23 April 2024 – Susan Crichton
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(9.44 am)
Mr Blake: Good morning, sir, can you see and hear me?
Sir Wyn Williams: Yes, thank you.
Mr Blake: This morning we are going to hear from Susan Crichton and I should just say before we start that we are going to trial a new break system where we’re going to have two breaks in the morning, one around 11.00 and one around 12.00.
Sir Wyn Williams: I’m very grateful, Mr Blake. Thank you.
Mr Blake: Thank you.
Susan Crichton
SUSAN ELIZABETH CRICHTON (sworn).
Questioned by Mr Blake
Mr Blake: Thank you very much. Can you state your full name, please?
Susan Crichton: Susan Elizabeth Crichton.
Mr Blake: Ms Crichton, you should have in front of you a bundle of documents that contains your witness statement.
Susan Crichton: I do.
Mr Blake: Can I ask you to have a look at that witness statement. It should be dated 30 January 2024?
Susan Crichton: Correct.
Mr Blake: It has the Unique Reference Number WITN00220100. Could I ask you, please, to turn to the final substantive page, that’s page 107?
Susan Crichton: Yes.
Mr Blake: Can you confirm that that is your signature?
Susan Crichton: So this was signed on Docusign.
Mr Blake: Thank you very much, and can you confirm that that statement is true to the best of your knowledge and belief?
Susan Crichton: It is true to the best of my knowledge and belief.
Mr Blake: I believe there are some small corrections you’d like to make within the text?
Susan Crichton: That’s correct, yes. Do you want me to go through those?
Mr Blake: Absolutely.
Susan Crichton: So paragraph 47: the penultimate line, “3939” should be amended to “39”.
Paragraph 77: line 2, delete the “the” before Horizon.
The heading preceding paragraph 95: “Initial Response” needs an extra “s” in response.
Paragraph 193, line 4: “they” should be “the”.
Paragraph 260 line 8: “long-term issue” should be “short-term issue”.
“Paragraph 260, the penultimate line: “Altman” is struck through and should be reinstated.
Mr Blake: Thank you very much. That statement is now in evidence and will be uploaded on to the Inquiry’s website shortly?
Also before we start, I believe there’s something else you’d like to say?
Susan Crichton: Yes, thank you.
So I want to begin by saying how – to all those that have suffered, families, friends, subpostmasters, Crown Office workers, that I am truly sorry for the suffering caused to you and your families. I wish that things had been resolved more quickly and, again, I’m very sorry that they haven’t been. I’m here today to give my evidence to the Inquiry establishing the facts and to try and ensure that something like this never happens again, thank you.
Mr Blake: Thank you very much. By way of background you were admitted as a solicitor in 1985; is that correct?
Susan Crichton: Yes.
Mr Blake: You worked for a number of companies before joining the Post Office: a subsidiary of Midland Bank; Avco Trust Limited; GE Consumer Finance, where you ultimately became General Counsel of Europe, Middle East and Africa; and also Skandia International, where you were Head of Risk and Compliance; is that correct?
Susan Crichton: That’s correct but, in relation to the Midland Bank, I wasn’t a qualified solicitor; I was a legal graduate.
Mr Blake: Thank you. You joined the Post Office in 2010 as Head of Legal?
Susan Crichton: That’s correct.
Mr Blake: You’ve made clear in your witness statement you didn’t, at that time, have any experience in criminal law and, indeed, you’ve said in your statement that the job description was for a technically strong and highly commercial lawyer; is that correct?
Susan Crichton: That is correct, yes.
Mr Blake: You were the Post Office’s first Head of Legal?
Susan Crichton: It was badged that way because it was to move forward to the separation. The role had been filled previously but it was part of the R&D Legal Team.
Mr Blake: Thank you and you had a number of other badges during your time, those included Company Secretary for a brief period between January 2010 and July 2011?
Susan Crichton: That’s correct.
Mr Blake: You became Legal and Compliance Director in April 2012 on separation from the Royal Mail?
Susan Crichton: That’s correct.
Mr Blake: At that time and from then on you had a direct line of reporting to Paula Vennells, the CEO?
Susan Crichton: Yes, that’s right.
Mr Blake: Mike Young is a name we’ll see, he was the Chief Operating Officer of the Post Office –
Susan Crichton: Yes.
Mr Blake: – and you’ve said in your witness statement, and we’ll come to it, he was responsible for various IT matters?
Susan Crichton: Correct.
Mr Blake: But when he left in 2012, you were assigned responsibility for the Security Team as well?
Susan Crichton: Yes, I think I say in my statement that we’d started to look at and think about the culture of the Post Office at that time and there was a view that we should relook at Security and its role within the organisation.
Mr Blake: That fell, from 2012, within your remit?
Susan Crichton: That’s correct.
Mr Blake: For some time you’re also HR and Corporate Services Director, is that from September 2012?
Susan Crichton: I’m sorry, yes, I think it was around that time.
Mr Blake: How long were you in that role for?
Susan Crichton: That would have been for just under a year because I think – I went back to General Counsel or Legal Compliance Director in July 2013.
Mr Blake: Absolutely. So from July 2013 until your departure, you were then called General Counsel?
Susan Crichton: That’s correct.
Mr Blake: But, before that, you had various wide areas of different responsibilities?
Susan Crichton: That’s correct.
Mr Blake: When did you leave the Post Office?
Susan Crichton: So I left at the end of November 2013, in the sense of I had actually left the business, if you will. An announcement was made at the end of September 2013. I think, as I say in my statement, I was on holiday for much of October and went in briefly to do a handover and then during November I was on gardening leave.
Mr Blake: Thank you. After that, you left and joined Lloyds TSB where you worked until 2018?
Susan Crichton: That’s right, when I retired.
Mr Blake: Thank you. I’m going to ask you various questions about corporate structure the use of external lawyers and various other topics in due course, probably this afternoon but I’m going to start this morning broadly chronologically, looking at bugs, errors and defects and also the involvement of Second Sight.
In terms of knowledge of bugs, errors and defects, perhaps I can start with your witness statement. That’s WITN00220100. Can we start, please, on page 6. Thank you. If we look at paragraph 16 at the bottom of page 6, you say there:
“Until his departure in 2012, Mike Young was the [Post Office] Chief Operating Officer. His responsibilities included IT and change procedures, cash in transit, security and procurement. When Mr Young left, I was assigned responsibility for the Security Team.”
If we could please move on to page 10, paragraph 27. Can you assist us with exactly when Mr Young left, at all?
Susan Crichton: So from looking through the documentation I don’t recall exactly but I think it must have been sometime in March 2012. I wasn’t sure whether it was before or after separation.
Mr Blake: Thank you. Paragraph 27 is in the context of the Computer Weekly article and it says there, as follows. It says:
“Regarding any awareness of the Board and/or Senior Management Team of the presence of [bugs, errors and defects] highlighted in the article, my understanding was that the responsibility for investigating such matters would have been with Mr Young. His remit included oversight and supervision of [the Post Office] IT functions.”
Moving, please, to paragraph 36, page 13. In this paragraph you address an article that’s published in Private Eye and you say:
“The response … at the Executive Meeting shortly following the publication of the article by Private Eye … was along the lines that there were no systemic issues with the Horizon system and was given by Mr Young who had oversight of IT as part of his remit.”
If we go over the page, paragraph 37. You say there that:
“[You] understood that Mr Young had a detailed understanding of the Horizon system and close knowledge of its operational function.”
The next paragraph, 38:
“… the Executive Team became aware of allegations against the Horizon system in the context of complaints received from [subpostmasters] or MPs … When an allegation or complaint arose, it was my understanding that the IT and Network Teams would consider the matter and would test the system to the extent necessary to assure themselves regarding the concern raised.”
Are we to understand it from those passages and overall from your witness statement, that you see Mr Young, at least between 2010 and 2012, as being responsible for the investigation and communication to the executive of matters relating to bugs, errors and defects in the Horizon system?
Susan Crichton: That’s my recollection, yes.
Mr Blake: Can we please look at POL00409718. I’m going to start in October 2012, so within the first year of your arrival at the Post Office, and this is an email from Mandy Talbot to you, Hugh Flemington, who we’re going to hear from in a week’s time – he worked in Post Office Legal, is that correct –
Susan Crichton: That is correct, yes.
Mr Blake: – and Jessica Madron, who was she?
Susan Crichton: She worked in the Legal Team, she was part of RM Legal seconded to Post Office.
Mr Blake: Thank you. So is Mandy Talbot also a lawyer?
Susan Crichton: She was part of the RM Legal Civil Litigation Team.
Mr Blake: You, there, are the senior recipient of this email?
Susan Crichton: That’s correct.
Mr Blake: She says, as follows:
“We need as an organisation to determine how best to deal with all the case where allegations are being made about Horizon and where there is money owed by the former subpostmasters to the business. I am compiling a list of the ones which have been sent down to me …
“Regardless of the true facts, these postmasters have all alleged that the true reason for the loss is the malfunction of the Horizon system. There are a number of issues which we need to resolve as a business about these cases before the decision is taken to send them out to BP.”
“BP” being Bond Pearce; is that correct?
Susan Crichton: That’s my recollection, yes.
Mr Blake: She then talks about the Seema Misra case and she says:
“As I understand the prosecution case the defendant’s expert has been unable to find any fault with the system but has come up with a number of opinions which have nothing to do with the case being prosecuted. Assuming that the case is concluded within the time period some of the issues set out will fall away but if it is adjourned or if we lose it the following points will become relevant. Misra is the prosecution case involving Issy Hogg, one of the lawyers used by Postmasters for Justice. If the prosecution is fully successful it will make the civil claims much easier to deal with. If the prosecution is only partially successful then it is likely to make the civil claims very difficult to proceed with if we cannot rely on the Horizon data.”
It says:
“Number 2 Postmasters for Justice plus Ms Hogg and a lawyer from Shoosmiths are seeing the Minister at BIS this week about Horizon issue – we do not know what may come of this but Mike [Granville] may be able to give us a steer.”
At the end of this, it says:
“Can I suggest that we have a conference call to discuss how to deal with these cases going forward, possibly on 20 October as by then I anticipate that Misra will have concluded.”
Can you assist us, this was October 2010, were you aware of issues relating to the Horizon system and litigation challenging the Horizon system earlier than October 2010?
Susan Crichton: So this was part of a relatively late disclosure. I’m trying to recollect when I became aware of it. I don’t think I was, no. I don’t think I was. That’s not my recollection, certainly not from – that’s not what I recollect. Obviously, seeing this now, then things were being raised and I think what I was trying to do was to look at this on a more – on a rounded basis, so I received this from Mandy, who was obviously a litigation lawyer in the RMG Civil Litigation Team.
Mr Blake: As you said, you were the senior recipient of this email?
Susan Crichton: Yes, in the Post Office, yes.
Mr Blake: Can we please look at POL00055590. We’re still in October, 21 October, and this is an email that this Inquiry has seen quite a lot of. It’s the email from Jarnail Singh in relation to the Misra case and it’s where he says:
“It is … hoped the case will set a marker to dissuade other defendants from jumping on the Horizon bashing bandwagon.”
You were a recipient of that email, 21 October.
Susan Crichton: That’s correct.
Mr Blake: In the email that we looked at earlier from Mandy Talbot, she suggested a call to discuss matters going forward after the Seema Misra case had concluded. Do you recall a conversation, a meeting, once that had concluded?
Susan Crichton: I’m afraid I don’t recall one, no.
Mr Blake: Do you recall receiving this email?
Susan Crichton: Is that the one on the screen?
Mr Blake: Yes.
Susan Crichton: Yes. Well, it was in the first batch of documents provided to me.
Mr Blake: I don’t mean recall from the Inquiry providing it to you, but do you recall, in your first year at the Post Office, receiving an email from a senior lawyer in the Criminal Law Division referring to the “Horizon bashing bandwagon”?
Susan Crichton: No, I’m afraid I don’t.
Mr Blake: Is it likely that that was sent to you in your capacity as Head of Legal of the Post Office?
Susan Crichton: It is, yes.
Mr Blake: We’re going to now move to April 2011. Can we please look at POL00107844. This is an email chain relating to the case of Mrs O’Dell and, if we could start at the bottom of the page, please, bottom of the first page, we have an email from Rebekah Mantle, Head of Dispute Resolution at the Royal Mail Group, and it’s sent to a very limited distribution list: it’s sent to Alison Bolsover, who was at that time the Senior Debt Recovery Manager at the Post Office; is that correct?
Susan Crichton: Yes, I think she gave evidence last year.
Mr Blake: Yes. We also have there Rod Ismay, the Head of Product and Branch Accounting – yes –
Susan Crichton: Yes.
Mr Blake: – and you. Why do you think this email was sent to the three of you about the case of Mrs O’Dell?
Susan Crichton: This is my recollection. I think, at the time, I was trying to understand this process that went through with regard to subpostmasters and the civil litigation process, and to try to bring some element of proportionality to it, as a commercial lawyer, to say “Should we be taking this action, given the likelihood of us being able to recover and the costs”?
Mr Blake: We may see these three names in other emails. Was there a particular reason why it was you, Alison Bolsover and Rod Ismay?
Susan Crichton: No, unless she thought we were the decision makers but I would have said Alison Bolsover was the decision maker in this case but I was the Head of Legal for POL.
Mr Blake: Who was the most senior recipient of this email?
Susan Crichton: I was the most senior recipient.
Mr Blake: She says, as follows. She says:
“… I am wondering whether the below case is one that is worth pursuing. Mrs O’Dell is claiming £290 from us; it would cost a lot more than this to defend so I think we should settle this on the basis that it’s not economic to defend such a claim. We could raise as a counter claim the loss of £9,616 (which we claim Mrs O’Dell owes us as a result of branch discrepancies, which she claims are as a result of issues with Horizon). However, the legal costs of collating and preparing evidence to show that [Post Office Limited] suffered a loss and that it was not due to Horizon, would exceed the value of the counterclaim.”
If we scroll up, please, there’s a further email from Rebekah Mantle again to you, Alison Bolsover and Rod Ismay, and she says:
“Just to keep everyone updated, Alison and I have agreed not to defend O’Dell’s claim on the basis it would not be economic (even if we were to exceed [I think that must mean ‘succeed’], in defending the claim the irrevocable legal costs would exceed the £290 she is claiming.”
So, again, this is another email, we’re now in 2011, that relates to a subpostmaster raising an issue relating to Horizon in her defence; do you agree with that?
Susan Crichton: I do agree with that.
Mr Blake: It’s your evidence, is it, that you were involved because you wanted to bring a degree of proportionality to these matters?
Susan Crichton: That’s my recollection, yes, and I think, in Alison Bolsover’s evidence, she mentions that I’d gone up to Chesterfield and we had a conversation about the Horizon cases.
Mr Blake: Yes. Perhaps we can look at POL00184214, the next month, May 2011. This an email from a lawyer at the Royal Mail Group, Helen Watson, and she says:
“Thank you. I am copying in Chris Darvill of Bond Pearce, as the case is now with him [I think this is about a different case, I think it is called Drake], although on hold pending confirmation from Susan Crichton as to strategy on these Horizon cases generally.”
So it certainly seems as though Helen Watson had understood your role at that point to be advising on strategy of the Horizon cases.
Susan Crichton: Yes, and I think this goes back to my comment around proportionality, to try to understand what was going on with these cases and why we were bringing them, and what had happened. So it wasn’t necessarily driven by I believed that Horizon wasn’t working; I just wanted to understand the process and the authorisation process for bringing those claims.
Mr Blake: You had a group of Horizon cases that you were aware of. Did you, at this point, consider whether the Horizon system itself should be investigated?
Susan Crichton: I think as part of this work, it was an iterative process of going back to the IT Department to say, “Have you reviewed all network departments to say have you reviewed all these cases? Can you explain to me how these shortfalls arose and convince me? Because this is the way they operated, that this Horizon was not at fault”.
Mr Blake: That’s a conversation you had in 2011, is it?
Susan Crichton: I think I mention in another place in my statement that, when complaints came in both from MPs or subpostmasters, these were dealt with by IT, Network, looking at the cases, trying to recreate the fact pattern – this is how I understood it – and explaining to the ET or me how this was not an issue with Horizon but was a more general issue with the subpostmasters, more mistakes had been made. That’s what I remember happening.
Mr Blake: You had joined the Post Office in January 2010. We’ve seen that, by October 2010 and well into 2011, you were aware of subpostmasters raising issues with Horizon, a growing number, and you have undertaken to review a strategy on the Horizon cases. Do you remember any specific meetings that you had with the IT Department relating to Horizon cases in which you were reassured that there weren’t problems with Horizon?
Susan Crichton: I think they would have been related to the specific cases, so I think what I would have done – I can’t recollect one, but my normal practice would have been to talk to both the IT and the Network Team to understand why they were confident that these issues had not been caused by Horizon.
Mr Blake: You said you addressed them as individual cases but you are undertaking some sort of strategy review. Did you not look at them strategically –
Susan Crichton: Yes, that’s right and, again, it was my background, rather than – I’m not a litigation lawyer but I was trying to understand that part of the Post Office process, and I relied upon the information given to me by the IT and the Network Team to demonstrate to me that these cases were not as a result of issues with Horizon, but were because of other issues.
Mr Blake: How did they demonstrate that to you?
Susan Crichton: So they would take a case, I’m trying to think of one – so an issue would have come in from a subpostmaster, either direct from the subpostmaster or from an MP, and they would work through the case, and probably with these litigation cases as well, and demonstrate the entries that had been made, and I would – and give me assurance that it wasn’t caused by Horizon. I am not an IT expert, and would have relied on their assurance about how had caused this loss or deficiency within the system.
Mr Blake: You said “they” would give you a guarantee?
Susan Crichton: No, I didn’t say they would give me a guarantee; I said they would give me an explanation and, in my recollection, it was a combination between senior people in the Network and people in the IT Team would look together at these and, often, it would be Network led.
Mr Blake: Can you assist us with some names, please?
Susan Crichton: So Angela van den Bogerd would certainly have been one. It may have been led by Kevin Gilliland, as he was responsible for the Network, although Paula was – Paula Vennells was the overall director. I’m just trying to think from the – and, generally, I would say Mike Young led on that for the IT side, although he wouldn’t necessarily do the work himself but he would be the leader of that.
Mr Blake: Thank you. We’ve seen both criminal and civil cases: the Seema Misra case as an example of a criminal case, the O’Dell case as an example of a civil case.
Susan Crichton: Correct.
Mr Blake: You then became Legal and Compliance Director and, from 1 April 2012, you became responsible for those matters that had previously been managed by the Royal Mail Group, including criminal prosecution?
Susan Crichton: That’s correct.
Mr Blake: Can we please look at POL00180229, please. So we’re now on 7 June 2012, so post-separation, and this is an email from Jarnail Singh. If we could have a look at that bottom email, it’s an email from you to Jarnail Singh about a case called Yetminster, and you say:
“… if we decide not to go ahead with criminal prosecution are there any risks for [the Post Office]?”
Am I right to understand that there was consideration being given at this time to dropping the case?
Susan Crichton: Yes, I think so. In fact, Yetminster is the name of the branch –
Mr Blake: Yes.
Susan Crichton: – and because, at that time, we were having discussions with Alice Perkins and Paula Vennells concerning an independent review of Horizon, which, if my memory is correct, we started having probably around about February/March of that – that was the first – start of that, around February/March of that year – I was concerned that we would be going ahead with criminal prosecutions with the background that we had an independent review of Horizon starting to happen.
Mr Blake: Why were you asking Jarnail Singh about the risks for the Post Office?
Susan Crichton: Because I wanted to understand his view. It was also my view, and I’ve said this in my statement, that I had asked for any prosecutions that relied solely on Horizon evidence to be ceased. Unfortunately, I cannot remember when that view was – when I formed that view but I know it was part of the work we were doing in relation to the getting an independent review on track. It wasn’t because I knew there was anything wrong with Horizon necessarily but I just felt it was important that we paused these cases whilst we did the review.
Mr Blake: Can we, please, look – perhaps if we can keep that one on screen and scroll up to the top of the email and we can also bring onto screen, on the right-hand side, POL00137248. It seems as though in May of that year there had been a meeting with Lord Arbuthnot and Oliver Letwin. I think you attended a preparation meeting. If we please look at page 7 of this document, we can see there at 6b, that’s the Tracey Merritt case, I think it’s called “Merrick” on the left-hand side but it’s Merritt, and the Yetminster branch, and it said, “Led by: Susan”. So it looks as though, in May of that year, you had personally reviewed some aspects of that case; is that correct?
Susan Crichton: It looks like it but I’m afraid I can’t remember.
Mr Blake: Are you aware that Ms Merritt had raised issues with Horizon in relation to her case?
Susan Crichton: Yes, I mean, I must have been because that’s the evidence there.
Mr Blake: Thank you. If we stick with the right-hand side document, please, the left one can come down. Jarnail Singh says to you as follows. He says:
“As a prosecutor Post Office Prosecution Limited must be seen to exercise its judgement in all cases which give rise to potential criminal proceeding to promote effective, consistent and fair decision making. If not, a third party examination of our case by, say, the Director of Public Prosecutions may result in withdrawal of our ability to prosecute.”
Is that a concern you were aware of, a withdrawal of the ability to prosecute?
Susan Crichton: Was I – I thought we should – so, to take a step backwards, our ability to prosecute was something I had raised with Paula much earlier in the year and said that we needed to review that. So I suppose, honestly, no, I wasn’t. I thought we should look at other ways of managing these issues.
Mr Blake: He says:
“Decision not to prosecute cannot be kept secret “everybody will find out what we are doing” this may open post office to criticism and undermine faith in Horizon. This U-turn will be exploited by potential third party subpostmasters alliance. It may send a green light for defendants to get hold of their Member of Parliament and result in [I think he means ‘capitulation’ rather than ‘copulation’]. We need to send a message that “post offices cannot be used as a bank”. We hold a robust stance, any wrongdoing will be investigated, prosecuted and money recovered.”
Were you in any way concerned by that response?
Susan Crichton: I think it’s fair to say, particularly given the fact that we were – and I was trying to push for an independent review, I didn’t agree with that response.
Mr Blake: Did you go back to Mr Singh and tell him those shouldn’t be part of our considerations?
Susan Crichton: I think I might have had a conversation. I don’t think there’s a document showing I went back to him.
Mr Blake: Sorry?
Susan Crichton: I think I went back to him and said or explained that we were going ahead to, you know, to set up an independent review and as I felt there were other ways – or we should be considering our prosecution policy more generally. But I really can’t remember but that’s what I likely would have done.
Mr Blake: So you think and it’s likely, but you can’t actually remember having done so?
Susan Crichton: Exactly.
Mr Blake: Was that view that was expressed there by Mr Singh consistent with the views of the business more generally?
Susan Crichton: In my view, yes, it was.
Mr Blake: Who in particular?
Susan Crichton: I think there was a – I think there was a group of people who had worked for the Post Office for a long time who held this view, and I think in my statement I mentioned it on a number of occasions, that this was public money and that the Post Office should make efforts to recover that money.
Mr Blake: You said a group: who was part of that group?
Susan Crichton: So my recollection would be it would be people who’d worked in the Network, people who’d been in the business for a reasonably long time.
Mr Blake: Who are those people?
Susan Crichton: I’m just trying to think. So Kevin Gilliland would have been the Network Director, then there would be the Group Debt Recovery Team in Chesterfield, and then there would be obviously not – so it would be sort of the Network – Angela van den Bogerd, Kevin Gilliland – I’m really searching for names now, I apologise, but that was my – it was the “This is public money and we need to protect it”, that was the sort of slogan, if you will.
Mr Blake: We’ve seen from these emails this morning, early on in your time at the Post Office and increasing, including when you had responsibility for the Security Team, you were aware of challenges to the Horizon system in the context of criminal and civil proceedings and, by May/June 2012 is it fair to say that you were thinking about the impact of corporate decisions on criminal cases?
Susan Crichton: Yes, I think that would be correct.
Mr Blake: Can we please look at your witness statement. You’ve mentioned briefly about the continuation of prosecutions whilst these concerns were happening. Can we please look at WITN00220100. It’s paragraph 255, which is page 91. You say in the second half of that paragraph 255:
“At some point around the time of the separation, I recollect that I made it clear (including to the Security Team) that no further prosecutions were to be commenced which were reliant on Horizon evidence.”
