the impact assessment notes that 5% have left the workplace altogether and a further 4% have had to cut their hours. Carers UK claims that this translates to 600 workers leaving the workplace per day. If that is correct, it is a staggering figure and clearly something that we should all want to do something about. It is clear that informal care needs can impact on one’s career, leaving many working people in a state of economic inactivity in order to provide care. When so much potential and experience is lost to the labour market, we need to address that; I hope the regulations will help in that respect.

It is important to note that the burdens do not fall on all sections of society equally. The impact assessment notes that the impact of caring while in work hits those aged 45 to 54 hardest—I declare an interest at this point as I am in that age group; I know it is hard to believe, but I am under 54—with more than a quarter of people reporting that it had taken a toll on their work. There is also a gender aspect to this, with women more likely than men to be responsible for caring. The family resources survey found that 9% of women, as opposed to 6% of men, are in this position. If we put the facts together, it is no surprise that women aged between 45 and 64 years old are most likely to be carers. As we know, with such added responsibilities they are more likely to be leaving the workforce, which exacerbates the existing gender pay gap.

All this shows that not only are many making a massive personal sacrifice, but there are societal consequences as well. The inequalities in terms of who is responsible should trouble us all, but there are also profound financial impacts. The impact assessment notes that the potential cost incurred to the Exchequer alone is around £2.9 billion per year. Analysis suggests that better carer’s leave policies could save businesses a cumulative £4.8 billion per year in unplanned absences, and a further £3.4 billion in improved employee retention. Clearly, those figures may need to be tested by experience, but it is clear that some businesses have caught on to the benefits of providing carer’s leave and introduced voluntary policies. Sadly, though, that applies only to a small proportion of businesses overall—Carers UK report that it is around 12% of existing employers.

It is an understatement to say that a very strong case for carer’s leave has been made for a number of years, but we do have concerns about some of the aspects of the regulations. Most significantly, the calls made during the passage of the Carer’s Leave Act for the Government to consider making such leave paid have fallen on deaf ears. It was not just the Opposition who called for paid leave; the Government’s own response to the consultation on the matter, which was published in September 2021, stated:

“There were strong calls from charities and individuals for this leave entitlement to be paid.”

Despite those strong calls, the space allocated to considering them in the consultation extended to just 162 words, in which the Government said they were “sympathetic” to the calls but judged that the impact on businesses would not be “proportionate”. There is no analysis to support that position, and no further evidence. I know that finances are tight, but we already know about the potential positive financial impact, so I would have expected some form of analysis in the impact assessment—which took a year to come out—of the costs and benefits of making the entitlement paid. The Government should at least have considered that as an option.

Why have the Government decided that it would be disproportionate to make the entitlement paid without offering any supporting evidence? Has the Minister looked at costings at any point? Indeed, has there been any consideration of that point at all? Given the evidence that there is an economic benefit, it is important that there is an explicit acknowledgment in the impact assessment that keeping the leave entitlement as unpaid will discourage some carers from taking up leave. The impact assessment says that

“as this is an unpaid leave entitlement some carers will be disincentivised to take the full entitlement of leave, as they do not want to lose more of their income. Existing survey evidence shows that one of the key reasons for not taking leave is because of affordability.”

Will the Minister explain why the Government have chosen a policy which, according to their own analysis, appears to limit the take-up?

[Kevin Hollinrake]

The hon. Gentleman is implying that we should make the entitlement paid, which is a perfectly reasonable position. As he makes that assertion and that policy decision that the Labour party will presumably adopt, does he understand how much that decision will cost and where the money will come from?

[Justin Madders]

As the Minister knows, we will publish our proposals with costings when we get to the general election. However, as the Government have been considering the regulations, I want to know whether they have undertaken such an exercise. It appears they have not, and I think, given that there is apparently some financial benefit, that it is perfectly reasonable to ask why that question has not been addressed at all. I further point out that the impact assessment states that

“some employees may prefer to use their annual leave for caring responsibilities, as this is an unpaid entitlement and annual leave is paid at full-pay.”

That undermines the purpose that the regulations are trying to achieve, so I hope the Minister can address that in a little more detail when he responds.

As I mentioned earlier, there is a question about how many people will actually benefit. I quoted figures from Carers UK and the CIPD, which place the number of people in work who are carers at more than 5 million or at 3.7 million, respectively. The Government’s estimate of those who will benefit is substantially lower, at 1.9 million, according to page 13 of the impact assessment. That number is also alluded to in the explanatory memorandum, which states that the number of in-work carers is roughly half the total number of informal carers, which is 4.2 million. It would be useful to hear from the Minister why we have such discrepancies on the figures; after all, there are several million people between the Government’s and the CIPD’s estimates. One possibility is that many carers do not qualify for the assessment because they are not employees. I do not know whether that has been part of the issue.

I have some concerns about the mechanics of the entitlement and will ask the Minister to address those when he responds. The particular issue is the ability of an employer to postpone the leave for a period of up to one month. The regulations state that an employer is entitled to delay the take-up of leave if

“their business will be unduly disrupted if the employee took carer’s leave during the period identified in the notice”.

That appears rather open-ended. What constitutes a business being unduly disrupted? Will the Minister help us with that? Will there be guidance issued on that point, alongside the regulations, to clarify the circumstances in which it can be invoked?

It is also worth noting that if an employee provides less than one week’s notice, the leave could be postponed before the earliest day or part day requested in the employee’s notice. That means that there are asymmetrical notice requirements. Where an employee must provide adequate notice to proceed with their entitlement, the employer can seemingly postpone at a moment’s notice. We can all see why that that might not necessarily align with people’s caring responsibilities. Most of the time, the leave will be dependent on the care needs of the recipient, and it might not be possible to rearrange cover in such a fashion, so will the Minister accept that a balance must be struck between the needs of the carer and of the employer?

I suggest that the way the draft regulations are framed means that the employer could, if so minded, refuse a request for whatever reason they chose, as long as they use the wording of regulation 8(b). On the face of it, under the draft regulations, there is no mechanism to challenge an employer’s decision. On reasons to postpone carer’s leave rather than refuse it—it is supposed to be operational in a month—what explanations does the Minister expect a business to produce? What measures can the Government take to ensure that consent is not withheld unreasonably?

Before I move on to the second set of regulations, I will say that it is a little disappointing that we have had to wait such a long time for regulation. It is now not far off seven years since the Government promised to

“give workers a new statutory entitlement to carer’s leave, as enjoyed in other countries”,

in the 2017 Conservative general election manifesto. That was repeated in the 2019 manifesto, which stated that they would introduce the

“entitlement to leave for unpaid carers, the majority of whom are women, to one week.”

A promise to introduce the provisions as part of the now mythical employment Bill was made in the 2019 Queen’s Speech. A consultation was launched in March 2020, followed by a Government response a year later, but then we heard nothing more.

As we know, throughout the passage of the Carer’s Leave Bill there was no opposition to its principles and no amendments were made. I think it was universally accepted that it was a positive step forward, which poses the question of why we have had to wait seven years for this to be delivered. Why did we have to rely on a private Member’s Bill for it to come into law? Hundreds of thousands of workers could have benefited from the protections in the legislation had it been issued earlier. It is positive that we have finally got there, but it is reasonable to ask the Minister why it has taken us so long.

