24 July 2024 – Margot James
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(10.05 am)
Ms Price: Good morning, sir. Can you see and hear us?
Sir Wyn Williams: Yes, thank you.
Ms Price: Can we now call Margot James, who, as you now know, is now attending remotely this morning?
Sir Wyn Williams: Yes.
Ms Price: Can you see the witness, sir?
Sir Wyn Williams: I can indeed.
Can you see me, Ms James?
The Witness: Yes, good morning. I can see you, Sir Wyn.
Sir Wyn Williams: Thank you. Over to you, Ms Price.
Margot James
MARGOT CATHLEEN JAMES (affirmed).
Questioned by Ms Price
Ms Price: Can you confirm your full name, please, Ms James?
Margot James: Yes. It is Margot Cathleen James.
Ms Price: As you know, my name is Emma Price and I ask questions on behalf of the Inquiry. Thank you for attending to assist the Inquiry in its work and for providing the witness statement which you have ahead of today. Do you have a hard copy of that witness statement with you?
Margot James: Yes, I do.
Ms Price: It is dated 26 June 2024. If you could turn to page 28 of the statement, please.
Margot James: Yes, I have 28.
Ms Price: Do you have a copy of the statement with a visible signature with you?
Margot James: The hard copy doesn’t have the original signature but I did have emailed my hard copy with the signature, and I have looked at it this morning and I can attest to the fact that it is my signature.
Ms Price: Thank you. Are the contents of your statement true to the best of your knowledge and belief?
Margot James: Yes, they are.
Ms Price: For the purposes of the transcript, the reference for Ms James’ statement is WITN10910100. Ms James, your witness statement is now in evidence and will be published on the Inquiry’s website in due course. As such, I will not be asking you about every aspect of your statement this morning, just specific issues which are addressed in it. Okay?
Margot James: Yes, thank you.
Ms Price: I understand that there’s something you wanted to say at the outset of your evidence?
Margot James: Well, thank you very much for giving me the opportunity, Ms Price, to apologise to Sir Wyn and to everybody present that I am not in the room. Unfortunately, I got Covid at the end of last week, and I respect the fact that the rules that the Inquiry are following preclude me from being able to give evidence in person, although I am perfectly physically able to do so. Thank you.
Ms Price: I’d like to start, please, with an overview of your professional background and career in Government. You explain in your statement that in 1985 you co-founded and were Chief Executive Officer of a company providing public relations and medical education services to pharmaceutical companies and healthcare providers; is that right?
Margot James: Yes, that’s correct.
Ms Price: In 1999, that company was sold and you managed the change to it becoming a subsidiary of a large multinational?
Margot James: Yes, that’s right.
Ms Price: You acted as chair of that subsidiary until 2002?
Margot James: Yes.
Ms Price: Then you joined an advertising agency in 2003 as Vice President, Europe, with responsibility for the integration and growth of its healthcare assets?
Margot James: Yes, that’s correct.
Ms Price: You were first elected as a Member of Parliament in 2010 –
Margot James: Yes.
Ms Price: – and you served until 2019 when you stood down at the general election?
Margot James: Yes, that’s right.
Ms Price: Whilst a Member of Parliament, you served as an Assistant Whip from 13 May 2015 to 17 July 2016?
Margot James: Yes, I did.
Ms Price: Then from 17 July 2016 to the 9 January 2018 you served as Parliamentary Under-Secretary of State for Small Business, Consumers and Corporate Responsibility with the Department for Business, Energy and Industrial Strategy; is that right?
Margot James: Yes, that’s right.
Ms Price: It was in this role that you became involved in some of the matters relevant to the work of this Inquiry?
Margot James: Yes, correct.
Ms Price: After you left the Department for Business, Energy and Industrial Strategy, you held a further ministerial post for as Minister of State for Digital and the Creative Industries with the Department for Digital, Culture, Media and Sport, from 9 January 2018 to 18 July 2019?
Margot James: Yes, that’s right.
Ms Price: Since leaving Parliament, you have held number of roles, including being the Executive Chair of the Warwick Manufacturing Group at the University of Warwick, and two non-executive board roles in the financial services and technology sector?
Margot James: That’s correct.
Ms Price: You now do independent consultancy and pro bono work in the areas of decarbonisation and climate change?
Margot James: Yes, that’s right.
Ms Price: You are also an Emeritus Governor of the London School of Economics and Political Science?
Margot James: Yes, I am.
Ms Price: Turning then to an overview of the portfolio you had as Parliamentary Under-Secretary at BEIS, and the Post Office brief in particular, you describe your portfolio in this role as broad in your statement and you have set out the areas for which you were responsible at paragraphs 11 to 14. You describe postal affairs and the Post Office as one of eight policy areas and statutory bodies for which you had responsibility, all of which were responsibilities held in addition to the three main areas of responsibility: small businesses, consumers and corporate responsibility; is that right?
Margot James: Yes, that’s right.
Ms Price: Did the breadth of the portfolio impact upon your ability to provide effective oversight of the Post Office?
Margot James: I think that it would not have – the answer, I think, to the question, is no, in normal times. But I think that if one were to be – it made it very difficult – the breadth of the portfolio made it very difficult to drill down into any areas within the overall brief that weren’t already pre-identified as being needing of a significant amount of attention, over and above what you might distribute if you were distributing your time evenly across everything in your portfolio.
Ms Price: You deal with the postal affairs brief at paragraph 15 of your statement. Could we have that on screen, please, it’s page 15.
Here you describe the postal affairs responsibilities as themselves quite broad, and you say this:
“The core of the brief was to ensure that BEIS held the [Post Office Limited] Board to account for meeting financial and non-financial targets and delivery of work that was agreed to be central to the Government’s manifesto commitments. This included securing the future of 3,000 rural branches … and branches in lower income urban neighbours, modernising the network, meeting access criteria, and expanding services (in particular a digital verification and identification system, banking services and services to SMEs). Some of the central work to that brief was to ensure all routine small businesses and consumer banking services were available throughout post office branches, and in particular in rural areas and lower income urban areas.”
Then at 16, you say this:
“Apart from this there was significant focus within the postal affairs brief on planning and securing [Post Office] funding. The Government provides funding to [Post Office Limited] in the form of a subsidy (which recognises the wider social purpose of the network that goes beyond that which would be commercially viable).”
Picking up on the reference to the wider social role, would you agree that the maintenance of the Post Office’s social role was a Government policy objective?
Margot James: Yes, most definitely.
Ms Price: Put simply, was it the case that, even if it did not make financial sense to keep Post Office branches open in rural and low income urban areas, the social value of doing so justified it?
Margot James: Yes, that was a very clear manifesto commitment in 2015, that we’d protect the network and, by saying that, I mean particularly those services in rural areas and poorer urban areas, which would otherwise not be commercially viable. So the subsidy was in respect of the need for Post Office to deliver a service, significant parts of which would not be commercially viable if operated purely in the free market.
Ms Price: Would it be fair to say that subpostmasters running branches in rural areas and low income urban areas, as well as their staff and Post Office employees employed in such branches, played an integral part in the delivery of the Post Office’s social role?
Margot James: An absolutely crucial part. It certainly couldn’t have been delivered without them.
Ms Price: You deal with the distinction between operational or contractual matters on the one hand and policy or strategy matters on the other, at paragraphs 20 to 23 of your statement. Could we go to paragraph 20, please, it’s page 6. By way of background, you say this:
“It was the intention of successive governments that, although publicly owned, the Post Office should have commercial freedom to raise funds, invest in new technology, diversify its offering, and operate as a retail company in a competitive market. It was thought that these commercial freedoms were crucial to the sustainability of the Post Office. The legislation underpinning [Post Office Limited] (the Postal Services Act 2000 and the Postal Services Act 2011) therefore separated the functions of ownership and management. The executives of [Post Office Limited] owed their duties to the company, and were accountable to the [Post Office Limited] Board, not directly to the Government of the day.”
You go on in paragraph 21 over the page to say:
“The Government’s role is as sole shareholder. It is responsible for setting the overall strategy, policy or objectives for the Post Office, as well as ensuring that [Post Office Limited] works to deliver on those objectives, but not to have any involvement in the day-to-day running of the operations of the business. It was accepted that [Post Office Limited] would operate at arm’s length from Government, that such freedom was crucial to its ability to grow and over time reduce its dependence on the public finances. As shareholder the Government would only get more involved (through UKGI, who undertook the shareholder function on behalf of Government …) if the strategic aims or objectives looked as if they might not be met, such as if a key milestone had not been achieved.”
Would you agree that there may be times when the way in which an arm’s-length body conducts itself at an operational or contractual level can cause concern for ministers at a policy or strategy level?
Margot James: Yes, I can think of instances where that would be the case. I’ve set out my answers, I hope with some clarity, but there is a slightly theoretical nature to those answers, I think. It is not always that – the line between strategy and execution and policy, it’s a grey area, and the lines sometimes can get rather blurred. But, ideally, I think that the way that we’ve set it out – I’ve set it out – probably works best, as long as you have a board of directors that are acting in good faith and owners that know enough about the business to be able to make – exercise their judgement as to when they need to perhaps blur those lines a little bit and get involved in something that might be normally classified as operational, and when they can draw back and act in the normal way that owners of companies are supposed to act.
Ms Price: Particularly where, as a matter of policy, there is a social role performed by a government-owned asset, would you agree that it is vital that there is effective oversight of key operational and contractual matters which might have a policy or strategy impact?
Margot James: Yes, I think the social purpose heightens the need for both the Board and the shareholders to ensure that the highest standards of corporate governance and corporate responsibility pertain, but I think, actually, those standards should be respected, whether or not the company has a specific social purpose, essentially within its constitution.
Ms Price: Would you agree that, in order for there to be such effective oversight, the Government must have access to adequate information about key operational and contractual matters?
Margot James: Yes, I think that the information about operational matters should be at quite a high level. I don’t think it does the distinction between ownership and management any favours if shareholders are getting a massive volume of information about operational matters. That’s not appropriate but I think certainly the – there’s got to be high-quality information at a high level about both operational and strategic issues that are affecting the company at any one time.
Ms Price: Ministers need to be adequately briefed?
Margot James: Yes, they do. They certainly do.
Ms Price: And ministers must provide effective challenge to the arm’s-length body’s approach to key –
Margot James: Yes.
Ms Price: – operational and contractual matters which have the potential to impact upon policy and strategy?
Margot James: Yes. I think that there’s a role for both ministers and, in a government-owned entity, the shareholder representative function, which, when I was a minister, was undertaken by UKGI. It’s most important that they are in a position to challenge on a day-to-day basis but that doesn’t remove the responsibility of ministers to challenge maybe less frequently. But, you know, when – on the appropriate occasions when ministers meet directors of the company for updates and things like that, then ministers should also be challenging the board. But on the day to day, that would be delegated to UKGI in this instance.
Ms Price: At paragraph 23 of your statement, further down the page, please, you give your view on which side of the albeit blurry line between contractual and operation and policy and strategy Horizon IT issues fell. Starting three lines down at paragraph 23 you say:
“The legislation assigned the management functions, including the operations of the company, to [Post Office Limited]. This meant that issues concerning [Post Office Limited’s] IT systems, aside from the issue of further investment in it and budgeting for that investment, were questions of day-to-day operation of the company. Issues surrounding whether Horizon was functioning as it should were matters for [Post Office Limited] to resolve as part of its operations.”
The complaints about the Horizon IT system, about which you were briefed when you took up the role, were that the way the system was functioning had led to people who had run and staffed Post Office branches being wrongfully prosecuted and/or their contracts being wrongfully terminated. Were allegations like this not relevant to the wider policy and strategy goals for the Post Office?
Margot James: Yes, I think that allegations like that were relevant to the strategic – the delivery of the strategic goals of the Post Office. I don’t feel, when I started in the role, that that was the way in which I was briefed on the Horizon issue. But, yes, in answer to your question, had I been briefed in that way, yes. The answer is yes, it should have been.