Now, it might seem that that wording there is quite careful wording. Can you assist us with what it meant, “reliant on Horizon evidence”; how was that defined?
Susan Crichton: So, in my mind, it was prosecutions that relied specifically on the evidence produced by Horizon and the corroboration evidence and, again, you know, forgive me because I’m not a litigator, was insufficient to outweigh that evidence. So I basically wanted the teams to be very aware that they had a duty to review the evidence and to decide whether there was sufficient evidence to go ahead on that basis.
Mr Blake: Was there some defined criteria that were sent to the Security Team and prosecutors in that respect?
Susan Crichton: You see, I haven’t seen a document like that and I think it would be a conversation that I had, certainly with John Scott and certainly with Jarnail – it might have been via Hugh Flemington for Jarnail – but I was trying to heighten people’s awareness about what we were doing.
Mr Blake: Did you articulate it similarly to the way you have articulated it to this Inquiry, that it was cases that involved Horizon evidence where there wasn’t much more than the Horizon evidence? I’m trying to understand the test that was applied?
Susan Crichton: Certainly, yes, I think that would be one way of looking at it but it was a bit more than that. It was for them to really try and understand what had happened in the branches and why the subpostmasters, if subpostmasters were the issue, had got into this situation.
Mr Blake: Is it fair to say that that didn’t stop prosecutions taking place that involved complaints about the Horizon system?
Susan Crichton: I think that’s right, from the evidence I’ve now seen.
Mr Blake: If we look at POL00180774, we’re still in June 2012, 20 June 2012, and this is about the Merritt case that we were looking at before. If we look at the bottom email, from Dave Pardoe to Jarnail Singh, and it’s copied to you above, he says:
“Jarnail, as this was a case where Horizon was being cited as being at fault; I’m not sure if we want to accompany the change in stance with a carefully worded missive stating that our position is not an admission of Horizon integrity issues (as it stands one of my Security Managers has been asked to advise the suspect – presumably verbally).”
If we scroll up above, Jarnail Singh sends that to you:
“Susan please see Dave Pardoe email below. Can I have a word before response to Dave?”
Do you recall speaking to him about that?
Susan Crichton: I don’t, no, but I would have spoken to him about that and I would have made the point that we just discussed.
Mr Blake: So is it right that some cases were discontinued or weren’t proceeded with but the Post Office was very clear that, when it was doing so, it shouldn’t tell people that it was because of the Horizon issue?
Susan Crichton: My position was that I didn’t know, in the sense of absolutely know, that there were issues with Horizon at that stage but that I did know we were going to undertake an independent review, and I didn’t want to go ahead with cases that depended solely or in a significant way on the Horizon evidence.
Mr Blake: Why would it need to be carefully worded, though?
Susan Crichton: I think it just needs to be sensibly worded, really.
Mr Blake: The words he used are “carefully worded”, and carefully worded so as not to include an “admission of Horizon integrity issues”. You’re copied into this email. Did you say, “No, you should tell them that we’ve discontinued because we’re looking into Horizon integrity issues”?
Susan Crichton: I can’t remember what I said.
Mr Blake: Is it likely or unlikely that you had that kind of a conversation?
Susan Crichton: I would say it is more likely than not but I really can’t remember, I’m afraid.
Mr Blake: So you think it’s more likely than not that your response to receiving this email would have been, “No, we can mention Horizon integrity issues when we discontinue the case”?
Susan Crichton: I really can’t remember.
Mr Blake: Can we please look at POL00141400, the next month, 11 July. If we could scroll down to the bottom of page 2, please. Do you recall advice from a lawyer at Cartwright King called Harry Bowyer around this time, relating to the case of Wylie?
Susan Crichton: So I can’t – didn’t recall the advice but, obviously, I’ve now seen it.
Mr Blake: Do you recall advice being given that certain steps needed to be taken at this time, in light of what had been discovered by Second Sight?
Susan Crichton: No, I don’t think it was because of what had been discovered; I think it was the start of the Second Sight investigation, rather than what they’d discovered. So I think it was the mere fact that the investigation was going to go ahead.
Mr Blake: His advice was that certain steps needed to be taken by the Post Office before a prosecution should take place?
Susan Crichton: That’s certainly how I understood his – reading it recently, that’s how I understood his advice.
Mr Blake: The bottom email from Jarnail Singh, which you’re copied into, says as follows:
“I agree. Defence will approach to stay the prosecution until the review by Second Sight is completed will become increasingly common. Post Office view is that such an approach be resisted.”
He says:
“There is no legal or forensic grounds to argue defendants will not get a fair trial or abuse of process. There is no reason to justify the case being stayed. The fact that the review is being carry out is not an acknowledgement that there is an issue with Horizon, the system working properly and is being used up and down the country. When the system has been challenged in criminal courts has been successful defended. There is no mileage in this position but is in fact superficial.”
Did you understand, at that point in time, that Jarnail Singh was saying that there shouldn’t be a stay in cases simply because Second Sight were carrying out their review?
Susan Crichton: That’s what I understood him to say, yes.
Mr Blake: If we scroll up, please, to the top of page 2. Hugh Flemington – so he was a lawyer in your team?
Susan Crichton: Yes.
Mr Blake: Yes, he says:
“Do we have a counsel acting for [the Post Office] saying [that] we should agree to stay requests?”
Jarnail Singh, copying you in, says:
“This was [Mr Bowyer’s] advice which was forwarded to you on 11 July.”
He says, again, in the top email:
“Hugh/Susan are you happy with our stance or do you want to make additions or amends.”
If we scroll up, please, there is a response at the bottom of page 1 from Mr Flemington, he says:
“J – assume your recommendation hasn’t changed and is still to keep fighting any such application? Issues appear to be:
“1. Comms brief needed to rebut the myths …
“2. Clarity [regarding] Second Sight terms of reference …
“3. A plan/bible of what information we are going to provide our legal teams and the courts if we have to fight applications to stay.
“4. Plan to deal with disclosure requests …”
It seems as though, in the summer of 2012, the Post Office perhaps wasn’t going to investigate or wasn’t going to proceed with new cases but, where there were ongoing existing cases, it was full steam ahead.
Susan Crichton: I think in this case – well, I think it eventually got stayed. I can’t remember.
Mr Blake: But, in terms of your instructions, as Head of Legal, there is an email chain here that queries whether to agree to stays and it seems as though the feedback to Jarnail Singh is very much business as usual?
Susan Crichton: It certainly looks like that, yes.
Mr Blake: Yes. Would you be surprised if we didn’t find an email from yourself querying why they are continuing to prosecute?
Susan Crichton: Yes.
Mr Blake: You’ll be surprised if there wasn’t an email query?
Susan Crichton: Well, it looks like we were having a conversation about it –
Mr Blake: Yes.
Susan Crichton: – and I think that would have been part of the conversation as to just how much reliance – and, obviously, it was the old Horizon system, not the new Horizon Online system, how much reliance we were placing on the Horizon evidence.
Mr Blake: Did you agree or disagree with the sentiments that are being expressed in this email chain?
Susan Crichton: I can’t remember. However, I do remember that we asked the Comms to assist in a press release or something that could be used with the agents who represent us, as to how to characterise the Second Sight investigation.
Mr Blake: So the response to a criminal prosecution and the potential of a stay was to draft a comms brief?
Susan Crichton: No, I’m just saying that that’s what I remember happening at that time?
Mr Blake: Yes, and do you remember expressing a view that the case of Wylie at this time should not proceed?
Susan Crichton: I cannot remember.
Mr Blake: Looking at this chain that was copied to you, do you think it’s likely or unlikely that you gave such an instruction?
Susan Crichton: I really can’t remember.
Mr Blake: I’m going to move on to look at the Board’s knowledge of these kinds of issues. We’re going to move back –
Sir Wyn Williams: Before you do, Mr Blake, the last email on the screen is, as I read it at least, before a meeting has taken place following those emails, if you see what I mean. I’m reading “One for our 3.30 meeting, I think”, as being these points are to be discussed and that would be consistent with the timing of the email. Is there any note, so far as the Inquiry knows, of a meeting which then followed?
Mr Blake: Sir, I’m not aware of a note. We can certainly look into it but perhaps a question for Ms Crichton is: does she recall such a meeting taking place?
Sir Wyn Williams: Absolutely, thank you.
Susan Crichton: I’m afraid I don’t, no.
Sir Wyn Williams: Do I take it that the email chain then peters out, so to speak?
Mr Blake: It does, yes. If we could scroll up to the top of the page, please.
There’s a message from Jarnail Singh to Hugh Flemington saying that this case deals with the old Horizon system.
I’m going to move on to knowledge of the Board around this period. Could we have look at POL00095587. We’re moving back in time slightly to January 2012. This is a significant litigation report. If we scroll down, we see your name there at the bottom and January 2012.
Did you implement significant litigation reports to the Board; was that your idea?
Susan Crichton: Yes, it was.
Mr Blake: Do you recall when you implemented that, approximately?
Susan Crichton: I had a conversation with Paula Vennells and said that I felt that these should be included in the Board packs. I think it might have been January 2012 because that was pre-independence. I think it might have been, yes.
Mr Blake: So this may have been the very first significant litigation report?
Susan Crichton: It might well be, yes.
Mr Blake: If we scroll up, please, 1.1, it says:
“Post Office Limited has received four letters before action from a firm acting for former subpostmasters who were dismissed when discrepancies between their branch accounts and cash positions were discovered.”
Is that the Shoosmiths claim at that stage?
Susan Crichton: I think it was, yes.
Mr Blake: If we look down at 1.5, it says:
“We may receive a large number of similar claims – possibly between 55 and 150 according to press reports.”
It says:
“Our strategy is to defend each claim robustly to deter future claims and we will be responding to each in full. At present we consider the legal claims to be weak and the damages claims to be inflated. We do not know what the ultimate value of these claims will be.”
Where it says “our strategy”, who was “us”?
Susan Crichton: I think in that context it was RMG Civil Litigation with input, I’m guessing, from me.
Mr Blake: You drafted the Significant Litigation Report?
Susan Crichton: I think they may well have drafted it and I checked it or read it, anyway.
Mr Blake: So “our strategy” is whose strategy? Anyone in particular?
Susan Crichton: As I say, I think it was suggested by RM Litigation Team and accepted by me as an initial strategy. As I’ve said, previously, I was anxious to understand the Post Office’s view and to bring more elements of commerciality to it.
Mr Blake: We can have a look at the Board meeting itself. Can we please look at POL00021503. This is the Board minutes of 12 January. We see there that you are attending to deal with items number POLB12/06, is that “to 14”, so all items between 6 and 14?
Susan Crichton: I think so, yes.
Mr Blake: We see there Mr Young is also in attendance, he’s only there to deal with POLB12/13. By this time, I think you were Legal and Compliance Director, part of the transition period; is that correct?
Susan Crichton: Yes.
Mr Blake: Can we please turn to page 6 and there is discussion of the Significant Litigation Report. It’s your evidence is that that report itself may have been drafted by the Royal Mail lawyers. If we scroll down, please, it seems as though – did you present that report to the Board?
Susan Crichton: I’m not sure whether I presented it or not but, obviously, Les Owen asked questions.
Mr Blake: I’ll read as follows, it says:
“Les Owen …”
Do you recall Les Owen; he was a Non-Executive Director?
Susan Crichton: I do, yes.
Mr Blake: Do you recall him – I think he was also a Non-Executive Director at number of other companies, including one that is technology based?
Susan Crichton: I didn’t know that but I know he was on the RMG Board.
Mr Blake: He, ultimately, I think, became Chairman of Royal Mail Group.
Susan Crichton: I didn’t know that.
Mr Blake: He asked:
“… for assurance that there was no substance to the claims brought by subpostmasters which had featured in Private Eye.”
So there was a report in Private Eye. It says:
“Susan Crichton explained that the subpostmasters were challenging the integrity of the Horizon system. However the system had been audited by RMG Internal Audit with the reports reviewed by Deloittes. The audit was very positive.
“The Business has also won every criminal prosecution in which it has used evidence based on the Horizon system’s integrity.
“Susan Crichton suggested that she clear the audit report with the external lawyers and if it is possible to give the report privileged status it would be circulated to the Board.”
What did you understand at this stage “integrity” to mean, in respect of the Horizon system:
“… it has used evidence based on the Horizon system’s integrity.”
Susan Crichton: I would understand it to be reliability: reliability and probity, I guess.
Mr Blake: Do you recall the Board probing the information that you gave them on this occasion?
Susan Crichton: No, I don’t.
Mr Blake: It does seem, at least from these Board minutes, that you were, at that time, the channel passing information to the Board relating to Horizon integrity?
Susan Crichton: I think what I was doing was responding to Les Owen’s question about the subpostmasters’ article in Private Eye, which is the one I referred to in my statement when I say that, at the Executive Team meeting, I had asked Mike Young because he – the letter had come from him, I think – how he had assured himself that it was appropriate to write in the terms to Private Eye and, in documents that have been recently disclosed, there’s a draft from one of the RMG PR Team, I think.
Mr Blake: In terms of channels to the Board, though, I mean, he was actually present and spoke to an entirely different matter. It seems as though you were the channel to the Board in relation to the challenges bought by subpostmasters relating to the integrity of the Horizon system?
Susan Crichton: Certainly in this case, yes.
Mr Blake: Can we please look at POL00103334. It’s page 122 of that document, please. It may take a minute to come up because it’s a large document. Thank you very much. Page 122. This is a paper that was provided to the Board by Mike Young for the 15 March Board meeting, so a later board meeting, addressing the Horizon system. I’m just going to read to you a little bit of “Background”. He says in this paper:
“The recent incident on Horizon was the fourth significant service failure of this system in nine months.”
If we scroll down, please, he says:
“As part of the move to Horizon Online, the contract was renegotiated and the architectural design changed in order to reduce Post Office’s operating costs by £50 million [per year] (excluding VAT). One of the design changes which contributed significantly (circa £5.5 million [per year]) to the savings was moving to an active/passive data centre arrangement. Consequently the resilience is now housed in one data centre with the second data centre primarily being used as a test environment but available for disaster recovery if required.
“As a consequence of moving to the active/passive design, when hardware issues arise they will result in network wide service disruption.
“The previous active/passive data centre arrangement would have prevented an impact to customers for the incidents of 12 December and 1 March as the hardware would still have been working in the other data centre.
“The level of risk associated with this design is being challenged in light of our future business strategy.”
If we scroll down, please, over the page, and over to the final page we see there, that’s from Mike Young to the Board. Now, that, as we can see, is a very technical report relating to Horizon. Was any link drawn between those technical reports from the Chief Operating Officer and your reports about the challenges to the Horizon system by the Board around this time; were those strings drawn together at all?
Susan Crichton: I don’t recollect that they were.
Mr Blake: Mr Young, as we know, left in 2012 and some of his responsibilities then fell to you?
Susan Crichton: The Security Team fell to me.
Mr Blake: Yes. By the spring of 2012, were you personally beginning to draw the strings together relating to problems with Horizon and challenges to Horizon?
Susan Crichton: I was certainly – when we started to talk about an independent review, I was certainly very much in favour of that.
Mr Blake: Can we please look at POL00179524. So you said you were in favour of an independent review to look into those issues. We’re now in March 2012 and Alwen Lyons, the Company Secretary, sends you, Lesley Sewell, who at that time, I think, was the interim Chief Operating Officer, Kevin Gilliland, who was the Network and Sales Director, a report called “Horizon Integrity”, and we’re going to see that as what we know as the Ismay report.
Susan Crichton: That’s correct.
Mr Blake: Can you assist us with why Alwen Lyons in 2012 sent you a report that dated back to 2010?
Susan Crichton: My recollection is that I hadn’t – I had not seen the report before and, as we were starting to think about or to look at commissioning an independent review, I think Alwen must have remembered that it existed and got it from Rod Ismay.
Mr Blake: Thank you. So you, as we’ve heard, were Head of Legal in 2010 but that was not a document shared with you at that time?
Susan Crichton: I have no recollection of it being shared with me at the time.
Mr Blake: These recipients – you, Lesley Sewell and Kevin Gilliland – were you the three, or perhaps together with Alwen Lyons, looking into the issue of a possible review of the Horizon system?
Susan Crichton: I think it was more Lesley was leading on the development of a terms of reference for the review and possibly Kevin Gilliland hadn’t seen it before either.
Mr Blake: Let’s look at the Ismay report. It’s POL00179521. It goes to Dave Smith, who was then the Managing Director, from Rod Ismay, Head of Product and Branch Accounting; you have the Finance Director there; and we have Mike Young, the Chief Technical and Services Officer; rob Wilson, Head of Criminal Law; Mandy Talbot is also a recipient. Does it strike you as odd that the Head of Criminal Law, Mandy Talbot, “Principal Lawyer (Civil)”, were recipients alongside the Managing Director but you weren’t a named recipient of that report?
Susan Crichton: I can’t comment on that but I didn’t recall seeing it in 2010, certainly.
Mr Blake: Does that distribution list strike you in any way as odd, that you’re not named there?
Susan Crichton: I suppose it was focusing on those people in the RMG team who dealt with Horizon issues and possibly they had contributed to the report.
Mr Blake: The report, I’m just going to read a few extracts from it:
“Post Office Limited has, over the years [and this is only in 2010], had to dismiss and prosecute a number of subpostmasters and Crown staff following financial losses in branches. A small number of these have made counterclaims that they were not guilty of the charges made but that the Horizon system was faulty.”
There’s a section, if we scroll down, there’s an “Executive Summary” there. If we turn to page 15, there’s a section on “Known IT Issues”, including things like screen freezes.
Page 17, please. There is a section on “Court Decisions”. I’ll just read a few passages from this section. It says:
“There have been cases, when taken to court by [the Post Office] where the defence has claimed that the accounting system Horizon was at fault and that there were incidents such as ‘ghost transactions’ or ‘electrical supply issues’ which have corrupted the Horizon records.
“With 2 notable exceptions, [the Post Office] has been able to rebut these assertions by ensuring a focus on the facts of the Horizon transaction logs and a request for the defence to be specific about which transactions they consider us to be ‘ghost’ and why.”
Are you able to assist us with the two notable exceptions, what they may have been?
Susan Crichton: Was the Cleveleys case one of those? No, I’m not, actually. I’m …
Mr Blake: You’re wondering whether it was the Cleveleys case?
Susan Crichton: The Cleveleys case.
Mr Blake: That case is actually mentioned further down and we’ll come to that.
Susan Crichton: Right, okay.
Mr Blake: You’re not able to assist with two notable exceptions?
Susan Crichton: No.
Mr Blake: Do you recall asking what the two notable exceptions were?
Susan Crichton: No, I don’t.
Mr Blake: If we scroll down, please:
“There are three ‘landmark’ cases which feature in the arena of challenges to Horizon.”
The first, we see there, the Cleveleys:
“… subpostmistress dismissed in 2001 soon after Horizon was introduced. The defence produced a report which showed how Horizon ‘could’ have caused an error and [the Post Office] did not have the audit transaction logs to refute the claim. [The Post Office] settled out of court [it says there] for £187,000, but subsequently improved the retention of audit transaction logs. This case would not have the same outcome today because of improved liaison between Fujitsu and [the Post Office] and availability of logs.”
It then goes on to the Castleton case:
“… Lee Castleton claimed that Horizon was faulty and found other subpostmasters to back him. However [the Post Office] presented the audit transaction log to his solicitor who promptly advised Castleton there was no basis to his case. Castleton sacked him, lost the case, and was found liable for £300,000 and went bankrupt. The judge decided that there was ‘no flaw’ in the Horizon system and said ‘the logic of the system is correct … and the conclusion is inescapable that the Horizon system was working properly in all material aspects’.”
If we scroll down, there’s the case of Mr Darlington at Alderley Edge as well.
Did this cause you any concern when you read it that there’s mention there of the history of cases relating to challenges to Horizon? In this case, we have civil cases, so not outside of your area of expertise. Were you concerned on reading that?
Susan Crichton: I think it fed into my view of the need to do an independent investigation. I can’t remember specifically reading this in 2012 but I think it just sort of further confirmed that we needed to try to resolve the issue or understand what the issue was, perhaps I should say.
Mr Blake: We’ve seen this morning the continuation of prosecutions relating to Horizon. Doesn’t it need a little bit more than just to think about an internal or an independent review of some sort?
Susan Crichton: I think at that time that that was my understanding, that some independent review would assist the business in deciding or understanding what was going on in this situation.
Mr Blake: Thinking about it now, though, do you think that there was a lack of urgency?
Susan Crichton: Absolutely, with hindsight, I feel – and, you know, I started off by saying how sorry I was; I’m also sorry that this took such a long time to be resolved on my watch.
Mr Blake: If we please go over to page 19, there’s reference there to “Independent Review and Audit Angles”, and it’s ruled out in 2010. It says:
“[The Post Office] has actively considered the merits of an independent review.”
It says further down:
“Ernst & Young and Deloittes are both aware of the issue from the media and we have discussed the pros and cons of reports with them. Both would propose significant caveats and would have limits on their ability to stand in court, therefore we have not pursued this further.”
If we scroll down, please:
“It is also important to be crystal clear about any review if one were commissioned – any investigation would need to be disclosed in court. Although we would be doing the review to comfort others, any perception that [the Post Office] doubts its own systems would mean that all criminal prosecutions would have to be stayed. It would also beg a question for the Court of Appeal over past prosecutions and imprisonments.”
We have looked this morning at the question of stays and the decision taken to press on with existing cases. Did receiving this in 2012 cause you to rethink whether that was the appropriate course of action?
Susan Crichton: It certainly should have done, yes.
Mr Blake: On receiving this in 2012, did you speak to anybody within the business about it?
Susan Crichton: I can’t remember.
Mr Blake: I’m going to move on now to the selection of Second Sight.
Sir, that might be an appropriate moment to take our first break of the day. I think the proposal is for it to be a ten-minute break.
Sir Wyn Williams: Yes, that’s right. So –
Mr Blake: So 11.05.
Sir Wyn Williams: 11.05. Thank you very much, Mr Blake.
Mr Blake: Thank you very much.
(10.54 am)
(A short break)
(11.05 am)
Mr Blake: Thank you, Mrs Crichton.
We’re going to move on now to the selection of Second Sight as the independent reviewer. Can we, please, look at POL00002000, please. At paragraph 107 and also 134 of your statement, you say that Deloitte prepared a proposal for an independent review around May 2012 and I think this is the proposal document.
Susan Crichton: Yes, I was pleased it was disclosed because I thought I remembered it, but I hadn’t received a copy of it.
Mr Blake: If we look at page 4, please. Deloitte, in what they call Project Spire, set out a proposed approach to a review, and they said:
“Step 1: understand processes, data flows and key risks.
“Fundamental to the assessment of processing integrity is the understanding of data flows, processes and key risks in the end-to-end process.”
A bit further down, they say:
“Using our Data Governance framework as a best practice benchmarking tool, we perform a current state analysis on the organisation, interviewing key personnel, examining documentation and reviewing systems.”
At step 3: “Sample to confirm data accuracy and integrity”, they refer to their data testing using a substantive testing technique. Did you understand Deloitte to be proposing quite a technical look at the Horizon system?
Susan Crichton: To the extent that I remember it, I remember thinking that this wasn’t looking at it from the point of view of people operating the system but, rather, the system as a whole.
Mr Blake: Yes. Perhaps if we go back to POL00137248, please, the preparation meeting for the Lord Arbuthnot and Oliver Letwin meeting. That was also May of that year. Can we please look at page 3, there’s a reference to Deloitte and it says as follows:
“Why are we considering Deloittes to perform the audit?”
It says:
“KPMG are excluded as they are Fujitsu’s auditor.
“Ernst & Young are included as they are Post Office’s auditor”, et cetera.
Then it says:
“Deloittes are on Post Office’s supplier shortlist and have proven experience in this area.”
Then it says – these are potential questions that could be asked:
“The audit could cost in the region of £250,000 to £500,000, why so expensive?”
The answer is:
“The audit envisioned is thorough end-to-end review of processes, systems and data which not only could reveal potential improvements but could be used as an assurance for [future court cases]. The cost is as a result and thoroughness of the audit and the expertise required. An alternative, reduced scope audit could also be considered.”