I now turn to the second set of regulations, the draft Maternity Leave, Adoption Leave, and Shared Parental Leave (Amendment) Regulations. As the Minister stated, they are about the protections against being made redundant that are afforded to workers who take maternity, adoption or shared parental leave. The rights stem from the MAPL regulations of 1999 and similar provisions in the Paternity and Adoption Leave Regulations 2002 and the Shared Parental Leave Regulations 2014.

All the existing regulations state that if a worker’s job is being made redundant during their maternity, adoption or shared parental leave period, they are entitled to be offered alternative employment that is not substantially worse than their previous job. As the Minister said, the new regulations will expand the time during which those protections apply up to 18 months after the birth of the child. That will mean that a mother taking the full 12-month entitlement to maternity leave or a parent taking the full 12-month adoption leave will be protected for at least six months after their return to the workplace. For a parent taking shared parental leave, protections apply only if they take off at least six consecutive weeks of parental leave.

We absolutely support the Government on increasing protections and, as the Minister said, a range of evidence that has been available for a long time indicates that new mothers have been pushed out of jobs and discriminated against. The Minister referred to the Equality and Human Rights Commission’s 2015 estimate of about 54,000 new mothers being forced out of their jobs, equating to about 11% of the women responding, who had

“been dismissed, made compulsorily redundant where others in their workplace were not, or treated so poorly they felt they had to leave their jobs”.

In 2020, a Pregnant Then Screwed a survey of almost 20,00 women also found a figure of about 11% of women on maternity leave who had been made redundant or expected to be made redundant. The Government recognised that position and made positive noises following a 2017 Women and Equalities Committee report, but did not launch a consultation on the issue until 2019. Again, a commitment to act was made in the 2019 Queen’s Speech, but here we are in 2024 before we finally have some regulations.

It must be stated that the second set of regulations will address only one element of the challenges that women and other parents face: that of being made redundant while pregnant. On page 7 of the impact assessment, it is estimated that the measure will likely cover about 7,500 people. Clearly, that is a not insignificant number of workers, and it is a welcome step that additional parents will have the protections, but that is only a small proportion of those who start a family each year, and it is certainly a drop in the ocean compared with the 11% figure in the surveys to which I have referred.

There is concern, then, that the regulations will not take us all the way to where we want to be in protecting women and new parents from discrimination during and after pregnancy. I think we can all agree that the surveys and the evidence show us that there is currently an unacceptable level of discrimination, but it is important to remember that that has all been happening under the current rules on maternity, adoptive and shared parental leave, so it is reasonable to ask this question. What do the Government think will happen, when the extension of the period comes into force, to actually ensure that all discrimination in the workplace is eliminated? We know that tens of thousands of women are already being forced out of their jobs, through reasons not associated with redundancy, during pregnancy or within six months of their return to work. I fear that the measure will not go far enough, so does the Minister have any thoughts or suggestions about what else could be done to reduce the very high numbers?

The regulations on which the statutory instrument builds are reliant on awareness by the employer of the rules and on the ability of the worker to enforce their rights. The impact assessment noted that 70% of employers reported a high level of awareness of female employees’ rights, but it also noted that deeply concerning biases were held by an unacceptably large proportion of employers. Reportedly, 70% of employers held the belief that women should declare a pregnancy during the recruitment stage, and 25% thought it was acceptable to ask a woman about their plans to have children when hiring. Those statistics are concerning and should be setting off alarm bells about the latent discrimination that still exists. I started work nearly 30 years ago and even then those sorts of questions were simply unacceptable, so the fact that the impact assessment reveals that that kind of prejudice is still alive is worrying to say the least.

The concern is reflected in the part of the impact assessment that raises concerns that the effectiveness of the regulations could be blunted through an employer’s adherence to them. I will draw to the Committee’s attention two passages in the impact assessment. The first is the comment on the wider landscape, where it says:

“The legislation in this area is complex and thus businesses may struggle to understand their obligations. As a result, employees may find it difficult to exercise their rights.”

The other, which is a surprisingly candid comment about how the current system is not robust enough to adequately protect workers, says:

“Employers are currently not incentivised to provide sufficient employment protection for pregnant and new parents, and are likely to prioritise their costs and bottom line.”

It would be useful to hear the Minister’s reflections on those comments, because they allude to a wider problem. Will he reassure us that there will be adequate support for businesses to understand the new protections and that they will be accompanied by a robust enforcement mechanism to ensure that the protections actually benefit the people they are intended to benefit?

In closing, I remind Members again that the Select Committee report with actions in relation to where we are with the regulations today was published in 2016. We know that a week is a long time in politics, so eight years must seem like an eternity, particularly to those 54,000 women who we can estimate have been forced out of work each year during that period. The total is more than 400,000 women during that time. As I said, I will conclude on those points. We support the regulations, but there are some questions that I hope the Minister will address when he closes the debate.

--- Later in debate ---

[Kevin Hollinrake]

The Government are very pleased to bring forward these two pieces of legislation and to deliver on two of our manifesto commitments. Let me touch on the points raised by the shadow Minister and the hon. Member for North East Fife.

The cost of carer’s leave to business is already around £33 million annually. Whether to extend it so that it is a paid right is an interesting question. As I said in my intervention, that would clearly mean a cost either for the taxpayer or for business, and we do not think, at this time, that that is the right burden to place on businesses, which are already facing difficulties from a number of sources, not least covid and the cost of living crisis.

Indeed, we have legislated in a number of areas. The hon. Member for Ellesmere Port and Neston mentioned the employment Bill, but he will be aware that there are six private Members’ Bills that will have some impact on businesses. As well as the draft regulations we are considering, we introduced flexible working legislation, neonatal care leave and the Employment (Allocation of Tips) Act 2023. Those are a number of requirements on business, and we always want to maintain a balance in relation to the impact on business and jobs. We think that this change strikes the right balance.

The hon. Gentleman asked how many people will be affected. Our statistics came from the family resources survey 2021-22, which states that there are 4.9 million adult informal carers, and half of those hold down a job. That is where we got the figure of 2.5 million from. A lot of the discrepancies he referred to may be a result of the kind of question that is asked. The questions are not necessarily the same, but the numbers are around the same ballpark. There may be a few hundred thousand either side, but in the context we are probably in the right place.

The hon. Gentleman and the hon. Member for North East Fife made a good point about postponement and who judges what is unduly disruptive. Our perspective is that it is right that the business—the provider of employment—determines that. Hopefully, most people acknowledge that most employers in the UK are decent businesses that do the right thing by employees. That is good businesses, and most are run by decent people. Of course, where things go wrong, there is a natural recourse to the employment tribunal, which can determine whether a business has been reasonable or whether a person has been inappropriately discriminated against. We could potentially look at guidance in this area; we will take that away.

On the time it has taken for us to get to this point, of course we seek to deliver these things as quickly as possible, but there has been a series of disruptions to our legislative programme over the past few years—not least covid and the cost of living crisis. We have introduced a number of pieces of legislation, as we discussed earlier.

The hon. Member for Ellesmere Port and Neston referred to further protections, and of course we always look at that. Part of what we do in legislation is set a baseline that encourages cultural change. We will continue our work with the Pregnancy and Maternity Discrimination Advisory Board to develop improved guidance, which may provide the further protection that he seeks.