Ms Price: Well, looking at it in a number of ways, first considering the social role which the Government wished to maintain as a matter of policy, which relied on the people who had run and staffed Post Office branches, there was a potential impact on that directly, wasn’t there?
Margot James: Yes. Yes, there was. Based on what I now know, certainly.
Ms Price: We’ll come on to that first briefing but, just taken at the high level, whether the allegations were right or wrong, the nature of those allegations were, on their face, weren’t they, relevant in that wider sense?
Margot James: I think, when we come on to discuss the nature and scale of the allegations which were briefed to me in the early – in my early days as minister with responsibility, did not strike me immediately as requiring in-depth oversight from myself as a minister at that point in time.
Ms Price: Looking at it in another way, wouldn’t IT failings resulting in wrongful prosecutions and terminations of contract have been inconsistent with any valid policy or strategy applying to the Post Office?
Margot James: Yes, I believe so. I believe so. I wasn’t aware – I don’t think I was aware that there were wrongful convictions. It may have been that I misunderstood my early briefings but, in my early briefings, I was advised that a number of people had gone to prison, but that was as a result of being convicted of a criminal offence in the courts.
Ms Price: At this stage, I’m just talking about the allegations, rather than whether those allegations were right or not, and we’ll come on to those prosecutions. But just in terms of those allegations, you’d agree, wouldn’t you, that were those allegations correct, that would of course be inconsistent?
Margot James: Yes, it would.
Ms Price: This is not to mention the impact on the future of the Post Office of potentially expensive and reputationally damaging litigation arising out of the allegations being lost or the litigation being lost; would you agree that that was a wider impact that needed to be considered?
Margot James: Most definitely.
Ms Price: Were those wider impact points considered at the time by you as Parliamentary Under-Secretary?
Margot James: No, not at the time. No. If you’re – yes, certainly not in the first sort of half of my time as minister.
Ms Price: Could we have on screen please paragraph 29 of Ms James’ statement, page 10.
You discuss here a potential distinction between the role and responsibility of the Department and you as responsible Minister when acting as a shareholder and when acting as a Government Department. Can I ask, why do you draw a distinction between the Government as shareholder and the Government as a Department?
Margot James: The shareholder role obviously is the ownership role, and that is where I think we delegated the responsibility for acting as an agent, if you like, on behalf of the Department to UKGI and UKGI was there to perform the normal responsibilities associated with the shareholders. I did wonder – when I wrote this, I did consider that the Government Department, particularly as it had, even in my own portfolio, you know, responsibility for corporate responsibility and corporate governance and the labour markets, that there was a wider remit that my Department had, given its responsibility for those areas of business policy that were affecting all businesses, particularly publicly quoted companies but also large private companies and, by inference, large public bodies – publicly-owned bodies like the Post Office.
So I felt that my department and myself as a minister should be more focused on those aspects than perhaps the shareholder function, which was acting purely as an agent of the owner.
That statement can come down now. Thank you.
I’d like to come, please, to the officials who assisted you in the part of your role which related to the Post Office and how, in general terms, they provided information and advice. If I have understood your written evidence correctly, there were, broadly speaking, two pools of officials who provided you with assistance on Post Office matters: first private secretaries from the Department’s private office, who assisted in preparing paperwork for your ministerial box and managed your diary; and second, officials who were subject matter experts in particular policy areas who, for the Post Office part of your role, worked for UKGI; is that right?
Margot James: Yes. That’s right.
Ms Price: Of these two groups, you say it was UKGI who prepared advice to you on the Post Office?
Margot James: Yes, they did.
Ms Price: You describe UKGI officials as conduits of information between the Post Office and BEIS and that, if you needed a briefing on Post Office issues or wanted to raise questions of the Post Office, this would be through UKGI in the first instance?
Margot James: Yes, that’s right.
Ms Price: You say at paragraph 25 of your statement that they also look the lead in challenging the Post Office Executives, and accounting for Post Office activities to BEIS. How did you understand those officials to challenge the Post Office Executives?
Margot James: I saw most of the challenge during the time where we were discussing budgetary matters, remuneration issues, the level of subsidy and investment were two distinct things that Government were providing. It was a particularly busy time on that issue, because we were approaching the negotiations around the next three years of Government investment and subsidy. So I saw most of the challenge in those terms because the early budgets that we received from the Post Office Board were quite considerably higher, or needing of more resource, than once UKGI had finished its various levels of challenge.
So I took it to mean that UKGI had a representative on the Board of POL and, in addition to that, a lot of work goes on behind the scenes within UKGI to provide good analysis, financial support, et cetera, and that was the nature of challenge that was going on that didn’t need my day-to-day involvement.
I dare say, by the way, that challenge was going on in other areas as well. I just answered the question by means of an illustration of an area where I was particularly aware.
Ms Price: You deal with the standards you expected from your officials at paragraph 26 of your statement. Could we have that on screen, please. It’s page 8. You see:
“As with the advice I received on all areas of my policy portfolio, I relied on officials for objective and honest advice. They were bound by the Civil Service Code and so I expected the advice given to be of this character. Given the breadth of all ministerial portfolios, it is necessary that Ministers make decisions on the basis of the advice given (except in those cases where I had good reason to challenge that advice) and we are reliant on its impartiality and accuracy.”
Why was impartiality in particular so important?
Margot James: Well, I mean, the Civil Service Code requires advice to be impartial and objective, and it’s very important, the impartiality aspect of it, for the advice to be given in good faith, without whoever is giving it having an agenda which may or may not be known to the intended recipient of the advice. So I think that’s what I regard as important when it came to impartiality: I required that the person providing the advice did not have his or her own agenda that would potentially impact the nature of that advice given.
And, throughout my ministerial career, I would say that most of the advice, the vast majority of my advice, met those criteria. On more than one occasion, though, it didn’t.
Ms Price: The part in brackets, are you saying here that you would follow advice given by officials in the absence of good reason to challenge it?
Margot James: Yes. I – normally the advice – if it’s advising you to take some action, the advice is usually provided in a way that provides you with some options and very cogent explanation of the implications of each option and I would normally, especially when I was new in post – I think you have to have a very good reason to challenge advice when you’re learning your brief. I mean, there are some exceptions to that but, in general, I would follow the advice given, you know, early on in any job I had in Government and, occasionally, you do have good reason to challenge that advice, yes. Generally not in the early days, I don’t think.
Ms Price: What would constitute good reason to challenge advice?
Margot James: When you feel that the – when you feel there’s some partiality, for a start. If you don’t trust the advice, that is a very good reason to challenge it. And when you think that it’s contrary to the public interest is usually the other reason. There can sometimes be – you have to have an eye on the Government and the impact you’re having on other Departments, Number 10, all these other stakeholders within Government. That might be a reason to challenge advice. You might feel that the advice is all well and fine but you know that a key player, whether that’s the Chancellor or the Prime Minister or your own Secretary of State, is going to have an issue with it, then that might be a reason to challenge it, against the public interest or you feel that there’s some partiality involved and you doubt its integrity. Those are the reasons, really, that I would have challenged advice.
Ms Price: At the time did you ever feel there was partiality in the advice being provided to you and the briefings being provided to you about the Post Office?
Margot James: No, I didn’t. I didn’t.
Ms Price: You go on at paragraph 26 to say this:
“I would, for example, rely on the officials to review and analyse the information provided to them and provide me with sensible steers on action and draft responses to correspondence or Parliamentary Questions which advanced the Government’s manifesto commitments and policy more broadly.”
You go on to deal with the process for dealing with correspondence at paragraph 27, and you explain this:
“Correspondence would be received by my private office and directed to me in a bundle a few times a week. It would initially be triaged by my private secretaries and I trusted them to deal with correspondence on my behalf. Documents which they referred to officials for analysis or advice would be returned to me with a submission or note of advice and often with a draft response for my consideration. I would read the correspondence and documents returned to me, but I relied on officials to direct me to the paperwork that required my close attention.”
How did you ensure that your private secretaries knew how to respond to correspondence appropriately on your behalf?
Margot James: There would be a sort of Government position – the Department position, the policy position, would be cleared and subject to review whenever circumstances changed, so that the correspondence would be – would come in and people not in my private office would draft responses using current Government approved lines in order to respond to the key points raised by the letter writer.
And they would then come into my private office, they would be checked over by the private secretary in my private office responsible for correspondence, and then she would arrange the correspondence with the MP’s letter, and then the response, and then the constituent’s letter, if indeed there had been a constituent’s letter attached. Not all MPs sent them: some did, some didn’t. Occasionally you would get letters from the public directly to the Department, to the Minister for whatever you were, and that would be dealt with in the same way, except there wouldn’t be an MP between you and the letter writer.
Ms Price: So when you say you trusted your private secretaries to deal with correspondence on your behalf, you’re not saying that they were replying on your behalf, you were saying they were dealing with the correspondence before it came to you?
Margot James: Yes. I mean, I think that the private office would reply to some forms of correspondence without checking with the Minister. Usually things like meeting requests, diary requests, lobbying campaigns, that sort of thing. There was a vast volume of correspondence, and some of it that would fall into that category would not reach me. It would be replied to by a private sector on behalf of the Minister – sorry, a private secretary on behalf of the Minister. But I think, for the – I think I’m understanding your questioning right: you’re talking about correspondence that did come through me personally.
Ms Price: I am talking about correspondence of substance, if I can put it that way.
Margot James: Yes. Correspondence of substance, it would be prepared in the way I outlined and it would then reach me in a big folder with the draft response for me to just sign.
Ms Price: Which officials did you rely upon to direct you to the paperwork which required your close attention: was that your private secretaries or the UKGI officials?
Margot James: It might be both. It might be either or both, really. It was exceptional. Normally it was just letters, they spoke for themselves, they didn’t need any particular briefing but, occasionally, there might be a briefing or an explanatory note and that would be provided to me either by my private secretary with responsibility for Postal Services or by an official from UKGI, depending on the nature of it.
Ms Price: You go on:
“There would be standard responses, based on agreed policy lines, to a large proportion of correspondence on any brief. Officials worked hard to draft those responses in line with government policy and they were updated over time and as circumstances changed.”
Was it UKGI officials who provided the substance of draft replies to correspondence in Post Office matters?
Margot James: Yes, I’m pretty sure it would have been. I can’t think that – they acted sort of in lieu of a normal BEIS team of officials on the Post Office brief so, yes, it would have been them.
Ms Price: In relation to the standard responses based on agreed policy lines, who proposed policy lines to take to you?
Margot James: The policy lines were approved, I would imagine in the early days, by the previous ministerial team and, periodically, if they had to change, they would require my approval. So you inherit, if you like, you inherit – because a minister comes in and it’s very automatic: the work continues and it’s – the identity of the Minister is completely irrelevant for some of the time, particularly in the early days, and the work just churns through and, instead of your predecessor signing it all, you’re signing it all.
So you don’t start afresh, looking at policies from the moment you sit down in your new ministerial seat. Not at all. You just carry on what’s gone before. And then, when circumstances change, of course, there may well be a change and that would then be yours to approve.
Ms Price: In the absence of a change in circumstances, would you routinely sit down and approve or consider whether you wanted to approve standard lines on agreed policy lines when you took up a role?
Margot James: Not as a rule, no. The way I tended to work would be to, if there was something I didn’t like about a line or the tone, sometimes – regrettably not always – sometimes I made time to amend them myself and this would either be, as I say a little bit later in the evidence, I think, by adding a PS or by rewriting it and sending it back, and, if I felt the change should be made in perpetuity, I would ask officials to make sure that the people responsible for the draft know that there’s a change here, and that they should make it – all future correspondence on that point. That’s how I tended to amend it.
Ms Price: Looking a little further up the page, please, at paragraph 26. Starting four lines from the top. You say this:
“After I had been in office for six to nine months it became clear to me that advice given by officials was often constrained by expectations on the part of officials of what might and might not be agreeable to Number 10, Treasury, or to another department which might be taking the lead on a particular issue. Officials would require challenge from the Minister in these circumstances if decisions were to be taken in what the Minister determined to be the public interest.”
Was this specific to the Post Office brief or the entire portfolio while you were at BEIS?