So was that your understanding, as at May 2012, that there was going to be potentially a thorough end-to-end review carried out by Deloitte?
Susan Crichton: My understanding was that that was what was suggested.
Mr Blake: By Deloittes or by –
Susan Crichton: By Lesley and Deloittes. So she had led on the commissioning and conversations with Deloitte, although I have a vague recollection of going to a meeting with Deloitte to help scope the project but, really, Lesley was leading on that, Lesley Sewell.
Mr Blake: Yes, thank you. Can we please look at POL00006484. We’re now in June 2012 and there is a meeting with Richard Morgan QC, 12 June, at his chambers. You are one of the people attending. Can you recall the purpose of this meeting?
Susan Crichton: So I think this was after Alice Perkins had asked me to find a forensic accountant of a different type or maybe it was just in respect of the independent review, but I think I’d asked for help in drafting the terms of reference, from Bond Pearce.
Mr Blake: The note says, as follows:
“It was recognised that an impasse had been reached in relation to the Horizon litigation which POL is seeking to address.”
Just pausing there, was that, at that stage, Shoosmiths or was that something else?
Susan Crichton: Sorry?
Mr Blake: What was the Horizon litigation at that stage?
Susan Crichton: Oh, that was the Shoosmiths – that was the Shoosmiths litigation, yes.
Mr Blake: “The question is what is the best way of breaking that impasse.
“The proposal to instruct an independent expert to prepare a report on the Horizon system is the highest risk response to the issue. What will it achieve? It will not be able to address any of the civil/criminal cases dealt with understand ‘Old Horizon’. Will it seek to review particular cases? If so, which ones?”
Are you able to assist us with who that is a note of? Is that of counsel or is that an attendee?
Susan Crichton: I think it must be an attendee.
Mr Blake: “Whatever the findings of the expert report it will not resolve the problem. [The Post Office] will be ‘damned if they do and damned if they don’t’.”
Do you recall that being said by somebody?
Susan Crichton: I don’t but it’s presumably an accurate recording of what was said at the meeting.
Mr Blake: Again, are you able to us with whether that is – if we have a look at the top of the page it says, “Summary of Conference”?
Susan Crichton: I think that might have been counsel.
Mr Blake: Thank you. If we scroll down, please, it then says:
“[The Post Office] will always have this problem – some people will never trust computers and will always believe they have an inherent problem.
“A less risky approach is to agree to take relevant MPs privately through particular cases in which they are interested.”
Can you recall the discussion in that conference? Was this the general view of the attendees, was this just the advice of counsel?
Susan Crichton: It was certainly the advice of counsel, I do recall that. I also recall the – what he – what is described in the note as “a less risky approach” was the current approach that was taken by Post Office. As I’ve explained earlier in my evidence, they would take the cases where there were complaints and work those through.
Mr Blake: Did you agree with the advice that was being given or the information that’s recorded here?
Susan Crichton: I felt, given my conversations with Alice Perkins, that we had to move on from this position, which was why – and I think it was by this stage she had asked me to find a forensic accountant who might be able to help in a different way to that described in the Deloitte report, Deloitte proposal.
Mr Blake: Can you just assist us: you referred to conversations with Alice Perkins. Can you just summarise that for us?
Susan Crichton: My memory is that we’d had a meeting where the Deloitte proposal was explained and I think it was either that meeting or shortly thereafter she had asked me – and I include it in my witness statement – if I knew of a forensic accountant who might be able to help, and she had a sort of – as I described, a shopping list: so shouldn’t be one of the big four; had to be somebody who would be able to carry out the review; would be somebody who would be credible to the MPs, James Arbuthnot, Justice for Subpostmasters; and would be able to have to conversation with subpostmasters.
Mr Blake: Why not one of the big four?
Susan Crichton: I’m not entirely clear on that but I think it was because what the Chair didn’t want was something along the Deloitte spec, which was very much process. My retrospective interpretation of that is that she did want to take into account the subpostmasters experience in dealing with the system and also to focus on the MPs’ cases and, obviously, the Deloitte report might have gone some way to that but it wouldn’t have focused on the MPs’ cases.
Mr Blake: Did the advice from counsel at this meeting influence the decision as to whether Deloitte was or was not chosen?
Susan Crichton: No, I don’t think so.
Mr Blake: You’ve said in your witness statement, paragraph 152, that:
“From my perspective, the investigation was undertaken precisely to assess whether there were issues with the Horizon system.”
You say, “From my perspective”. Were there different perspectives on that at this time?
Susan Crichton: I’m not sure there were at this time but, from my perspective, at the time it was kicked off/started, it was to take the cases put forward by the MPs and for Second Sight to work those cases through, using their specialist expertise, as I think I’ve described in the statement in various ways.
Mr Blake: We’re going to now look at a proposal from Second Sight in June 2012. Can we please look at POL00096576. This is a report or a proposal that has been produced by Second Sight to:
“… carry out an Independent Review of past fraud and theft cases in order to determine whether the facts support the business’s findings and the charges brought against individuals.”
Can we just scroll down the page, over to the next page. So the proposal:
“Second Sight has been invite to carry out a review of a yet to be determined number of closed, and possibly some still open, fraud and theft cases.”
So, as you’ve said, the proposal there is to look specifically at the cases rather than the system as a whole, potentially?
Susan Crichton: Correct.
Mr Blake: If we scroll down, we can see that this proposal has been drafted by Mr Warmington, that’s on page 3, 1 June 2012. Could we please turn to page 5. It does seem that at least to some extent, under the heading of “Case Review – Approach”, there will be – if we look at the right-hand side, fourth paragraph, fourth bullet point down:
“Study and selectively test the ‘Horizon’ system in order to find any ‘Black Hole’ Program Bug; etc that might have caused mysterious shortages.”
So it did seem that part of Second Sight’s proposal was going to be to test the Horizon system?
Susan Crichton: But I think it was to test it in the context of those cases, not more generally. That was my understanding.
Mr Blake: Thank you. Can we please look at POL00180209 and, if we scroll down to the very bottom, the second page, the bottom of an email chain. At the very bottom of page 2, we have Ron Warmington sending you and Simon Baker the proposal. He says:
“As promised, here is our Proposal for the Case Review.”
If we scroll up, we have Simon Baker responding to you and also addressing it to Lesley Sewell as well. He says:
“Attached is Ron’s proposal.
“My view is that we make it clear to Alice/Paula the distinction between the work Ron is proposing (an independent review to past cases) and the Horizon Forensic Audit (the Deloittes proposal) and put it on the agenda to discuss tomorrow.”
Now, it seems as though the suggestion is that there are potentially going to be two different investigations: one is the Second Sight independent review of past cases and the other is a forensic audit carried out by somebody like Deloittes; is that understanding correct?
Susan Crichton: I can’t remember. I just know that they were quite different reviews and I think we made that clear as part of the meeting with Alice Perkins and Paula Vennells.
Mr Blake: If we scroll up, please, we have an email from you, saying:
“In the meantime Alice has asked for a [Terms of Reference] for the work that Ron et al are going to do …”
If we control up, Simon Baker responds, saying at the bottom:
“I am also hoping to have a proposal from Deloittes some time this evening which I will also bring to the meeting tomorrow.”
So it looks as though there is going to be a meeting on 7 June, relating to the various proposals.
Can we please turn to POL00233736. This is a timeline of the Mediation Scheme and it’s only one part on page 3 that I’d like to take you to. It logs various events over various dates and, if we could look at 7 June 2012, it says in this document:
“A meeting is held between Paula Vennells, Alice Perkins, Susan Crichton, Alwen Lyons and Simon Baker where the Deloitte and Second Sight proposals are discussed.
“Second Sight is chosen as the preferred supplier.”
So it seems, by 7 June, it was an either/or decision between Deloitte and Second Sight, not a proposal to have both types of review, and Second Sight win the contract; is that correct?
Susan Crichton: I can’t recollect that we were going to do both of them but I do recollect that Alice Perkins’ objective was to satisfy the MPs, in regard to their constituents, so obviously the Second Sight review would be more likely to do that than the Deloitte review would be.
Mr Blake: Can you recall that meeting? What was discussed at that meeting?
Susan Crichton: I can’t, no. All I can recall is the information I’ve seen in the emails.
Mr Blake: You refer in particular to Alice Perkins. Was she a particular driving force at this meeting?
Susan Crichton: Yes, she was. Well, I think – at the meeting, I can’t remember but I know that she was very much engaged with the matter of trying to resolve the MPs’ queries.
Mr Blake: So the focus for her was resolving the issues for the Members of Parliament and their constituents?
Susan Crichton: That’s my recollection, yes.
Mr Blake: Do you recall the view of Paula Vennells at this time?
Susan Crichton: No, I don’t think I do but I suspect it would have probably been the same.
Mr Blake: What was your view at this time?
Susan Crichton: I just – I felt very, very strongly we needed to move forward and, you know, if that was getting Second Sight to do a review of the MPs’ cases, I felt that would help us understand what was going on.
Mr Blake: But it wouldn’t, of course, carry out some sort of end-to-end technical review of the type that was proposed by Deloitte?
Susan Crichton: No, it wouldn’t.
Mr Blake: So when you say “move things forward”, do you mean bring to a swift conclusion the issue?
Susan Crichton: I think I was trying – it’s difficult to remember, it’s so long ago, but I was trying to ensure that the cases raised by the MPs were properly reviewed, and the Deloitte’s proposal would not do that.
Mr Blake: Well, they would help you to understand the underlying problems, though, wouldn’t it?
Susan Crichton: It was a very technical audit and, you know, the proposal was pretty technical. I wasn’t actually sure because I think what we were looking at, in terms of what terms subpostmasters were dealing with, was the system possibly not performing as it ought to and I wasn’t sure that the Deloitte’s report, in hindsight, would have given us that insight.
Mr Blake: It’s a very technical system, though, isn’t it?
Susan Crichton: It is.
Mr Blake: Didn’t a technical system need a technical report?
Susan Crichton: So I’m struggling a bit because I’m trying to find the right word. What I wanted to do was to look at it from the subpostmasters’ point of view because, yes, it’s a technical system but as – having worked in Financial Services for a long time, my background was technical systems have to be made to work for the people who use them, so it’s how does this then work to support the subpostmasters in their offices?
Mr Blake: In terms of Second Sight, Ms Vennells said in her witness statement that you knew Ron Warmington from earlier in your career and socially at a local tennis club, she says, although she understood that you weren’t a close acquaintance. Are you able to assist us with that?
Susan Crichton: So I’d worked with Ron Warmington at GE and I certainly didn’t know him outside work.
Mr Blake: So the suggestion that you knew him socially at the tennis club, that’s wrong?
Susan Crichton: No.
Mr Blake: How well did you know Mr Warmington?
Susan Crichton: He worked – so I was part of the EMEA team at GE Consumer Finance. He was actually part of the International Team, I think, Fraud and Investigations. So he and I had worked closely on a couple of investigations that he’d done with me, one in Switzerland and one, from memory, in Czech, and I think he also provided advice on fraud prevention but that would more probably have been for the risk team at General Electric, rather than for me.
Mr Blake: We saw there in the proposal – there was at least a proposal to look at some technical aspects insofar as they related to the individual cases.
Susan Crichton: Yeah.
Mr Blake: Was that discussed at all, once Second Sight had been taken on, as to how their technical investigation would take place?
Susan Crichton: Certainly when they came into the office, yes, I think it was because, when they came into the office, I gave them or showed them the files that we had managed to obtain and I then arranged for them to have a briefing on Horizon, again, from memory, they did Horizon training. Simon Baker, who was the project lead, was part of Lesley Sewell’s IT and Change Team so he provided the link into the IT system and it was Ian Henderson’s particular area of expertise. So I certainly thought that’s what – part of what they would do.
Mr Blake: One of the first areas of discussion is whether those who had been convicted should be included in Second Sight’s review, and I think you said that, at that stage, there was a concern about reopening prosecutions that had concluded; is that right?
Susan Crichton: That is correct, yes.
Mr Blake: Can we please look at POL00180234. It’s an email from Simon Baker to yourself of 7 June 2012. He says:
“In speaking with Mike this afternoon we wondered if it is worth making a distinction in the [Terms of Reference] between cases that have been prosecuted and those that haven’t.
“For those cases that have already been through the legal system we don’t want to be seen as reopening the cases, instead we want to position those as a review of the existing evidence to enable an understanding of the allegations and facts in regards to Horizon.
“For those that haven’t been prosecuted we can position as a full independent investigation.”
So was part of your thinking at that time also that those who hadn’t been prosecuted would get a full independent investigation but those who had been prosecuted would get something a little less than that?
Susan Crichton: I think it probably was, yes, but I think, again, as I go on to say in my witness statement, the two or three – at least two cases where prosecution had ensued were included in the Second Sight review.
Mr Blake: Yes. Were ultimately included?
Susan Crichton: Correct.
Mr Blake: Perhaps we can see an email from yourself of the same date to Alice Perkins and Paula Vennells. That’s POL00105472. You say:
“In addition, and following a review of the cases listed, which I had not seen this before, I have been giving some further thought to our position particularly in respect of the cases where we have criminally prosecuted the subpostmaster/mistress. I those cases, I do not think that we want to be seen as reopening the cases but rather position this as a review of existing evidence to enable an understanding of the outstanding concerns and the facts insofar as they concern the Horizon system. For those who have not been prosecuted we can offer a full independent investigation.”
So that’s very much echoing the views of Simon Baker in that previous email?
Susan Crichton: Correct.
Mr Blake: Why would it be a problem if problems with Horizon were identified in respect of those who had been convicted?
Susan Crichton: I suppose what I was thinking was that we should then proceed and – you know, forgive me, I’m lamentably unqualified in the criminal piece of this, but what I was concerned was they had gone through the courts and they had been convicted and I thought we shouldn’t reopen that.
Mr Blake: But if there was new evidence that showed that that conviction had been unfair –
Susan Crichton: Exactly, yes.
Mr Blake: – wasn’t that something that positively should be investigated?
Susan Crichton: Yes, I agree with you. It should have been and it was, actually.
Mr Blake: But, as at June 2012, it was your position that they shouldn’t be. That was a mistake –
Susan Crichton: That was – sorry, I apologise.
Mr Blake: Was that a mistake on your part?
Susan Crichton: I think it was, yes.
Mr Blake: Can we please look at POL00096606. This is an email exchange with Alice Perkins. If we can look at the bottom email, please, 9 June 2012, from Alice Perkins. She says as follows, she says:
“I am clear that we should include all the MPs’ cases, irrespective of whether they have been decided in court. If we try to draw a distinction here we will be accused of picking cases to suit ourselves and being vulnerable on the ones we omit. We’ll have a row about that instead of moving the issue on.
“On reflection, I don’t buy the argument that we would somehow undermine the court process by doing this. There are plenty of ways in which people go over ground which has been settled in court and if there weren’t, no one would ever be able to get a conviction overturned. And if (which we don’t believe) there were new evidence in a case which had been decided, we would want to do, and be seen to do, the right thing by that.”
She says:
“I am sorry to be bothering you with this on a Saturday but time is against us, especially as Paula is seeing James Arbuthnot on Monday afternoon and I feel … strongly about this.”
Scrolling up, Paula Vennells responds, copies you in, and she says:
“Alice, if Susan doesn’t get back to you, I’m around so call me on the mobile. I wasn’t party to this part of the discussion as it was when I was in the Eagle meeting but we can talk and I can pick up with Susan on Monday.”
Then we see an email from Alwen Lyons summarising the position to Paula, and she says:
“Paula in case Susan doesn’t pick this up as she is in Berlin and before you speak to Alice. The issue that came to light with the list of MP cases was that they included the [I think that’s meant to be ‘Misra’] case. You will remember the case and the publicity. She went to prison and had her baby whilst in there. The husband got publicity through radio and press. Susan’s anxiety and she raised this at the meeting with Alice before you joined was whether now contacting her to tell her we review the case would be a red rag to a bull.
“Alice feels this is the business pushing back unnecessarily and she feels this has happened throughout the process and she is having to keep pushing us!”
So just looking at the Misra case, it seems as though you were concerned at that time about the publicity that had been raised by her conviction and that now telling her that you were going to review her case and look into whether or not there weren’t issues with Horizon would be a red rag to a bull. Was that your position at that time?
Susan Crichton: I was very concerned about the situation, I understood what had happened in the Misra case, which was clearly very concerning, and I didn’t want to reopen it unless we had good reason to believe that there was an issue there, but it was included on the list of cases to be reviewed.
Mr Blake: It was ultimately included but it seems as though – and we see, at the bottom, Alice Perkins expressing quite a strong view that these kinds of cases should be included –
Susan Crichton: Yes.
Mr Blake: – but it seems as though you have expressed a particularly strong view in respect of the Seema Misra case, that because it was a highly publicised case, it wasn’t one that should be looked into?
Susan Crichton: My other concern around it was that it effectively would, you know, dilute the publicity with regard to the other cases that were being looked at.
Mr Blake: Because somebody who was put in prison and had a baby there would get more publicity than other cases?
Susan Crichton: I think what I was concerned about was that, if we were going to reopen this case, well, not reopen it but investigate this case, it must be done appropriately and we must then be able to move forward with the conclusion. So, you know – and I understand now around the disclosure of information and the importance of that.
Mr Blake: It might be that Seema Misra’s case got a lot of publicity because she was put in a terrible situation, and –
Susan Crichton: Absolutely.
Mr Blake: – looking into the issues that she raised in her trial, to see whether there was anything in it, might precisely have been the very thing to do at that time?
Susan Crichton: I agree.
Mr Blake: Why didn’t you agree at the time?
Susan Crichton: I was too shortsighted, maybe.
Mr Blake: It looks as though, as at 9 June 2012, you wanted a narrow review, not looking at decided cases and, at this time – we’re going to go on to talk about what happens later – but, at this time, June 2012, Alice Perkins thought that it should be wider, all MPs’ cases, she refers to being seen to do the right thing, the business was pushing back, it seems. Do you agree with that characterisation of the difference in those two positions?
Susan Crichton: Probably, yes.
Mr Blake: I’m going to move on to 2013. Can we please look at POL00059567. Can we start on page 2.
Second Sight had been carrying out their investigation for some time now, by January 2013. Ron Warmington emails Simon Baker, Ian Henderson and you and others, and he says:
“Hello Rod/all: As just mentioned, I’m afraid we now have to seek information on the time it has taken to notify the [subpostmasters] (in our sample) about [transaction corrections].
“The issue here is whether [subpostmasters] have been able to get to the bottom of a [transaction correction] in the event that they have been unable to print out, or even to view on screen, the underlying transactions that went through (and in some cases were also reversed) on the day of the challenged transaction.
“What we need to establish is: how many of the [transaction corrections] (that were raised in the 32 cases that we now have in our sample) were notified to the [subpostmasters] after 42 days had expired.”
So, in essence, how many subpostmasters were notified too late about the transaction corrections?
If we scroll up, we can see an email from you to Alwen Lyons, and you say:
“But this is not Horizon … How do we box this off?”
So by early 2013, were you trying to confine the areas that Second Sight were looking into?
Susan Crichton: I think I was just trying to understand what it was.
Mr Blake: But you weren’t trying to understand: you weren’t saying, “What is this?” You were saying, “How do we box this off?”
Susan Crichton: Well, how do we resolve the issue. So with transaction corrections.
Mr Blake: Does “box off” mean resolve the issue or does “box off” mean prevent the issue from being looked into?
Susan Crichton: So I think, in the context there, I wanted to understand what the issue was because –
Mr Blake: Well, I mean, you’re not asking there what the issue is; you’re saying, effectively, how do we stop this being looked into, aren’t you?
Susan Crichton: No, I don’t think. So I think if you go further down my recollection is from Ron’s email that he talks about the delay in transaction corrections coming through and the difficulty that subpostmasters have in reconciling those transaction corrections because of the delay that’s coming through.
Mr Blake: Yes.
Susan Crichton: So, yeah, I think I just wanted to understand what the issue was.
Mr Blake: The suggestion from your email seems to be that that isn’t fairly and squarely within the issue of the Horizon system; that’s to do with the transaction corrections and, therefore, that shouldn’t be something that Second Sight are looking into; am I unfair in that suggestion?
Susan Crichton: I think so because what I was trying to say is how does this all fit together? Because transaction corrections come from a different system, didn’t they? I thought. I didn’t know.
Mr Blake: So your expression “box this off”, it is your evidence to the Inquiry that that is, in fact, a request to look into something more rather than not look into something?
Susan Crichton: That’s what I think, yes, that’s what my recollection would be.
Mr Blake: Do you think that’s a reasonable interpretation of those words?
Susan Crichton: No, I don’t.
Mr Blake: What do you mean by that?
Susan Crichton: So I think it could be read in “How do I box this off”. I think what I was trying to say is how do these fit together with Horizon? So, if they’re not in the Horizon system, how does it all fit together?
Mr Blake: It’s answered by Simon Baker, if we scroll up, please – sorry, actually, if we go to the top email, it’s answered by Alwen Lyons, and she says as follows:
“So you are right not a Horizon issue but Ron’s point is that if [transaction corrections] come late and there was a Horizon issue [subpostmasters] have no chance to look at the evidence.”
Susan Crichton: Yes.
Mr Blake: So she’s making clear to you there that, in fact, although it’s not technically an issue with the Horizon system, it’s an issue with your processes, which means that subpostmasters wouldn’t, in fact, have a chance to look at the evidence because they wouldn’t know whether their transaction correction is being accepted or not?
Susan Crichton: Yes.
Mr Blake: Do you think, at that time, you and others in the business were genuinely interested in Second Sight investigating those kinds of issues?
Susan Crichton: Yes, I do.
Mr Blake: Because what appears to be happening is that we’ve gone from a situation where we have Second Sight and Deloitte making different proposals – one included a highly technical review of the system – Second Sight winning the contract, to trying to narrow the scope, for example we saw your email about not including those who are convicted of criminal offences, and here it looks as though, a reading of that email correspondence, is that they’re trying to narrow the scope further to confine them simply to the Horizon system itself? Do you agree with that or not agree with that?
Susan Crichton: No, I mean, I think the intention, and certainly from the beginning, was that they should look at the MPs’ cases and, in order to do that, they needed to have the ability to go – I mean, as their proposal said – to go outside of Horizon and, as their definition in the interim report says, that it was much broader than Horizon in terms of training, support, how subpostmasters were more generally dealt with.
Mr Blake: So am I to understand that there wasn’t an attempt at this stage by the Post Office to confine the scope of Second Sight’s review?
Susan Crichton: That’s my recollection. My recollection was that we wanted to have review done on the cases raised by the MPs.
Mr Blake: Can we please look at POL00144482, 22 April 2013, email from Simon Baker to you, Alwen Lyons and Lesley Sewell. This refers to a letter from James Arbuthnot to Alan Bates, and he says:
“The key points to me in the letter from [James Arbuthnot] to Alan Bates are:
“His suggestion that Second Sight focus their efforts on the two best MP cases.
“As ‘result’ – even if preliminary, by the summer.
“He doesn’t respond to Alan Bates’ request to focus the investigation on ‘systemic failures’.
“He says Alan Bates’ request for [Post Office] to continue to fund Kay Linnell is for Alan Bates to take up with the Post Office.”
Then he says this:
“This gives us the opportunity to really contain the scope of the investigation.”
Now, that is inconsistent with the evidence that you’ve just given on containing the scope of the investigation. Why would it be that, in April 2013, Simon Baker felt able to say to you that there was scope to “really contain the scope of the investigation”?
Susan Crichton: I think we were finding, from a practical point of view, that investigation was taking a lot longer than we had anticipated, that there’d been – that we weren’t getting through the cases or that Second Sight wasn’t able to get through the cases in the sense – in a timing sense, that we had hoped, and that we needed to get to some conclusion on some of the cases.
So that’s – so I mean it’s really down to his recommendation and also what we needed to have in terms of updating James Arbuthnot and what has to be included in the report to go – and I can’t remember when we agreed to do it but the report had to go back to James Arbuthnot and the MPs before the summer recess.
Mr Blake: Aren’t the words that are highlighted on the screen there entirely consistent with the email that I took you to from you, saying that you needed to “box off” an issue? Don’t they both suggest together that, in early 2013, the Post Office was trying to reduce the scope of Second Sight or contain the scope of Second Sight’s investigation?