The hon. Member for North East Fife rightly asked how we can promote this legislation. We constantly work with stakeholders and various employer groups to talk about legislation that we are introducing, and we will continue to do that to ensure they inform the employers—their members—about the regulations.

I thank everyone who participated in the debate, not least the hon. Lady, who has done incredible work in taking forward her private Member’s Bill. It is always a pleasure to be involved in legislation that receives cross-party support, and I am very pleased that that is the case today. We very much hope the new carer’s leave right will improve the lives of carers who are juggling their caring duties and work commitments. The extension of additional redundancy protections to pregnant women and new parents will reduce the number of parents who feel they are being unjustly pushed out of the workplace. We want the regulations to succeed because we have an opportunity to make a real difference to the lives of those who may rely on these changes in the future. I commend the regulations to the Committee.

Question put and agreed to.

Resolved,

That the Committee has considered the draft Carer’s Leave Regulations 2024.

DRAFT MATERNITY LEAVE, ADOPTION LEAVE AND SHARED PARENTAL LEAVE (AMENDMENT) REGULATIONS 2024

Resolved,

That the Committee has considered the draft Maternity Leave, Adoption Leave and Shared Parental Leave (Amendment) Regulations 2024.—(Kevin Hollinrake.)

Business and Trade

Kevin Hollinrake Excerpts

Monday 19th February 2024 Ministerial Corrections

The following are extracts from the Second Reading debate on the Shared Parental Leave and Pay (Bereavement) Bill on 26 January 2024.

[Kevin Hollinrake]

Our 2019 manifesto pledged changes to enhance workers’ rights and support people to stay in work. The Government have delivered on those commitments by supporting a package of six private Members’ Bills helping new parents, unpaid carers and hospitality workers; giving all employees easier access to flexible working; and giving workers a right to request a more predictable working pattern. We have been pleased with the successful progress of that legislation through Parliament, where it has received cross-party support, resulting in six Acts successfully receiving Royal Assent. The Government have already made good progress on laying secondary legislation in due course to implement those new Acts.

The Employment Relations (Flexible Working) Act 2023, for example, will give all employees with 26 weeks’ continuous service the right to request flexible working, empowering employees to ask for a working arrangement that suits them and their unique circumstances.

[Official Report, 26 January 2024, Vol. 744, c. 523.]

Letter of correction from the Under-Secretary of State for Business and Trade, the hon. Member for Thirsk and Malton (Kevin Hollinrake):

An error has been identified in my speech on Second Reading of the Shared Parental Leave and Pay (Bereavement) Bill.

The correct statement should have been:

[Kevin Hollinrake]

Our 2019 manifesto pledged changes to enhance workers’ rights and support people to stay in work. The Government have delivered on those commitments by supporting a package of six private Members’ Bills helping new parents, unpaid carers and hospitality workers; giving all employees easier access to flexible working; and giving workers a right to request a more predictable working pattern. We have been pleased with the successful progress of that legislation through Parliament, where it has received cross-party support, resulting in six Acts successfully receiving Royal Assent. The Government have already made good progress on laying secondary legislation in due course to implement those new Acts.

The Flexible Working (Amendment) Regulations 2023, for example, will result in all employees, including those without 26 weeks’ continuous service, having the right to request flexible working, empowering employees to ask for a working arrangement that suits them and their unique circumstances.

[Kevin Hollinrake]

The Protection from Redundancy (Pregnancy and Family Leave) Act 2023 will provide greater protection to women who are on maternity leave or an employee who is on adoption or shared parental leave in a redundancy situation.

[Official Report, 26 January 2024, Vol. 744, c. 523.]

Letter of correction from the Under-Secretary of State for Business and Trade, the hon. Member for Thirsk and Malton (Kevin Hollinrake):

An error has been identified in my speech on Second Reading of the Shared Parental Leave and Pay (Bereavement) Bill.

The correct statement should have been:

[Kevin Hollinrake]

The Protection from Redundancy (Pregnancy and Family Leave) Act 2023 will provide greater protection to women who have returned from maternity leave or an employee who has returned from adoption or shared parental leave in a redundancy situation.

[Kevin Hollinrake]

Obviously, all legislation should include an impact assessment, including a financial impact assessment on business. The impact assessment result was de minimis—I think that is below £5 million, which is not a significant impact. We therefore do not think that the changes will create a significant burden on businesses. We have engaged with business representative organisations and payroll professionals throughout the policy development of these changes. They have responded positively and understand how the changes will increase flexibility for families. We are working with His Majesty’s Revenue and Customs to plan communications with businesses to ensure that they fully understand the new arrangements, and we will continue to engage with them while we finalise guidance to ensure the smooth introduction of these changes.

[Official Report, 26 January 2024, Vol. 744, c. 525.]

Letter of correction from the Under-Secretary of State for Business and Trade, the hon. Member for Thirsk and Malton (Kevin Hollinrake):

An error has been identified in my speech on Second Reading of the Shared Parental Leave and Pay (Bereavement) Bill.

The correct statement should have been:

[Kevin Hollinrake]

Obviously, all legislation should include an impact assessment, including a financial impact assessment on business. The impact assessment result was de minimis—I think that is below £5 million, which is not a significant impact. We therefore do not think that the changes will create a significant burden on businesses. We have engaged with business representative organisations and payroll professionals throughout the policy development of these changes. They have responded positively and understand how the changes will increase flexibility for families. We will work with His Majesty’s Revenue and Customs to plan communications with businesses to ensure that they fully understand the new arrangements, and we will continue to engage with them while we finalise guidance to ensure the smooth introduction of these changes.

Post Office Services: Isolated Communities

Kevin Hollinrake Excerpts

Thursday 8th February 2024 Commons Chamber

[The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)]

I congratulate the hon. Member for Stretford and Urmston (Andrew Western) on securing this important debate on a subject close to my heart, as the representative of the rural seat of Thirsk and Malton.

We all know how highly our communities value post offices, and our constituents have deep concern whenever they are closed, even temporarily. They value them because of the services they provide but also, as the hon. Gentleman puts it, because they are the provider of trusted relationships—I could not agree more. The post office network is still significant, with over 11,500 branches across the country. Recent research by the London School of Economics highlighted that the network makes a valuable contribution to the economic health of our high streets, generating £3.1 billion of additional spending every year. It is understandable that the hon. Gentleman wants to debate the issue, given that his constituency has seen changes in its provision of post offices in recent months and years.

The Post Office has the commercial freedom to deliver the branch network within the parameters set for it by Government. Those parameters include minimum access criteria and minimum services to be provided at branches across the country. For example, 99% of the population must live within three miles of their nearest branch and 95% of the total urban population must live within one mile of their nearest outlet, which relates to the hon. Gentleman’s constituency because it is in an urban area. Despite all the challenges faced by retailers in recent years, it is pleasing that the Post Office meets and exceeds those criteria at a national level. In fact, more post offices have opened this year than have closed and the network is as large today as it has been for five years, with around 11,700 branches open.

As the hon. Gentleman will know, 12 branches are operating in in Stretford and Urmston, serving around 13,000 customers each week. The post office network in the area supports around 60 full-time equivalent jobs and has an economic contribution to his constituency of over £6 million each year, as well as driving an additional wider high street spend of £5 million a year.