Margot James: It’s actually not particular to the Post Office, it’s what I learnt interesting my time as a minister in both departments. The only thing that jars with me there really is the last sentence “officials would require challenge”, I mean “might require challenge”. I think that was a bit of an overstatement in those circumstances. Yes, I did become aware of the great frustration, actually, of advice being limited by what the officials thought the Treasury would wear. It was mostly the Treasury.
Ms Price: What did you do to challenge this when you became aware of it?
Margot James: Well, I don’t think it’s – I’m very happy to answer that question. I don’t think I can give you an example from my postal affairs brief. Do you still want me to give you an answer to – an example of what could be the case?
Ms Price: That perhaps answers the question. In relation to the postal affairs brief, did you ever challenge that or – forgive me, let me ask a different question: did you ever observe that in your postal affairs brief?
Margot James: Right. I understand your question. If I could just give myself a minute to think.
Ms Price: So a perception that officials were being constrained by the expectations of what might and might not be agreeable to Number 10 and the Treasury or another department?
Margot James: I think I – I don’t think so, no. I don’t think there is an example of the advice I received from the Post Office team that was contingent on what might be agreeable to another department, HMT or Number 10, no. No.
Ms Price: In the specific context of replies to subpostmasters in correspondence, in the last two sentences of paragraph 27, a little further down the page again, please, you say this:
“I sometimes edited these responses myself [and these are the draft responses to correspondence] or added a postscript, when I had time and when the response drafted for me struck, in my view, the wrong tone. This began to happen with my replies to [subpostmasters] as I became increasingly uncomfortable with the line we were taking.”
When did you start becoming increasingly uncomfortable with the line which was being taken?
Margot James: I think, after approximately six months in the role. I couldn’t give you a precise date. I can’t – it wasn’t sort of contingent on a particular event. It was the letters I just occasionally received from subpostmasters, who – the ones who tended to write to me directly as Minister for Postal Services at BEIS and, after I had received a few of those letters, I started to think that the advice I was getting did not reflect what seemed to be happening to the people who were writing to me.
Ms Price: What aspect of the standard response or agreed policy line were you increasingly uncomfortable with?
Margot James: I was – well, I was certainly uncomfortable with the tone, and – yes, it started out as I was uncomfortable with the tone of the response that I was being asked to send the letter writer, by way of a reply and it gradually grew into a concern that the line that I was being given on Horizon was – I started to doubt it. I mean, there’s quite a bit in the line that I was being given whenever I – whenever the subject of Horizon came up for discussion in meetings. The thing that I started to doubt was the fact that all of the complainants were guilty of some sort of incompetence or theft or false accounting, or the things that I’d been told were causing the criticism of the Post Office and its computer system.
Ms Price: Starting with the discomfort you felt about the line that was being taken in response to subpostmasters, did you raise that discomfort with anyone?
Margot James: Initially, I rewrote – to deal with the tonal aspect, I did what I said I did up there: I either edited it or added a PS. When I started to be concerned that there were innocent people being caught up in something that was presented to me at the time as being a blanket problem with the complainant and not with the computer system, I started to raise Horizon more actively in my meetings with both UKGI and the Post Office, when I met the Post Office Board representatives, which happened sort of – I think I say there quarterly: three or four times a year, I suppose.
Ms Price: What was the response when you raised things more actively?
Margot James: The response was essentially a repeat in a different way of the lines that they always relied on and they – I mean, they conceded that there would be cases where something might be wrong that was nothing to do with dishonesty but, in general, they stuck to their line, which was that, you know – well, I don’t know whether you’re coming on to talk about that. I can go through it now if you wish me to.
Ms Price: We will be coming on to that. Just sticking for the moment with the question of draft replies to subpostmasters, the Inquiry has not seen any draft replies which show edits, as such, on them. What would your process have been if you wanted to make those changes? You’ve described a postscript, would that be on a document?
Margot James: It would be on the letter itself. I haven’t seen any either. It’s frustrating that so few letters have been retained. It’s a curious situation because you would think that the Department either retained all correspondence or no correspondence but they seemed to retain a few bits of correspondence. Who knows why. But anyway, I don’t know how many letters I sent out on postal matters but certainly more than the three, four or five that were included in the pack of information that we received from the Department, for the purposes of the Inquiry and I agree: none of them contain any edits at all.
What I would do is I would either alter the copy and then it would go back and be returned, you know, as a new copy of correspondence with my changes incorporated, and I would sign it and it would go, or, if I felt the person had waited for long enough for a response or I wanted to put it in my own words there and then and get the thing off, I might literally write in my own writing “PS” under my signature, and I might write three lines, I might write sometimes seven or eight lines, clarifying whatever was above and making the point that I wanted to make to the recipient.
Ms Price: Could we have on screen, please, UKGI00016320. This appears to be a draft letter, given the “Dear xxx” to the constituent of a fellow Member of Parliament. It is dated 12 October 2016 and we can see that it’s drafted in your name, by the top right-hand corner and the bottom of the second page. If we can just go to that quickly, please. Going back to the first page, the penultimate paragraph here says:
“[The individual] mentions the Post Office’s IT system. This system has over 50,000 users successfully undertaking transactions every day and there is no reason to consider that it is not fit for purpose. Your constituent refers to current legal proceedings which have been issued against the Post Office on the matter of the Horizon IT system; this is a legal matter and I am unable to comment further.”
Then the last paragraph:
“Whilst the Post Office is publicly owned, it is a commercial business operating in competitive markets, and the Government allows it the freedom to operate commercially on a day-to-day basis. Post Office places great importance on the relationship it has with postmasters, and I would encourage [the postmaster] to discuss any concerns he has with his contacts at the Post Office. [He] can also make use of the National Federation of SubPostmasters, who remain the representative body working for postmasters.”
Does anything in those two paragraphs contain anything which made you uncomfortable at the time?
Margot James: I don’t remember that particular letter and I think the date was October 2016, so I don’t think I would have been uncomfortable about that response at that time. But it would depend slightly on the nature of the letter that the MP had received. Sometimes, MPs didn’t attach the letter that you were actually answering, which was annoying but – so I would caveat my response by saying, if the letter had been a handwritten letter all about the Horizon system and the problems the individual was suffering, I think I would have found the tone of that response a bit impersonal and abrupt. But if, however, the letter had been of a more general nature as some letters were, criticising, you know, some of the other aspects of Post Office policy and throwing in the dispute over Horizon as an additional item, ie not from somebody who was actually personally affected by it, then I would have found that line acceptable.
I hope that was a clear answer? As I gave it, I started to feel it sounded a little bit convoluted.
Ms Price: No, that’s clear. In terms of the timings of this, you’ve picked up already on the October 2016 date, so you don’t think you were editing draft replies by this point in a substantial way?
Margot James: No, not in a substantial way wouldn’t have been, no.
Ms Price: I’d like to come, please, to what you were told about complaints and legal action relating to the Horizon IT system, when you first took up the role of Parliamentary Under-Secretary. You explain at paragraph 30 of your statement that, upon your appointment to the role, you were given a Day One briefing pack relating to the Post Office. Could we have that on screen, please. It’s UKGI00020328. This has the date July 2016, so when you took up the role. It is described as an overview and is it right that you consider that this was the first time that you became aware of the litigation?
Margot James: Yes.
Ms Price: Going over the first page, please, the first slide is entitled “Summary and Key Issues”, and this was a document, wasn’t it, that related to the whole Post Office brief not specifically to Horizon issues or the litigation?
Margot James: Yes, that’s correct.
Ms Price: The third paragraph on the slide says this:
“This pack gives a high-level overview of how [Post Office Limited] is set up, the areas in which it operates, and its long-term strategy. There are also some short-term matters (below) which you need to understand and may require prompt action. We recommend you receive more detailed advice on each.”
Then the last paragraph is headed “Horizon” and refers you to a later slide for more information but the summary here says:
“A small number of mostly former subpostmasters have raised concerns about [Post Office Limited’s] Horizon IT system, which they claim has caused their businesses losses. Over two years’ worth of independent investigation has founding no systemic faults in Horizon, but campaigning and media interest persists. As well litigation has been commenced against [Post Office Limited].”
Then going to page 14 of this document, which is slide 13, the heading is “Horizon IT System: Complaints and Legal Action”, and this was the information which was provided to you:
“Following complaints from a small number of (mostly former) subpostmasters about the Horizon IT system, in 2012 [Post Office Limited] commissioned an independent firm, Second Sight, to examine the system for systemic flaws that could cause accounting discrepancies.
“Second Sight’s Interim Report, published in July 2013, and Final Report, published in April 2015, both make clear that there is no evidence of system-wide problems with Horizon.”
That’s underlined:
“The Interim Report raised some questions about the training and support offered to some subpostmasters, and [Post Office Limited] implemented a series of measures to improve its processes. It also created a mediation to consider individual subpostmasters’ cases.”
The next paragraph addresses that Mediation Scheme and it says:
“While some cases were resolved through mediation, a number were not – in particular, cases where individuals had received criminal convictions (eg theft or false accounting), since mediation cannot overturn a court judgment.
“Earlier this year, group civil litigation on behalf of 91 claimants was commenced at the High Court. This is at an early stage and precise details of the claim are unclear. As there are legal proceedings underway, our advice is that this should remain independent of Government. It is a matter of law.
“The Criminal Cases Review Commission is understood to be considering [circa] 20 cases raised on this subject. This review has been underway since early 2015; we have no indication of when the CCRC may reach conclusions on any of the cases. [Post Office Limited] are engaging fully with the CCRC’s work.”
Then in bold at the bottom:
“We recommend you receive further briefing on this subject, and [Post Office Limited] would be happy to meet with you and provide any further briefing or information.”
The second paragraph here flagged up that there were two reports from an independent firm which had been produced. Did you ask to see those reports when you read this slide?
Margot James: I doubt very much that I would have done that. I can pretty much say no, I wouldn’t have done.
Ms Price: Why would you not have done?
Margot James: Because I was being briefed at that point across many, many different policy areas and I was just wanting to take in sort of top-line advice and move on, absorb as much as I could, and get to grips with my role. So I wouldn’t have requested any additional information, I was going to say at this stage, and that’s how it should have been and I should definitely have asked for it at a later date, and I don’t think I did. And I very, very much regret not asking for it.
Ms Price: Did you understand from the information here that there were people challenging the safety of their convictions on the basis of discrepancies they said had been caused by the computer system?
Margot James: I thought that the 20 cases being reviewed by the Criminal Cases Review Commission must have been a group of people in that category, yes.
Ms Price: Did you ask for any further information about how these individuals had come to be prosecuted at this time?
Margot James: I’m afraid I didn’t. I think I thought that – I would have thought that the CCRC would investigate and justice would be delivered via that route. I didn’t see it as a minister’s role to get involved in that.
Ms Price: In relation to the advice that this should remain independent of Government, on 29 July 2016, Laura Thompson from UKGI sent an email to your private office about the litigation. Could we have that on screen, please, the reference is UKGI00006961.
We can see here the email was copied to Richard Callard and Gareth Evans, that was Richard Callard who went on to give you a verbal briefing on 4 August; is that right?
Margot James: Yes.
Ms Price: Ms Thompson says this:
“There is currently civil litigation underway in the High Court against the Post Office by a group of [circa] 200 individuals, mostly former postmasters (postmasters are essentially ‘franchisees’ …). The claims relate to the Post Office’s ‘Horizon’ IT system, and accusations that Post Office has treated its agents unfairly. There is a chance that there could be some media interest in this issue over the weekend, because Post Office have today sent a letter to the claimants’ solicitor, which will be shared with the claimants and could therefore be made public.
“This is a legal matter and the operational responsibility of Post Office Limited, the company which manages the Post Office Network. As such our advice would be not to comment, and for Press Office to pass any media enquiries to Post Office directly. This is the approach we have taken previously on this issue – please let me know if you think SpAds or ministers would disagree.
“We will provide full briefing on this issue to ministers – this is flagged in the Day One briefing pack, and we have also included in our briefing to Margot James.”