Susan Crichton: It wasn’t my intention to restrain or contain the scope but I was concerned that we needed to get to some determination on the MPs’ cases and I can’t remember when they developed the concept of the Spot Reviews, because that was – sort of, again, was trying to move the investigation forward.
Mr Blake: Do the words here make you revisit the words that we saw just before about boxing off the investigation or is it still your evidence that that wasn’t trying to reduce the scope of the investigation?
Susan Crichton: I don’t think I was; I think was trying to understand how it all fitted together.
Mr Blake: He says, as follows:
“My recommendation is that we take advantage of this and draft a letter from Paula/Alice to James where we suggest the following:
“1. We are concerned about the overrun of cost and time of the investigation, noting it has been running for a year and to date no evidence of systemic failures have been found.
“2. To move forward we suggest that Second Sight complete two in-depth MP cases – selecting the ones that they feel indicate systemic problems.
“3. Post Office respond to the four Spot Reviews …
“4. We meet [James Arbuthnot] in June …
“5. Set the expectation that when we meet in June, unless there is strong evidence of any system failures we will close the investigation at that point.”
It certainly seems as though, in early 2013, the line from the Post Office is that “Progress needs to be made, we are concerned about the cost and the time and, if there isn’t evidence by the summer, we should close the investigation”. Was that a view that you shared?
Susan Crichton: No, I understood from the Chair that we needed to review the MPs’ cases and we were going to do that through the Second Sight process. I do agree that we were concerned about the overrun of costs and time and we were concerned about the efficiency of the process going forward, and, I think, actually, that was a concern shared by Second Sight.
Mr Blake: As the year progressed, was the Post Office increasingly concerned about the way that Second Sight were finding issues with Horizon?
Susan Crichton: I don’t know about more generally but I felt it was – I still felt it was important for them to review the MPs’ cases and, to the extent I was frustrated, it was because of what I felt was a lack of progress and I’d stress that, you know, in the beginning, we were late and slow in getting them documents and implementation and we had to develop a system to assist them, so the scanning system we put in place.
Mr Blake: Were you not increasingly concerned about the potential findings of Second Sight?
Susan Crichton: No, it was an independent report and they had – so my attitude was with Second Sight that I tried to make sure they got the information they asked for in a timely fashion and that they were assisted in the way that we could assist them in coming to their conclusions. But I do agree there was concern about the level of cost and the level of resource it was taking up.
Mr Blake: Can we please see POL00189210. We’re in June now, so the time at which progress had to be made or it would be shut down. Can we scroll down to the bottom, please. We have an email from you to Ron Warmington, saying:
“Hi from sunny Croatia – given the short timescales wondered how things were going with the report?”
I think you were on holiday at that time. Had you been tasked by somebody to chase the Second Sight Report?
Susan Crichton: No, I don’t recollect that, no.
Mr Blake: If we have a look at the response from Mr Warmington, he says:
“Wow … Croatia? Are you trying to get far enough away that the shock wave won’t impact?”
Were you aware, at that stage, of a potential shock wave arising from Second Sight’s report?
Susan Crichton: No, I don’t think so. I mean, we had been through the sort of – I can’t – no, I don’t think I was. I mean, it was an independent report and it had to be allowed to be an independent report.
Mr Blake: He says:
“Seriously, it’s all getting a bit heated, not least because of the need to disclose those two Horizon ‘defects’ (Gareth Jenkins called them ‘bugs’ in his report) that impacted 77 sub post offices and result in some [subpostmasters] ‘being asked to make good an incorrect amount’ (wording from Gareth’s [report].
“The problem is that, in answer to James’ question
(which he is bound to ask): ‘Have you (Second Sight)
Mr Blake: found any instances of a defect in Horizon that led to a shortage for which any [subpostmaster] was held accountable?’ The answer might not be ‘No’ … but, in any event, [the Post Office] had disclosed two software defects that did have that effect, albeit [the Post Office] dealt with them very properly and wrote off the differences that had arisen. That correction process looks to have taken place over a year in regard to the differences arising from one of the defects, however.”
He continues and says:
“We are also still trying to bottom out the Rudkin matter and that looks as though it will go to the wire.”
Is that the issue of remote access or what we refer to as “remote access”?
Susan Crichton: The Rudkin matter, yes, I think it is.
Mr Blake: He refers to Horizon defects and he says:
“… Gareth Jenkins calls them ‘bugs’ in his report …”
Do you recall there being an issue within the Post Office referring to “bugs” and trying to change the wording?
Susan Crichton: Not from my point of view, no. I mean, I would tend to use the word “defects”, in any event, because I think “bugs” is a bit slang.
Mr Blake: Pardon?
Susan Crichton: I think just using the word “bugs” is sort of a bit not precise, so I would use the word “defects”.
Mr Blake: Gareth Jenkins was a Fujitsu engineer?
Susan Crichton: He was, yes.
Mr Blake: He was highly knowledgeable about the Horizon system. If he called them “bugs”, what’s wrong with calling them “bugs”?
Susan Crichton: Just a different style.
Mr Blake: Just a different style?
Susan Crichton: Well …
Mr Blake: Can we please look at POL00380985. It seems that by July 2013, there is discussion within the business at the highest levels about changing the language that’s used about these bugs. We see here, 2 July, if we have a look down at the bottom email, it looks as though the question has been posed:
“What is a non-emotive word for computer bugs, glitches, defects that happen as a matter of course?”
Paula Vennells emails as follows, she says:
“My engineer/computer literate husband sent the following reply to the question …”
The answer is:
“Exception or anomaly. You can also say conditional exception/anomaly which only manifests itself under unforeseen circumstances …”
Then there are two kisses. She says:
“Does that help?”
The kisses were for her, she thinks. She says:
“Thank you for the work.”
If we look up to the response from Mark Davies – so Mark Davies was the Commissions Head at the Post Office at the time, is that right –
Susan Crichton: As I recall, yes.
Mr Blake: – to her, to Paula Vennells, you’re copied in, and he says:
“I like exception [very] much.
“Very helpful.”
I know that you said that you had issue with the word “bugs” because it seemed to you to be slang, despite being used by Gareth Jenkins but can you recall, at the same time, at the very top of the business, discussion about using less emotive language for what was occurring?
Susan Crichton: I’m sorry, I really don’t recall that there was. I really don’t recall that email.
Mr Blake: You don’t recall that there was discussion about using less emotive language?
Susan Crichton: I don’t think so, no.
Mr Blake: Can we please look at POL00190361. It seems around the same time, the next day, there is discussion with lawyers, CMS, to look at the legal implications of Second Sight’s Interim Report for potentially defamatory content. Do you recall around exactly that time the Post Office seeking to challenge, potentially, Second Sight’s Interim Report?
Susan Crichton: I didn’t recall this. It came through in the last lot of disclosures. I think it was probably – well, I’m assuming it’s probably from the – as a request from the Comms Team.
Mr Blake: If we have a look at POL00190619, it does seem that you were involved in requesting such advice. POL00190619, thank you.
Could we have a look at the penultimate page, please. Susan Barty, a partner at CMS Cameron McKenna, says:
“Dear Susan and Hugh
“You have asked for my opinion as to whether we can obtain an injunction in relation to the Second Sight Report.”
Do you recall seeking legal advice trying to injunct the Second Sight Interim Report?
Susan Crichton: I don’t know. I really don’t recall that.
Mr Blake: Do you recall at least that, as at this time where discussions are being had as to references to bugs and how to describe them, there were also attempts to prevent Second Sight’s Report from being released?
Susan Crichton: No, I don’t recall that.
Mr Blake: Can we please turn now to POL00145100, and we’re back on the issue of description of bugs. Over to the second page, please, we have a speaking note. It’s an email from Martin Edwards. If we scroll down, he says:
“Alice, Paula
“With many thanks to Susan, Alwen, Mark and everyone else involved, here’s the briefing note for the meeting with [James Arbuthnot].”
Do you recall in July – so exactly the same day, in fact, as the injunction against Second Sight’s Report is being discussed – being part of a group who drafted a briefing note for the meeting with James Arbuthnot?
Susan Crichton: I don’t recall it no but, obviously, I was.
Mr Blake: If we scroll down, please, “Briefing note with James Arbuthnot, 3 July 2013”. Can we scroll down. We see over the page the beginning of speaking notes. Over to page 4, please, it says as follows:
“From what we’ve been told by [Second Sight] so far, there is no evidence in the interim report to support any suggestion of systemic failures with the Horizon system (and this is based on the four ‘best’ cases from all those under review).
“If this is the case, important that point is communicated [early] given some of the original allegations about the system – otherwise computer and agent confidence in the integrity of the system could be fundamentally undermined.”
Then it says as follows:
“This is not to belittle the importance of the overall user experience for [subpostmasters]. It is essential that we continue to improve our wider systems of support and training for agents, and we are grateful for many of the additional insights generated by this investigation to date. Many of these process issues are historical and have already been rectified to improve guidance to staff and training for [subpostmasters] – but where further changes need to be made we will absolutely act on them.”
Do you recall at that stage a shift to the focus being on the wider Horizon system and not on the computer system itself? So to include, for example, the support that’s being provided to subpostmasters?
Susan Crichton: So when the Second Sight Report or investigation was started, it was the case that they were going to look at the broader Horizon issues, in terms of support for subpostmasters, a Helpdesk, NBSC, so a much more – a much broader investigation than just the Horizon system as it related to subpostmasters, and the MPs’ cases. So I think that’s consistent with the commentary here.
I also think that, because of the delays in the report, we were trying to say, you know, they’ve looked at their four best cases and, currently, they don’t have evidence to support the suggestion of systemic failures.
Mr Blake: Can we please move to page 6 of this briefing note and it’s here that I want to focus before we take our second break. There is a heading “System exceptions”, and it says as follows:
“We know of two system exceptions (anomalies) under the current Horizon system where [subpostmasters’] accounts have been affected, and both were voluntary communicated to [Second Sight] (although not directly related to cases under review).
“Key point to note is that in both cases our processes picked up these issues, appropriate remedial action has been taken and they did not lead to any disciplinary action against the affected [subpostmasters].
“Absolutely no reason to believe this means there are other undiscovered issues.”
If we scroll down then, please, it then gives “Further detail of the two cases if required”, and there’s reference there to the “62 branches exception”. Can you see everything is now being called an “exception” rather than a “bug”? We know this as the receipts and payments mismatch bug, I think Gareth Jenkins knows this as the receipts and payments mismatch bug, but it’s now being called the “62 branches exception”.
If we scroll down: the “14 branches exception”.
I mean, are we to understand here that words that were suggested by Paula Vennells’ husband have now made their way into the terminology that’s being used by the business?
Susan Crichton: That’s certainly what it looks like.
Mr Blake: You were, it seems, part of the group that drafted this briefing note. So do you really not have any recollection of the word “exception” now being used instead of “bug”?
Susan Crichton: No, I don’t. I would have given input around the Second Sight Report.
Mr Blake: It’s absolutely Orwellian, isn’t it, the use of the word “exception” now instead of “bug”; changing the language within the company; crafting a briefing that now refers to exception? Did you not take responsibility for that briefing, given that you were one of the people drafting it?
Susan Crichton: If I had solely drafted it, if it had been my work, then I would have taken responsibility or would take responsibility for it. I don’t have – I can’t remember that.
Mr Blake: If we look at page 1, Lesley Sewell emails Martin Edwards and says:
“Just to be clear – these were not undiscovered issues, we brought them to [Second Sight’s] attention for completeness. Also, when Susan and I were crafting the briefing we were careful in our own wording as these were associated with potential losses to [subpostmasters] in their trading statements.”
Lesley Sewell certainly seems to be suggesting that you were crafting the briefing and being careful about your choice of language; do you agree with that or not?
Susan Crichton: I do agree with that, yes.
Mr Blake: Do you think Lesley Sewell was mistaken about that?
Susan Crichton: No, I think she was right. My recollection must be mistaken.
Mr Blake: It says:
“We need to be careful in our comms not to indicate that we do not have anomalies or exceptions as that is not the case – it’s the context which is important and in this case the fact that they could and did affect Trading Statements.”
So “We need to be careful in our comms not to indicate that we do not have anomalies and exceptions”; the wording here that’s being used, is there an element of smoke and mirrors about the whole thing now?
Susan Crichton: It certainly reads in that way, yes.
Mr Blake: Sir, that’s an appropriate moment to take our second morning break. Could we please return at 12.15?
Sir Wyn Williams: Yes, certainly, Mr Blake. Thank you very much.
Mr Blake: Thank you very much.
(12.05 pm)
(A short break)
(12.15 pm)
Mr Blake: Thank you.
Can we please look at POL00190429. A meeting takes place with Second Sight on 3 July with Second Sight, Paula Vennells, you and Alwen Lyons; do you recall this meeting?
Susan Crichton: No, but we have the notes here.
Mr Blake: This is 3 July, so it’s a day after Ms Vennells’ husband’s feedback on language to be used and it is also the day of those emails that we saw in relation to trying to think about an injunction in relation to Second Sight’s report. It reads as follows:
“At the beginning of the meeting
“James reported that you had told him last week that you had ‘nailed’ something and that your interim report would show real concerns in the whole process.
“He thought there was a risk that people had been prosecuted and were still being prosecuted based on the system, process and software which was not [operating] correctly leading to miscarriages of justice.
“He said he wanted to work with us and that the report could be a ‘triumph’ for the Post Office.
“Body of the meeting
“Need to [be] very clear about the definition of Horizon.”
That’s something that I was mentioning before, that it seems as though there is an increasing focus now on separating out Horizon as a computer system and Horizon as a system that involves the processes of support and training, et cetera:
“We accepted that [Second Sight] were also looking at the wider system, but that we need to be clear, cannot misrepresent what Horizon – the computer system means.
“Discussed the anomalies which [the Post Office] had bought to the attention of [Second Sight] during the review.”
Do you see there that the word “anomalies” is already being used, just one day in?
Susan Crichton: Yes, I noticed that.
Mr Blake: “The 64 and 14 cases. He accepted that these are things found in all computer programs and suggested that we use an example of other systems to make that live. He accepted that the most important thing was how they had been managed.
“Anomalies will lead subpostmasters to doubt the system, so we need to be clear that this is normal in a system of this size.”
He says:
“James was very concerned about an email which suggested that Product and Branch Accounts could be remotely journalled without the subpostmaster’s knowledge. We need to be clear about what happening here.”
Am I right in saying, and we will come to it later, but that concerns the issue of what we know as remote access?
Susan Crichton: Yes, I think that – yes, that was the issue that Mr Rudkin flagged, I think. I can’t remember but …
Mr Blake: There is then a meeting at Bond Dickinson on 10 July. Can we please have a look at POL00407582. It seems as though you attended, with Hugh Flemington, a meeting at Bond Dickinson with Simon Richardson; do you recall that meeting at all?
Susan Crichton: I had a feeling he’d come to us but I don’t recall the meeting but, yeah, we have the notes.
Mr Blake: The location is empty so it may well have been a meeting at your offices.
Susan Crichton: Yeah.
Mr Blake: If we scroll down, 10 July 2013, he or somebody has said:
“The Board want to sack [Second Sight] and of course are now not coping well with the fact that they are independent. SC [I think that’s you] is going to arrange to meet [Second Sight] and she asked if she could use our offices next Tuesday. I said I could sort out a room for her.”
Do you recall who said that the Board wanted to sack Second Sight; was that your knowledge?
Susan Crichton: I can’t remember who said it.
Mr Blake: But you recall that that was the position of the Board at that time?
Susan Crichton: I think they were – what was the date of this, 10 July?
Mr Blake: Yes.
Susan Crichton: I can’t recall that they actually said that but it was my understanding that they were very unhappy with the tenor of the report.
Mr Blake: Was that the whole Board or particular individuals within the Board?
Susan Crichton: I don’t know. I suspect I only got a blended view.
Mr Blake: Paragraph 4:
“She thought it would also be essential to have a session looking at the strategic options and perhaps involving a QC but she did not want to go back to the one they had used before. She had found him patronising and irritating.”
Was that Mr Morgan?
Susan Crichton: Possibly.
Mr Blake: So it looks as though you’re considering a legal route?
Susan Crichton: So what I was – so my recollection in relation to this note is that – and it’s something I have alluded to before – the position we’d reached with Second Sight, they’d got so far down the track with quite a number of the cases and I was trying to find a way through that they would be able to complete their review more quickly or more efficiently. But I was also starting to take the view that it might not be the right thing to do to leave that process as it was, and I talked to Ian and Ron about it – Second Sight, rather, about it, as to how we would manage this going forward.
Mr Blake: It continues, paragraph 6:
“The real worry was around Fujitsu expert who appeared to have known of some of the problems but not referred to them in his report or statement even though they could be dismissed. There are non-disclosure issues here. They are looking at replacing that expert with somebody else.”
Was that a concern of yours?
Susan Crichton: To replace the expert or to –
Mr Blake: No, that there had been a Fujitsu expert who had known about some of the problems referred to in the report? I think that’s a reference to Mr Jenkins?
Susan Crichton: Yes, and also the work that Cartwright King were doing in terms of the disclosure. So I think, by that stage, we’d started to do the Sift Review – or they had started to do, shall I say, the Sift Review of the file and I was concerned that we made quick progress with that, so that that information could be passed up to the defence solicitors or counsel and also to the subpostmaster where appropriate. So I think that’s what I’m referring to there.
Mr Blake: But that real worry, it seems, about the reliability of Mr Jenkins’ evidence, which was in court proceedings, was that something – I mean, we have here you attending with Hugh Flemington, so did you pass that up the chain?
Susan Crichton: The real worry?
Mr Blake: (a) The worry and (b) the fact that a Fujitsu expert knew about problems and hadn’t necessarily provided a full and accurate picture in evidence?
Susan Crichton: Yes, I did.
Mr Blake: Who did you tell about that?
Susan Crichton: I think I flagged it to Paula and also to the Board.
Mr Blake: We’re here on 10 July; was it before the 10 July meeting or was it after?
Susan Crichton: I think – I really can’t remember the timescale. There was so much going on at the time.
Mr Blake: But the summer of 2013?
Susan Crichton: Oh, yes. I mean, in July.
Mr Blake: It then says:
“There was generally an overall defensive air and the Board are also feeling bruised. There are tensions between people and that includes Alice Perkins (the Chair), Paula Vennells (CEO) and [you].”
Can you assist us with what those tensions were at that time?
Susan Crichton: I felt that I was trying to ensure that the Second Sight review was independent and, by that, I meant that they had been given the appropriate level of support and information to enable them to deliver the report but I hadn’t – I had not – and I can’t remember whether it was expressed to me at this stage or not – but I felt that I was being accused of not managing the process properly, of not controlling the process enough. But my view was that this is an independent report and, therefore, it has to be Second Sight Report; it’s not our report at the Post Office.
Mr Blake: “I said [that] the Minister had dealt with the questions extremely well and looked in control of the brief. Evidently she had [the Post Office] in to tear them off a strip for not putting someone up earlier in the day for interviews on Radio and TV.”
Was there also tensions, as you understood it, with the Minister?
Susan Crichton: That’s as I understood it, yes.
Mr Blake: Can we please look at POL00027548.
Sir Wyn Williams: Mr Blake, before you ask questions about that, can I just clear my mind?
That paragraph 6 that you referred Ms Crichton to, in terms of the date, had the Simon Clarke written advice been delivered to Post Office by the time of this meeting or did that come a few days later?
Mr Blake: The Simon Clarke advice relating to Gareth Jenkins was 15 July; this meeting is 3 July.
Sir Wyn Williams: Exactly so. So –
Mr Blake: Sorry, this meeting is 10 July, so this pre-dates the formal advice from Simon Clarke.
Sir Wyn Williams: It pre-dates the formal advice but, clearly, Ms Crichton, what Mr Clarke was going to put in writing must, in some shape or form, have reached you and others in the Post Office?
Susan Crichton: Yes, so my memory – and I think it’s either in my statement or in some of the documentation – is that they came down to London, I think, on 3 July. I can’t remember, actually, so I think they came down to London and we had a meeting and I asked them to put their advice in writing but I also asked them to start the review sift disclosure. I think that’s the timeline.
Sir Wyn Williams: Right, I understand. Thank you.
Mr Blake: Was Paula Vennells aware before the formal advice had been received, or after, or are you not able to assist?
Susan Crichton: I can’t recollect but I would have thought it was likely that it would be before the formal advice was received but I really – I can’t recollect exactly and I think it was complicated by the fact that she was going off on holiday and, again, I can’t remember those exact dates.
Mr Blake: We’ve seen, from the correspondence and the meetings that took place around this time, real concerns at the Board level and also there’s also reference in that note that I just took you to about tensions between you and the Chair and the CEO. Were you, at this stage, coming under pressure in relation to Second Sight’s report and the discoveries that they had included in that report?
Susan Crichton: So my recollection is that – not necessarily pressure. I did feel there was a view – and I can’t ascribe that view particularly to anybody – that I hadn’t managed the process well and my view was that it was an independent process and had to be allowed to be independent in those terms.
Mr Blake: Did you, in any way, feel that you had to adjust the way that you carried out your work in order to satisfy the CEO or Chair?
Susan Crichton: I don’t think I did. I think I remained of the view that this was to be an independent report and what I did do is talk to Ian and Ron and we had – Second Sight – and we had a conversation around their report being evidence driven, and I think that took place probably around 1 July. And then I remember that Second Sight issued another version, I think, which was the version, I think, that was then published.
Mr Blake: In respect of that version, were you concerned by it, were you happy that it had revealed certain things about Horizon?
Susan Crichton: I remember being content that it was an evidence-driven report from the issues they had discovered as part of their investigation. I remember being concerned about the length of time it was taking to come to those conclusions and, as I say, that was partly due to the Post Office delay in getting them information. Those are the things – that’s my recollection at the time.
Mr Blake: Can we please look at POL00027548, please. I’m just going to look at some of the actions that you carried out in July 2013. This is a document, I think this is the report for the Board of July 2013. It has your name at the bottom, 11 July. We see there an update on the status of various Horizon claims, and it says:
“On 8 July 2013, Second Sight provided an interim report … This the subject of a standalone report …”
We’re going to have a look at that report:
“Second Sight’s initial findings … conclude that while there are no systemic problems with horizon, there are two specific ‘bugs’, which give rise to errors in a number of branches’ accounts. Second Sight also highlighted shortcomings in the Post Office’s internal training and support to subpostmasters in relation to the Horizon system.”
So you there refer to – I think you use the words that were perhaps used in the Second Sight Report of two specific bugs. Can we please look at POL00145427. This relates to the Board paper that is said in this table to be subject to a standalone paper. We’re going to look at the drafting process of that paper.
We have here, 12 July, an email from yourself to Alwen Lyons, and you had been sent an earlier version of the board paper. You say:
“Hi you must have read my mind whilst I was out walking the dog I suddenly thought that it wasn’t a good idea to mention ‘bugs’ so have changed that and also found another couple of typos – the recommendation is much better.
“Thanks.”
So your evidence before our break was that you couldn’t remember changing the word “bugs” to other words but it seems very clear that that was at the forefront of your mind on the 12 July 2013?
Susan Crichton: That’s certainly what this email says, yes.
Mr Blake: We can see the earlier draft of the document that you’ve been commenting on and that can be found at POL00145421. This is an earlier draft of the Board paper and, if we look at the “Background” section, it says:
“As the Board are aware Second Sight have now published their interim report and this Board paper considers the options/proposes a course of conduct for Post Office.
“Following publication and the MPs’ meeting a statement was made in the House of Commons … various MPs have raised issues … The main concerns seem to focus on:
“The fact that people have gone to prison.”
Then it says:
“The fact that there have been some bugs in the Horizon system (albeit that [Second Sight] have found no systemic problems).”
If we look at the later version that’s produced – and that can be found at POL00145428 – we see the updated version. If we scroll down, we see it’s now been changed to:
“The fact that there have been some defects in the Horizon system …”
So the word “bugs” there has now been changed to “defects”?
Susan Crichton: Correct.
Mr Blake: Do you recall making that change?
Susan Crichton: I think I must have been done. So I don’t recall but I’m the author of the paper, so I must have done.
Mr Blake: What would the reaction of the Board have been, if it had remained in its original version and said “bugs” in the Horizon system?
Susan Crichton: I don’t know.