I am aware of the hon. Gentleman’s concerns about the situation in Partington, where I understand the post office branch closed last year when the postmistress retired after an incredible 35 years serving her community. From my own constituency experience, I fully appreciate the impact a branch closure can have on a community. It can be disruptive, particularly for communities without nearby alternatives, but that fluctuation is part of the modern, dynamic, franchise-led business that the Post Office primarily is. The network is made up of small businesses and, just like any other franchise-based business, the Post Office cannot control a franchise’s decisions about their future. As postmasters move on, branches close and new ones open, as the hon. Gentleman has experienced at first hand, with the opening of Stretford post office in its new permanent location late last year.

The reasons for a temporary branch closure are generally outside the control of the Post Office. However, in such instances, the Post Office ensures services are maintained as quickly as it can. I understand from the Post Office that there is interest from a community group in taking on the Partington branch, with a further meeting scheduled next week, so I am hopeful that the branch can be reopened as soon as possible. I note the hon. Gentleman’s point about the provision of a mobile service, and I am happy to take that away and update him. It is not easy to secure, as I have experienced myself, but we will do whatever we can.

We are not blind to the realities of taking on and running a post office. Like any other retailer, post offices face pressures from continually evolving consumer behaviours, particularly as consumers shop online more, driving footfall away from our high street. When it comes to consumer habits and accessing Government services, it is not our place to dictate to people where they should access those services—I think that we often like to access those services online. None the less, we are keen to retain what services we can. The hon. Gentleman did point to the DVLA contract, which has been extended for another year. I think that everyone would like to see that contract extended on a longer-term basis, but negotiations will have to continue.

Changes in consumer behaviour are significantly driving down the number of letters being sent, which is also having an impact on post offices. Nevertheless, there are reasons to be optimistic. We were pleased to see the Post Office launch its Parcels Online business last year, whereby customers can select and pay for Evri and DPD products online before dropping parcels off at their nearest post office. The Post Office is now also rolling out a similar proposition across the physical network, which means that customers can compare different carriers to choose the option that best suits their needs. We see this as a significant opportunity to improve competitiveness and competition in the market, and I am keen that the Post Office expand that proposal further to include more carriers.

There is also a major opportunity, as the hon. Gentleman puts it, in banking services. All customers should have appropriate access to banking and cash services wherever they live. That is why we have legislated to protect access to cash to ensure that customers can continue to access everyday banking services at the post office. This development is important for the hon. Gentleman’s constituency as, for example, around 50% of bank branches in Stretford and Urmston have closed since 2015, so post offices are key in providing access to cash in the constituency, as they are across the country.

In December, £3.3 billion in cash was either deposited or withdrawn across the country. The post office network is therefore a crucial component of this country’s long-term provision of cash and banking services. And that is why I have been clear that the Post Office should be ambitious in its negotiations with the banks for the next iteration of the banking framework agreement, which already provides significant revenue into the post office network. We welcome that, but there are further opportunities. The hon. Gentleman may want to speak to the Economic Secretary to the Treasury about other services, such as banking hubs. As I said earlier, there are 30 hubs around the country already and 70 more in the pipeline, but our aspiration is to get 500, and it may be suitable to provide a hub in his constituency.

[Gerald Jones]

I thank the Minister for giving way. I fully accept that there are challenges. For example, many of the people working in our post offices have done so for many years and when they come to retirement, it really is a challenge to get people to take on those businesses. The communities that we have described this afternoon—geographically isolated communities and communities with public transport issues—tend have many older people who often use cash in their transactions. Banking hubs are great in larger towns perhaps, but things are much more difficult in smaller, isolated communities. What other options can be considered so that those communities do not become financial deserts?

[Kevin Hollinrake]

The hon. Gentleman raises an important point. Banking hubs are not a one-size-fits-all solution. There are other solutions, some of which are facilitated by the banking framework. Enhanced facilities in post offices is one such solution—for example, a separate line in the post office. Smart ATMs are part of the solution. OneBanx provides a mini-banking solution that can be provided in libraries, for example. Different financial organisations, such as some of the building societies, are rolling out such provisions, but we see banking services, and the remuneration that flows from them, as critical to ensuring that we have a sustainable network of post offices. I have always been clear in this House that if Members have particular local issues, I am happy to work with them and the Post Office to try to deliver solutions on a case-by-case basis.

Although there are opportunities, that does not mean we are out of the woods. Branch profitability is a top priority for postmasters, and I am keen to ensure that it can be enhanced wherever possible. I assure Members that we remain steadfast in our support for the network. We have provided significant financial support to sustain the nationwide network—over £2.5 billion in funding in the past decade alone—and we are providing a further £588 million for the Post Office between 2022 and 2025. The moneys include investment and, as the hon. Member for Stretford and Urmston referred to, an annual network subsidy of £50 million, which helps to safeguard services in the uncommercial parts of the network.

The Government have been clear that post offices should be a valuable social and economic asset for communities and businesses for years to come. We continue to work with the Post Office to ensure that the organisation and the network are fit for the future, and we always welcome views on the network, such as those expressed today. I thank the hon. Member for Stretford and Urmston for introducing this important debate, and the other hon. Members who contributed to it.

Question put and agreed to.

Post Office Management Culture

Kevin Hollinrake Excerpts

Thursday 8th February 2024 Commons Chamber

[Marion Fellows]

I could not agree more with the right hon. Gentleman. I frequently agree with him on Post Office matters. This is important, because the all-party parliamentary group on post offices, of which he is a member and I am the chair, is a true cross-party group. There is no party that does not have a member of the APPG.

Sean Hudson of the Communication Workers Union described the management culture perfectly:

“Every serious management failure results in a culture of offering that failure up for external investigation at significant expense to POL and the taxpayer, without learning from those mistakes.”

It has since transpired that the legal fees for resolving disclosure issues in the past year alone cost £24 million. That money could have gone into the network to help struggling sub-postmasters, many of whom are working for below the minimum wage. For context, POL announced remuneration improvements this year of just £26 million, which in no way take into account the rise of costs and overheads. Some of the issues were only brought to light through the perseverance of campaigners through freedom of information requests that revealed that not all relevant evidence had been disclosed to the inquiry. Some of the issues outlined came to light before the transmission of ITV’s “Mr Bates vs The Post Office”, which has had a monumental impact on the public consciousness in Britain. It is important that that was beamed into front rooms across the nation. It has caused deep distrust of Post Office management among the general public.

With the words “openness and transparency” in mind, I want to bring to the attention of the House the case of my constituent Salman Aslam. Salman, or Sal, is a young man who ran a post office in my constituency for five years, before he walked away last year. Sal took over the post office from his father, when he was in remission from Hodgkin’s lymphoma. Sal began noticing shortfalls, which he continually plugged himself and which ranged from £4,000 to £16,000 at a time. He estimates that he has paid in about £100,000 of his own money. When audited last year, a shortfall doubled in front of his eyes to £80,000, He decided he could no longer go on, for the sake of his finances, and of his mental and physical health, which doctors were saying was under threat due to his levels of stress.

Throughout the five-year ordeal, Sal contacted the Post Office for help continually, but none was forthcoming, and after handing in his keys, the Post Office was not in touch for more than a year, leaving him in a perennial state of stress and fear. Sal went public with his story a few weeks ago—I had a hand in that—and once the story went out, Post Office Ltd immediately sprang into action and the communications department got in touch with him. That is not indicative of a change of culture. It echoes tales of the past that are all too familiar: desperate postmasters reaching out to POL for help, but receiving little in return; and communication from POL arriving only after some negative press.

