Post Office: Horizon Accounting System

Lord Callanan Excerpts

Thursday 18th June 2020 Lords Chamber

[Lord Arbuthnot of Edrom]

To ask Her Majesty’s Government, further to the answer by the Prime Minister on 26 February (HC Deb, col 315), what steps they have taken in relation to the establishment of an independent inquiry into the Post Office’s Horizon accounting system.

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

My Lords, last week the Government announced an independent review to consider whether the Post Office has learned the necessary lessons from the Horizon trial judgments and to provide an independent and external assessment of its work to rebuild its relationship with its postmasters. The Government are keen to see this review launched as soon as possible, and we are in the process of identifying a chairman to lead its work.

[Lord Arbuthnot of Edrom (Con)]

My Lords, perhaps I may explain why this review is so inadequate. The terms of reference have been designed to exclude all possibility of blame falling on the Government. However, last week my noble friend told me that the Government became aware only in early 2019 that transactions entered remotely might be invisible to sub-postmasters. That was unconvincing, since the Post Office had said in open court in January 2017 that that could happen. That verified what Second Sight had said in its interim report of July 2013—but then of course it was quickly sacked. Nor do the terms of reference say anything about the likelihood of the Post Office improperly making a profit from the sub-postmasters, or about the suspense accounts or the critical role that Fujitsu played in all this. Without asking those questions, you cannot get to the bottom of this, as the Prime Minister wants. Does my noble friend appreciate that the Government appointing one of their own rather than a judge as the chairman of this review does not fill us with confidence that it will be independent of the Government?

[Lord Callanan]

I pay tribute yet again to the work that my noble friend has done in both Houses on this important issue, along with other noble Lords and MPs. The findings outlined throughout the Horizon judgment already provided an extensive insight into what went wrong at the Post Office, including an independent judicial view of all the facts that all sides were looking for. However, the Government now accept that more needs to be done. We want to be fully assured that, through the independent review, there is a public summary of the failings that occurred at the Post Office, drawing on the judgments from the Horizon case and listening to those who have been most affected without repeating the extensive findings already entered into by Mr Justice Fraser. The Post Office has committed to co-operating fully with the review and we, as Ministers, will hold it to that. The review will have sufficient strength and breadth to deliver in a timely manner, and I assure my noble friend that the chair of the review will be fully independent of both the Post Office and the Government.

[Baroness Falkner of Margravine (Non-Afl) [V]]

My Lords, I, too, pay tribute to the noble Lord, Lord Arbuthnot, but I think that the Minister is playing with semantics to the extent that he talks about how the review will be independent. Does he recognise that people want responsibility to fall where it should, whether on this Government, the previous Government, the Post Office, Fujitsu or anyone else? Does he not think that 20 years is long enough for the victims to have waited for this review? Will he please get on with it and deliver a proper, independent review to address these issues?

[Lord Callanan]

I can say only that I agree completely with the noble Baroness. We need to get on with it and get to the bottom of these things as quickly as possible, and that is what we are endeavouring to do.

[Lord Cormack (Con) [V]]

My Lords, as one of those kindly mentioned by the Lord Speaker at the beginning of today’s session, on Waterloo Day in 1970 I could never have imagined being part of a hybrid House of Lords 50 years later. I pay tribute to my noble friend Lord Arbuthnot and endorse all that he said. Does my noble friend the Minister agree that in the last half-century no well-regarded public institution has behaved with more apparent malevolent incompetence than the Post Office? Will he do his best to ensure that we do indeed have a thoroughly independent review and that those who have suffered so much are publicly exonerated and generously compensated—and can we have this done within this calendar year?

[Lord Callanan]

First, I offer my congratulations to my noble friend on his 50 years of exemplary service, as indeed I do to the Lord Speaker. I can only agree with my noble friend. We need to get to the bottom of this quickly. We need to get on with it, and the best way of doing that is through an independent review.