Picking up in the middle paragraph here specifically, were you told at the time that your private office had been asked if they considered you would disagree with the proposed approach that this was a legal matter and the operational responsibility of the Post Office?
Margot James: I wouldn’t have disagreed with that, so whether I was told or whether I wasn’t, because I can see that is an email that I wouldn’t have seen, I would have been content with the advice. But I wouldn’t have seen that but I think it would have come to me in a different form, potentially you have it in another form shortly, but it would have come to me. But I didn’t see that particular email.
Ms Price: But in any event, your response would have been that you were content with that device, would it?
Margot James: Yes. It would have been.
Ms Price: Could we have –
Sir Wyn Williams: At that point in time, did you have a Special Adviser who had any – well, did you have a Special Adviser, first of all?
Margot James: No, I didn’t but I did have access to Special Advisers to the Department who advised the Secretary of State and there were three of them and, with the benefit of hindsight, actually, I think one was a lawyer and I could have – I should have asked him. But we didn’t have Special Advisers at my level in the ministerial sort of hierarchy.
Sir Wyn Williams: That’s fine. Thank you.
Yes, Ms Price?
Ms Price: Thank you, sir.
Could we have on screen please paragraph 35 of Ms James’ statement. It’s page 11. Starting four lines down, you note the advice provided by UKGI that the proceedings “should remain independent of Government: it is a matter of law”, and you’re referring here, aren’t you, to the Day One briefing that we’ve just looked at?
Margot James: Yes.
Ms Price: You provide this comment:
“I took this to mean, as I would do in any litigation relating to the Government, that BEIS should not look to interfere with it or comment on the process until it was concluded.”
What do you mean here by “interfere”?
Margot James: That’s a poor choice of word because it’s obvious that Government shouldn’t be interfering in legal process. I think I took it to mean that we have to be careful, as ministers, not to say anything that might prejudice legal outcomes of cases that are live within our court system, and that’s a general principle that most Parliamentarians are aware of, whether you’re a minister or not. Of course, it doesn’t preclude you from taking a view but you have to be alive to the consequences, which can interfere with the outcome of the trial.
I think also, an appreciation that once matters have reached the courts, the courts are in the best position to – well, it’s their job to adjudicate the outcome, and they get to see all the evidence and all the witnesses and, as a minister, you don’t, so it’s unwise to opine, I think, on cases that are going through the courts. As a general principle.
Ms Price: By “comment”, do you mean internal comment or public comment?
Margot James: Public comment. And, of course, that doesn’t – I might go on to say this – sorry, I’m not good at reading while I’m talking but, yes, it’s that constraint, if you like does not preclude you, of course, from discussing litigation in private, particularly with one of the parties.
Ms Price: Exploring a little what you say here, because you make wider reference to “any litigation relating to the Government”, where a Government department is the defendant in civil litigation, it’s right, isn’t it, that instructions need to be provided by the Department to lawyers acting for the Government, both as to the substance of the claim and litigation strategy?
Margot James: In general, yes, that’s true but I don’t think that happened in this case.
Ms Price: We’ll come on to why this case might be different but I’d just like to ask you some general questions about that because it seems to influence your approach in this particular instance.
So if litigation against Government is high-profile enough, it’s right, isn’t it, that both the substance of the defence and the litigation strategy may need to be signed off by senior civil servants and potentially ministers, would you agree?
Margot James: Yes, I would agree.
Ms Price: So, as a matter of principle, whilst a Government Department which is a party to litigation may choose not to comment publicly on the litigation, as you’ve just referred to, it’s not right to say that the relevant Department will not be involved in the legal process until it’s concluded, is it?
Margot James: No, I agree with what you’ve said, yes.
Ms Price: Of course the position is one step removed where the defendant is a government-owned asset but would you agree that the fact that an issue is the subject of litigation against a government-owned asset should not prevent a minister holding the brief for that asset from being fully briefed on the underlying issues in the claim?
Margot James: Yeah, you’re right. I mean, it shouldn’t just preclude, it should happen as a matter of course, really.
Ms Price: So that that minister can fully understand the case –
Margot James: Yes.
Ms Price: – or, whether or not comes to it, the proposed defence and the proposed litigation strategy?
Margot James: Yes. You are right. And we didn’t, in this case.
Ms Price: Looking again at paragraph 35 of your statement, six lines up from the bottom, you say:
“Perhaps due to this position being taken [and that is the position that it was a matter for the courts, a matter of law] not many details were provided [and this is in the Day One briefing pack]. Whilst the Day One briefing pack did mention the litigation, it did not, for example, contain any details about there being concerns around remote access to Horizon or the deletion and replacement of files. Whilst it referred to the Second Sight Interim Report and Final Report, it did not refer to any of the subsequent reports, reviews or actions taken by [Post Office Limited]. It did not contain any information on the Simon Clarke Advice, any of the Deloitte reports or the Swift Review. With the benefit of hindsight this briefing, even making allowance for the fact it was a high-level summary, was very selective and omitted several important developments.”
So to your mind, even taking the approach that this was an operational matter for the Post Office and with the courts, is it your view that this briefing did not provide you with adequate information about the issues underlying the litigation?
Margot James: 100 per cent. I mean it certainly – I think they included reference to the Second Sight Reports, because the Second Sight Reports, I presume, had been in the public domain for so long that they had to include them. But there’d been other reports – and you just summarised by name which reports are relevant – that were not mentioned at all, ever.
Ms Price: We saw, on the “Summary and Key Issues” slide of the Day One briefing on page 2, that there was a recommendation that you receive more detailed advice on Horizon. There was then a recommendation in bold, at the bottom of the “Horizon IT System Complaints and Legal Actions” slide, which recommended you receive further briefing on the subject, noting that the Post Office was happy to meet with you to provide any further information or briefing.
You deal with this at paragraph 38 of your statement. Could we go to that, please. It is page 12, please, towards the bottom of the page on page 12.
You refer to a promise that UKGI would provide a full briefing on the issue to ministers. Is that the promise in the email we looked at dated 29 July from Laura Thompson?
Margot James: Yes, I think so.
Ms Price: Then you say this:
“It is correct that the Horizon IT system issues were flagged in the Day One briefing pack as explained above. But to the best of my recollection I never did receive what might be termed a ‘full briefing’. I regret not asking for one and that my private office did not follow up on this promise.”
Margot James: Well, that’s true, I do very much regret not asking for one. I had a briefing when I met with the Board, when I asked questions, but it didn’t build very much on what I’d already been told, if at all.
Ms Price: Well, we’ll come on to what came next but, just for now, thinking about those recommendations, which had been made twice in the briefing pack, once in bold –
Margot James: Yes, I know.
Ms Price: – why didn’t you ask for the briefing when you read those recommendations?
Margot James: I might have said, “Well, we must get that”, but I might not have specifically asked for it. I think I’m saying that because I don’t recall ever getting one and I think, to be fair to UKGI, that they would have given me one, had I pressed for it, but whether – how full it would have been, no one would know, but fuller than perhaps had been included to date.
Ms Price: Sir, I wonder if that might be a convenient moment for the first morning break.
Sir Wyn Williams: Yes.
Ms Price: I think it is 11.25 now, so if we were to come back at 11.35, please.
Sir Wyn Williams: All right.
Ms Price: Thank you, sir.
(11.24 am)
(A short break)
(11.36 am)
Ms Price: Hello, sir. Can you still see and hear us clearly?
Sir Wyn Williams: Yes, I can.
Ms Price: Is the link still working to the witness as well, sir?
Sir Wyn Williams: As far as I’m concerned, it is.
Ms Price: Thank you, sir.
Ms James, you received a verbal briefing from UKGI on 4 August 2016 – is that right –
Margot James: Yes.
Ms Price: – from Mr Callard and Ms Thompson from UKGI?
Margot James: Yes.
Ms Price: This was another briefing spanning the whole of the Post Office brief, rather than being specific to the litigation and the issues underlying it; is that right?
Margot James: Yes, that’s right.
Ms Price: Could we have on screen, please, UKGI00000015. This is the note which you say in your statement you were provided with ahead of this meeting. It is a three-page document and Horizon IT issues are addressed on the second page. Could we go to that second page, please, and it is listed first under “Things you need to know”. The notes say this:
“‘Project Sparrow’
“Alleged problems with IT system seeing postmasters suffer losses and in some cases imprisonment.
“No evidence of bugs in the system despite three years of investigation.
“High Court proceedings have begun.
“Suggest we give you a fuller briefing on this as it regularly flares up.”
Can you recall now what you were told about Project Sparrow at the meeting?
Margot James: I can’t recall what I was told at the meeting – at that particular meeting, no. I would think that I was not told very much. It was, as you say, an introductory meeting for the whole of the Postal Services brief, probably excluding the Royal – oh, actually, Royal Mail is down there. So I doubt I was told much more than what appears there.
Ms Price: There is here a further suggestion that you have a fuller briefing. On this occasion, did you ask for a fuller briefing specific to the Horizon IT issues?
Margot James: Not on that occasion, no.
Ms Price: Can you recall why not?
Margot James: Because I was content with the briefings I was getting on the issues which were, I suppose I thought at the time, were the highest priority issues for the responsibility I had for the Post Office and I wouldn’t have pursued a fuller briefing on something that fell into the category of things I need to know. I would hope for a fuller briefing on something I needed to know when it became more of a priority matter for my consideration, if you follow the distinction.
Ms Price: Yes, could we have on screen, please, paragraph 40 of Ms James’ statement. It’s page 13. Here you say this:
“I do not remember the detail of that verbal briefing on 4 August. I believe it covered the topics outlined in the July2016 Day One briefing pack. My understanding was that there may be occasional faults in the IT system, but nothing that was a structural flaw across the system.”
Did you understand at the time the occasional faults in the system to be capable of causing accounting discrepancies?
Margot James: No, I wouldn’t have understood that at the time. No.
Ms Price: Did you ask for any further information about what those occasional faults were?
Margot James: Not at the introductory meetings, no. I asked for more information about what the occasional faults might be later on in my time as Minister but I wouldn’t have done during the meetings that you’re talking about, the introductory meetings.
Ms Price: When later on in the time you held the role did you ask about the nature of the faults?
Margot James: I would have asked after a few months, after six months or so, once I started getting concerned that there was more to the Horizon issue than I had been briefed about.
Ms Price: Who did you ask?
Margot James: I asked at one of my meetings with Board representatives. That would probably have been the CEO and the CFO and, although I referred to meeting the Post Office Board three or four times a year, I don’t think I ever met the whole Board, that wouldn’t have been a good use of their time. What I meant was I would meet the key people from the Board: the CFO, the CEO, possibly they might have with them the Government Affairs Director.
Ms Price: When you asked for more information about these occasional faults, what were you told?
Margot James: I was told that this had been the longstanding problem, that there’d been independent investigations into Horizon over two, if not three, years, that some faults might be found but nothing systemic, nothing system-wide, capable of causing a significant problem for a large number of postmasters. I was told that a number of postmasters had been convicted and there were very few of them affected. Given the fact that 65,000 people used the Horizon system, the numbers involved were very small indeed.
And I would say that the demeanour of the Post Office was they were very good at presenting themselves as the victim in all this. They came across as beleaguered; what more could they have done; they’d set up this Mediation Scheme; they’d improved their training processes; they did acknowledge that there were occasional faults, as with any computer system and nothing capable of causing the amount of harm alleged.
So I wasn’t wholly satisfied with this but that was the sort of tenor of the conversation I got when I probed more. And I said before, I should have asked for the Second Sight documents and that was possibly my biggest mistake, especially the second one, if I’d ever been able to get the second one out of them.
Ms Price: Could we go, please, to paragraph 49 of Ms James’ statement, that’s page 15. Here you deal with a meeting you had with Paula Vennells on 1 September 2016, and you say this:
“I was briefed in advance of that meeting by Michael Dollin of UKGI … This was a routine introductory meeting to help me understand the current issues facing [Post Office Limited]. I do not recall the Horizon IT system issues, the SPM complaints or the Group Litigation being discussed in that matter. I was certainly not briefed specifically on those issues and matters relating to Horizon were not included in the meeting agenda.”