Throughout the Horizon scandal, POL prioritised institutional reputation over the welfare of sub-postmasters, whom Mr Read himself recently told the Business and Trade Committee were the trusted asset that made the network what it is. Sal is one of many postmasters who have been in touch in the past weeks to tell me that they are experiencing shortfalls—not historical shortfalls, but ones that have occurred in the past year. Issues with Horizon appear to be continuing to this day, which is seriously concerning. Is the Minister aware of ongoing issues with Horizon? What has he done, or is he going to do, to address these? Sal, like all the victims who preceded him, is in this position through no fault of his own. Today, I call for an undertaking from the Government, the Post Office’s sole shareholder, that he will not be pursued for the ghost debt of £80,000, and I ask the Government to examine what kind of redress he can expect, having sunk so much of his own money into his post office to cover repeated shortfalls generated by Horizon. I have other constituents who are also in that position.

The culture of change that Nick Read has called for has not been apparent. In 2023, POL was rocked by scandals once again, with one appropriately named “bonusgate”. The former Chair of the Business and Trade Committee, the hon. Member for Bristol North West (Darren Jones), outlined the statutory definition of “false accounting” at a meeting and said:

“it seems to me that in the annual accounts that Post Office reported to Parliament there was false or misleading information presented that did lead to…financial gain”.

I said in July:

“That is the management culture of POL: bonuses for doing ‘a reasonable job’.”—[Official Report, 13 July 2023; Vol. 736, c. 161WH.]

We should compare that with the compensation schemes, which have been fraught with difficulty every step of the way. The fundamental principles of public life, including openness, honesty, and integrity, have not been upheld by the management of POL for decades.

Regrettably, even the compensation schemes established to address the injustices of the lamentable Horizon chapter are not immune from POL’s unjust approach. Dan Neidle, a renowned tax expert, soon realised that the schemes are designed to ensure that the lowest amount of compensation is paid out. The application forms are so legally intricate that even a legal expert such as Mr Neidle expressed the need for legal advice in order to complete them, but POL provides only token amounts for legal advice. The original absence of an option to claim punitive damages, something a lawyer would notice, puts applicants, many of whom are elderly and financially vulnerable, at risk of missing out on a significant portion of their compensation. I have seen a heavily redacted offer, and that is what happened to a sub-postmistress who was spat at by members of her local community after rumours of her stealing abounded in the neighbourhood. This is appalling, shameful and a stain on us all.

[The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)]

The hon. Lady remarked earlier about the number of people coming forward following the ITV series, and I am keen for people to do that. It is important to say to all postmasters that they will be treated fairly. I know that she has some concerns about that, and she is right to raise concerns where she has them. I, too, have concerns about some elements of the original Horizon shortfall scheme. We are looking at that, in conjunction with the advisory board, to see what might be done to make sure that those payments were fair.

Let me draw the hon. Lady’s attention to some of the stats on the new group litigation order scheme. We may be talking about the simpler cases coming forward here, but with 58 claims received, 52 offers have been made and 41 have been accepted without even a reference to the independent panel for people who are unhappy with the offers made. I do believe that the offers made are fair, but I am also happy to be challenged, in order to make sure that they are.

[Marion Fellows]

I thank the Minister for his intervention. I know that he has worked hard since he took over his post to make things better, but it would not be right if I did not continually and continuously push him.

[Kevin Hollinrake]

indicated assent.

[Marion Fellows]

He is acknowledging that.

At this point, it is worth reading out a letter from Professor Chris Hodges, the chair of the Horizon Compensation Advisory Board, who has been similarly scathing. He writes:

“Dear Nick Read,

My colleagues on the Advisory Board and I remain deeply unconvinced by the substance of what you say on legal issues. We continue to hear stories your former Sub-Postmasters and Mistresses are confused, intimidated and hurt by the behaviour of the Post Office and its lawyers in negotiating settlements generally and in continued use of legalistic terminology. This is especially true for the significant number who remain deeply traumatised, and who do not understand the practice of terminology of what they see as an aggressive approach to settling claims. This is irrespective of whether the language or behaviour may or may not be technically permissible, and irrespective of the fact that they may have legal representation. Your reliance of legal argument and legal terminology similarly does not impress us. We do not perceive demonstration of behaviour that is anything like a sympathetic understanding towards the people your organisation has harmed. We suggest that this should give you cause for deep concern.”

--- Later in debate ---

[Kevin Hollinrake]

I am sorry to intervene on the hon. Lady yet again, but people might listen to her speech more than mine at the end, so I am keen to get a point on the record about the non-disclosure agreements. In evidence to the Select Committee, the Post Office has been quite clear—it is certainly our position—that nobody will be held to their non-disclosure agreement, so everybody should feel completely at liberty to discuss the terms of their settlement with Members of Parliament and others, as they feel appropriate. It is important to get that on the record.

[Marion Fellows]

I really thank the Minister for his intervention because hearing direct from the Minister that he will not be pursued will provide my constituent with some element of comfort. However, people are still traumatised years later because of the treatment they have had and it is hard for them to believe that people will not pursue them. I will show my constituent a clip of what the Minister just said.

I have met recently with Christopher Head, who is in the Gallery today. He is a Horizon victim and campaigner who, out of his own good will, helps others in applying for compensation. I do not want anyone else to add to Christopher’s burden because he is doing such a good job. He has told me of the difficulties people face and that he himself received an offer that was only a minuscule fraction of his estimated Horizon losses. Alan Bates recently talked about his offer as well.

Many sub-postmasters I have spoken to recently told me that they plugged shortfalls out of their own pocket for years. The Minister has advised those people to apply for the Horizon shortfall scheme, and I sincerely hope that many more people will take advantage of that. Will the Minister ask Post Office management to make their records of those payments available to individuals? Have Post Office management let the Minister know when they will give an estimate of the excess claimed in Horizon shortfalls, from the introduction of the system to the end of financial year 2019-20? That is important because all that excess money, which was not owed, was put into Post Office Ltd and management bonuses were paid on profits.

The Post Office network is in disarray. Sub-postmasters have no faith in the current management of Post Office Ltd to turn things around. What they see is an organisation that is top-heavy, with multiple layers of management and directors, who have self-interest at heart.

--- Later in debate ---

[Ian Lavery (Wansbeck) (Lab)]

Today’s debate is extremely timely and important. It is harrowing to listen to cases from across the UK, and it takes time for it to sink in how the cover-up of this scandal has cost the lives of ordinary, hard-working people who only wanted to provide for their families by working for their communities in post offices. We have to think about how many of those people have been tret, not just by the Post Office but by the Government and Fujitsu. Many of them have had extreme difficulties in employment. They were not just betrayed but sent to prison for crimes that they did not commit. They knew they were innocent; more importantly, the people who sent them there knew that they were innocent as well. We need a lot of answers. More and more is coming to the fore every day with regard to this scandal.

Mention has been made of who knew about this. The Government knew about it, Fujitsu knew about it, and the Post Office knew about it; yet they still sent investigators into sub-postmasters and sub-postmistresses’ post offices. They investigated people, charged people, and devastated people’s lives. They acted like the Gestapo. They turned up on the day and closed post offices down. That is the Post Office management culture, and it needs to be addressed.