Mr Blake: Were there topics or words that you thought weren’t a good idea to mention to the Board or to use before the board?
Susan Crichton: No, I don’t think so.
Mr Blake: Was there a culture of some sort about not speaking openly about bugs?
Susan Crichton: Not that I recollect, particularly.
Mr Blake: You ultimately produced this paper for the Board. I want to take you to an earlier draft and can we please look at POL00191680. So the email I took you to before about walking the dog and suddenly thinking that it wasn’t a good idea to mention bugs, that was 12 July.
Susan Crichton: Right.
Mr Blake: We have here a draft being sent to you by Hugh Flemington, 10 July. I’d like to look at that draft, please, it’s POL00191681. He says:
“This is where I got to.”
This is a much earlier draft. Can we please look at page 5 of this and scroll down to “Options on ‘Claims’”. Thank you. Is it possible to bring on to screen another version that we just looked at, it’s POL00145428, please.
It’s page 3 of that other document, if we could have those two side by side, please. Thank you. Page 3 of the left-hand side. If we could scroll down, please, on the left-hand side to – that’s fine, if we could scroll up slightly, sorry where you were before. Thank you.
Let’s look at these next steps, originally they were called “Options on ‘Claims’” and referred to two options. You had, on the right-hand side, in the original or earlier version, a “Reactive approach”:
“… we wait for any criminal case to be overturned and for claims for compensation to be made. We then decide whether to settle or fight these on probably a case-by-case basis.”
Or you have a “Proactive approach”:
“… where following the publicity in the wake of [Second Sight’s] interim report, Post Office could proactively invite subpostmasters and former subpostmasters to contact us and raise issues. There is a material and significant risk in the proactive approach, not least because it will lead subpostmasters to expect compensation and whilst we may have to pay compensation if we are found to be in the wrong …”
It seems as though “wording”, that might be a suggestion to insert some sort of wording:
“… these claims could be considerable, eg excluding the criminal cases, loss to business/home/ marriage breakdown/ill health.”
Then there’s a positive recommendation to the Board in this original draft:
“The recommendation is to adopt a reactive approach and assess individual claims on their merits as and when they arise. Where it is considered that there is little chance of success for the defendant that Post Office should defend the claim. This could give rise to the accusation that Post Office is being ‘bullying and unsympathetic’. There is clearly a balance which is required with regards to legal costs and paying compensation to defendants and a policy will need to be developed.”
The final version is on the left-hand side and that says, as follows, it gives two next steps:
“A Proactive approach – there are a number of areas where the Post Office wishes to take a proactive approach, for instance looking at processes for managing our relationship with our subpostmasters.”
Then it says:
“Further details will be shared at the meeting.
“A Reactive approach – in respect of the criminal cases the Post Office should wait for those to be overturned via the Court of Appeal and for claims for compensation to be made. We then decide whether to settle or fight these on a case-by-case basis.”
So it certainly seems that, by 12 July, in the final paper to the Board, the proposal was that, in criminal cases, you don’t take a proactive approach and assist subpostmasters but you wait for them to come to you; is that correct?
Susan Crichton: I think by 12 July, the Cartwright King sift had already started. I’d need to go back and check the dates but I’m pretty sure – again, I’d have to check the dates, but I think they came to see me on 3 July and I asked them to sort of start the sift at that point. So, basically, they came with a proposal as to what needed to be done in respect of the disclosure required by the Second Sight Report and the other – the Helen Rose report and I asked them to start that process straightaway and then that process then involved the disclosure of those reports to either the subpostmasters or to the solicitors acting for them.
Mr Blake: What you’re not doing is the right-hand side proactive approach, which is to invite subpostmasters and former subpostmasters to contact you?
Susan Crichton: I think what I – so sorry for interrupting. What I had proposed to do, as far as I recollect, was to discuss those in more detail at the Board meeting but, because I didn’t get invited into the Board meeting, I didn’t get the opportunity to expand on those suggestions in the Board meeting.
Mr Blake: Where it says, “Further details will be shared at the meeting”, is this another example of not wanting to commit too much to writing or is it something else?
Susan Crichton: I wanted to flag that there were options that I thought the board should consider and to be able to make that as a verbal statement, rather than have it in writing, from my memory.
Mr Blake: Were the Board told about the risks that had been identified in that earlier draft?
Susan Crichton: I don’t know, I wasn’t at the Board meeting, so I don’t know what was shared in that respect.
Mr Blake: We’ll get to the reasons for that but it had been your intention to attend the Board meeting, had it?
Susan Crichton: Yes, it had.
Mr Blake: It certainly reads, on the right-hand side, as though it was anticipated that many people would have successful and wide claims against the Post Office?
Susan Crichton: I think that – I think that was certainly my view at the time. But that wasn’t necessarily based on data; that was based on what I knew we needed them to go ahead and disclose.
Mr Blake: Although you didn’t attend the board meeting, those risks that are identified on the right-hand side, were they things that you shared with the Executive Team?
Susan Crichton: I – my recollection is I shared them with the CEO.
Mr Blake: Around 12 July or at some other point?
Susan Crichton: It would – would have been around that point. It might have been a bit later than that but – because we’d started working through the Cartwright King sift and looking at the numbers of the disclosures required to be made.
Mr Blake: The reactive approach that’s discussed there and recommended in respect of criminal cases, the net effect of that was likely to be to delay compensation, wasn’t it, waiting for people to come to you rather than inviting people?
Susan Crichton: So because of the disclosure process that was ongoing, I just thought it was important – this is my recollection – I thought it was very important to start that disclosure process and, as we see through the other documents, we then ask for that disclosure process to be validated and further advice came from Mr Altman and, frankly, I think that, after Post Office got through that stage, then there should have been a step back to say, “And what next?”
So that might have been my advice on 12 July and I suspect it was advice from Cartwright King, although I don’t have that information. I think –
Mr Blake: Would you accept that, looking back, that was an opportunity missed in which the Post Office could have taken a proactive approach to approach subpostmasters?
Susan Crichton: I think, in hindsight, yes, it was, and I think, in hindsight, that was what – part of what I was trying to do with the Mediation Scheme.
Mr Blake: Can we please stick with the left side one, so the one on the right-hand side can be removed. This is the final version. Can we scroll over the page, please. There are details here of the Criminal Cases Review. It says:
“Post Office have been advised by our external criminal lawyers to undertake a review of all cases going back to the time of the migration from old Horizon to Horizon Online …”
So this is the Sift Review that you were just talking about?
Susan Crichton: That’s correct, yes.
Mr Blake: It says:
“It is important to note that we believe (precise records from [Royal Mail] are not available) that we will have undertaken circa 55 prosecutions a year for the last 10 years. Our external lawyers have advised us that they believe there will be around 5% where they need to disclose the additional evidence and then it will be up to the defence lawyers to consider the evidence and apply to the Court of Appeal.
“Each individual has to seek leave to appeal to the Court of Appeal if they want to seek to overturn a conviction. The Court of Appeal will look at each case on its merits and will consider what evidence a person was convicted on: for example, there may be Horizon evidence but also other paper trail evidence or even admissions of guilt. It is by no means certain that each appeal will be successful.”
Then it says:
“We may also face civil suits for wrongful conviction. The consequences of this are:
“Malicious Falsehood …
“Defamation …
“Wrongful termination …
“Harassment …
“If we abandon prosecutions we may also face claims for [for example] malicious prosecution.”
Quite severe consequences, potentially, facing the Board at this stage?
Susan Crichton: Yes, I agree.
Mr Blake: Now, I want you to look at that 1.1 where it says:
“Our external lawyers have advised us that they believe there will be around 5% where they need to disclose the additional evidence and then it will be up to the defence lawyers to consider the evidence and apply to the Court of Appeal.”
On a previous draft that I’ve taken you to, it says – in fact, very different wording – that 5 to 10 per cent of cases may be overturned. Could we please go back or if it’s possible to have side by side POL00191681, and the second page of that, please. Thank you. This is the earlier version that I took you to before, the Hugh Flemington draft, a couple of days letter. If we scroll down on the left side to 3.4.2, in that earlier draft, it says:
“It is important to note that we believe precise records from [Royal Mail] are not available) that we will have undertaken circa 55 prosecutions a year. Our external lawyers have advised us that they believe there will be around 5-10% of these which may be successfully overturned and the convictions quashed.”
Now, you were the author of the final version and submitted that to the Board. Are you able to assist us with how it came about that 5 to 10 per cent which may be successfully overturned became 5 per cent where they need to disclose the additional evidence?
Susan Crichton: I can’t remember exactly but do we have a date for the first draft because –
Mr Blake: We do.
Susan Crichton: – I was getting –
Mr Blake: The first draft is – well, it was sent to you by Hugh Flemington on 10 July 2013.
Susan Crichton: This would have been done for the Board couple of days later, maybe two or three days later.
Mr Blake: The final date on the right-hand side is the 12th.
Susan Crichton: So I think what I was doing was – I was in contact with the criminal law firm who were doing the review and I can’t remember exactly but it may be that they gave me that revised information in the meantime but I cannot remember but that –
Mr Blake: It’s a very significant difference, isn’t it?
Susan Crichton: Yes, it is.
Mr Blake: 5 to 10 per cent gets changed to 5 per cent –
Susan Crichton: Yes.
Mr Blake: – and “successfully overturned” is changed to “they’ll need further steps before they might successfully overturn”.
Susan Crichton: Yes, it is.
Mr Blake: Did you make that change yourself?
Susan Crichton: I think I must have done, yes.
Mr Blake: Who were the external lawyers that you spoke to in relation to that?
Susan Crichton: That would be Cartwright King, I think.
Mr Blake: Do you think, in some way, it was intentionally watered down?
Susan Crichton: No, I don’t think so. I think I was just stating the facts, I suppose.
Mr Blake: They’re quite different facts, aren’t they?
Susan Crichton: Well, the 5 per cent is clearly very different but I think also I had a better understanding of what the process would have to be – I can’t remember exactly. I’m only speculating now.
Mr Blake: Were you concerned that the board would react quite badly to being told that 5 to 10 per cent might be successfully overturned?
Susan Crichton: I don’t think so because it was a fact. It was, you know – and I would have been guided by the – by Cartwright King, who were undertaking the review.
Mr Blake: Do you remember who in particular you spoke to at Cartwright King?
Susan Crichton: No, I can’t remember.
Mr Blake: Who was it likely to have been?
Susan Crichton: Maybe Martin Smith. There was somebody I was in correspondence with, which is in the documents where I’m going backwards and forwards about how many have you done, you know, when will you get it done, how is it going on it.
Mr Blake: Thank you. That can come down, please. Can we please look at the Board minutes of the ultimate Board meeting on 16 July 2013, that’s POL00021516. We can see there Alice Perkins, some Non-Executive Directors, including Susannah Storey, who I think was from UKGI, or ShEx at that time?
Susan Crichton: ShEx.
Mr Blake: Paula Vennells, Chris Day. You’re not in attendance. Why weren’t you in attendance at that Board meeting?
Susan Crichton: Because I was waiting outside to be called in.
Mr Blake: Who had asked you to stay outside?
Susan Crichton: So the process for the Board meeting was that you waited outside the room at around the time of your slot and then the Company Secretary would come and get you when the Board had reached the point that you should appear on the agenda.
Mr Blake: Did the Company Secretary come and get you to present on the very paper that we’ve just been looking at?
Susan Crichton: No, she didn’t.
Mr Blake: Do you know why she didn’t?
Susan Crichton: I’m trying to remember what she said to me at the time. I think she said that they had completed the discussion and that I wasn’t required.
Mr Blake: Can we turn to page 6 of these minutes, please, “Horizon Update”, so this is presenting the paper that you had produced:
“The CEO explained that although the Second Sight Report had been challenging it had highlighted some positive things as well as improvement opportunities.”
Just pausing there, would it have been normal for the CEO to have presented something like this?
Susan Crichton: In general, what would happen, if you had a specialist topic at the Board, you would go and present that paper. So I think – I mean, she might give a short summary at the beginning but, in general, if it was your paper, you should go and present it.
Mr Blake: “The Business had been praised in Parliament for setting up the independent review; the proportionality of the tiny number of cases had been emphasised; and no systemic issues had been found with the Horizon computer system. However there were cultural issues which had to be addressed to improve the support we gave to subpostmasters. The CEO stressed that this was now a catalyst to make changes in the Business.”
It says:
“The Board were concerned that the review opened the Business up to claims of wrongful prosecution. The Board asked if Susan Crichton, as General Counsel, was in any way implicated in the prosecutions.”
Were you aware that there was going to be Board discussion about you in particular?
Susan Crichton: No.
Mr Blake: What is your understanding of this paragraph?
Susan Crichton: I’m just reading it again. So my understanding is that the Board were asking the CEO whether I was implicated in the prosecutions, in other words bringing the prosecutions against the subpostmasters.
Mr Blake: “(c) The board expressed strong views that the Business had not managed the Second Sight review well and stressed the need for better management and cost control going forward.”
Now, where it refers to “The Business”, what do you think they had in mind?
Susan Crichton: Well, I think it was me but I don’t know what was said in the meeting.
Mr Blake: “The Board accepted that this was an independent review and therefore things could happen that were beyond the control of the Business.
“However the things that could be managed by the Business needed to be well managed with strong leadership and the Board asked the CEO if she had considered changing the person leading for the Business.”
“Considered changing the person leading for the business”; who was that person?
Susan Crichton: That was me.
Mr Blake: “The CEO had considered this and recognised that the Business did not have good governance in place around Second Sight, but that the independence of the review, and the input from MPs and Justice for Subpostmasters Alliance had made this complicated.”
“The Business did not have good governance in place around Second Sight”; what do you understand that to be a reference to?
Susan Crichton: So now I understand that to be that I did not control the Second Sight delivery of the report, is what I understand that. I think that’s a – that’s what I understand that to mean.
Mr Blake: We see at the end there:
“The Chairman asked for a review, a post-mortem, to report to the ARC …”
Is that Audit and Risk Committee?
Susan Crichton: That’s correct.
Mr Blake: “… explaining how we awarded and managed the contract. This should be put in hand swiftly.”
One final document before we break for lunch. Can we please look at POL00099210. This is the Board agenda, so this is the original agenda. If we scroll down, “11.40 Horizon Update”, it looks as though it was going to be you and Mark Davies who were going to speak to that issue; is that the correct interpretation of this agenda?
Susan Crichton: It is, yes.
Mr Blake: Can we please turn to page 105. We see this is the document that we looked at earlier, so this is a document that you produced, your significant litigation risks table?
If we scroll down, please, to pages 106 and 107 – 106, over the page, please – we have a list there of principal criminal cases bought by Post Office Limited. Did you prepare this table?
Susan Crichton: I think it was prepared by either – I think it was prepared by Mr Singh.
Mr Blake: But it has your name at the bottom, you took overall responsibility –
Susan Crichton: Yes, it reported to me, yeah.
Mr Blake: – for this paper. We see there reference to:
“Two assistant subpostmasters accused of cover shortages by delaying the processing of business deposits to Santander. Case concerned 40 deposit slips being suppressed …”
I think that is a case we’ve looked at:
“Both defendants pleaded guilty, and were sentenced to 5 months and 6 months …
“Subpostmaster accused of theft of …”
Plenty of entries of subpostmasters being accused of theft and various figures; references to defendants pleading guilty; Crown Court trial fixed; the case has been committed to the Crown Court; the defendant pleaded guilty and was sentenced to nine months’ imprisonment, suspended for 18 months; subpostmaster accused of two offences of theft and two offences of false accounting, that case had been committed to the Crown Court; subpostmaster accused of fraud, defendant pleaded guilty and was sentenced to 16 months’ imprisonment.
So the same Board, if we scroll down, being made aware, at the same time as issues concerning the Second Sight Report, of subpostmasters continuing to be prosecuted.
Continuing: there’s a hearing date to be set there; we see POL has recovered so still recovering money; further enquiry undertaken by the Investigation Team. So the Investigation Team was still investigating, the lawyers were still prosecuting and all these matters being brought to the Board’s attention on the same day as the report regarding the Second Sight Report.
Susan Crichton: That’s correct, it was in the same Board pack.
Mr Blake: Yes. We also have the Board paper that you produced that we looked at, I don’t need to take you to it but albeit it doesn’t now say 5 to 10 per cent of cases will be successful overturned, it did, at this point, say that the Second Sight Report will need to be disclosed in 5 per cent of cases and there was that final page that I took you to which mentions various civil suits for wrongful convictions, et cetera. That paper went to the Board on that occasion as well?
Susan Crichton: That’s correct.
Mr Blake: Is it surprising that there isn’t more discussion at Board level of the link between the Second Sight Report and all these prosecutions and investigations that were still continuing?
Susan Crichton: I find it surprising, certainly with hindsight but, even at the time, I found it surprising.
Mr Blake: Thank you, sir, that might be an appropriate time to break for lunch until 2.00.
Sir Wyn Williams: Yes, sorry. Can we go back to the agenda again, please. There is something that is niggling away at me that I want to clear up.
Mr Blake: That is the first page of the previous document so POL00099210, page 1. Perhaps we could zoom out a little bit.
Sir Wyn Williams: Right, thank you.
Now, let me see if I’m understanding this, Ms Crichton. Item 4, “Horizon Update”, to be delivered by you and/or Mr Davies, I suppose. Do you know whether Mr Davies delivered a report?
Susan Crichton: I don’t think he did. Can you see from the minutes?
Mr Blake: Sir, it may assist if we look at POL00021516, which are the minutes, Mr Davies is not listed as being in attendance.
Sir Wyn Williams: Right. So neither of you were involved in that.
Sorry, we’ve gone to the minutes now. Can we go back to the agenda, what was intended and then, if you go down to item 9, you were to provide either a paper or a report, I’m not quite sure which, in relation to group structure, yes?
Susan Crichton: Yes, that’s correct. It’s on the agenda. I can’t remember whether I went in and did that or not.
Sir Wyn Williams: All right. So then item 11, the Significant Litigation Report, which you had taken responsibility for, even if you may not have drafted it, for some reason that was being presented by Alwen Lyons. I know she was Company Secretary. What was the thinking behind that, so far as you were aware?
Susan Crichton: So it was a noting paper. So –
Sir Wyn Williams: Right. So there was to be no discussion of it; is that what that means?
Susan Crichton: No, it means it is there to be noted by the Board but, if there are any issues that the Board wishes to raise on that, they can raise it and it can either be dealt with via the minutes or an action item. So, for instance, if the Board had said, “Can you give more details about this or that”, that would have been in the minutes and would have been a Board action item, which would have then come to me to deal with.
But – so it was absolutely – you could absolutely discuss them but – so it’s things like the company sealings and the Health and Safety Report and the Significant Litigation Report were, I think, from memory always items for noting.
Sir Wyn Williams: Right. The document in which you ultimately said that there may need to be further disclosure in 5 per cent of past cases, can you identify for me where that might have come up, in terms of the agenda, in respect of items 1 to 12, so to speak? Where would that have fitted in?
Susan Crichton: So that would have been item number 4, the “Horizon Update”.
Sir Wyn Williams: Right. So that’s where either you or Mr Davies would have had the opportunity to speak to the report but it appears that neither of you were asked to do so; have I got that correct?
Susan Crichton: That’s correct.
Sir Wyn Williams: Okay. Sorry to go back over that, but I wanted to be clear how these things work.
Mr Blake: Absolutely, sir.
Can I just ask two questions that follow up from that?
Sir Wyn Williams: Yes, of course.
Mr Blake: If we go back to the board minutes at POL00021516 and we look at page 8 of that. We see at the bottom there “Group Structure”, and that was one of the items that you, it seems, were due to address and there isn’t reference to you there. It has an action point for the CFO and, if we scroll down the page, “Action: CFO”, “Action: Company Secretary”, are we right in understanding that, despite that matter not being about Horizon, you still hadn’t been invited into the room?
Susan Crichton: I think that’s what I remember happening, yes.
Mr Blake: Thank you.
Sir Wyn Williams: So we’d better make it 2.05 now, Mr Blake.
Mr Blake: Yes, let’s go for 2.05. It might be that we run into tomorrow morning with Ms Crichton. She is aware of the possibility of that.
Sir Wyn Williams: Yes, I understand that, you know, it’s difficult to be precise about the length of time of questioning, as this Inquiry has proved on occasions and, as inconvenient as it may be on occasions for witnesses, I’m afraid these things do happen.
Mr Blake: Thank you very much, sir.
Sir Wyn Williams: 2.05.
(1.06 pm)
(The Short Adjournment)
(2.04 pm)
Mr Blake: Good afternoon, sir, can you see and hear me?
Sir Wyn Williams: Yes, I can thank you.
Mr Blake: Thank you very much, sir.
The first document we’re going to look at this afternoon is POL00118496, please. This is a note, a file note, from Paula Vennells, dated 26 July 2013 and it relates to a conversation that she had with you on 24 July. I’m going to spend a bit of time on this document and I’ll take you through some of the key paragraphs in this file note. She says:
“Purpose: to make clear to Susan that she is accountable for the process going forwards and that there are three areas of concern that I have going away on leave. And also, in order to protect the business as much as possible, to reassure her that I believe she can do this, in order to give her the confidence to do so and to avoid any misunderstanding or possible demotivation in the process.”
What was your understanding of the purpose of the meeting?
Susan Crichton: I can’t remember, it might have been our first one-to-one after the issue of the report but I’m not sure.
Mr Blake: We’ve seen the Board minutes and concerns raised at Board level. Was this the first opportunity to discuss what happened at the Board with Paula Vennells?
Susan Crichton: That would be my recollection, yes.
Mr Blake: What do you understand by “protecting the business”; was that something that she brought up with you?
Susan Crichton: Yes, she did. I think she felt that – I think what I understood her to say was that she felt that the Second Sight Report could have been very damaging for the business.
Mr Blake: She says:
“I asked Susan how she felt the meeting with Alasdair Marnoch (Chair of [the Audit and Risk Committee]) had gone. She thought he had understood and was supportive of the process. I confirmed that was the case and that he was particularly reassured that we had the legal and independence aspects covered.
“I also said that I had now had 2/3 conversations with the Chairman, who although she was still very concerned about the whole issue, was more reassured that we were taking the right approach, which included Susan seeing this through. I suggested that Susan should see Alice – Susan informed me that she had already secured a date next Thursday 31/7.”
Can you assist us with what the purpose of the meeting with Alisdair Marnoch was?
Susan Crichton: He had been tasked, or he might have been volunteered, I don’t know – he was the Chair of the Audit and Risk Committee – to come and meet with Alwen and I, so that we could take him through the process that we were going through, or I could take him through the process we were going through, as I hadn’t had an opportunity to do that the Board meeting. Can I just add that I hadn’t seen the minutes of the meeting either, so I didn’t understand what had been said at the meeting. I was also keen to understand that, in case there were some issues arising from that that I needed to know about.
Mr Blake: So you hadn’t been invited into the meeting and you hadn’t seen the minutes of the meeting and we’re now 26 July; was that a surprise to you?
Susan Crichton: Yes.
Mr Blake: It says Alice Perkins was very concerned; were you aware that she was very concerned and, if so, what were you aware of?
Susan Crichton: I think I knew she was concerned but I didn’t particularly know why because I felt that I delivered on what she’d asked me to do, at least, you know, we’d got to the Interim Report stage. So I didn’t really understand why and I did think I had to meet her and talk to her, and I was very concerned that, you know, following standing outside the Board meeting for an hour, you know, where on earth do you go from here?
Mr Blake: The note says:
“I outlined three concerns that I would want Susan to be clear about and have actions in place to deal with …”
The first is costs; the second is delivery of work in progress. It says:
“Susan felt and that via Angela and her close working with [Second Sight], we should be able to manage the above two points. Her concern centred on [the Justice for Subpostmasters Alliance] and keeping them to any approach agreed. My observation to her was that Alan Bates would be subject to the same pressures as George Thomson: [Alan Bates/George Thomson] agree a sensible way forward but when they go back to their members, they are accused of ‘going native’ and then sent back with different and usually more extreme requests. The only way around this is to stay very close to [Alan Bates], to be in touch once or twice a week, to check that he has the support [he] needs, and to listen out for any concerns that may be building.”
Can you assist us with that paragraph there and what was being suggested there?