There is a document which may assist on why Horizon issues were not addressed at that meeting. Could we have on screen, please, POL00244227. This is an email from Tom Wechsler to Paula Vennells, copied to others. It is dated 30 August 2016. It appears to be Paula Vennells’ briefing, or referring to her briefing, ahead of the meeting with you on 1 September. Underneath points 1 to 4, there is this:
“Since the base material was pulled together we have had some additional feedback from UKGI, including this evening.
“Their advice was …”
Then at the fourth bullet point:
“The Minister has been briefed on Sparrow but is content that this is best left to the Courts – no need to cover the issue in the meeting.”
Had you agreed by this point that this was a matter best left to the courts which should be dealt with independently of Government; that was the advice we saw in the Day One briefing?
Margot James: I don’t think that would be an unfair summary of – a view I might have expressed at a meeting if, given the advice that, “Now the litigation is underway, it would be best to wait for the outcome of that litigation before taking any further steps with relation to the Horizon issue”. I don’t think that would be an unfair – I don’t recall actually saying that, proactively, at that time. I might have agreed the advice. It’s a moot point.
Ms Price: Why do you say it’s a moot point?
Margot James: Because I think, at best, it’s an overstatement of a view that I had. I might have agreed advice, yes, it is indeed best left to the courts, but that does not need – that does not mean, ergo, that the issue shouldn’t be covered.
Ms Price: Of course, if I can just stop you there, my question at the moment is limited to whether, regardless of the consequences, you had agreed at that point that it was a matter best left to the courts, independent of the Government, which was the advice set out in the Day One briefing pack?
Margot James: All I can say was that I didn’t disagree with it. I wouldn’t have disagreed with it. I doubt my agreement was sought. Introductory meetings are not places – they’re not times where ministers give guidance and advice. They are – the Minister is in reactive mode, it’s he or she is absorbing information. If something strikes you, I think, as extraordinary or something you wouldn’t agree with, you would say that, but you wouldn’t be actively giving a view on an area of policy in an introductory meeting.
Ms Price: Were you aware at the time that this was the reason that the issue was not covered in the meeting with Paula Vennells?
Margot James: No.
Ms Price: What would your reaction have been, at the time, if you had learned that you agreeing this was a matter best resolved by the courts meant you were not going to be given any information on the issues underlying the litigation by the CEO of the Post Office?
Margot James: I think that would have been wrong. I think it would have been wrong for them to assume that, because I seemed content with that advice, that that meant that no further information was required. I mean, it should really have been covered in the meeting. But it also should have – I should have been given a proper briefing. If I can remind you of our discussion earlier about the Civil Service Code and the importance of impartial and objective advice, to have information as – well, as the Post Office did, well beyond the Second Sight Reports that they disclosed they had, and not provide ministers with the same level, if you like, of information at the very least as they were providing about Second Sight, was very wrong.
So I wouldn’t think that bullet 4 is a free pass for the Post Office never to mention Horizon or anything about it to that minister ever again, no, definitely not.
Ms Price: We will come on to the press lines which were agreed about the litigation but, just looking at this document alone, do you think that your early agreement, or at least lack of objection, to the approach that this was an operational matter for Post Office best resolved by the courts may have led to you receiving less information from UKGI and the Post Office about complaints and legal action relating to the Horizon system?
Margot James: Well, I think that – yes, I think there is a partial explanation for – it gives – I think it possibly gives them an excuse to feel, “Well, she’s happy for this to be decided by the courts, so we’re not going to provide any further information”. I think it gives them cover for that, unfortunately. So …
Ms Price: Would you agree, though, that this should not have been the case because a decision not to comment publicly on an ongoing legal case should not prevent effective oversight by the Government of such important matters, which were the subject of those legal proceedings?
Margot James: Yeah, I agree strongly with that. I agree strongly with that and, indeed, had the initial briefing pack, which you had on the screen an hour or so ago, had that contained a comprehensive – brief but comprehensive briefing on the Horizon issue, then I would definitely have expected to have covered it in my first meeting with the CEO.
It was a selective briefing, as I think I have already communicated and, therefore, the slant was – lulled me into a false state of security, I think, on the issue.
Ms Price: That document can come down now. Thank you.
You were given some information on Horizon IT issues ahead of Parliamentary debates on the future of the Post Office in November 2016 and March 2017; is that right? These are covered in your paragraphs in your statement.
Margot James: Yes.
Ms Price: The information that you were provided with was part of a wider briefing pack covering a range of issues; is that right?
Margot James: Huge range of issues, yes.
Ms Price: You deal with this at paragraphs 51, 52 and 61 of your statement, if you need to refer to them.
Margot James: Thank you.
Ms Price: You say that the briefing pack repeated the information and advice you had previously received; is that right?
Margot James: Yes.
Ms Price: You describe at paragraph 22 of your statement Parliamentary debates being of particular value to you in keeping yourself informed independently.
Margot James: (The witness nodded)
Ms Price: Whilst neither of these debates focused specifically on Horizon issues, would it have been helpful for you to have had more fulsome information about Horizon issues for those debates?
Margot James: Well, no. Unfortunately, it wouldn’t have helped me because Horizon didn’t come up in either of the debates. If it had done, if one of the MPs who was very knowledgeable about the matter had decided to attend the debate and hold forth, then a briefing would have been useful. But, in the absence of such a member, it wouldn’t have been useful because no one raised it.
Ms Price: You were provided, ahead of such Parliamentary debates, with these written briefings. Did they themselves not serve a purpose in terms of you becoming more independently informed, or more informed, about the –
Margot James: Um – sorry, I shouldn’t have interrupted you. I apologise, what was your last sentence?
Ms Price: My question is whether, regardless of what questions you were asked in the debate, the briefings themselves served a purpose for making sure you were informed in relation to briefs you held?
Margot James: Yes. Well, they did, although that wasn’t the prime purpose. One would hope that the Minister was informed enough, certainly by the time of these debates, but you still need a comprehensive briefing, you know, to remind you so that you can refer to stuff during the debate. If the debate had been about the Horizon issue or the Mediation Scheme, about something relevant to the Horizon issue, then I think that would have put UKGI a real bothersome position because they would have had to have briefed me more. I couldn’t have gone into the a Parliamentary debate with the usual ten lines or five lines – ten, if you were lucky.
They’d have had to have briefed a whole briefing pack on the matter. But, alas, while I was Minister, the only issue that really generated noise in Parliament was potential Post Office closures. That was the thing that was alive in Parliament during my 18 months in the role.
Ms Price: Turning, then, to the press lines which were agreed about litigation, could we have on screen, please, page 18 of Ms James’ statement. At paragraph 56, you deal with an update on the litigation, which you received on 20 January 2017. This discussed an upcoming hearing at the High Court on 26 January 2017.
Towards the end of the paragraph that you quote here from that document, is a section on media interest. It says this:
“If there is any media interest, I would suggest our usual approach of referring any enquiries to Post Office. I would not suggest we comment on legal action – but welcome thoughts from Press Office.”
You then say at paragraph 57 that you decided to accept this advice, the advice about media lines; is that what you’re referring to?
Margot James: Yes, I think that’s the only thing they’re asking my agreement to.
Ms Price: Yes, after consultation with the BEIS Press Office. Then you deal at paragraph 58 with an email dated 31 January 2017, in which Laura Thompson confirmed UKGI’s advice that:
“… ‘we’re content with the suggested lines – pass to Post Office in the first instance, ‘operational matter/legal proceedings’, if needed …”
Was this the established line by this point: that this matter was an operational matter for Post Office and being resolved in court?
Margot James: Yes, that was the position, and I noticed the email came from Claire French. I think she was the lead person from the Press Office of what was BEIS at the time, and that was the established position, yes.
Ms Price: At the time, were you satisfied with that line?
Margot James: Yes, I would have been, I would have been satisfied with that line. I didn’t suspect the Post Office of acting in bad faith and they were best equipped to comment on issues pertaining to their own operations. Far better that they comment than the Government comments on something which, yes, we did regard at the time as an operational matter for the Post Office.
Ms Price: Was this also the line which was being given to subpostmasters in correspondence at this stage, so early 2017?
Margot James: Yes, it would have been. It would have been.
Ms Price: Did you think that that was a satisfactory response to be given to subpostmasters in correspondence at that time?
Margot James: Early in January, yes, I probably would have done. I would say that my feelings altered during Quarter 1 of 2017, I think.
Ms Price: Do you accept now that the litigation and the underlying Horizon allegations were not simply operational matters for the Post Office?
Margot James: I do. I do accept that, yes. They should have been. If they’d been handled appropriately, they should have been an operational matter for the Post Office but, because of the way the Post Office was behaving, they most certainly should have been a matter for the Government, for the owner.
Ms Price: Would you agree that the effect of this line, passed to Post Office in the first instance, was to defer to the Post Office on issues concerning the integrity of Horizon?
Margot James: Yes. I think that’s a fair assessment.
Ms Price: Is it right that the Post Office’s interests were not one and the same as the Government’s?
Margot James: That’s quite a broad question.
Ms Price: In the specific context of these issues?
Margot James: Yes, I see. Well, given the regrettable lack of suspicion on the part of myself – I can only speak for myself – at the time, there was nothing wrong in my view with that position. But anybody – anybody who knew what was going on at that point within the Post Office on this issue, to anyone who was in possession of that knowledge, it would not have been an appropriate or adequate response because what was going on was potentially so damaging, obviously, to the victims of the behaviour but also to the Post Office itself, and to its owner, that you wouldn’t allow – you wouldn’t delegate everything about the matter to the organisation that was behaving in all the wrong ways in its management of the matter.
Ms Price: Had you seen the reports which you say you should have been provided with – and we went to that list earlier, including the Deloitte reports, the Swift Report and the Clarke Advice – would you have agreed to defer to the Post Office in this way?
Margot James: No. No, definitely not. I think that we would have had – we wouldn’t be at this position at that point in time, had we had all that information that you’ve just mentioned by virtue of those reports. I suspect the Government’s – the BEIS Legal Department, myself, as Minister, and the Secretary of State, would have been all over it, demanding change – I mean – well, I mean you can start by demanding the implementation of Jonathan Swift’s recommendations. That would have been a good place to have started.
Ms Price: Do you think that this line, “operational matter, legal proceedings”, may have had the continued effect of you being provided with limited information about the allegations which underpinned the litigation?
Margot James: Sorry, I don’t quite – I don’t really –
Ms Price: Well, going back to the discussion we had earlier about the early lack of disagreement to this being an operational matter and a matter for the courts, and what the consequences of that might be, and we looked in particular at the email to Paula Vennells, which appears to have led to that issue not being discussed at that meeting –
Margot James: Yeah, I see what you mean.
Ms Price: – we talked at that stage in the context of your early briefings. My question is: looking at this line which continues to be used throughout 2017, I’m asking whether you think that continued potentially to have the effect that less information was coming to you than should have done?
Margot James: Well, I mean, possibly they would use that as an excuse to not provide the information but, of course, as we just discussed and I think you just mentioned briefly then, it all goes back to the partial briefing that was included in my Day One pack and the first meeting I had with UKGI.
Ms Price: Does this serve to underline the fact that the distinction between operational and contractual matters and policy and strategy matters is necessarily blurred and should have been blurred, and there is a danger in putting things in a sealed box marked “Operational, contractual, legal”?
Margot James: Yes, I think so. I think you have to accept that you use your best endeavours as a shareholder to hold the Executive to account and, in general, that means leaving the Executive with responsibility for execution and operations because, obviously, if you interfere too much, then the Executive can rightly challenge you back when objectives aren’t met. And too much blurring compromises accountability. But having said that, there is a blurred line between strategy and execution and operations, and to deny any overlap can have the reverse effect, whereby shareholders are completely blindsided, on the basis that “This is an operational matter, therefore you don’t need to know anything about it whatsoever”.