I am not sure how we can compensate anybody. How can we compensate the family of a woman or man who committed suicide as a result of the pressure that they were put under by the Government, the Post Office and investigators? How do we compensate people for the death of a loved one who was the breadwinner in the family, and decided that their only option was to take their own life? It is unimaginable. We cannot put ourselves in their shoes.

What about the men and women who went to prison because they had supposedly falsified accounts and committed theft? They were imprisoned with child-killers and rapists for things they had not done. Not only did they know they had not done them; the Government and the Post Office knew it too. Fujitsu knew what was happening behind the scenes. This does not seem like the country I am very proud of—what happened with the Government behind the scenes. It is very murky and sinister. At the same time, the Government and the Post Office were prosecuting people with evidence from Fujitsu, and people were being imprisoned and taking their own lives. Frankly, it is enough to make us cry.

[Kevin Hollinrake]

The hon. Gentleman is rightly making a typically impassioned speech. I have been very careful throughout the whole time I have been involved in this matter, which is over four years, as a Back-Bencher and a Front-Bencher, not to play any kind of party politics with it. I put it on the record that the issues occurred under a series of Governments: the Labour Government, the coalition Government and the current Government. It is important that we look at the matter on a cross-party basis and seek to resolve it as such. I am keen to work with him on that basis.

[Ian Lavery]

I thank the Minister for that intervention, and I agree. I have a lot of time for him. We have had conversations about this matter and many others. As he will notice if he looks in Hansard, I have not been party political. I have said “the Government”. He is correct to point out that there have been Governments of different colours throughout the period.

--- Later in debate ---

[Ian Lavery]

Not only that, but Jo Hamilton had to pay £36,000 back, even though she knew she was in the right. I asked Nick Read, the chief executive of the Post Office, whether it was a possibility that the money paid back by a number of the victims would have been in a place where it could have provided bonuses for senior executives. How perverse is that? The answer from the chief executive, when I pressed him and pressed him, was that yes, it was a possibility, but he did not know where the money actually went. That in itself is so bad that it beggars belief.

Fujitsu, meanwhile, denied any knowledge of bugs or any wrongdoing, but actually knew quite the opposite, and it supplied evidence to the Post Office to prosecute individuals. How bad is that situation? This is not a spy movie—it is worse than a spy movie. They had a dark room in Fujitsu where its employees were communicating with the Horizon computer system in post offices up and down the country. Fujitsu denied it all along, saying that it was impossible it could ever happen, yet people there were changing the amounts of money openly. The Government knew. Fujitsu knew, because it had the operation in its own offices, with employees changing facts and figures in the accounts of ordinary hard-working individuals—again, spy movie stuff. It is unbelievable that that could be the case.

Is it not unreal to think that none of this would have come about if not for the ITV dramatisation, “Mr Bates vs The Post Office”? We would not be discussing it in this Chamber, because it would have been kicked into the long grass. The people would all have suffered the same—those who are in prison, the families who have been destroyed, and the kids who have been brought up with the criticism and abuse that their parents were thieves —but it would not have been unearthed.

[Kevin Hollinrake]

There is no doubt that the ITV series has rightly heightened awareness both in this House and further afield, and I welcome that, but much work was going on in this space before it aired, including on how we can overturn more convictions on a blanket basis. I was working on that with the advisory board before the series aired, so it is not right to say that we would not have got to this position without it. We probably would not have got here as quickly, but the hon. Gentleman must concede that this work has been going on for years—although I welcome the fact that it is happening more rapidly now.

[Ian Lavery]

I thank the Minister for that clarification. Forgive me, Mr Deputy Speaker, if I suggested that nothing at all had happened, because I know that the Minister, the all-party parliamentary group, the hon. Member for Motherwell and Wishaw (Marion Fellows) and others have been working on the matter assiduously. However, as the Minister said, we might not otherwise have been at this stage. We might not have got Fujitsu to say for the first time, “Yes, we are sorry,” and the Post Office might not have started to admit that it had pursued wrongful or unsafe prosecutions. But we are where we are. I would not want to mislead anyone in the debate.

I have three brief examples. These people, Minister, were heavily involved with Horizon and the Post Office, and suffered greatly. It causes me real heartbreak, to be honest. The first example is that of Janine, a lady from my constituency who has sadly passed on; no one came to see me about her case until they saw the ITV documentary. Her husband simply cried for the entire hour that I sat with him. He wanted justice for Janine, who sadly died of covid. He is hoping for some sort of justice now.

Janine was employed in a post office in a newsagents, which is a regular thing up and down the country. Her contract with the newsagents said that any shortfall in the post office finances must be made up by her. She and another person were employed by the newsagents, and then there was the sub-postmaster or mistress— I am not sure which it was on this occasion. Janine was accused of stealing £25,000, even though she had not seen that amount of money before. The Post Office investigators came to the newsagents and basically tret her like a common thief. The pressure was put on: “We are going to charge you with theft and you are going to prison.”

Janine was absolutely devastated. She pleaded guilty. Then, she sat back and realised, “Why should I be pleading guilty when I am not guilty?”. It cost her and her family a small fortune to take the case back to court and have the guilty verdict rescinded. The Post Office then said, “Okay, you can accept the lesser charge of false accounting and pay the money back.” She refused. All this cost her £15,000 in legal fees—these are just ordinary working people in the community. She was then informed that if she paid the £25,000 back, the Post Office would drop the charges. That is what happened: she paid the money back. Unfortunately, by the day she sadly passed on, she and her family had lost everything they had.

That needs scrutiny. We need to look at the management culture. What on earth was going on at the Post Office during this thing? Who directed the investigators to go to those post offices and treat people the way they were tret in the investigations? They knew at the time that the allegations were false. That is the thing that I have reiterated and will continue to reiterate: they knew that the allegations were in many ways false, unfounded, unfair. Maybe the investigators did not, but the people at the top of the Post Office certainly knew; people in government knew. That cannot be right. Janine’s husband has written and submitted a really heart-rending letter, but under the current schemes, he is unlikely to be able to claim any money. How can that be just? I will follow that up with the Minister.

The second example is that of a man who wrote to us saying: “I’ve got a massive problem. I’m like lots of other sub-postmasters and sub-postmistresses. We work at the very heart of the community. It’s where people used to come to talk. We were trusted, well respected, listened to.” He was seeing mistake after mistake crop up on his computer week after week, but rather than inform the Post Office, he was putting money in week by week to balance the accounts, which had been altered by somebody at the Fujitsu head office.

This individual says that he simply could not stand the idea that anybody would think him in the slightest—in the remotest sense—a thief. He has paid tens of thousands of pounds, if we aggregate the money that he paid week by week. There is no way that he or hundreds of other employees have the opportunity or ability to claim compensation at this moment. That begs the question of whether the Post Office, together with the Government, will write to every single person who was a sub-postmaster between 1998 and now to ask them if they are aware of anyone who might have put their own money—out of their own backside pocket, out of their family’s savings—into balancing the accounts. There should be consideration of compensation for such individuals. The Post Office will have all the details of people in those roles who claimed to have used finances from their own back pocket.