Susan Crichton: So I would say that the Post Office developed a very close relationship with George Thomson who was the (unclear) of the National Federation of SubPostmasters and she was suggesting that I should develop the same kind of relationship with Alan Bates, which I didn’t have any issue with developing that relationship but I felt it had to have a purpose.
Mr Blake: If we scroll down the page, another one of the objectives, it relates to the JFSA, and then it says as follows:
“Susan was initially frosty in her manner. She is clearly feeling the pressure, which is understandable. I hope that I reassured her, and within a few minutes we were talking normally, she relaxed and we had a useful conversation as noted above”.
Is that an accurate description of you on that occasion?
Susan Crichton: I certainly – I think I would have been frosty, yes, given the Board meeting issue and I think I was concerned about my position vis à vis the Board, probably I would have been talking normally because I don’t – that would be my normal way I’d behave.
Mr Blake: She says:
“I remain concerned [that] Susan is not organised or structured nor is she a leader. These gaps in her capability are risks to the business. They are being dealt with by supporting her with individuals who are organised and structured, and by a process to monitor. She remains a good adviser. I will review the longer term decision in September.”
Does that accord with your recollection of the discussions with Paula Vennells on this occasion?
Susan Crichton: She didn’t mention those things to me.
Mr Blake: No, and what is your feeling about what’s said there?
Susan Crichton: I suppose I would disagree with those and I think my career demonstrates that that’s not the case.
Mr Blake: Were you aware that your future was going to be determined in September or reviewed in September?
Susan Crichton: Not at that time, although, when I reflect on it, it’s not entirely unsurprising.
Mr Blake: We know that you received the Clarke advice relating to Gareth Jenkins on 17 July. We’re now on 26 July. There doesn’t seem to be a mention in this email of concerns about historic and even ongoing criminal cases. Why is that?
Susan Crichton: I think because that was the role that Alisdair Marnoch was taking, so part of our discussions was to go through the review process that Cartwright King – and to explain why we were doing it and what we were doing. At least, that’s what I remember us doing. We spent quite a bit of time on that.
Mr Blake: So was it not your responsibility to draw that advice to Paula Vennells’s attention?
Susan Crichton: I think I had flagged it to her. I just can’t quite remember when.
Mr Blake: Would it be around that time?
Susan Crichton: I would have thought so. I think, yeah. It would have been part of the discussion around the Cartwright King review and why they’re doing it and what they had to disclose and why they had to disclose it.
Mr Blake: Is it surprising, though, that on 26 July that you had a meeting with the CEO and no concerns were raised in that meeting about the safety of convictions, for example?
Susan Crichton: I think I had done that with Alisdair Marnoch, so she would have had that – and he did a note. I think it is surprising, yes, in retrospective.
Mr Blake: So it’s surprising but you thought that it was being taken forward by Alisdair Marnoch?
Susan Crichton: Yeah, and if you go back to my recommendation in the Board paper, I think that asked for the ARC to review the prosecution’s policy, I think – it was in one of the drafts, anyway – in September, as part of the ARC meeting.
Mr Blake: Do you think that that lacked some urgency, given the advice from Simon Clarke?
Susan Crichton: Probably, yes. But we were then doing the – we were then doing the disclosure and also I had asked that prosecutions be ceased but I hadn’t officially – I hadn’t – I’d asked that they would be reviewed as per the post-separation issues.
Mr Blake: But they were continuing?
Susan Crichton: As far as I was aware, yes.
Mr Blake: Can we look at POL00006590, please. This is a document of 26 July 2013 and it’s entitled “Update on the work programme arising from the Horizon report”. So that was produced, I think, on the same day as your meeting with Paula Vennells – sorry, the same day as the email note from Paula Vennells, two days after your meeting. Do you know who drafted this document?
Susan Crichton: I don’t know who drafted it.
Mr Blake: We’ll see somewhere there’s an email chain where it’s sent by Paula Vennells. Would it have surprise you if Paula Vennells herself drafted this?
Susan Crichton: No, it wouldn’t surprise me, no.
Mr Blake: On page 1, you hadn’t been asked to provide or produce a document like this?
Susan Crichton: I don’t think so.
Mr Blake: Because we saw in the Board minutes that there was a request for an update on the work?
Susan Crichton: Yes.
Mr Blake: But that was, as we’ve heard, a meeting that you weren’t in attendance?
Susan Crichton: No.
Mr Blake: Page 1:
“Further to the Board discussion on 16 July, this note provides an update on how we’re taking forward the programme of work in response to the publication of the Second Sight Report.”
Now, given that you had actually produced the note for the Board for 16 July and were due to speak to that, is it surprising or were you surprised that an update was being provided by somebody other than you?
Susan Crichton: I am surprised but I can’t remember writing this or it’s not the way, it’s not my typeface, but I – yeah. Sorry, yes, I don’t think I did it and it is surprising to me, but I can’t remember.
Mr Blake: If we scroll down the page, point 4:
“We have … been focusing on developing an approach to respond to these expectations which balances the requirements to be cost effective, time efficient and credible … two specific concerns about Second Sight …
“[First] as a two-man attempt they do not have to the capacity to deal with all these cases within an acceptable timescale; and
“[Secondly] their approach of seeking to reconcile the conflicting evidence and views of the Post Office and subpostmasters – which stems from a steer from James Arbuthnot that they needed to ‘keep the JFSA onside’ – is pushing them into an almost impossible situation, which both extends the time taken to conclude each case and, more worryingly, creates a tendency for them to place greater weight on the subpostmaster’s version of events, irrespective of the evidence we present.”
Was that a view that you were aware of?
Susan Crichton: No, I don’t think I was. I can’t remember being aware of that view … I don’t remember that there was the concept that it was irreconcilable. I thought it was a question of them stating their case.
Mr Blake: Were you aware of a concern in the business at this time that Second Sight were tending to place greater weight on the subpostmasters’ version of events?
Susan Crichton: Possibly within the business but it wasn’t a concern that I shared, I don’t think.
Mr Blake: “We propose to address these concerns through two specific measures:
“[The first] restricting Second Sight’s remit to the specific task of preparing an impartial evidence base …”
Then over the page:
“changing the way we work with Second Sight, by allocating additional senior level resource with a deep understanding of the network to work closely alongside them, in order to answer their queries and help them prepare an accurate evidence base as quickly and efficiently as possible.”
If we move on, please, to 26 July, can we look at POL00297994. It’s around this time there’s an email discussion about the Board’s own potential liabilities, raised at a 23 July Board meeting. This is an email to you from the Head of Corporate Finance and he provides a suggested response to a question raised at the 23 July Board meeting:
“The Board requested further clarification on their position as directors; in summary it is highly unlikely that any individual director would have any personal liability in connection with this review, unless they had acted in bad either or maliciously. In the unlikely event that an action is brought (could only be by Post Office Limited or in very rare circumstances by the shareholder acting on behalf of the company) there is insurance cover in place to cover directors”, et cetera.
Were you aware of a concern at Board level about their own personal liability?
Susan Crichton: I think that had been fed back to me as one of the questions raised by the Board to be covered off in this paper, which is why I talked to Charles Colquhoun about it or asked him for his view on the policy.
Mr Blake: Was your impression of the Board or the executive at this time one of concern about their own personal liability?
Susan Crichton: I think possibly at the Board level because that was the feed – that was what was fed back to me from the Board meeting.
Mr Blake: Does anything stick out in your memory in that respect?
Susan Crichton: No, I don’t think so.
Mr Blake: You then have a meeting with Susan Crichton (sic). Can we please look at POL00381455, please – sorry, with Alice Perkins, “AP meeting with Susan Crichton – 31 July at 148 Old Street”.
Again, this is another note that I think I’m going to have to take you to in quite a lot of detail. She begins the note saying:
“I opened by saying that I had wanted the meeting because I felt uncomfortable about the fact that [Susan Crichton] and I had not had a conversation since the [Second Sight] Interim Report had been published a few weeks ago. I had not wanted to go on my holiday without talking to her.
“I first asked about her health as the last time I had seen her on her own before the June Board awayday, she had been unwell.”
Are we to read anything into that? Were you feeling unwell as a result of your work or was it entirely unconnected?
Susan Crichton: I think where I come out to it on reflection was it was actually making me quite ill.
Mr Blake: It says that you were very cool in your manner at the outset. You had number of questions which you wanted to ask. You started to write down what she was saying in your notebook and she remarked that it seemed as though it was turning into something very formal, which was not what she had in mind. She wanted to talk to you about how you were and how you felt about things.
Is that an accurate reflection of what occurred at the beginning of that meeting?
Susan Crichton: I can’t recall that but it could have been.
Mr Blake: It then goes on to say:
“She said she had been very unhappy about being kept outside the Board meeting for an hour and then told her presence was not required. She said she was not prepared to be treated as a ‘scapegoat’.”
Why were you concerned about being treated as a scapegoat?
Susan Crichton: So I felt at the time as if I had delivered on what she’d requested, albeit by the Interim Report, that I hadn’t been allowed to go and explain to the board my position and kept outside and I didn’t have another channel to talk to the Board, and you’ll see later that I think I make clear that, as a General Counsel, you can’t operate in a business if you don’t have the support of the Chair, the Board and the CEO.
Mr Blake: How were they going to treat you as a scapegoat?
Susan Crichton: So my view was that, within the Board context, I suspected, because I didn’t know, that the Chair had not been clear and that it was her instructions that we instituted the Second Sight review on the basis that we did, as in an independent review and, if it was an independent review, then that’s what it had to be: an independent review.
Mr Blake: It says:
“I said that I hoped she knew me and the Board well enough to know that we were not interested in finding scapegoats. That was not my approach and no one had in mind to make her into one. I apologised for the fact that she must have felt uncomfortable outside the Boardroom and explained that after [Paula Vennells] had, at my request introduced the agenda item on [Second Sight] privately, the discussion had developed quickly and it had not been appropriate at any point to bring her in.”
So the suggestion seems to be that she had requested the CEO to introduce the item and that it went quickly and it hadn’t been appropriate to been you in. What was your reaction to being told that?
Susan Crichton: I said that I thought that was not appropriate. You know, I said that if you – it was a significant piece of – should be a significant – I think what I said, something along the lines of it was a significant issue for the Board and there should have been a full discussion and I should have been there to explain how I – my views on the issues in front of the Board.
Mr Blake: “The agenda had been really packed, partly because we had to add this piece of business, and I had decided that once the Board’s private discussion was over, there was no time to pursue the conversation further with [you].”
Did you believe that?
Susan Crichton: Well, it’s what she said at the time but, no, I didn’t necessarily believe it because I knew what was on the agenda.
Mr Blake: We also saw that you had been due to talk about another item on the agenda?
Susan Crichton: Later in the – yes, on the corporate restructure.
Mr Blake: Your recollection, am I right in saying, you don’t believe that you at any point entered the room?
Susan Crichton: No, it would have been very difficult for me to go in and talk about the corporate restructure after not coming in to talk about the Second Sight Report.
Mr Blake: “I had realised that that would be difficult for her. She said that she needed to know that she that the full confidence of the Board. No one told her what had been said at the Board, though she understood that there had been some difficult questions, especially from VH.”
Is that Virginia Holmes?
Susan Crichton: Yes.
Mr Blake: She was a Non-Executive Director?
Susan Crichton: Yes.
Mr Blake: Why do you think there were some difficult questions from Virginia Holmes?
Susan Crichton: I think Alwen probably told me that but didn’t really give me any detail.
Mr Blake: So you did have a line into the Board from Alwen Lyons –
Susan Crichton: Yes.
Mr Blake: – in terms of feeling back what had happened?
Susan Crichton: Well, only at a very high level.
Mr Blake: What had Alwen said about Virginia Holmes?
Susan Crichton: I can’t remember now, I’m sorry.
Mr Blake: Did you get on with Ms Holmes?
Susan Crichton: It was a professional relationship.
Mr Blake: Do you have any concerns about her?
Susan Crichton: I didn’t really know her that well, she hadn’t been on the Board for that long, I don’t think.
Mr Blake: It says that your reputation was at stake. Were you concerned about your reputation?
Susan Crichton: I felt that it was important, as an in-house lawyer, that you were able to behave in a way that had integrity and, having been tasked with delivering an independent report, then that’s what you should do.
Mr Blake: It says:
“I said that the [Second Sight] Interim Report and the timing of its publication had been potentially very serious indeed for the [Post Office] in terms of our national reputation and the effect it could have on our funding negotiations with Government. In the event, it had not come out so badly partly because of the way the Minister had handled her statement in the House of Commons. But it had been very worrying at the time.”
Can you assist us with that paragraph please?
Susan Crichton: So I think, as part of the James Arbuthnot discussion, he’d asked Jo Swinson, I think, who was the Minister at the time, to go before the House of Commons, and he’d asked her a Parliamentary question that she’d had to answer, from memory.
Mr Blake: Yes. In terms of funding negotiations with the Government, what were the concerns there?
Susan Crichton: I can’t remember where we were in the funding cycle but Post Office relied for funding on the Government and it may be, I’m not completely clear on this, that we had a one-year – we maybe had a one or two-year funding agreement as part of the separation from Royal Mail Group but I really can’t remember. It would seem strange that we’d become independent with only a two-year funding arrangement but I can’t remember, I’m afraid.
Mr Blake: It then says:
“The Board had been unsighted on the issue. They had naturally been alarmed when they had found out what had happened and the fact that the Board paper had been so bland had not help to build their confidence in the handling of the affair. (There had been the possibility of a discussion on a Board call the previous week but because we had needed to discuss issues in relation to the strategy and funding negotiations with the Government which required Board decisions, these had had to come first and we had run out of time for the [Second Sight] issue before people had to leave the call).
“In the course of what followed, the following points were made:
“[You] said that you thought that it had been right to have the enquiry, as it had revealed the imbalance of power between the [Post Office] and subpostmasters which needs addressing. This was a huge and complex issue for the business.”
Can you assist us with the words there and what it was that you said.
Susan Crichton: I think, as part of the work that Second Sight did, it really brought it home to me – and I’d already had a discussion with the team as part of our review of the Post Office contract some time previous to this – that we needed to look at the contract to redress the balance. I likened it, because of my background, to a consumer contract with a large corporate, and that was borne out by certainly the feedback I’d got from Second Sight. But this was a fundamental issue for the business that they needed to address.
Mr Blake: The note continues:
“I commented that I thought that, although the outcome had in some ways been good for [the Post Office], the way the process had been handled had been deeply flawed. I had backed [your] judgement on the appointment of [Second Sight] because we did not want to appoint one of the big four, [you] seemed very confident in them and given her strongly stated opinion to having an enquiry in the first place, I had wanted [you] to feel some ownership of the process once we had decided to go down that route. We had lost control of the process; I had lost confidence in Simon Baker early on but had been told repeatedly that he was good and capable of handling the role. I said that we should never have got into a position where we did not see the draft of [Second Sight’s] report until days before its publication …”
Pausing there, it very much seems as though you’re being blamed in that paragraph.
Susan Crichton: I feels like it, yes, and I think, with regard to Second Sight, I hope I’ve made it clear that, although I knew Ron Warmington, you know, we were not friends and I very deliberately, I think, stepped out of the selection process and allowed them to talk to Alice Perkins and Paula Vennells themselves because it was key to me that both parties accepted what they were getting into at that point, as in a proper independent investigation.
Mr Blake: Was it your strongly stated opinion that there should be an inquiry written in the first place?
Susan Crichton: Yes, it was.
Mr Blake: Were you sole voice in that?
Susan Crichton: It felt a bit like it at times, yes.
Mr Blake: It continues:
“I understood that [Second Sight’s] investigation had to be independent but in the Civil Service there would have been someone marking it who was close to all the key people [Second Sight, James Arbuthnot, JFSA] and knew what was going on between them. By the time I found out how [Second Sight] had, in effect, changed the [terms of reference] to which they were working, it was too late to retrieve the situation. The organisation and people in it should have had proper time to consider Second Sight’s findings and respond to them.”
It says that you questioned her understanding of the endgame and that the Post Office had seen the report earlier:
“[You] had been contacted by the CEO while unwell about this and had come back early from [your] holiday to handle it which had not been ideal.”
Can you assist us with the reference to “the civil service there would have been someone marking it who was close to all the key people”?
Susan Crichton: I don’t remember this part of the conversation specifically but I assumed what she was talking about was that, in the Civil Service, of which I had no experience, there would have been a level of control over the report that I hadn’t exercised.
Mr Blake: Is it a suggestion that, although it would have been an independent report, there would have been some influence by those who were being investigated?
Susan Crichton: Yes, I think that’s probably right. That’s what I understand this sentence or these paragraphs to say.
Mr Blake: Is that how you understood the conversation at the time?
Susan Crichton: I think so, yes. I think it was.
Mr Blake: It says that:
“[You] said that as a lawyer it was inappropriate for [you] to influence the key stakeholders. [You] would have been criticised had [you] close to them [Ms Perkins] commented that if [you] had felt unable to play that role, [you] should have flagged it up and someone else could have been brought in to perform it (privately I am astonished at this view which I simply do not recognise from my experience elsewhere).”
Did you and do you consider that it would be inappropriate to influence the key stakeholders?
Susan Crichton: I think the role I was trying to play for Post Office was to be an independent intermediary, so that Second Sight got the information in the form that they wanted it. I wasn’t always successful and, certainly, timing-wise things took too long to do. But that’s what I believed my role was in this context.
Mr Blake: Analysing that paragraph, what do you recall of the conversation with Ms Perkins?
Susan Crichton: I just – it was very frosty. I suppose I characterised it as being a very difficult conversation.
Mr Blake: It says that:
“[You] said that [you] were in a … difficult position now. [You] needed the Board’s full confidence because so many aspects of what [you] were being asked to do were beyond [your] control. [She] said that [she] realised that she could not control everything, but this was not like an unexpected meter [sic] exploding out of nowhere.”
Do you know what that that meant?
Susan Crichton: I think it might be “mortar”.
Mr Blake: “We needed to identify the worst things which could happen, face them, and work out how we would mitigate them. We needed to stay close to the key players and ensure that we were building their trust and we knew what was going on between them. That would take time. But I did not accept the degree to which [you] had claimed that they were beyond [your] control – they needed managing.
“I asked about [Second Sight’s] role going forward and said I thought it was critical that we capped off their involvement at the 47 cases already in the frame. We could not allow them to become involved in any additional cases as we would then find it much harder to bring their involvement to an end. [You] said that would be very difficult as [James Arbuthnot] and [Justice for Subpostmasters Alliance] rated them. [She] pointed out that the Post Office did not. It was up to us to propose very quickly alternative arrangements going forward which would command the respect of [James Arbuthnot] and the [Justice for Subpostmasters Alliance].”
We then talked about cost, and the need to appoint any ‘independent’ figures carefully and rigorously …”
If we go over the page, please, I think there’s a paragraph there where I think you were critical of Simon Baker, that he hadn’t been of the right calibre.
Susan Crichton: I thought Simon Baker did a really good job as a project manager, in retrospect, I don’t think I would have said that. I think he was, you know, relatively senior in Lesley Sewell’s world and he could sort of make up for my lack of technical expertise in knowing what to ask for and getting stuff done and I think that Second Sight appreciated that and thought he’d done a pretty good job.
Mr Blake: “The problem was that there were too many well paid people in the business not performing as they should be. I said I had thought this issue was being tackled through more rigorous performance management, to which her reply was that she was referring to people below the [senior leadership team].”
Can you assist us with who you were referring to if that was an accurate description of what you were saying?
Susan Crichton: I don’t think it was an accurate description. No, I don’t think I – I don’t think I would have said that and I certainly can’t specifically remember saying it.
Mr Blake: It says:
“By the end of the conversation, [your] tone was less formal and cool but [her] confidence in [your] judgement on key issues and in particular [your] ‘fatalism’ or reluctance to see the importance of managing events and people rather than standing back and letting them happen, were very troubling though I did not say this in terms.
“I deliberately did not say anything about the Board’s or my confidence in her and after the beginning of the conversation, she did not raise the point again. I did not explicitly raise the issue of the way [Second Sight’s] costs had been allowed to spiral out of control because I did not want the conversation to become the ‘post-mortem’, and there were already enough issues on the table between us.
“PS At one point, [you] referred to a recent conversation with the BIS team which one of them had commented that they had always felt uncomfortable about the Horizon cases. When [you] had asked why they hadn’t pursued that, the person had said it was because the [Post Office] had always been so forceful in its defence of the issue and its handling.”
Are you able to assist us with that conversation with the BIS team?
Susan Crichton: I’m really sorry, I can’t remember it. I worked closely with the BIS team throughout the state aid and the separation. I didn’t have much contact after that so whether it was during that period, I don’t know, and I can’t remember who said that to me.
Mr Blake: Who were the BIS team?
Susan Crichton: On the state aid it was Will Gibson and there was somebody else who helped him, so they would have been my main points of contact. I’m afraid I can’t remember his colleague’s name.
Mr Blake: I’m just going to take you back to your witness statement, on the topic of this entire meeting, and the meeting I’ve just shown you before with Paula Vennells. Could we look WITN00220100. It’s page 86. Thank you, page 86.
There are some parts in your witness statement where you’ve addressed comments that have been made by Paula Vennells. If we scroll down, you say at paragraph 239:
“As to Ms Vennells’ comments in her email to Ms Perkins on 26 July 2013, I was not aware at the time of Ms Vennells’ criticisms of me.”
The next paragraph:
“As to whether I consider these criticisms to be fair, they were never communicated to me and I do not consider them to be fair. I have held a number of senior roles during my career and these are not criticisms I have ever faced.”
If we scroll down to 246 and 247:
“Regarding whether I was aware at the time of Ms Vennells’ and Ms Perkins’ criticisms … I was not aware of them.
“In respect of whether I considered these criticisms to be fair, I refer to my explanation above. I was not aware of these criticisms at the time. They were not criticisms I had faced from colleagues before or since.”
We’ve just seen two filenotes, one from Paula Vennells, one from Alice Perkins, detailing meetings you had with them at which they seemed to have been quite blunt about certain criticisms of the way that you approached things.
Do you think, looking back at your witness statement here, that’s accurate?
Susan Crichton: So I obviously hadn’t seen those notes before I wrote this and I suppose because they were talking about my lack of ability and organisation and as a leader, I wouldn’t say that those two notes really addressed that. I would say that they – well, maybe organisation, I don’t know, but that’s not how I would necessarily characterise those notes. Now that I – you know, as I say, I didn’t see them when I’d written the witness statement.
Mr Blake: What your statement doesn’t seem to do, though, is to give any idea of the strength of feeling that appears to have been present in the summer of 2013 between you and the senior leadership of the Post Office.
Susan Crichton: So I think in relation to the Chair, I make some reference to the relationship there and said it was cool or – I can’t remember exactly – when I had a meeting with her and it was frosty because I didn’t necessarily remember all of the detail of that, I certainly remembered that I put to her the point about independence.
Mr Blake: The relationship was pretty bad by that stage, it seems?
Susan Crichton: I think that’s probably a fair summation of it, yes. But, again, I had frankly not forgotten it but probably moved on from it.
Mr Blake: Can we please look at POL00116114. This is the same day as that meeting. It’s an email from Alice Perkins to a number of different recipients. She is thanking Alwen Lyons for the note. If we scroll down to page 2, we can see Alwen Lyons has sent an email saying:
“Dear All [the bottom email there]
“Please find attached a detailed note from Paula providing an update on our programme of work in response to the Horizon investigation.”
Do you recall I referred to that note and we weren’t sure who had drafted it?
Susan Crichton: Is that the note that was –
Mr Blake: I believe that is.
Susan Crichton: Right.
Mr Blake: Would that surprise you?
Susan Crichton: No, no, it wouldn’t. I was just, you know –
Mr Blake: If we scroll up, please, page 1. Ms Perkins is referring to the way forward, Board note on Horizon. She says:
“First, while it is clear that we are committed to using [Second Sight] for the 47 cases which are already in the frame for this review, it is extremely important that we cap their involvement at that.”
So that was something that was communicated to you to in the same day. Second:
“We need to … cap [Second Sight’s] costs.”
Then further down it says:
“Finally, I’ve asked Susan to keep the Board fully informed of future developments and to alert me to anything which she is unable to resolve which could get in the way of getting the job done in the way it needs to be done. She will be seeking conversations about all this with all the [Non-Executive Directors] on an individual basis and will be in touch with you to arrange these.”