I should add, though, that when you’re in Government – and indeed in the private sector, it’s no different, really – you do expect the people you’re dealing with to be complying with the law at the very least and certainly to be acting in good faith and, of course, that was not the case.
Ms Price: The standard line to this effect was provided in further briefings for you for an MP drop-in session, and you deal with that at paragraph 65; a cribsheet on the Post Office, which you deal with at paragraph 66; and a Hot Topics pack, which you deal with at paragraph 67; all of those being in 2017; is that right?
Margot James: Yes, I think so.
Ms Price: Did that standard line continue to be used in correspondence to subpostmasters throughout 2017, as far as you can recall?
Margot James: As far as I can recall, it would have done, yes.
Sir Wyn Williams: Can I just ask you, I’m not sure – and this is my ignorance, all right – if Ms Price is going to show you particular letters from subpostmasters during this period but I’m slightly querying the extent to which you would have received letters from subpostmasters when there is active litigation ongoing, all right? On the one hand, you’ve got the Group Litigation – I think it was made Group Litigation in March 2017. So there’s a legal process going on and, on the face of it, I’m a little surprised if individual postmasters were writing either to you or to ShEx or whoever – UKGI, I’m sorry – while that litigation is going on.
I mean, what is your memory of actual letters either from subpostmasters or MPs on their behalf?
Margot James: Don’t recall receiving a letter from a subpostmaster who was among the Group Litigation Order, one of the complainants in that case. I don’t recall anybody writing to me who was themselves going through that litigation.
Sir Wyn Williams: Yes.
Margot James: I do recall postmasters writing to me about the Horizon issue in more detail and describing the experiences that they were having with Horizon.
Sir Wyn Williams: All right.
Margot James: And that – that would have been, I think, whilst this litigation was going on but coincident to it.
Sir Wyn Williams: All right. Well, if there are particular letters that Ms Price wishes to refer to, no doubt she will. But can you just give me an approximation of a number of such letters you received, say in the last 12 months that you were relevant minister?
Margot James: I would probably have received maybe ten-ish, I would say.
Sir Wyn Williams: All right, thank you.
Margot James: Almost one a month. But not quite.
Sir Wyn Williams: Fine. Thank you.
Sorry, Ms Price.
Ms Price: Not at all, sir. If it assists, the letters that I have for the purposes of this witness, the latest one is in October 2016, so it was very much a question without the documents providing a clear answer.
Sir Wyn Williams: Without wishing to have a chat to you, Ms Price, I rather suspected that, if there were specific letters, you would have put them by now. Hence my questions to try to clear my mind.
Ms Price: Yes, sir. Thank you.
Sir, would that be a convenient moment for our second morning break, please?
Sir Wyn Williams: Yes. Just so that I can manage what goes on, what are you anticipating in terms of the further time necessary to examine Ms James?
Ms Price: I will be very nearly finished by lunchtime. But I think I will still have a little to go after lunch, probably no more than 15 minutes or so after lunch, plus Core Participant questions.
Sir Wyn Williams: Well, I was going to ask you to check about whether we actually need to have a full lunch break, especially given that Ms James is recovering from Covid. If it’s the case that we could complete the evidence by, say, 1.30 to 2.00, with just further short beaks, that may be a preferable way of dealing with things, so have a chat to Core Participants and see what they say. All right?
Ms Price: Yes, sir. I will do. Thank you.
Sir Wyn Williams: Thank you very much. So what time shall we resume?
Ms Price: 12.25, sir, please?
Sir Wyn Williams: Fine.
(12.14 pm)
(A short break)
(12.25 pm)
Ms Price: Hello, sir.
Sir Wyn Williams: Hello.
Ms Price: I’ve discussed with Core Participants the likely time estimate for questions, and there should be a total of around 15 minutes, made up of five minutes from Mr Stein and ten minutes from Mr Henry. So it should be possible to conclude, I would hope, if we go through now, by about 1.15.
Sir Wyn Williams: That’s perfect, Ms Price. You carry on then, please.
Ms Price: Thank you, sir.
I’d like to come, please, Ms James, to your impression about the Post Office Board and the Chief Executive Officer’s willingness to discuss Horizon issues. Could we have on screen, please, paragraph 49 of Ms James’ statement. That’s page 15.
Towards the bottom of the page, starting three lines up, you say:
“Later in my time as Minister (it is hard to remember exactly when) I formed an impression that Horizon was the last thing that the [Post Office Limited] Board or CEO ever wanted to discuss, that they would never bring it up proactively and, if I asked questions about it, they were reluctant to speak about it in detail. To begin with, I simply put this down to it a difficult issue which was subject to ongoing litigation, but as time went on and as I started to get number of letters from MPs raising complaints from [subpostmasters] in their constituencies, and some letters from [subpostmasters] themselves which contained accounts of their personal experience of Horizon which was at odds with the minimal details disclosed to me by the CEO of [Post Office Limited]. I started to feel that there might be more to the Horizon issues than I was being told.”
Starting, please, with the way you had contact with the Post Office Board and the CEO, in your statement at paragraph 22, you say that you would challenge the Post Office Board where appropriate by questioning them at quarterly meetings. Who attended those quarterly meetings? You referred earlier to the CEO and the CFO; did anyone else ever attend?
Margot James: Yes. Others did attend but I’m afraid I can’t remember which individuals from the Board attended with the CEO and CFO. I would imagine it would have been the Government Affairs Director but I can’t say for sure. Occasionally, I would meet the CEO just on her own, and I think there were occasions where it would just be the CEO and CFO, and then there were occasions where they might be accompanied by another Board Director.
I think the first time I met representatives of the Board there were probably about four of them I met on the first instance, but it was a reduced number after that initial meeting.
Ms Price: Those quarterly meetings, how long did they last?
Margot James: They probably lasted 45 minutes.
Ms Price: That was to cover all Post Office issues during that time, was it?
Margot James: Yes.
Ms Price: Were Horizon issues ever on the agenda for those meetings?
Margot James: I think I can safely say no.
Ms Price: Did you ever ask for Horizon issues to be put on an agenda for those meetings?
Margot James: Not to my knowledge.
Ms Price: Did you ever attend a Post Office Board meeting?
Margot James: I don’t think I did, actually. I’m quite surprised but, I mean, I should have done. But then, diary management was extremely, extremely difficult and I think there would have been an intention to have attended a Post Office Board meeting but I don’t recall ever attending one and I suspect that it was a matter of diary management, I think. I mean, certainly it was in the case of other institutions for which I was responsible for, for example, I wanted to attend a meeting of the Board of the British Business Bank, and I failed to do that. They were in Sheffield, which didn’t help, in terms of the lengthy travel time involved but, even so, I would go up north quite regularly with my portfolio. It’s just – it was a very, very difficult thing to manage all the diary requirements for such a wide and varied brief, really.
Ms Price: If you didn’t ask for Horizon issues to be on the agenda for your quarterly meetings, do you think you did, in fact, raise Horizon issues at those meetings or not?
Margot James: I did, certainly at one of them, probably two of them, I would say. Yes.
Ms Price: Can you recall when you raised those Horizon issues?
Margot James: It would have been, I think, probably after the funding issues were resolved. So that would have been in the second half of 2017.
Ms Price: Did you say it was on one or two occasions at which you raised Horizon issues at those meetings?
Margot James: I can only really be sure of saying at least one, probably two occasions because, inexplicably, although, as you’ve seen, because you have the documentation in front of you and you put some of it on the screen, I have been given, you know, copies of meeting briefs, agendas, even, but not one meeting minute. So there was no readout or report, or whatever you want to call it, from any of the meetings through the whole time I was at the Department, which is strange. Not for now, but it is of interest what is retained and what isn’t. It seems very random.
Ms Price: If you think that you raised Horizon issues only once, possibly twice, at your meetings with the CEO and the CFO, what was it that led you to form the view that the CFO and the Post Office Board were reluctant to discuss issues to do with Horizon in detail?
Margot James: Because occasionally I would meet with the CEO one to one, in addition to the Board members which we’re now discussing, and I raised it with her as well, separately from the Board meeting, and on all occasions, there was a change in demeanour, a wish to shut the conversation down as soon as could be done politely, and a general reluctance to discuss further. And that would be the same, whether it was one to one or as part of the update I had with the Board.
Ms Price: When, roughly, speaking to, in your time in the role, did you first ask directly about Horizon issues to the CEO?
Margot James: I would say earlier than I would have raised it at the Board. So probably either towards the end of 2016 or early in 2017.
Ms Price: On how many occasions in total do you think you asked directly about Horizon issues?
Margot James: I would say probably four, I would say we’d be safe to say. Yeah, a good four times.
Ms Price: The Inquiry has been unable to find any documentary evidence that your concerns about this reluctance to discuss Horizon issues were raised at the time you were Parliamentary Under-Secretary. Did you raise those concerns with anyone?
Margot James: Do you mean with the people we’ve just been discussing, the Post Office Board –
Ms Price: Either directly with Paula Vennells, or with anyone else from the Board, or more widely?
Margot James: Certainly. I’m sorry if I wasn’t – if I wasn’t clear when you asked me how many times I had raised the Horizon –
Ms Price: Forgive me, I think we may be talking at cross purposes.
Margot James: I wondered, sorry.
Ms Price: My question was: if you were concerned that there was a reluctance to talk about Horizon issues on the part of the Post Office Board and the CEO, whether you raised the fact that you were concerned, either directly with the CEO, or anyone from the Board, or more widely?
Margot James: I – I don’t recall ever alleging to the Board that I felt they were trying to close down the discussion, no. I persevered in the discussion against this kind of pushback, when it came to discussion with the Board or representatives of the Board of Post Office. So, on the question of – so I didn’t raise directly with them that I was concerned that they didn’t want to seem to raise this issue, I would just persevere with them. But I did – it did form some of the discussion that I had with the Secretary of State, probably the Permanent Secretary, and probably with UKGI, as well, but I can’t be sure about them because I can’t remember. But I do remember discussing it with the Secretary of State, probably fairly later on. I wouldn’t have raised a misgiving or – I wouldn’t have raised that kind of feeling with the Secretary of State, unless it grew in substance.
So I would – I suspect I didn’t raise it with him, probably until the second half – certainly well into 2017.
Ms Price: Was there any particular question that you asked the Post Office Limited Board or the CEO that you didn’t get an answer to?
Margot James: I can’t really remember. I – whether – I felt I was fobbed off because, in general, they would find different things of saying the same thing in response to my questions, and the best question I could have asked them was “I want a copy of the Second Sight Report, both of them, please”, and that’s – and I didn’t ask that question, unfortunately. But I did ask other questions about the computer system, why it was that the assumption was that all of the subpostmasters in making those complaints were guilty of misconduct or incompetence, because I have explained that I had received letters which I felt were very bona fide from people who didn’t appear to be in either camp but nevertheless were experiencing problems with the system.
And those were the sort of questions I was asking, and I didn’t get good answers to my questions. I got really a reiteration of how, you know, two or three years of independent scrutiny had not actually come up with anything system wide. They did give way that sometimes there were occasional faults and they conceded that that might cause some of the problems that the campaigning group of postmasters were complaining about.
Ms Price: One of your reflections on matters is that you wish you had challenged the Post Office Board more vigorously than you did, and you say that at paragraph 37 of your statement. Looking back, what did you challenge the Post Office Board on; the “more vigorously than [you] did” suggests there was some challenge, what was that?
Margot James: I think the challenge was that I wanted more information about the system of Horizon and what it was capable of doing in relation to subpostmasters who were not in the camp of even being taken to court. I wanted more information about that, the system. That was my main challenge. I didn’t challenge on the litigation strategy and, I must say, I had no idea at the time of the way that the Post Office were behaving when it came to matters of disclosure and the quality of evidence that they were allowing to be brought, and the matters raised in the Cartwright King and Swift papers. I wasn’t aware of all of that so I didn’t challenge them about that.
I think the most effective challenge I made was to their wish to cap the amount of compensation that they were prepared to put into the Mediation Scheme, or any of its successors, in terms of the compensation that might be offered to subpostmasters because I was aware, of course, of the – of the Criminal Case Review Compensation team, who were looking at – I think it was about 20 cases when I first came into my position.