I will briefly mention the last example. I have not actually seen these individuals—they are coming to see us next week—but I have been told by one of their relations that they were involved in the Horizon scandal and paid £25,000. That sum crops up time and again. They paid that just to save their name. Nothing went to court—nothing happened—but they paid the money, despite the fact that they were innocent. They thought that because they paid the money, the matter would go away, and there is very little opportunity for people like them to reclaim their money. It is unfair. Never mind them stealing money off the Post Office; the Post Office has stolen money off hard-working people. That should be recognised.

It would be helpful if the Post Office and the Government could listen to what other people have to say. This is not just about those who were convicted or prosecuted; there are more people who were not convicted or prosecuted, but who are out of pocket and have had their life destroyed as a consequence of the Post Office Horizon scandal. We need to look at how that can be addressed. Those people deserve compensation. As the hon. Member for Motherwell and Wishaw said, this scandal is appalling. It is disgraceful, shameful, and a stain on all of us. I agree with the Minister that this is a cross-party issue. We have the opportunity to put things right, so let us do it. Let us look after the people whose only crime was going to work and looking after their family.

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Business and Trade (Kevin Hollinrake)]

May I first pay tribute to the hon. Member for Motherwell and Wishaw (Marion Fellows) for securing this debate and her fine work as always on the all-party parliamentary group on post offices, and to the Backbench Business Committee for bringing forward this debate? I also pay tribute to all Members of this House and the other place for their work on this issue. I promise the shadow Minister, the hon. Member for Bethnal Green and Bow (Rushanara Ali), that I do not need anybody to hold my feet to the fire, but it is good that we have this momentum. I very much appreciate the work that has been done by many.

There have been many kind words from contributors about my work, but it is a bit part compared with that of many others who have campaigned long and hard on this issue, as have people outside this place, including members of the legal profession and the media, many of whom we are familiar with for their great work on bringing this scandal to light.

On the governance issues, I am fond of a quote by Emerson, who said:

“An institution is the lengthened shadow of a single man.”

I am keen to ensure that the Post Office’s management culture is in the right place. A positive management culture is paramount to the health of any organisation, so I very much welcome the opportunity the debate brings to consider that point. The Post Office scandal is one of the biggest miscarriages of justice in living history, and the victims must get the justice they deserve. I do believe that today’s Post Office is different from the past, but restoring trust will take time. That does not mean that we are satisfied with the current situation. This will never be about quick fixes; it will be about fundamental changes in every part of the organisation, and that change will not occur overnight.

When the current chief executive of the Post Office, Nick Read, started in September 2019, he made it clear that as well as delivering the essential services that we value across our constituencies, the Post Office needed to apologise for the events of the past and fully address them. On the point made by the shadow Minister about the current board, no one serving on a day-to-day basis on the current board was there at the time of the scandal. As I said, Nick Read joined in 2019, and only one member of the board was there at the time, but they are on extended leave on health grounds and do not work on the board on a day-to-day basis. No members of the senior management team were there at the time.

Post Office is taking steps to right the wrongs of the past. However, it is also important to highlight what it has done with a view to the present and future of the business to improve the culture and ensure that a similar situation can never arise. Crucially, Post Office is taking steps to restore trust between itself and postmasters. That is so important, because, as I have said many times, without postmasters, there is no post office network.

In December 2019, the parties to the group litigation in Bates v. Post Office Ltd took part in a mediation session and issued a joint statement confirming Post Office’s commitment to resetting its relationship with postmasters. Since then, Post Office has improved the board’s structure by ensuring that two non-executive director postmasters nominated and elected by other postmasters have a seat on the board. That is intended to ensure that postmaster voices are being heard at the highest level and that senior management are aware of the impact that decisions will have on those on the frontline delivering services.

Post Office also created a postmaster experience director role, which is filled by a serving postmaster. To pick up the point made by the hon. Member for Motherwell and Wishaw, it is held by Mark Eldridge, who is a serving postmaster at Great Massingham. He is seconded to the role, so he may no longer be in that post office on a daily basis, but he is nevertheless a serving postmaster. He leads the day-to-day relationship with postmasters. Alongside those senior appointments, the Post Office has reformed operational matters to improve culture and trust between senior management, staff and postmasters. Improved training packages and the hiring of more than 100 new area managers to provide dedicated local support are all examples of positive changes. At my meeting yesterday with Voice of the Postmaster and Communication Workers Union national postmasters, they spoke highly of the support and engagement provided by those area managers.

Post Office has also strengthened how it listens to postmasters, with two postmaster conferences and a nationwide postmaster consultation conducted each year to provide the foundation of Post Office annual priorities. I experience at first hand how postmasters in the network today can challenge Post Office leadership on various issues when I chair a regular working group between the Post Office and the National Federation of SubPostmasters. I know that, according to various commentators, past experience of that group has been mixed, but my experience from working with them on an ongoing basis has been that the challenge they provide is constructive but robust.

I know that branch profitability is the top priority for postmasters, and I am pleased that the Post Office is committed to increasing the share of income going to postmasters. That has been stressed on every occasion we have met. We have also very much stressed the need to control central costs—indeed, to reduce them—so that we see more of the remuneration heading towards postmasters. The clear strategy for the Post Office to do that and ensure that the highest share of income goes to postmasters is through parcels and banking services, which are key; we have discussed that regularly when we have met. That point was raised by the hon. Members for Midlothian (Owen Thompson) and for Strangford (Jim Shannon).

I have been clear that the banking framework, which is negotiated between the Post Office and the UK banks, should be as ambitious as possible. Banks have saved about £2.5 billion a year through closure of branches, and in our view a greater percentage of that should go to postmasters directly. I am pleased that the shadow Minister likes our policy on banking hubs, which came principally as a result of our legislation on access to cash. Thirty are open already, and another 70 are in the pipeline, so we will be at 100 and we anticipate that about 500 will be rolled out across the country. Clearly there is more to do to strengthen the relationships with postmasters, but I believe that the Post Office has made and is making some positive steps forward.

Members rightly raised compensation, which speaks to the current management culture at the Post Office. Getting compensation to those impacted by the scandal has not been as swift as we would have hoped. I can assure Members that my Department has been working hard on compensation, alongside colleagues in the Post Office who were recruited specifically for that purpose. As the Secretary of State said recently, we continue to look for ways to speed things up, and we work closely with the Horizon compensation advisory board to ensure that we deliver faster compensation, and that compensation is seen to be fair and is fair.

Recently, we introduced measures such as fixed sum awards of £600,000 for overturned convictions, and £75,000 for the GLO. To be clear, a fixed sum award is an option for people who believe that it will provide sufficient redress. People who believe that their claims are above that level can go down the full assessment route, but the fixed sum award route has the benefit of speedy resolution of claims and reducing the number of people in the queue who want to go down the full assessment route. That should mean faster resolution of claims for all parties involved in the compensation process.

[Dominic Raab (Esher and Walton) (Con)]

The Minister has been given credit for the assiduous way that he is righting the wrongs. Members in all parts of the House have been contacted by those affected, such as sub-postmasters who have been prosecuted or have suffered in other ways. Is there a constituency breakdown of the numbers affected? Some people will be more familiar with how to avail themselves of opportunities than others. If we can make ourselves available to those affected —not just those prosecuted—that may provide some assistance, albeit at a late stage, and some solace to them as they try and right the wrongs that he has rightly outlined.