Why were you speaking or needing to speak to the Non-Executive Directors at this stage?
Susan Crichton: I presume she said that, on the basis that I’d asked her if I had the confidence of the Board, and so it was sort of “Well, talk to them and find out”, was the sort of impression I got.
Mr Blake: Did you talk to them and find out?
Susan Crichton: From memory, well, I’d certainly spoken to Alisdair Marnoch, I can’t remember about the others.
Mr Blake: What impression did they give you about your future in the company?
Susan Crichton: I just can’t remember. I think I was sort of on the way to making my own decision, to be frank.
Mr Blake: Can we please have look at POL00145793. We’re now on 1 August, so the next day, if we could start on the second page, please. There’s an email from yourself to Paula Vennells. If we scroll down, that’s the email. You’re providing some updates on the Horizon project. If we scroll down to Second Sight, you seem there to be putting into practice what Alice Perkins had asked regarding the 43, minimising Second Sight’s involvement, limiting costs, bringing in another company, potentially, replacing Second Sight, “will have to be carefully managed, we plan on having a face-to-face meeting with Second Sight next week to discuss and agree a way forward”.
So it seems as though, by that stage, you’re getting quite clear directions on the future of Second Sight from –
Susan Crichton: Yes, that’s right.
Mr Blake: – the Chair?
Susan Crichton: Correct.
Mr Blake: You’re putting them into action and emailing the CEO?
Susan Crichton: I think, from memory, we’d had a conversation about how to – I had a conversation with the Second Sight about how to move forward from here, or from, you know, the day before, and how to work through the cases they’ve got, but we were also thinking about putting in place the Mediation Scheme, which eventually went into place and they remained a key part of that Mediation Scheme.
Mr Blake: Can we please turn to POL00108058. This is the next day, an email from Paula Vennells to Alice Perkins. If we scroll down to the bottom, please. Actually, if we scroll down over the page Alice Perkins sends Theresa Iles a message, saying:
“Here is the document to which I was referring. I should be grateful if you could make sure Paula sees it on her return (but no need for her to see it during her holiday).
“Please could you make sure no one else sees it?”
If we scroll up, its her meeting note.
Susan Crichton: Okay.
Mr Blake: If we scroll down, sorry, we can see the attachment at the bottom and it’s “AP meeting with Susan Crichton.docx”.
The response from Paula Vennells is on the bottom of page 1, please, it says:
“Hi Alice.
“Teresa confirmed it is on file.
“Thank you for doing the meeting and the note. It makes me sad but doesn’t surprise me.
“There are two alerts from me – the first is your point about the bland Board paper: I have just seen a bland update from Susan on this week’s work, which I have immediately sent on to Chris, with some concerns about lack of progress (some issues – [Second Sight’s] costs and working party process – remaining the same as when I left last Wednesday/Thursday) and no risks flagged at all. For example, there is no colour on the fact that our external lawyers have issued disclosures on 9 cases, up from 2 weeks ago.
“The second alert is how much Susan sees as ‘beyond her control’. One for my full return.
“I will keep close to this and to Chris, who also was briefed to deal with the [Second Sight] costs issue.”
So reference there to the bland Board paper. We’ve seen over the course of today, Board papers being changed, words being changed, “bugs” being changed to other words, the 5 per cent issue, for example, going from 5 to 10 per cent of cases that are going to overturned, to 5 per cent of cases where disclosure needed to be made. Do you think that you were producing bland Board papers that didn’t accurately set out the risks?
Susan Crichton: I don’t think so and, certainly as I mentioned, my intention would have been to have a better discussion about the risks face to face because, at that stage, we weren’t sure what the risks were. There were a sort of range of potential risks and outcomes from the actions we were having to take and I would have preferred to discuss that range, rather than just have it set out in a Board paper.
Mr Blake: I mean, we’ve talked about, for example, the Simon Clarke advice on Gareth Jenkins, we’re now in August 2013. Don’t you think you should have been jumping up and down a bit more about serious risks to the business, serious risks to the safety of convictions?
Susan Crichton: With hindsight, probably. Yes, probably. I should have been.
Mr Blake: Paula Vennells says to Alice Perkins:
“It makes me sad but doesn’t surprise me.”
What’s your view as to whether that was a genuine feeling or not?
Susan Crichton: I have no idea.
Mr Blake: I’m going to take you to notes of some more meetings but, first, I just want to look at some events that occurred around the same time. Can we begin with POL00142323, please. We’re going back slightly in time to 22 July, so the previous week or so. This is an email from John Scott. I apologise for the formatting, I think we have other versions that don’t have all the question marks but you can take it from me this was an email that was sent from John Scott to yourself, Hugh Flemington, Jarnail Singh and others. He says, as follows:
“A review has been conducted in respect of commercially sensitive and/or legally privileged information, in particular with the management and exchange of information subject to the Second Sight review. Whilst most information within this group will be legally privileged, nonetheless, if the information was to inadvertently be sent to the wrong email address or intercepted innocently or otherwise, once out in the public domain it will be hard to control.
“Having agreed with Susan Crichton, with immediate effect, all information should where possible be placed onto a document and access is through a password protocol. The procedure is easy to use and only takes a matter of seconds.”
Do you recall a discussion with John Scott in around 22 July relating to the protection of confidential and sensitive information?
Susan Crichton: No, I don’t.
Mr Blake: Do you think it’s likely that it happened, given that there is reference in that email to an agreement with you?
Susan Crichton: Yes, I do think it’s likely and I was always of the view that, if it made sense, to use password protection, just to avoid, as he said, you know, it being inadvertently sent to the wrong person.
Mr Blake: Do you recall any conversation with John Scott around this time about concerns relating to the circulation of information relating to Horizon matters?
Susan Crichton: No, I don’t think I do.
Mr Blake: There’s mention there of the Second Sight review. Why in particular did this concern relate to the Second Sight review?
Susan Crichton: I think it was more the general exchange of information.
Mr Blake: Can we look at POL00006577. We’re now on 2 August. So a very similar time to when these conversations were taking place with Paula Vennells and Alice Perkins. This is a letter from Andy Cash; who was Andy Cash?
Susan Crichton: So he was one of the lawyers at Cartwright King.
Mr Blake: Thank you. We can see there it’s “Dear Hugh and Susan”, so you were one of the recipients, “For the urgent attention of [Hugh] Flemington and [Susan] Crichton”. He says as follows:
“I enclose for your urgent attention an advice prepared by my colleague Simon Clarke. I am sure you will appreciate that the advice is sent as part of our brief to advise on the impact of Horizon issues and to protect the reputation of [the Post Office]. It is fully accepted that you may wish to take a second opinion on the views expressed.”
This is the Simon Clarke advice on the duty to record information. Did you instruct Cartwright King to provide that advice or was this something that was provided voluntarily?
Susan Crichton: So I have a bit of a problem with the chronology here. The copy of this letter came in relatively late and I know there was quite a lot of discussion on the timing with one of my former colleagues last week. I don’t remember seeing this in this form. I remember I think I spoke to, later than 2 August, I spoke to Martin Smith, I think. I think that is right. That’s what it says in my statement, I think, in relation to the advice that was attached or enclosed with this letter.
Mr Blake: Let’s look at the advice. It’s POL00006799. Do you recall receiving the advice?
Susan Crichton: Yes, but, again, I can’t – I think, probably, after I’d had the telephone call from Cartwright King, I went off to try to find what had happened to the letter.
Mr Blake: If we scroll down, please. Paragraph 2 says as follows:
“I advised that there ought to be a single central hub, the function of which was to act as the primary repository for all Horizon … issues. The hub would collate, from all sources into one location, all Horizon related defects, bugs, complaints, queries and Fujitsu remedies, thereby providing a future expert witness, and those charged with disclosure duties, with recourse to a single information point where all Horizon issues could be identified and considered. The rationale behind this advice derived from the need to protect [the Post Office] from the current situation repeating itself in the future.
“[The Post Office] accepted that advice and according a weekly conference call meeting was established so as to meet the requirement of the central hub.”
Over the page, please. He says at paragraph 5:
“At some point following the conclusion of the third conference call, which I understand to have taken place on the morning of Wednesday 31 July, it became unclear as to whether and to what extent material was either being retained centrally or disseminated. The following if has been relayed to me:
“The minutes of a previous conference call had been typed and emailed to a number of persons. An instruction was then given that those emails and minutes should be, and have been, destroyed: the word ‘shredded’ was conveyed to me.
“Handwritten minutes were not to be typed and should be forwarded to POL Head of Security.
“Advice had been given to [the Post Office] which I report as relayed to me verbatim:
“‘If it’s not minuted it’s not in the public domain and therefore not disclosable.
“‘If it’s produced it’s available for disclosure – if not minuted then technically it’s not’.”
If we scroll down slightly, it says:
“Some at [the Post Office] do not wish to minute the weekly conference calls.”
Then on page 7 he gives his advice or his conclusion. He says as follows:
“Regardless of the position in civil law, any advice to the effect that, if material is not minuted or otherwise written down, it does not fall to be disclosed is, in the field of criminal law, wrong. It is wrong in law and in principle and such a view represents a failing to fully appreciate the duties of fairness and integrity placed upon a prosecutor’s shoulders.”
Now, there is a discussion by the 14 August 2013 with John Scott, and I’d like to look at that. It’s POL00139690. If we scroll down to the bottom of that page, please. There’s an email from you on 13 August about the Wednesday call:
“John – as part of our remedial action I had asked you to set up and chair this call. I have had very worrying feedback re this call from [Cartwright King] and it sounds like this is not being chaired, the participants are unclear as to its purpose and no minutes are being kept – or there is confusion.”
Now, it certainly seems that by 13 August, you had considered the advice that I’ve just read.
Susan Crichton: So, from my memory, what happened is Jarnail and Hugh had had a conversation to say that the calls were being mismanaged and not achieving their objectives and it may be at that point I went off to look for the advice, or I had spoken to Martyn. I don’t think I’d seen the advice from Simon at that point because, if I had, I wouldn’t have contacted John Scott in these terms nor would I have suggested he then carry on to chair the calls because that would be illogical.
Mr Blake: Illogical or wrong?
Susan Crichton: Well, wrong, wrong, it would be wrong.
Mr Blake: How are you so confident, having not remembered detail of a number of meetings today, that you didn’t see that advice by the 13 August?
Susan Crichton: Well, it’s just this is relatively late on the 13th, it’s 8.30 in the evening. I’m not completely confident, no. I wouldn’t be completely confident but that’s how I think the logic worked. But, you’re right, I can’t be completely confident.
Mr Blake: Because the covering letter to the advice was 2 August, why does the timing, 8.30 in the evening, mean that it’s less likely that you saw the underlying advice?
Susan Crichton: Because, as I understood from the evidence that was given last week, I actually didn’t get hold of the advice, the physical advice, as in – until 14 August, and then I wrote the letter to Cartwright King, which is also in the evidence. But you’re right: I can’t be completely certain.
Mr Blake: If we scroll up, please, we can read from this email. It says, “Susan”, this is from John Scott:
“The brief given by yourself for this meeting was to provide in effect an under the radar escalation point from across the business of issues that may impact the integrity of the Horizon system. You were frustrated in regards to the production and circulation of the Helen Rose report and therefore did not want any electronic communication which may be subject to [Freedom of Information Act] or Disclosure.”
Is that right?
Susan Crichton: No, that’s not correct and that’s not the reason I was frustrated about the production of the Helen Rose report. I thought that the idea of having a conference call and a single hub was a very good idea and we should have been doing it anyway. But what I did want was there to be one single repository of the data so that we had one version of what had been discussed, what had been agreed, and what remedies were going to take place, so that it was in one place and accessible. So I didn’t think it made sense to have a lot of different emails flying around but I wanted it in one place, so that if Cartwright King needed to find it, it’ll be there, if Bond Dickinson needed it, if anybody needed it, it would be in one place and accessible and maintained, because one of the issues with Post Office, as you’ve no doubt realised, is that the document retention issues are complex. So that’s what I wanted.
Obviously –
Mr Blake: This is a contemporaneous email, it’s not a witness statement that’s been written –
Susan Crichton: No.
Mr Blake: – for the Inquiry with hindsight, a contemporaneous email that says, very clearly, that you were frustrated about the circulation of the Helen Rose report and you didn’t want any electronic communication, which could be subject to disclosure. Why would John Scott say that to you in an email, knowing that –
Susan Crichton: I don’t know.
Mr Blake: – you could easily come back and say, “What are you talking about”?
Susan Crichton: I don’t know but the Helen Rose report was much more about how it was prepared, why it took so long, how it was disseminated to the Criminal Law Team or it wasn’t disseminated to the Criminal Law Team.
Mr Blake: That was a report that related to Horizon integrity issues?
Susan Crichton: Yes, the Lepton.
Mr Blake: I’ll continue:
“The conference calls have been set up and they are chaired by a Senior Manager from the Security Team and then I’m briefed thereafter (I wasn’t aware I had to specifically Chair, but that is easily remedied). At the outset the purpose of the call was, given that this was an informal escalation point and no electronic notes would be taken or circulated and communication would created. Written notes have been taken for each call and activity has been driven behind the scenes. For example a potential Horizon glitch was raised that had been reported previously to Simon Baker. This was then managed subsequently directly with Rodric Williams and Steve Beddoe by myself in a manner to bring it under legal privilege as far as possible.”
What did you understand that to mean?
Susan Crichton: Presumably that something was raised by Simon, but I would presume that to have been included in the central repository.
Mr Blake: John Scott appeared before this Inquiry in Phase 4 and his evidence was that you wanted things covered by legal professional privilege; is that correct?
Susan Crichton: I think, certainly, there was a view from the civil litigation lawyers on the call that they wanted to try to protect information by legal privilege and, if you look at some of the early minutes, it’s discussed in the call.
Mr Blake: At this stage, were you in charge of John Scott’s department?
Susan Crichton: I was.
Mr Blake: Did you therefore give him a direction that things should be covered by legal privilege, as far as possible?
Susan Crichton: No, I left that to the civil litigation lawyers that were on the call.
Mr Blake: He certainly seems to think in this email that it was you who gave that order?
Susan Crichton: I’m not – I wouldn’t – I don’t think I would have done.
Mr Blake: Putting a potential Horizon glitch under legal privilege so far as possible, that’s very significant, isn’t it?
Susan Crichton: It certainly seems so, yes.
Mr Blake: If we carry on, the next paragraph ends as follows:
“However, the nature of operating under the radar and with memory fading of the rationale, from Martin’s perspective it would look disorganised without formal terms of reference, electronic notes, action list etc.”
Was this a group that was meant to be operating under the radar?
Susan Crichton: Not as far as I was concerned because there’s an email from Rodric setting up the group and it clearly states that – who needs to be on the calls, we’ve got two lawyers from external firms. It absolutely wasn’t operating under the radar, in that respect.
Mr Blake: He ends as follows:
“Clearly I will now attend the conference calls as Chair and following on from the previous discussions and the steer below, unless otherwise directed, this will become a formal meeting with terms of reference, electronic notes, actions and appropriate governance within such approach. This will be built into the operating and governance model and the previous notes and actions over the last three will now be electronically recorded and circulated. This does run the risk that more communication will be generated electronically with issues, reports and actions responded to, etc that may include inappropriate comments, opinion, assumptions that may be subject to [Freedom of Information Act] and Disclosure (as in the Helen Rose report).”
This correspondence with John Scott is occurring around the same time as the CEO is complaining about bland Board papers. Were you, at this time, seeking to not include certain information provided to the Board, and to keep information under legal privilege, so far as possible?
Susan Crichton: No, that’s not my recollection.
Mr Blake: Let’s look at the response to Andy Cash, that’s POL00006797. We’re on 16 August 2013. I think we heard from Rodric Williams that he drafted this response; do you recall that?
Susan Crichton: Yes, I saw that, yes.
Mr Blake: Was that your recollection?
Susan Crichton: Yes. Yes, it is my recollection.
Mr Blake: He says:
“Thank you for your letter of 2 August 2013 enclosing Simon Clarke’s advice on ‘Disclosure …’; unfortunately I had not seen your letter and was not aware of it until Martin’s email on 14 August.”
So that was the evidence you’ve just been giving about potentially not having seen it.
Susan Crichton: That’s correct, yes.
Mr Blake: But that may or may not be correct, you’re not sure.
Susan Crichton: So I think – I thought it was a telephone call with Martin but maybe it was an email saying, “Have you got this letter?”, I don’t know. But I think it was the time he was away, so it might well have come into him because he was first on the envelope. But I’m speculating.
Mr Blake: There is a suggestion in the evidence that Rodric Williams had kept it in a drawer. What’s your recollection of that?
Susan Crichton: I think – I just can’t specifically recollect it but it might be correct because we were so busy and because Hugh was away and I think also Rodric had been on holiday as well.
Mr Blake: Why would it be kept in a drawer if people were away? The suggestion of a drawer is something slightly covert.
Susan Crichton: I don’t know. I really don’t know.
Mr Blake: Do you think there was an attempt to keep that advice quiet?
Susan Crichton: No, I don’t think so.
Mr Blake: “That advice was prepared as a consequence of statements purportedly made in connection with the weekly conference calls we established to share across the Post Office Limited issues identified with the Horizon system …
“A key purpose of the Horizon calls is to ensure Horizon users are promptly made aware of any issues with it, so that these issues can be effectively managed.”
Next paragraph:
“I am therefore deeply concerned at the suggestion in Simon’s note that there may have been an attempt to destroy documentary material generated in connection with the Horizon calls, specifically any minutes of the calls. I note Simon’s advice does not suggest that material connected to the operation of Horizon itself may have been compromised.
“Post Office Limited is committed to conducting its business in an open, transparent and lawful manner. Any suggestion to the contrary would not reflect Post Office Limited’s policy and would not be authorised or endorsed by Post Office Limited. Accordingly, the purported statements referred to in Simon’s note do not reflect or represent Post Office Limited’s position.”
That’s not true, is it?
Susan Crichton: In what sense?
Mr Blake: Well, we’ve seen the email correspondence from John Scott, saying that that was exactly the kind of thing that he was doing intentionally. Do you think it was fair or accurate to say “the purported statements referred to in Simon’s notes do not reflect or represent Post Office Limited’s position” when you had been told by John Scott on 14 August that he thought that this was an under-the-radar group that didn’t want any electronic communications?
Susan Crichton: I’m just trying to remember the order of things. I think that what happened was that I went and asked Jarnail what had happened and why this had come to the fore but I think that was before this had come in. But I also don’t recollect having that conversation with John. I just know that Rodric sent the email to set the group up. There was some discussion in one of the first sets of minutes about privilege. I don’t recollect either asking John Scott if he’d shredded documents or not, which I would have done, had I seen the information before that email had come in. So I’m just really a bit confused about the chronology.
Mr Blake: I can assist you with the chronology. The chronology is 13 August you send an email to John Scott saying that you had some worrying feedback from Cartwright King. On 14 August, John Scott responds to you saying that – referring to the under-the-radar escalation point and saying that you didn’t want any electronic communication. Then on 16 August, you send a letter to Andy Cash at Cartwright King, making no mention of any confusion within the business as to whether electronic records should be kept but instead referring to purported statements in Simon’s notes, which don’t reflect or represent Post Office Limited’s position. That’s the chronology, isn’t it?
Susan Crichton: I think that’s right, yes.
Mr Blake: Yes, and why would you not be full and frank with your own lawyers as to the contents of John Scott’s very recent admission in his email to you?
Susan Crichton: I think I was trying to be full and frank because I think it was the intention, my intention that we set up this hub, we ran this properly, there were minutes, notes, and it was run from a central, you know, file, so that people could have access to it. I didn’t intend for it to be under the radar, in that sense.
Mr Blake: No, but you had told, very shortly before you sent this email, that the person who was meant to be chairing it saw it as precisely that?
Susan Crichton: Yes, I should have put those two things together.
Mr Blake: Why weren’t you full and frank with your own lawyers in that respect?
Susan Crichton: I think I was. I think the Post Office was committed to running that hub in the way that I’ve set out. I think there had been some issues with regard to operationalising that, which were obviously very significant.
Mr Blake: Is there a missing paragraph in this letter that should have said, “Oh, and by the way we have a rogue employee who totally misunderstood the brief”?
Susan Crichton: I think if there’s some correspondence or there’s some copy documents I’ve seen which seems to indicate that – and it goes to the cultural point about Post Office, which is raised – I can’t remember which note it is – saying that people don’t want this to be recorded, whereas that was not my view. That was not my stance.
Mr Blake: Having received Simon Clarke’s advice, did you press John Scott any further as to whether anything had been shredded?
Susan Crichton: I can’t recollect that.
Mr Blake: The note in that advice about shedding, would that, in your view be consistent with John Scott’s email to you of 14 August?
Susan Crichton: No, it wouldn’t, but it would be consistent, I think, with the type of thing that Jarnail had – Jarnail Singh had brought to my attention, with regard to the confusion of the calls and what the purpose was and how we could get the items, the issues nailed down and properly described and moved forward.
Mr Blake: As General Counsel of the Post Office at this time, what investigation did you carry out into those very serious allegations that had been made in that Simon Clarke advice?
Susan Crichton: My recollection was that I certainly went and spoke to Mr Singh because he was on the call. I also think I spoke to Andy Parsons and – I’d obviously spoken to Simon – to Martin Smith and I think I asked John Scott but I can’t remember when.
Mr Blake: It might be suggested by some in the room that, by the summer of 2013, you had now effectively drunk the corporate Kool-Aid and were worrying about having given Second Sight too much information. What would you say to that suggestion?
Susan Crichton: No, I don’t agree with that.
Mr Blake: Did you, by that stage, feel responsible for the damage that Second Sight was said to have done to the business?
Susan Crichton: No, I felt responsible, I suppose, for Alice saying she was blindsided – Alice Perkins saying she was blindsided at the Board, but I didn’t – on reflection, after – I didn’t consider that to be the case.
Sir Wyn Williams: Is that a convenient moment for our afternoon break?
Mr Blake: That is, sir, yes, thank you very much, could we come back in 10 minutes’ time.
Sir Wyn Williams: Yes.
Mr Blake: Thank you very much. 3.25.
(3.17 pm)
(A short break)
(3.25 pm)
Mr Blake: Thank you, Mrs Crichton.
We’re going to stick with August 2013 and just look at some other developments that occurred at that time. Can we bring up on to the screen POL00116218, please. I’m going to start on page 2, the bottom of page 2. Can we have a look at the very bottom email, please, and over to the next page. 27 August, Alwen Lyons emails Paula Vennells a draft note for the Board and it says as follows:
“Paula [I think it says ‘here’] is the message for the Board, can you let me have any amends. Would you look in particular at the HR piece as these are my words and you may want to change them.”
If we scroll down we can see “Horizon – Announcement of independent Mediation Scheme for subpostmasters (Project Sparrow)”:
“We have today announced the introduction of an independent Mediation Scheme to address the concerns raised by some subpostmasters regarding cases which they feel require further resolution.”
It says:
“The Post Office, JFSA (Justice for Subpostmasters Alliance) and Second Sight, the independent investigators, have formed a working group to collaboratively develop and monitor this scheme which is available to current and former subpostmasters from 27 August 2013.”
So we have, by now, 27 August, established the Mediation Scheme and the Working Group. If we scroll up, please, there’s an email responding to this from Paula Vennells to Alwen Lyons and you, and she says:
“Alwen, thank you for this. I’ll get back to you on one section I’m reviewing but wanted to get Susan in the loop on Horizon [as soon as possible].”
She says:
“Re Horizon: I think there is too much detail [regarding] the release but nothing on reassuring the Board [regarding] mediation. They will want to know how we plan to manage any associated risks.
“Susan, a couple of questions to help position this: I have just read the mediation pack tonight: [page] 10 states clearly that compensation can be a possible outcome. When we discussed this, the hope of mediation was to avoid or minimise compensation but as far as I can see the pack doesn’t really suggest any other outcome. (Difficult to do I know). And so, this will be the page that [subpostmasters] may attention to. You explained that there were steps in place to advise [subpostmasters] entering the process that this was a chance to be heard and not to expect compensation. [However] are we planning to manage those expectations? And where compensation may be offered, you mentioned small figures in the £3,000-£5,000 band: can we give a range of costs?”
