Post Office Horizon: Compensation and Legislation

Lord Lansley Excerpts

Tuesday 27th February 2024 Lords Chamber

[Lord Johnson of Lainston (Con)]

I am grateful to the noble Lord for allowing me to carry on in my position, at least until the end of this Statement. I am glad he has such halcyon memories of the railways when he was a younger man; I am not quite sure when that was.

We need to be aware of something which has struck me in the discussions around this. There is naturally a sense of reflection over the salaries paid to senior executives in an organisation such as the Post Office which is going through such a traumatic time, and the view that we want to punish the current executive leadership. While that is a very natural instinct, we want the best people possible running the Post Office today. It is an intensely complex situation, not just in terms of compensation and the issues around the Horizon scandal but running 11,000-odd Post Offices around the country and all the issues around that. What is important is that we get value for money; if the Post Office was making a great profit, everyone was happy, all the staff were delighted and we were not in this situation, we would be extremely pleased, probably, to pay the chief executive more than he is currently paid.

It is not necessarily about the quantum; the point is the governance around how salaries and bonuses are fixed. There was a question earlier in this House about long-term incentive plans compared with short-term ones. In the financial services sector, where I come from, you are paid your bonuses over three, five and often more years, which is considered to be quite onerous but I think it has resulted in changes in behaviour. It is absolutely right that we should look at these sorts of plans for these highly paid executives in these public corporations.

[Lord Lansley (Con)]

My Lords, I draw the House’s attention to my registered interest as UK chair of the UK-Japan 21st Century Group. Can my noble friend update the House on the prospects of securing a significant contribution to the financial redress from Fujitsu? Of course, Fujitsu is a Japanese company but in this context this is consequential upon its acquisition of ICL during the 1990s.

[Lord Johnson of Lainston (Con)]

I thank my noble friend for raising that point. I think it has been widely publicised that Fujitsu has apologised for its role in this —as one would expect and hope—but has also accepted a moral responsibility. It has also suggested that it will look to see how it will participate in this process and my colleague Mr Hollinrake has been very clear that this overall envelope of compensation to postmasters is not to be borne solely by the Government. Clearly, there is an ongoing inquiry. This is an extremely complicated process to comment on at this stage but the tone of what my noble friend is suggesting chimes completely with the Government’s view.