So I was aware that compensation might be required for all sorts of things and I wasn’t sympathetic to the Post Office Board’s recommendation that they cap the overall amount at what I suspected was a level below what might transpire to be required.
Ms Price: You wrote a letter to Tim Parker, the then Chair of Post Office, on 20 December 2017, and you address this at paragraph 68 of your statement. You describe it as a standard letter drafted by UKGI, which reminded him of the Government’s strategic priorities for the Post Office and confirmed the level of subsidy and investment for the forthcoming year.
You note in your statement that there was no mention of Horizon issues. You had been in the role for 18 months by this point, was this not an opportunity to explain to the Chair the importance of ministers being fully aware of developments in the litigation, particularly if you had concerns that the Board was reluctant to discuss Horizon?
Margot James: Yes, it would have been a good opportunity, now you point it out. Would you – could you remind me of the date of that letter?
Ms Price: 20 December 2017.
Margot James: Yes, it would have –
Ms Price: We can go to that if you’d like to.
Margot James: No, I had forgotten the date and where it fitted into the whole scheme of things. But, yes, you are right: I should have brought his attention to my concerns actually earlier than that. He was the Chairman and I should have possibly sought a meeting one to one with him to discuss the matter. I think that would have been a – and then possibly included a follow-up in the letter to which you refer. I should have done that, I didn’t do that. But I – with the benefit of hindsight, I should have done that.
Ms Price: Did you ever raise with Tim Parker a concern that the Board was reluctant to discuss Horizon issues?
Margot James: No, I didn’t, which I certainly should have done.
Ms Price: Could we have paragraph 70 of Ms James’ statement on screen, please. That’s page 23. You deal here with what you did after you became concerned that there may be more to Horizon than had been communicated to you, and you say that you decided to meet the outgoing leader of the National Federation of SubPostmasters. Nine lines down you say this:
“I decided to meet the outgoing leader of the National Federation of SubPostmasters and took the opportunity of questioning him about the alleged impact of Horizon on some [subpostmasters]. Somewhat to my surprise I was reassured by the representative of the NFSP, who concurred with the line taken by the [Post Office Limited] in response to my questions. This had the effect of allaying my concerns which had been growing prior to the meeting. This state of reassurance was reinforced by Horizon never coming up during my meetings with the leadership of the CWU.”
You found reassurance in the stance taken by the NFSP; is that right?
Margot James: Yes, I did.
Ms Price: You say you found that surprising at the time. Did you discuss your surprise about this with anyone at BEIS or UKGI?
Margot James: I can’t remember doing that, no.
Ms Price: Could we have on screen, please, the Day One briefing for the Post Office, UKGI00020328. That’s page 13 of that document, thank you. This is a slide about key stakeholders, and covered here was the National Federation of SubPostmasters. There is an explanation here that:
“[Post Office Limited] has recently started funding the NFSP directly, to enable it to transform into a trade association working in partnership with [Post Office Limited] and not a union-like organisation often in conflict with it. Although this has been widely welcomed there has been tensions in the group’s relationship with [Post Office Limited] (eg the NFSP negotiates with [Post Office Limited] on subpostmaster remuneration).
“In addition some subpostmasters … believe the NFSP is now compromised as it received funding direct from [Post Office Limited].”
Did you consider, at the time you met with the NFSP, whether its stance might have been influenced by the fact it was being directly funded by the Post Office, especially considering the information contained in this briefing that some subpostmasters considered the NFSP had been compromised?
Margot James: It’s a very good question that you ask and I don’t think I did consider that. It didn’t strike me as an explanation for the content of the meeting I had with the outgoing Chair or Chief Exec of the NFSP, and I think it was also sort of amplified by the fact that I’d had several meetings with the leadership of the CWU, and they had not raised Horizon at all with me. And I asked them about it and they were not concerned, I would say, would be the general tenor of what I got back.
So a good reading of that briefing paper prior to my – I must have had a briefing on NFSP before I met them because that was the standard process, if you were going in for a meeting, you had a briefing first, and that would have contained some background information on the NFSP. Whether it would have been identical by then to the two paragraphs you have up on the screen is another matter. Quite possibly not.
Ms Price: I’d like to turn, please, to your impression that certain things were deliberately withheld from you. Can we have on screen, please, paragraph 42 of Ms James’ statement, that’s page 13. It’s just the last sentence here, with reference to the Simon Clarke Advice, the Deloitte reports or the Swift Review, you say:
“Having now read these reports I have concluded that they were withheld from me deliberately.”
Who do you think was withholding the reports deliberately?
Margot James: Well, it depends on the report. Any of the – any of those reports I mention that were – that had been disclosed to UKGI, I would say they withheld it from me. But I gathered, from watching a previous evidence session, approximately a week or ten days ago, to my absolute astonishment, it came out at that previous evidence session that the Chairman of Post Office didn’t even share the Swift Report within his own Board, so obviously I wasn’t going to get a copy.
And if the Board weren’t seeing it, then I presume UKGI didn’t see it either. So I’m not quite sure who, in answer to your question, was withholding the information from me. Either the Post Office were withholding it from UKGI and, therefore, it didn’t reach me, or UKGI were aware of it, and excluded it from the original briefing which, as I mentioned, did give me a couple of lines on the Second Sight Report.
So my point would be that the Simon Clarke Advice, Deloitte, you know, Bramble, et cetera, and the Swift Review, any of those that UKGI knew about should have been bullet pointed with the reference to Second Sight.
Ms Price: Why do you conclude that it was deliberate?
Margot James: Because there’s no logic to advising a minister about the presence of one report when there are other reports which develop the thinking of the report mentioned further, add to the volume of knowledge on the same matter. It doesn’t – it’s partial, in my view, to give the Minister reference to one report and then remain completely silent on the presence of further work to of – in the same vein which adds to the body of knowledge.
Ms Price: Could we have on screen, please, UKGI00016898. This is a UKGI risk register dated 31 July 2016, so around the time you took up the role, and going, please, to the – I think we already have it open – the risk register tab, which related to the Post Office. First of all, have you ever seen a risk register like this from UKGI before?
Margot James: No, no. You sent me a copy of it as an additional document approximately ten days ago, and I am 99 per cent sure that it was the first time I had seen a copy of these risk registers, which doesn’t necessarily surprise me. I mean, it’s – they were produced, I gathered from the reports that you sent me, on a monthly basis from UKGI and I would expect them to be internal management documents and ministers to be made aware of highlights, I guess, from it.
Ms Price: Under item 6, which is line 40, Project Sparrow is addressed. The risks associated with the litigation are addressed in columns D and E. Then in column K, there is this – and to read the full text you need to cast your eyes up to the long bar at the top because of the nature of the boxes:
“Responsibility rests with [Post Office Limited] to manage both the Mediation Scheme and stakeholders generally. [Post Office Limited] Chair undertaking review with independent QC. We are managing Ministers’ involvement, with the intention of keeping the issue independent of Government.”
Then in column P, which is further mitigating actions, there is this:
“Ensure [Post Office Limited] are proactively managing interest and noise, and are aware of Ministers’ expectations. Manage interest and wobbles from Ministers or the centre, including prepared fallback options if current arm’s-length position becomes untenable.”
What is your view of this express management of Ministers by officials?
Margot James: Alarmed. I find that very alarming. First of all, would you mind reminding me of the date of this particular risk register?
Ms Price: 31 July 2016.
Margot James: Right. Well, I was very surprised to read, on your previous slide – when you put up the full copy in column – I think it was column D, where it said that the Chair is –
Ms Price: I think the column I showed you first was K.
Margot James: Right. I mean, I’m very surprised, because I couldn’t see on my – I did see this and I read it, but couldn’t see beneath, you know, what you’re showing me above. I could only see the first three lines; I was very surprised to see, “POL Chair undertaking a review with independent QC”, which indicates to me that UKGI must have known about that, because they are the ones maintaining this risk register. So must – they must have known bit.
That doesn’t mean to say they had a copy of it because, of course, my understanding of the previous evidence session was that the Chair didn’t share it with the Board and that would presumably include the UKGI representative on the Board. But there it is.
Anyway, back to your the question about managing, you know, to make sure there’s no ministerial wobble, and things like that, and maintain the arm’s-length position here, sort of – it’s not – what is written there – and your previous statement about ministerial wobbles and preserving the arms-length position – that is not really consistent with the Civil Service values of integrity, honesty, impartiality and objectivity, in my opinion.
I think it is an example of a team of people who should be following those principles but who have gone rogue and abandoned those principles.
Ms Price: Do you agree that preparing fallback options, in case the arms-length position becomes untenable, casts some doubt on whether there was ever a justified basis for saying that this was a reason for Ministers not to become more involved?
Margot James: Probably. As I might have mentioned right at the beginning of our exchanges this morning, if the Post Office had been managing this issue in an appropriate manner, within the law and in good faith, it should indeed have been the case that it was an operational matter for the Post Office. But the fact that they weren’t meant that it should definitely have been on the Government’s radar.
Ms Price: Sir, just at this juncture, I need to confess that my time estimate was ambitious and I’m going to need a little more time than I had budgeted for. Given that that is the case, and with an eye to the transcriber, I wonder whether we want to take another short break and then complete all of the questioning after that, or whether you’d like me to continue to the end of my questions and then do that.
Sir Wyn Williams: Well, we started at 12.25, did we not?
Ms Price: Yes, sir.
Sir Wyn Williams: Just ask if I can ask the transcriber through you, whether, if we continue until about 1.30, as opposed to 1.15, which I assume would be enough time –
Ms Price: Yes, sir.
Sir Wyn Williams: – is that okay with her.
Ms Price: Yes, I’m seeing nods.
Sir Wyn Williams: Fine. Well, then, let’s do that.
Ms Price: Thank you, sir.
Could we have on screen, please, UKGI00006991. Starting on page 2, please, this is an email from your private office to Laura Thompson from UKGI, it’s dated 23 August 2016. The last paragraph of this says:
“I also wondered if you could send me a copy of the group civil litigation letter (and our response) on Horizon? Just for further background for me.”
The response from Ms Thompson is on page 1 and, in her penultimate paragraph, she says:
“On the Horizon issue, we (Government) have not been party to either the Letter of Claim from the claimants or [Post Office Limited’s] response – [Post Office Limited’s] response in particular is subject to legal privilege. I recommend we maintain that distance, certainly at this stage in the proceedings. Happy to chat through of course.”
Were you aware at the time that this request had been made on your behalf and refused, in effect?
Margot James: I don’t think I was, no.
Ms Price: Would it have concerned you, had you been aware?
Margot James: Not at that stage, it wouldn’t have done. I think later on, with my growing knowledge of the situation it would have done. I think it was a good call on the part of my private secretary. I think he did it on his own account and, unfortunately, he left during my time in the job, so I lost his continuity, unfortunately, because he might have brought it back up again later, as my interest in Horizon grew. But, at the time, I’m afraid I probably would have been accepting of that.
Ms Price: We looked at one of the UKGI risk registers. If we could please have on screen the one from January 2017. That’s UKGI00042795, and this the risk register for Post Office specifically. Item 21 deals with Project Sparrow. The risks are addressed in columns D and E. If we can start with D, please. The risk identified here is:
“Civil litigation and/or Court of Appeal processes judge that [Post Office Limited] has acted inappropriately, or illegally. Even absent such a finding, ongoing risk that they continue to be perceived to have acted in that way.”
Then the next box:
“Potential for significant compensation claims, if civil or criminal courts rule against [Post Office Limited]. More likely however, and certainly in the short-term, is that this continues to be a significant distraction (and cost) to the business as they defend their actions.”
Were the risks of the litigation ever expressed to you in those terms?
Margot James: No.
Ms Price: That can come down now. Thank you.
Margot James: Certainly not the first one. I think it was evident to everybody that it could become a costly distraction, but certainly not that the Post Office, you know, might have acted illegally.