Was that your understanding of the Mediation Scheme?
Susan Crichton: In the sense of compensation?
Mr Blake: Well, Paula Vennells gives the impression in this email that the hope of mediation was to avoid or minimise compensation and that, if there was to be compensation, it would be only small figures.
Susan Crichton: So I think my view – my recollection at the time was that compensation could easily be one of the outcomes and we wouldn’t know what level it would be. I mean, there is some documentation which looks at things like compensation for – I can’t remember now, loss of contract or something, and there is some mention somewhere of those kinds of figures but we wouldn’t actually know until we’d started the scheme.
Mr Blake: From your recollection, in relation to this email and general conversations that were had at the time, was the business at that stage a little concerned about what the result of the Mediation Scheme could possibly be?
Susan Crichton: Yes, I think it probably was.
Mr Blake: Can we turn to POL00194465. Just very quickly I want to go to that bottom email. It seems that, by 29 August – this is an email from Chris Day to Alice Perkins, you’re copied in:
“I have discussed this with Susan and asked her to negotiate a monthly cap of £25,000 with [Second Sight]. In addition, [Second Sight] have agreed to transition out (subject to our in-house team being sufficiently competent/independent in both carrying on with existing investigations and supporting [subpostmasters] appropriately) over the coming months; depending on the incidence of new cases arising and the rate of take up …”
Over the page, please:
“… Susan’s view is that this is likely to be achievable by the end of this calendar year or latest first quarter of 2014.”
So it seems as though, by this stage, Second Sight were being transitioned out of the picture.
Susan Crichton: What was going to happen, the way the Mediation Scheme was going to work, from memory, is that they would be part of the Mediation Scheme and they would look at the subpostmasters’ cases to make sure that there was enough information there for mediation or they would be sitting in that central hub there. So it was transparent in that respect, they were still going to be part of the Mediation Scheme and, I think, on my part, that was absolutely a best guess as to how long it would take to do that. We didn’t know. We hadn’t started.
Mr Blake: Looking back at all of those emails that we’ve seen this afternoon and this morning, do you think that the Post Office was genuine in wanting to get to the bottom of the problems with Horizon?
Susan Crichton: I felt I was genuine and I thought you might ask me about the Mediation Scheme, so I have reflected on that. I know that I was genuine, my attempt to set it up in the way I believed would work and would work for subpostmasters. I’m really not sure what the Post Office wanted from that at that stage.
Mr Blake: Do you think that the Executive Team really wanted an independent investigation?
Susan Crichton: In 2012?
Mr Blake: Yes.
Susan Crichton: I know that I thought it was the right thing to do. I don’t know about other people on the Executive Team. I can reflect and say, well, maybe they didn’t but I don’t know. I don’t know.
Mr Blake: The picture that’s painted by some of those emails that we’ve been looking at is that, when things suddenly weren’t going the Post Office’s way in that independent inquiry, it seems that there was an attempt to cover that up in some way by using legal professional privilege, bland Board statements, using words other than “bugs”; do you agree with that?
Susan Crichton: That was not my intention at the time, from my recollection.
Mr Blake: How about the intention of others?
Susan Crichton: I can’t speak for other people. I really can’t.
Mr Blake: Well, let’s look at a filenote from Paula Vennells, POL00381629. This is a filenote that’s very recently been disclosed by the Post Office. I think you may have had it only yesterday. It starts, it says, Friday, 30 September. 30 September was actually a Monday and it looks, from the context of this document, likely to have been 30 August because we then scroll down and we can see a meeting on 2 September. Does that –
Susan Crichton: I think it must have been 30 August.
Mr Blake: 30 August. I’m going to take you through, as I have, those other filenotes, quite slowly and carefully.
“Purpose: Susan had asked me earlier in the week how I felt about her continuing in the business and what job I was expecting her to do. I was slightly surprised that she had raised the issue again – we had already had a conversation where I said I had wanted to help her restore her reputation after the Board discussion. But again I said I wanted her to do what I had asked of her prior to my holiday, ie to get on top of the new processes, to lead the business through the Mediation Scheme and to help me use this as a catalyst to change the culture, so we ‘listened’ more.”
So that’s a reference to the Board discussion of 16 July 2013?
Susan Crichton: I assume so.
Mr Blake: Did you understand that to be the purpose?
Susan Crichton: I have to say, I can’t remember this meeting. So I just can’t remember it at all.
Mr Blake: It says:
“Susan was very, very angry. She yelled at me. She thinks this has damaged her reputation. She was upset that Alice had commissioned the RH review.”
Is that the Richard Hatfield review?
Susan Crichton: I think it must be – yes.
Mr Blake: That was a further review that was going to be a Lessons Learned exercise; is that right?
Susan Crichton: That is correct.
Mr Blake: Now, you may not be able to recollect this meeting, but can you recall not being happy with the commissioning of the Lessons Learned Review?
Susan Crichton: I was not, no. I felt it was an inappropriate use of funds, if you like. I thought we should get on and get the Mediation Scheme going.
Mr Blake: Why would it be an inappropriate use of funds?
Susan Crichton: Because it was just going back over old ground again.
Mr Blake: “She was cross that I hadn’t got her the [terms of reference] before I circulated it to Alice, Alasdair and RH [Richard Hatfield]. She was convinced there was a breakdown of trust [especially] between her and Alice. But with the Board generally. Although she did say that all the Board except Susannah had been in touch.”
We’ve seen previously the reference to you being worried you were going to be a scapegoat. Is this in a similar vein?
Susan Crichton: Yes, I think so.
Mr Blake: Susannah, is that Susannah Storey?
Susan Crichton: Is that the ShEx representative?
Mr Blake: Yes.
Susan Crichton: Yes.
Mr Blake: Would it have surprised you that she hadn’t been in touch or are we not to read anything into that?
Susan Crichton: Not really. I mean, also I think they hadn’t necessarily all have been in touch, they might have sent an email or popped into the office or something.
Mr Blake: “I explained I had simply not the time to give her the [terms of reference] – Dave Ward call/CWU [Communication Workers Union] discussion with CD/KG.”
Are you able to assist us with that?
Susan Crichton: I’m guessing it would be – oh, Chris Day and Kevin Gilliland.
Mr Blake: “I said if she felt some changes were needed then I would be happy to consider them. She suggested that our external lawyers Bond Dickinson should be involved. I said if that helped I couldn’t see why not and would think about it.”
Now, she said “I explained I had simply not the time to give her the terms of reference”; do you think that was true?
Susan Crichton: On reflection, no.
Mr Blake: Why not?
Susan Crichton: Because it would only have meant sending – forwarding an email.
Mr Blake: “It is clear that the RH review has destabilised her. She shouted that she was looking at other jobs. She threatened that we would have to back her – implying of the importance of references.
“She again raised that Alice had made mistakes. I reminded her that we probably all had and Alice had accepted that [Richard Hatfield] needed to be even-handed. I reminded her again that I had raised (with Alice) the ‘issue’ of Alice also needing to be interviewed. And I said that whilst I would be asking Alice about couple of challenges Susan raised (Alice believing Donald and BIS comments about a [Post Office] cover-up?), I wanted to be loyal to the Chairman as I believed she had imagined the [Richard Hatfield] review would be a way of moving on.”
There’s quite a lot to unpack in that paragraph. Can we begin by looking at the issue between you and Alice Perkins. Did you feel that the review was, in some way, Alice Perkins setting you up?
Susan Crichton: I think that’s what I thought at the time, that would be my recollection, yes.
Mr Blake: “Alice believing Donald and BIS comments about a [Post Office] cover-up”; can you assist us?
Susan Crichton: I can’t remember that.
Mr Blake: It’s quite important for this –
Susan Crichton: I absolutely understand and the problem I have is that I can’t remember this meeting at all. I’m sure, you know, it’s written contemporaneously, as you’ve said, with other things, so I’m sure it must have happened but it’s so far out of my normal range of behaviour, the shouting and the – especially in a public place – well, anyway, but I just can’t remember it.
Mr Blake: It then says:
“(I also wanted to see if we could get ourselves back on an even keel: Susan is clearly making lawyers notes on everything; and I would like the two of them to repair their relationship. I’m not sure how doable the latter is but to have it breakdown totally at present is not in anyone’s interests).
“So I mostly listened and took the anger. Eventually, she calmed down and I said I would (genuinely) like to help her find a way through this. She began to be positive again and as we walked back to 148 …”
Is that the Post Office building?
Susan Crichton: Yes.
Mr Blake: “… Susan suggested I join her and her HR team for her moving on supper. I thanked her, and said I would be happy to do that, and to say how sorry I was that it had happened so quickly; that she had helped me make the function much stronger and I was grateful to her.”
At that point, is that moving on just from the HR team not from the whole business or –
Susan Crichton: That was just moving on from the HR team.
Mr Blake: If we go over the page, please, there seems to be another meeting on Monday, 2 September 2013. There was another note, sorry, of that date and she says as follows:
“Over the weekend I reflected that ounces request to been in BD …”
I think that’s Bond Dickinson, is that your reading of it?
Susan Crichton: Yes, it is.
Mr Blake: “… was more about her lack of confidence and decided to reassure her that I was happy to take her opinions – to demonstrate confidence in her.”
It then says:
“Susan then told me it didn’t matter because she couldn’t do her job any more.”
Just pausing there, there was a second meeting, was there, on the Monday?
Susan Crichton: I’m – I found this note really quite confusing. I couldn’t work out whether – what was reflection and what was the meeting. I recollect that with my view at the time, and it was becoming into sharper focus that I could no longer do my – no longer continue in my role at the Post Office if I didn’t have the trust and confidence of the Chair, the Board and the CEO.
Mr Blake: We saw that, on the first page, it was a meeting at Costa Coffee, Old Street. Here it says meeting room 3.00 pm, so it does look as though there was a further meeting on the Monday?
Susan Crichton: Did you say it does look?
Mr Blake: It does look?
Susan Crichton: Yes, I think that that’s right. It does look like that.
Mr Blake: “Susan … told me that it didn’t matter because she couldn’t do her job any more. The RH review was not the right action for the business. We had ruined her reputation and compromised her. Professionally, she needed to point out that the RH review shouldn’t happen as not being legally privileged, it could be detrimental to the business but Alice would not believe her and instead see her view as defensive. Therefore she could no longer be effective: a General Counsel cannot operate if they don’t have the confidence of the Chairman/Board/ CEO. I repeated she had my confidence and I cited other business issues in the last several days where I had sought her counsel. I am trying to help her repair the situation. She pointed to the impossibility of her ever coming before the Board. I disagreed – she will have spoken to all of the Board. And I reminded her that Alice wanted an open and even-handed RH ‘lessons learned’ review.”
We saw that at that earlier board meeting you hadn’t been allowed into the room or hadn’t been invited into the room. Did you think that, from that point onwards, it was or was not possible for you to effectively attend board meetings?
Susan Crichton: I suppose I came to the conclusion or the realisation it’s something you never – I never expected to happen to me and it took me some time to adjust to what had happened and understand it, and it was clear to me that I was just – I felt I couldn’t continue in my role, and I think that was further exacerbated by the way that the responsibility for HR had been removed from me.
Now, I agree that was the right thing to do for the business but it was the way it had been done. So I think mentally I was in a bad place, I think I can say.
Mr Blake: The suggestion in that paragraph might be that Alice Perkins thought that you didn’t want to be scrutinised by the Lessons Learned Review; was that your understanding of hers or Paula Vennells’ position?
Susan Crichton: No, I don’t think so.
Mr Blake: Can we scroll down, please. She says as follows:
“I wonder if Susan is overreacting to the … review. But she could be right. She will undoubtedly make the legal case against it. Emotionally, she may just throw in the towel if we decide to press ahead. This may also be her way of saying she can’t cope with much more pressure at present.
“If Susan leaves in the short-term, that will be a major setback. She has stabilised the project [which] is demonstrating that she wants ‘right to the wrongs’ (my words, not hers). And importantly, the external stakeholders have responded positively and she has the confidence of the internal team.”
She says not your words but hers, in terms of “right the wrongs”; what did you understand that to be a reference to?
Susan Crichton: I think she’s referring to the fact that’s how she felt about the Second Sight review and my handling of the Second Sight review.
Mr Blake: Could we scroll down, please:
“I need to find a way of calming this down. And buying us some time to think carefully. We can do a ‘lessons learned’ internally. And if we do it ourselves, then there could be some reconciliation. How we handle this will say a great deal about the values of the business.”
Then she provides some further reflections. She says:
“In both meetings, Susan was very emotional. She is hurt. Her ego and self-esteem have been undermined. She swings between wanting to get away from it all with a settlement and leave immediately, to building a case to fight and defend her reputation, to accepting that the most satisfactory outcome would be to restore her reputation by managing the mediation scheme through to a satisfactory ongoing process.”
Just pausing there, is she right there; is that a fair reading of your feelings at that time?
Susan Crichton: Reading this back, because it is quite a blur, it probably is, but I really can’t remember specifically. You know, I’ve been a lawyer for a long time and then I’d worked in a number of different companies. I never expected to find myself in this position.
Mr Blake: “Each time, we finished the meeting positively.
“Susan had said to me prior to my leave, that she would never have put a business she worked for in the situation we found ourselves with the [Second Sight] interim report, and she wished she had never allowed Alice to persuade her to do the independent review. She should in her view have resigned over it at the time.”
That suggests that you regretted getting Second Sight involved.
Susan Crichton: I didn’t regret getting Second Sight involved. I think what I regretted is that I hadn’t been clearer, if it was appropriate, about my role in the Second Sight review and what I meant by being independent.
Mr Blake: We’ve seen some evidence and some documents that referred to, effectively, you convincing Alice Perkins to do the independent review and here we have the suggestion that, in fact, it was the other way around.
Susan Crichton: I think Alice was driving the independent review and I think in her notes you see her initial intention that the MPs’ cases should be reviewed but that gradually cooling as we go through the process.
Mr Blake: What reasons do you think there were for that cooling?
Susan Crichton: The length of time – so, practical, I think the length of time it was taking; the cost it was taking; and the fact that she considered I wasn’t controlling it appropriately.
Mr Blake: What about the damaging things that Second Sight had discovered relating to Horizon?
Susan Crichton: Yes, obviously, they would be included as well.
Mr Blake: “My reflection on what happened with [Second Sight] as I write this today [2 September] is that Susan was possibly more loyal to her professional conduct requirements and put her integrity as a lawyer above the interests of the business. She did not communicate clearly what she was concerned about. If as she says she felt compromised (personally and for the business) by being asked to manage [Second Sight] more closely, then her misjudgement was that she did not make that clearer to me on the two or three occasions that I asked her to do so.”
Do you agree with what’s said there?
Susan Crichton: Yes – well, as I say, I can’t remember this conversation – oh, it’s her reflection, isn’t it? So this wasn’t a conversation that we had; this was her thinking about it afterwards.
Mr Blake: Yes. So, for example, managing Second Sight more closely, did you see that as, in some way, in conflict with your role as a lawyer?
Susan Crichton: I think what I would have said was that I wanted to ensure that their report was independent and I wouldn’t try and control them in a way that didn’t give them access or ability to write the report in their way, provided it was evidence based.
Mr Blake: The reference there to putting your integrity as a lawyer above the interests of the business, what did you see your role as, in terms of being General Counsel? Was it integrity as a lawyer or was it interest of the business, or were they in conflict?
Susan Crichton: I had never experienced a situation where my integrity as a lawyer was in conflict with the business that I worked for. I was just very focused on delivering the independent report from Second Sight. So if that meant that I put my integrity as a lawyer above the interests of the business, then possibly that’s what I did. I didn’t see it quite in that way at the time.
Mr Blake: “Susan believes the person who compromised her is Alice. Alice met [James Arbuthnot] partway through the review and, according to Susan, Alice agreed with [James Arbuthnot] that [Second Sight] had to ‘keep the JFSA happy’. Susan believed that an independent review meant that she could not/would not then intervene to change the biased opinions that Second Sight reached because they were ‘keeping the JFSA happy’. It took some strong persuasion for Susan to accept (which I am clear she did, as she was disappointed with it) that the first interim report needed [Second Sight] to amend it. The Board and the external stakeholders only saw the second version.”
Can you assist us with your views on that?
Susan Crichton: So my recollection is that, when I got the first version of the Second Sight Report, which hasn’t appeared in any of the documents, that some of the flavour of the report was not focused on the evidence but rather focused on a somewhat emotional interpretation of the facts, and this was when I had the discussion with Second Sight to say, you know, “What you write needs to be evidence based and needs to be put in those terms”.
But we had a discussion about it. I wouldn’t have been able to force them to do that but we just had an exchange of views.
Mr Blake: Can we scroll down, please.
“Wider performance context:
“Up until this time, Susan has been a wise (if risk averse – we had discussed this), General Counsel. She worked long hours professionally for the business steering the [Post Office] through the MDA and MSA, during the separation from Royal Mail.”
It says, “(if risk averse – we had discussed this)”; do you recall a conversation with Paula Vennells about you being risk averse?
Susan Crichton: No, I can’t and I wondered if – oh, no.
Mr Blake: That could be a discussion with somebody else, perhaps?
Susan Crichton: I wonder if she’d discussed it with Alice? I don’t know.
Mr Blake: It says further down:
“She agreed that she would relinquish the HR function …
“When we were faced with the urgency of handling the Second Sight interim review fallout (ministerial statement to Parliament, high profile media etc), I told Susan that I was minded to implement that decision immediately, so that she could concentrate the [Second Sight] handling. Fay would take on HR reporting … in the interim. Susan agreed.
“HR Announcement:
“When I returned from holiday, I was told by Alwen that Susan had been upset because I had not spoken to her about the timing of the announcement. She indicated … that could be construed as constructive dismissal; but then qualified her comments by confirming she did not know and had not been involved twice in the decision making process.”
Is this related to you relinquishing the HR role?
Susan Crichton: Correct.
Mr Blake: Yes. What’s your recollection of that?
Susan Crichton: So I don’t remember discussing it twice. In retrospect, with hindsight, it was absolutely the right thing to do. Just the HR made that – the addition made that job very difficult to do.
Mr Blake: Can we please look at POL00381658.
Before we look at that other document, what are your general reflections on this note, having now seen it and going through it?
Susan Crichton: I find it quite shocking because I’d got into that kind of situation. As a personal reflection, it’s quite distressing, I think. I must have been in a really bad state.
Mr Blake: Does it give you any insight into how the company was run at the time?
Susan Crichton: So if I put myself in Paula’s position – and I have been in this position with people I’ve worked with and for over the years – I would have packed myself up on a month’s sick leave and said, “Don’t come back until you feel better and have got things in perspective”.
Mr Blake: Did that happen?
Susan Crichton: No. I mean, I don’t know whether you’re going to go on to it but, shortly after this, I had already taken some legal advice and I gave Paula Vennells a without-prejudice letter, which set out the terms on which I would agree a settlement to leave POL and I left POL effectively at the end of September because we went on holiday. I came back in for a day or so in October, and then I was on gardening leave in November.
Mr Blake: Can we look at POL00381658, please. This is an email exchange between Paula Vennells and Alice Perkins of 7 September 2013, so the month that you’ve said you effectively left. She says:
“My approach needs to remind Alasdair …”
Who was Alasdair, sorry?
Susan Crichton: I think that was Alasdair Marnoch, the chair of the ARC.
Mr Blake: “… where we left off, then to paint the story to arrive at the conclusion carefully. [Especially] as the last time we spoke, I had been in the place of trying to help Susan repair the damage. So that will be a change.
“I think he will understand. Alasdair had raised a couple of questions re Susan’s judgement, but less than others.
“Regarding speaking to Susan, I had a tip-off from Alwen that Susan may raise it with me on Monday herself. They spoke midweek: Susan said it was making her ill and she didn’t see how she could continue having lost the confidence of the Board.”
It says:
“Exactly the same conclusions.
“Although that makes it slightly easier if she does raise it, people can change their minds (not tidy!). So I shall wait and see what happens. Either way, assuming Susan is in 148, we will have the conversation on Monday.
“I’m speaking to Fay this weekend as we will need to be thinking about which lawyers we use, interim cover and about business messages. And indeed when Susan goes. It sounds as though she wants that to be straight away. Much will depend on Susan’s state of mind. I have been in situations like this where people have been helpful and suggested the best outcomes themselves. Susan is capable of doing that but I’m not holding my breath.
“I hope this sounds calm – I am – on the outside … on the inside, it was never going to be easy. (But it’s nothing to what Susan is going through, irrespective of what caused it).
“Thank you for your support – and helpful questions are always welcome.”
“Irrespective of what had caused it”: I mean, did you believe Paula Vennells to have understood your reasons for leaving?
Susan Crichton: No, I don’t think she did.
Mr Blake: Why not?
Susan Crichton: I don’t think she understood my point about this has to be an independent review, we can’t manage it or manipulate it in the way that, possibly, Alice was expecting me to do, and this is all supposition on my part. Either way, I had decided that the time was to draw a close to this chapter in my career.
Mr Blake: Can we please look at UKGI00007316. These are key points from a Second Sight meeting that relate to after your time. It says as follows:
“Interesting snippets include:
“Ron Warmington used to work with former POL [General Counsel] Susan Crichton at GE – that is how they were introduced to [James Arbuthnot].
“[Second Sight] link the ‘change in approach’ by [the Post Office] to Crichton’s departure (in November 2013 according to LinkedIn).
“Slight dig at how [the Post Office] are ‘on their third or fourth [General Counsel] since Crichton left’.
“Ian Henderson worked for the CCRC for 4 years. Said they take a very narrow and technical view of miscarriages of justice.”
Were you aware – I know you weren’t working in the business – but of any change of approach of the Post Office after you had left?
Susan Crichton: No.
Mr Blake: Did you have any discussions with Second Sight, for example, after you had left?
Susan Crichton: No, no. I don’t think – no, I don’t think I’ve – no, I don’t think so.
Mr Blake: Looking at the way things were going when you did leave, do you think it was likely or unlikely that the Post Office would become more restrictive towards Second Sight?
Susan Crichton: I suppose, reflecting on the discussions today, that they would become more restrictive, although I hoped, I genuinely really hoped, that the Mediation Scheme might move the process forward.
Mr Blake: Sir, I have a number of miscellaneous topics to move on to. It’s been quite a long day today. I’m in your hands. We have plenty of time tomorrow. I can either start on those topics –
Sir Wyn Williams: Mr Blake, if you’re trying to persuade me that after a long, hard day we should stop now, then you needn’t say any more.
Mr Blake: Thank you very much, sir.
Sir Wyn Williams: I’m sorry, Ms Crichton, that you will have to come back tomorrow. I’m grateful to you for agreeing to do that. These are arduous sessions and, in making the observation which I did about Mr Blake doesn’t need to persuade me any further, rest assured I’ve had regard for you, as well, and, although I have no doubt that you want this over as quickly as possible and as efficiently as possible, there’s a limit to how many questions you can reasonably be asked to field in one day, and you have fielded a good many.
So I think it’s time to stop, all right?
Mr Blake: Thank you very much, sir. Mrs Crichton is a lawyer and will have well in mind the prohibitions on speaking –
Sir Wyn Williams: Yes, I’m sure she will. I should think the last thing that she will want to do is to talk about this but if you do get tempted to talk about it, Ms Crichton, resist the temptation.
The Witness: Thank you, sir.
Mr Blake: We’re back at 9.45 tomorrow.
Sir Wyn Williams: 9.45, and I’m reminded that there will be a fire test as usual on a Wednesday morning at 10.00, so I simply propose that, if you are still asking questions, as I assume you may be at that point, Mr Blake, you simply stop very shortly before 10.00 and we just all sit quietly through the fire alarm and then start again.
Mr Blake: Yes, that’s correct, sir.
Sir Wyn Williams: Fine.
Mr Blake: Sir, I’m reminded by Mr Wallis that today is three years since the quashing of the convictions.
Sir Wyn Williams: Yes.
Mr Blake: No doubt those present will be marking that today.
Sir Wyn Williams: Well, I have no doubt that, as each year goes by, never mind three years, that would be something which is always embedded in the minds of very many people.
All right. See you tomorrow.
Mr Blake: Thank you very much.
(4.04 pm)
(The hearing adjourned until 9.45 am the following day)