Monday 29 June 2020

Nick Read's selective awareness

Nick Read, Post Office CEO
Nick Read has had nine months to find out what on earth the Post Office has been up to over the last twenty years, or at least ask some questions about the worst of it.

His first job was to stop the litigation, which he did. His second job was to, in his words, "reset" the Post Office's relationship with Subpostmasters.

In a letter to the BEIS Select Committee, Mr Read explores that theme a little further, stating:
"As Chief Executive, ensuring that the business conducts itself with integrity is of upmost [sic] importance to me. That requires addressing the issues of the past... with energy and transparency. Bluntly, there can be no new beginning without an appropriate reckoning with the past."
So how much reckoning with the past is Mr Read prepared to do?

The appendix to the letter contains answers to questions posed to Mr Read by Darren Jones, the chair of the BEIS Select Committee inquiry. The very first answer is disingenuous by omission.

Mr Jones asks: "Do you now accept that there was a major problem with Horizon and, if so, when did Post Office Ltd identify this problem and what was the nature of that problem?"

Mr Read replies:
"Post Office accepts that there were deficiencies in previous versions of the Horizon system." However: "the judgment did not determine whether bugs, errors or defects did in fact cause shortfalls in the individual claimants’ accounts but it found that they had the potential to create apparent discrepancies in postmasters’ branch accounts."
The judgment did not determine whether bugs, errors or defects caused shortfalls in the individual claimants’ accounts because the trial was specifically set up not to look for them. It was set up to see if there was the potential for Subpostmasters' branch accounts to be affected by bugs errors and defects. This is the exact text of the judge's finding
"It was possible for bugs, errors or defects of the nature alleged by the claimants to have the potential both (a) to cause apparent or alleged discrepancies or shortfalls relating to Subpostmasters’ branch accounts or transactions, and also (b) to undermine the reliability of Horizon accurately to process and to record transactions as alleged by the claimants. Further, all the evidence in the Horizon Issues trial shows not only was there the potential for this to occur, but it actually has happened, and on numerous occasions." [my italics]
Mr Read chose to leave the information in italics out of his response to the select committee.

In 2015 the Post Office told the BBC's Panorama that remote access to Subpostmaster accounts simply could not happen without the Postmaster being aware of it. This was later revealed to be untrue.

In his letter, Mr Read says: "As I was not involved at the time, I do not wish to speculate how Post Office’s knowledge of remote access issues evolved over time."

Mr Read thinks the Post Office should be "addressing the issues of the past", but he's not going to address this one.

Nor is he going to address the issue of who at the Post Office was telling porky pies to the government about what they'd been up to. Lord Callanan told peers the government had been "misled". Mr Jones wants to know more:

"Are you investigating which advice was misleading or flawed and who gave it?" he asks, "Will there be any sanctions for those who may have given misleading or flawed advice?"

Mr Read replies: "I am not able to comment on matters before my time."

In response to Mr Jones' question on the Post Office's prosecution function, Mr Read replies:
"I believe that the last private prosecution of a postmaster or branch assistant was brought by Post Office in 2015 but there have been very few since 2013." 
That was also before Mr Read's time, but he managed to find the answer to that question.

CWU take

I am grateful to serving Subpostmaster and "redoubtable" Communications Workers Union Branch Secretary Mark Baker for running his eyes over the other answers Mr Read gave. I asked him to do this as he uses Horizon daily. The Post Office refuses to accept the CWU as a representative body for Subpostmasters and Mr Baker's answers should be seen in that context.

Mr Jones asks: "Can sub-postmasters now park significant shortfalls in suspense accounts and can they expect that Post Office Ltd’s first response will be to assist them in identifying possible errors?"

Mr Read replies: "A postmaster can put a shortfall into their suspense account, trade normally and ask for our help and investigation if they do not understand the reason for the discrepancy."