[The Earl of Erroll (CB) [V]]

Why has this taken five years since these miscarriages of justice were revealed to Parliament in an Adjournment debate in the Commons? What happened to the later independent report by Second Sight, which was due to be published in March 2015? Horizon was already in trouble with developments at ICL, and was nearly scrapped in the mid-1990s on the merger with Fujitsu. Perhaps it is a pity that it was not.

[Lord Callanan]

Of course, the Horizon court case occupied a lot of time and effort in both government and the Post Office, and it provided an extensive and, indeed, damning indictment of what went on at the time. However, we think that there is more to be done and that an independent review is the best way of proceeding with that.

[Lord Browne of Ladyton (Lab) [V]]

My Lords, will this review be able to be held up pending the determination of the criminal investigations that are ongoing, as well as perhaps criminal appeals? The priority should be that those damaged by the scandal are exonerated and compensated. The Government are the owner of the Post Office. Will they exercise their muscle to ensure full compensation? Indeed, Parliament, in a two-clause Bill, could legislate for exoneration of all those convicted. Surely the Government do not want to prolong the agony. What more evidence is needed before these steps can be taken to achieve the inevitable?

[Lord Callanan]

It is extremely important that we do not interfere with the proper consideration of these cases through the Criminal Cases Review Commission. I obviously cannot pre-empt what might happen, but I think that noble Lords will realise what I hope will happen as a result of this process. It is also important to get on with the review and to make sure that we learn the lessons from what went wrong. We also need to make sure that these things never ever happen again, because this is a terrible, terrible scandal.

[Baroness Burt of Solihull (LD) [V]]

The Minister seems keen to move on from this debate, but there are many faithful ex-servants of the Post Office who cannot move on, whose lives have been ruined. Does he agree that they deserve proper justice—yes or no? The noble Lord, Lord Arbuthnot, has shown that the proposed review is inadequate. If the Minister does believe in justice, will he now finally sanction an independent, judge-led inquiry?

[Lord Callanan]

I do agree with the noble Baroness that they deserve justice. Nothing that we can do will be able to put back together some of the lives that have been shattered and broken by this terrible scandal but I honestly believe that the best way of securing justice is through the judicial process, which is ongoing and which I cannot pre-empt. That process will run its course but then there is additional work to do; we think the best, swiftest and fastest way of doing that is through an independent review.

[Lord Polak (Con)]

Following on from the noble Baroness, Lady Burt, earlier this week I spoke to the lovely Rita Threlfall, who was a sub-postmistress in Liverpool from 1998 to 2010. One of six children, Rita told me how she was brought up with three guiding principles: education, hard work and honesty. Can your Lordships imagine the devastation following the Horizon-created £35,000 shortfall, when Rita was suspended and charged with theft and false accounting? She was left a mental and physical wreck. She said, “Since my dismissal, my health declined. I depend on a wheelchair, seldom leave the home, suffer with extreme anxiety. I lost my income, my health, my sanity and I am now bankrupt.” I plead with my noble friend the Minister, for the sake of Rita and so many others, to ensure that the Government set up a judge-led inquiry and remove the previous chief executive from her position as chairman of Imperial College Healthcare NHS Trust.

[Lord Callanan]

I thank my noble friend for drawing attention to one of the many tragic cases that have resulted from this; there are many others like it and I too have heard some terrible tales. We believe that an independent review is the best way of getting to the bottom of it. This will have essentially similar terms of reference to a judge-led public inquiry. With regard to the former chief executive, it would be very helpful if she would account much more fully in public for what she knew and for the actions that she took at the time. I have written to the Department of Health to make clear our position on her future. The Care Quality Commission is, I believe, looking at whether she is a fit and proper person for the role that she holds. I hope that it will conduct that review swiftly. Obviously, I cannot predict that, and it is not a matter directly for me, but I have written to the Department of Health to make my views clear.

[The Lord Speaker (Lord Fowler)]

My Lords, the time allowed for this Question has elapsed. I repeat what I said previously: if noble Lords could keep their supplementary questions reasonably short, we could get more people into the list.