[Kevin Hollinrake]

I thank my right hon. Friend for his intervention and his work on this matter. It is interesting that more people are coming forward, through colleagues, to the compensation processes, which is very welcome. Some colleagues have written to all their postmasters in their area, asking them to come forward. That is a positive step. I was not aware that I had a postmaster in my area who had been affected—Sam Harrison of Nawton, near Helmsley, who sadly passed away last May. She was one of the 555 members of the GLO scheme. Sadly, she has passed away. New cases come to light all the time. I am very happy to work with my right hon. Friend to see what information we might provide him, so that he can take forward those actions.

As I said, we are aware of concerns about the Horizon shortfall scheme, which was the first scheme set up. We are looking at ways to ensure that that scheme’s compensation is fair and seen to be fair. More than £160 million has been awarded already to 2,700 victims, and 64% of all claimants who made their claims prior to the ITV series—more will come forward as a result, which we welcome—have had full and final compensation. Much work has been done by me, my predecessors and many officials, who do a tremendous job trying to right the wrongs of the past, but there is more that we can and have to do.

As of 6 February, more than £35 million has been paid out to those with overturned convictions. There have been 42 claims submitted already for the 101 convictions that been overturned; 36 offers have been made and 32 have been accepted. A very significant proportion of those have taken the fixed sum award. £27 million has been paid out to 479 claimants among the original 555 postmasters who took the Post Office to court. A total of 58 completed claim forms have been received, and 52 claimants have received offers. Of those, 41 people have accepted those offers without going to the next stage, the independent panel. That indicates that people feel that the offers they are receiving are fair, because there are two further stages in that process if they feel that they are not getting fair settlement of their claims. Some £98 million has been paid out through the Horizon shortfall scheme.

There were 2,417 claimants who claimed prior to the original deadline, which has now been extended for late applications, so there is no final date for applications in that scheme. Some 2,417 offers have been made and 2,051 have been settled, meaning that 84% of claims have been settled. The hon. Member for Motherwell and Wishaw raised the total compensation amount—I think she mentioned the figure of £2 billion. The maximum budget set thus far is £1 billion. That is the number we are working to at the moment. However, we have always been clear that that is not a cap and it will not stop people getting fair compensation for their claims.

On the matter of more people coming forward, we are absolutely united with the Post Office in calling for anyone impacted by the scandal to bring forward their claims as soon as possible. I welcome the fact that the ITV drama has helped to uncover people who had not previously come forward.

The hon. Member for Motherwell and Wishaw asked about ongoing shortfalls. There may be instances of that, although not all shortfalls occur as a result of software problems. I am happy to look at any cases of that that the hon. Lady has, but I have to say that it has not been raised with me thus far in my conversations with the National Federation of SubPostmasters, the Voice of the Postmaster and the CWU. However, I am happy to look at that as we proceed.

Compensation is one part of providing justice; the other is truth and accountability, which the Post Office has told us it is fully committed to. The Post Office Horizon inquiry has been established to uncover what went wrong, and the chair, Sir Wyn Williams, continues to make good progress.

The Post Office is co-operating fully with the inquiry. While the recent disclosure issues have been disappointing, they were the consequence of a failure of process rather than a reflection of the management culture. We do not regard them as a deliberate obfuscation, as the hon. Member for Motherwell and Wishaw said. Nevertheless, it is a serious and unacceptable matter, and we certainly want to ensure that they do not happen again.

It was reassuring to hear Sir Wyn Williams’s comments on Friday that he was “impressed” that the Post Office’s new lawyers have a

“grasp of the scale of the disclosure exercise”,

and that he currently has no reason to doubt that the Post Office will continue to assist the inquiry by disclosing relevant material. The inquiry will also look at the future of the Post Office itself from September this year.

On governance, strong and effective leadership of the Post Office is essential. As is set out in the Post Office articles of association, the Business Secretary appoints the chair and approves the appointment of directors of Post Office Ltd. It is a role that the Government take very seriously. As Members will be aware, following a conversation with the Business Secretary in late January, Henry Staunton agreed to step down as chair of the Post Office. We judged that the current chairmanship was not proving effective and had a difficult decision to make between changing course or waiting and hoping that it improved.

The shadow Minister referred to ministerial scrutiny, and I think all Ministers should learn the lessons of the past in terms of their approach to concerns that are raised. Of course, we as a Department have learned from this ourselves. We will continue to look at governance arrangements and make sure they are fit for purpose. We are not planning any further changes at this time. Members of the House and others have looked at different models of governance of the Post Office, such as mutualisation. As I said, I met with the Voice of the Postmaster and the CWU yesterday, and I am happy to have further conversations with them about that potential route. We are confident that our representative at UK Government Investments, Lorna Gratton, is doing a good job to ensure that the Post Office’s governance is fit for purpose.

The hon. Members for Wansbeck (Ian Lavery) and for Motherwell and Wishaw asked about the surpluses and where they ended up—whether they went into a suspense account, into profit and loss, or into bonuses for directors. We are currently conducting an exercise to find out where that money went and how much it was, and we will report accordingly.

The hon. Member for Inverclyde (Ronnie Cowan) talked about the role of Fujitsu. We welcome the admission from Fujitsu that it holds moral responsibility for the scandal and a responsibility to contribute towards the compensation bill. We will certainly take that up in due course, but it is right for us to ensure that we understand the extent of the bill. The inquiry is looking at other matters surrounding Fujitsu and it is right that we wait for the outcome of that. He mentioned the role of Ofcom. Ofcom does not regulate the Post Office; it regulates Royal Mail. There is a distinction there.

The hon. Member for Wansbeck talked about who knew what. That is something we very much want to know. The inquiry’s purpose is to find exactly that. He made the absolutely correct point that no amount of redress could ever make up for what has happened to some people in this scandal. People have taken their own lives and people have been made bankrupt. The least we can do is try to make that good by providing them with full and fair compensation.

I am very sorry to hear about what happened to Janine. I am very happy to look at that case with the hon. Gentleman, as he asked me about it offline the other day. It is certainly the case that if an employee suffered financial detriment, their employer should be able to claim on their behalf. There may be other cases we need to look at, including that case, so I am very happy to have that conversation with him.

The hon. Member for Chesham and Amersham (Sarah Green) talked about non-disclosure agreements and raised the tragic case of Martin Griffiths in that context. As I said to her in an intervention, it is absolutely right —the Post Office has said this and it is also our position—that no NDA should prevent somebody speaking to relevant individuals, including their Member of Parliament. It is the case, in whatever part of our system and wherever an NDA is signed, that no NDA can ever prevent somebody speaking out—going to the police or other authorities—about a crime. That is the case in any circumstance. The Official Secrets Act only covers the confidentiality of mail and it is no longer signed by postmasters. Again, I am very keen that the gentleman she referred to passes on his evidence to the inquiry, because I think it might find it very useful.

I thank the hon. Member for Strangford again for his very kind words. Understandably, many people are still affected by the scandal and in terms of my performance as a Minister—whether I am the right person or whether I am fit for purpose—I guess the jury is out. I quite understand that. People will judge me at the end of the process, but while I am here, I am very keen to make sure that the full and final settlements are made as quickly and as fairly as possible.

To conclude, I have outlined some of the progress the Post Office has made to improve its culture and its relationship with postmasters, and its determination to right the wrongs of the past. Despite the positive progress made since 2019, there are clearly still improvements to be made. Where the Post Office makes mistakes, I will continue to challenge the leadership. Where action is needed, I will not hesitate to act decisively.