Mr Baker says:
"This is not an entirely accurate reply. The reality is that a Postmaster can only put a discrepancy into local suspense for the amount of left in his/her trading period. Trading Periods, or TPs, last for four weeks. On TP day the Postmaster is forced by the system to accept the discrepancy. This is done by pressing an option called Settle Centrally. This allows the Postmaster to complete that TP and roll over into the next TP. 
What happens next is that the PO financial HQ gets in contact with the Postmaster to ask them how they would like to pay the discrepancy... the PO open up a debtors account in the Postmasters name and the discrepancy is treated as a debt owed.  
Only if a Postmaster knows that they can dispute the discrepancy will the PO commence further investigations as alluded to by Mr Read. Currently I have several members of my Branch that have raised a dispute over discrepancies but the disputed amount seems to get parked as it would appear that the Post Office can’t prove any fault on the Postmasters part but do not know what to do next. 
Discrepancies below £150 still cannot be disputed there is no option to park these smaller shortages."
Mr Jones asks: "What mistakes did Post Office Ltd make?"

Mr Read replies with some monumental guff which doesn't answer the question, but instead talks about "significant lessons to be learnt... undertaking wholesale reform... better training and continuing dedicated support..."

Mr Baker writes:
"In our opinion the Post Office is only tinkering around the edges of trying to change its relationship with Postmasters. It is our belief this can only be achieved if Mr Read adopts a more inclusive approach to finding the solutions for a successful working relationship...
We have made several attempts to engage with Nick Read and he has rebuffed all approaches. Nick Read's approach appears to be to select small token groups of individual Postmasters to consult with and base his polices on those limited perspectives. 
This was also Paula Vennells' approach and it failed."
Mr Read tells the inquiry: "We have increased [Subpostmasters'] remuneration by £20 million a year on top of the £17 million increases secured for banking services through our new framework with the High Street banks."

Mr Baker notes:
"Most of the £20m allocated last year as fees increases were on Banking transactions and the £17m that Nick Read alludes to was also on Banking fees and travel products. It is important to highlight that both sets of fee increases are funding allocated, not deployed. 
I mention this because the Covid crisis has wiped out all Banking and Travel related products. Therefore it is misleading for Nick Read to imply that Postmasters are in receipt of £37m worth of fee increases."
I have asked the National Federation of Subpostmasters - the only representative organisation the Post Office will recognise - for their thoughts about Mr Read's submission to the inquiry. I will publish them if they respond.

Number crunching

In terms of new information from the Post Office in Nick Read's letter, there are a few interesting numbers.

The Post Office says it has now received 560 applications to its Historical Shortfall Scheme. These are completely separate from the 555 people who took part in the Bates v Post Office group litigation and also separate from the "around" 500 people whose convictions are being independently reviewed by Peters and Peters, as convicted Subpostmasters are barred from the Historical Shortfall Scheme (their only chance of compensation is getting the Criminal Cases Review Commission to review and refer their case to the Court of Appeal, have the Court of Appeal quash their conviction and then attempt a malicious prosecution claim against the Post Office at the High Court). This means there at least 1600 people who claim to have lost money via Horizon.

The Post Office has also confirmed it has spent "approximately" £43m during the civil litigation on trying to fight the idea it had any responsibility towards its Subpostmasters, which, when you add it to the £57.75m settlement fee, just tops £100m.

This figure includes "expenditure on legal and professional consultancy fees connected with the litigation and other costs indirectly related to the litigation". It's not clear whether it includes the Peters and Peters review of the Post Office's 900 prosecutions using Horizon data, and it doesn't include any sums related to the Historical Shortfall Scheme. This by itself will cost a few million to operate and could end up making individual compensation payments running into thousands.


Finally, as to whether anyone has been sacked or is going to take responsibility at the Post Office for ruining so many lives, Mr Read plain refuses to answer the question, stating:
"The original Horizon system was introduced from late 1999 and there have been considerable changes, including of personnel, over subsequent decades. 
A number of the management team have left Post Office in recent years. As the Committee will appreciate, I am not at liberty to reveal the circumstances or terms of their departures."
Further reading:

My fisking of Paula Vennells' letter to the select committee inquiry. Ms Vennells is Mr Read's predecessor.
My take on Fujitsu's letter to the select committee inquiry. Fujitsu operate the Horizon system for the Post Office.


This blog is entirely funded by donation. You can donate any amount through the secure payment portal I have set up for this purpose (click here for more info or to donate).

If you contribute £20 or more you will be added to the secret email list. This alerts you to the latest developments on this story before they happen, as well as links to new articles and stories, whether posted here on this blog or elsewhere. Thank you for your support.