Ms Price: You explain in your statement that you were not aware, when you were Parliamentary Under-Secretary, that the Post Office had brought private prosecutions against subpostmasters and others, and you deal with this at paragraph 44, and if I can summarise, you say, in effect, you would have exerted greater challenge had you been aware that prosecutions had been brought privately. Why is that?
Margot James: I was really shocked when I did discover, very belatedly, that these had been private prosecutions because I had assumed – which is a very bad thing to do, in the role I had, but I had assumed that the prosecutions had gone through the normal process of being cleared by the CPS and mounted in the normal way, and that was why I allowed myself to be persuaded of an important part of the Post Office’s line to me, which was, you know, and where people have been charged, they have been found guilty, which was an important part of the line that I was given by the Post Office.
But what I’ve since discovered, obviously the whole issue of disclosure and the quality of evidence being brought was thrown into doubt, as far as back as, I think, 2013.
Ms Price: Could we have on screen, please, paragraph 74 of Ms James’ statement. That’s page 25. Towards the bottom of that paragraph, you acknowledge here that you should have asked for a copy of the Second Sight Reports, but you say:
“These were held very close by [Post Office Limited] but I could probably have had access to them and I should have read them rather than taken as read the only message [Post Office Limited] wanted the reports to convey.”
You were, in your first briefing, told about the Second Sight Reports and you obviously regret not having asked for them. It’s right that you didn’t ever ask for copies of those reports, is it?
Margot James: I’m pretty sure I didn’t. I think I would have got them, if I had have asked for them, and I think if I’d asked for them and they hadn’t been forthcoming, I would have, you know, asked for them again.
Ms Price: Why is it, therefore, that you say these were held very close by Post Office Limited?
Margot James: Oh, I think I meant the second Second Sight – sorry, it’s a bit confusing, isn’t it? The Second Sight Report number Two, or final, or whatever it was. There’s a bit of a – I think I should have said the final report was – I had the impression was held very close.
Ms Price: How did you gain that impression, if you never asked for it?
Margot James: Yes. Um … I think that might have been with the benefit of hindsight. I think I might have read somewhere in the evidence that I’ve been given to prepare for this Inquiry – it’s coming back to me slowly. Basically the first – the Interim Report was one thing but the – I think Second Sight were dismissed at or around the time they reported the second time, and I think they had many complaints, which was certainly not shared with me at the time, about the Post Office withholding information, and obstructing their inquiries when it came to their follow-up work, having produced their Interim Report. And I think that I was imagining that, given those conditions, I think it likely that the Post Office would have been reluctant to reveal or disclose the second or final report.
Ms Price: That can come down now, thank you. One of the things that you say would have been a red flag to you – and to give context, you say at paragraph 71 of your statement that you had a generally favourable impression of the Post Office around the time your concerns about Horizon issues were increasing, so it would have taken a red flag for you to become more proactive in relation to the issues – but one of the things you say would have been a red flag was exposure to now Lord Arbuthnot’s campaign.
When you took up the role, did you ask which Parliamentarians had an interest in the issue of Horizon challenges?
Margot James: No, I didn’t.
Ms Price: Did you request a briefing on any recent Parliamentary debates which concerned the Post Office?
Margot James: No.
Ms Price: Did you ask your private office staff to provide you with previous ministerial responses to Parliament on key Post Office issues?
Margot James: No. All of these would have been good things to ask for but I’m afraid I didn’t ask for any of them.
Ms Price: At the time, was there any mechanism for incoming ministers to be briefed on past relevant Parliamentary debates?
Margot James: No, I don’t think there would have been no, no.
Ms Price: Did that change at any point when you were in a ministerial role, having gone on to be Minister of State in a different department?
Margot James: No, I don’t think it did, actually. I gave my predecessor – sorry, my successor at BEIS a briefing on all the kind of top line issues within my brief about two weeks after he had assumed what were my responsibilities. But I did that informally, without any officials present. So, that’s not really what you’re talking about, I don’t think. There’s no formal handover process which enables the new Minister to capture the top line, be it Parliamentary or any other aspect of the brief, what had gone before. Which is curious, I suppose, really, but it is – that’s my experience.
Sir Wyn Williams: I understand that might be the case as between the respective ministers. Does not the Civil Service provide a kind of handover in the sense of highlighting important points which were being dealt with by the previous minister and which now catch your attention? I take it you’re going to say “Well, that was the initial briefing”?
Margot James: Yes, I was going to say, Sir Wyn, that does happen, and that is your introductory pack and all the introductory meetings. I think one unfortunate aspect of when I assumed this role was that it did coincide with a new Government and an entirely new ministerial team and private office team. I don’t think my private office had experience of handling any aspects of my brief left over from my predecessor, unfortunately. That wouldn’t always be the case but when it’s a new government, I think it is the case.
Ms Price: Turning finally to your reflections on the governance structure in relation to the Post Office, could we have on screen, please, paragraph 79 of Ms James’ statement. That’s page 26. It’s towards the bottom of page 26. You say:
“The structural problems of the current system of oversight are first that there are too many players involved”, and you list UKGI, HMT and DBT:
“This gives rise to communication challenges …”
You go off to list other issues there.
Is the essence of the problem that you’re getting at here that nobody grips the problem, because there are so many players involved?
Margot James: There’s the potential for that. I don’t think it automatically follows but I think that the potential for that is heightened by the number of players involved. And the agenda – I think this whole – the point about stakeholders developing their own agendas is heightened by the more there are in the mix.
Ms Price: Going over the page, please, you say:
“The other problem with the status quo is that UKGI as the representative of Government on the Board of [Post Office Limited] reports directly to HMT.”
You talk about:
“[The] power wielded by HMT across Government, which can be absolute and heightens the risk that UKGI focuses purely on the achievement of financial objectives with the sole goal of reducing public subsidy.”
I think you’ve seen in the documents provided to you more recently two Memorandums of Understanding about the role of UKGI officials. Have you had an opportunity to look at those?
Margot James: Yes, I have.
Ms Price: Without displaying them, for the purposes of time, would you agree that the Memorandum of Understanding which was in place at the time, and the Memorandum of Understanding in place now, states that UKGI formally acts as an agent of the Department – that is what was at the time BEIS – as opposed to the Treasury?
Margot James: Well, it did act as an agent of the Department, I would agree with that. But it doesn’t change the position that it is wholly owned by HMT. So whilst it might act as an agent of the Department, it is accountable really to the people who own it, and that’s HMT.
Ms Price: There is a section in the Memorandum of Understanding relating to the accountability to Parliament for the activities of UKGI, and the levels are BEIS ministers, the Principal Accounting Officer level, BEIS Permanent Secretary, and the senior official level, UKGI and BEIS. Would you agree from that there is a degree of accountability between UKGI and the Department already in existence that was there at the time?
Margot James: Yes. Yes, I would agree with that. Yes, whenever I gave evidence or attended a debate in Parliament, led a debate, answered a debate, I was always – UKGI support was always available to me, and it wasn’t a BEIS official, it was an official of the UKGI who would support me in those matters. Yes.
I mean, they were interchangeable in most senses with Department officials for that particular brief. It is just that, although they are supposed to comply with the Civil Service Code, they are not civil servants and I can imagine it might be quite difficult to act, you know, in – as a civil servant, if you haven’t had the training to be one.
Ms Price: Looking, then, to paragraph 81, a little further down this page, there are two options, which you moot in your statement, that might improve matters, and one is that the Post Office should be taken essentially under DBT, and the other is that the role of Ofcom should be extended to give regulatory oversight, independent regulatory oversight. Which of those two options, with the benefit of having considered this matter with the benefit of hindsight, do you consider to be the better?
Margot James: Well, I don’t think either option will resolve the cultural crisis within the Post Office. In order to resolve that, I think the machinery of Government is probably adequate without a change. But long term – long term, I think I would favour the latter. If the Post Office can be brought into an acceptable state, which is a very big if, then I would favour the regulated route rather than the DBT owned route.
I mean, we did, as I know you are aware, have a long-term consideration that it might be mutualised as a service, and that’s another option. I didn’t mention that there, but that is another option, although it does have to be, I think, to qualify for mutual status it would have to be not in receipt of public subsidy, I think. So that’s an issue. The subsidy issue is a bit of a – that kind of leads more to the DBT-owned model. But, I mean, none of this will solve the cultural crisis in the Post Office, I suspect. That has to be subject to radical surgery, I would imagine.
Ms Price: Sir, those are all the questions I have for Ms James.
Sir Wyn Williams: Thank you, yes.
Ms Price: Shall I hand over to Mr Henry first.
Questioned by Mr Henry
Mr Henry: Ms James, thank you so much.
I don’t want to go back to the document but it’s UKGI00016898 and it’s column D of the risk register of 31 July 2016, allocated to risk number 6, which was entitled “Project Sparrow”. Therein, one reads:
“… increasingly orchestrated campaign against the [Post Office Limited] on alleged faults with the Horizon system, including attempts to derail the Mediation Scheme set up to address individual cases.”
The author of that being Mr Callard.
Was that clearly communicated to you when you assumed ministerial responsibility that month?
Margot James: Not in those words, no. Not in those words. In fact, I don’t ever recall being told that there were attempts to – being made to derail the Mediation Scheme. I wasn’t informed of that. I was informed that there was – I think that term was almost used in an ongoing to campaign against Horizon, in spite of the fact that two or three years of independent scrutiny had found there to be no systemic problems. That was communicated, yes.
Mr Henry: That was communicated to you.
When you succeeded Baroness Neville-Rolfe, did she brief you informally, as you did your successor?
Margot James: No, I don’t think she did. No.
Mr Henry: So, consequently, it seems, that the suspicions that she harboured about the Post Office’s reliability or veracity over Horizon got lost on the handover to you and you were starting from scratch?
Margot James: I’m afraid so. I’m afraid so.
Mr Henry: You were, of course, depend upon your officials and dependent upon ShEx?
Margot James: Yes, I was.
Mr Henry: Now, again –
Margot James: To be – so was she, of course, when she came in.
Mr Henry: Yes, of course. Now, I don’t need to go to paragraph 56 of your statement but that is that on 20 January 2017, Laura Thompson of UKGI provided your private office with an update on the Group Litigation, and you remember the passage that you were taken to by Ms Price. And then, in the following paragraph, paragraph 57, you said:
“I would have taken this email as an update only, and not a request for action or decision of any sort. I decided to accept this advice [in other words the advice not to get involved] after consultation with the BEIS Press Office.”
Why the Press Office, Ms James? Is this concern, as it were, about optics as opposed to substance; why the Press Office, as opposed to a more considered briefing on strategy?
Margot James: That’s a very fair question. I think – I didn’t often seek advice from the Press Office. But I think, correct me if I’m wrong because I don’t have the document absolutely to hand, but I think that that was advice in relation to media handling.
Mr Henry: Quite right, it does say:
“If there is any media interest, I would suggest our usual approach of referring any enquiries to Post Office. I would not suggest we comment on legal action, but welcome thoughts from Press Office.”
Margot James: I think that’s probably why on that occasion I was seeking guidance from the BEIS Press Office because I – you’re quite right, I wouldn’t normally, on matters of substance, seek guidance from the Press office.
Mr Henry: I now want to move on to what you might have done differently had you been properly apprised in a timely fashion about material issues. No need to get it up on screen, but your paragraph 74 begins:
“I should have been briefed on the scope and purpose of Tim Parker’s review and especially the conclusions as set out in the report of 8 February 2016 by Jonathan Swift, [Queen’s Counsel].”
I then omit words, and you refer to Project Zebra of June 2014, that you should have been told about, and further work by Deloitte, Project Bramble, again, you should have been told about. Then you say this:
“If I had known about these reports, we might have been able to put pressure on POL to implement the recommendations of the Swift Report, rather than just commission yet more reports that served to delay the day of reckoning for the [Post Office Limited].”
Had you been properly briefed in a timely fashion and seen the writing on the wall, might you have gone further at that stage than simply requiring the Post Office to implement the Swift recommendations?
Margot James: That’s a very, very good question, and I am not sure what – well, I was going to say I’m not quite sure what more I could have done at that point but, if I’d been armed with all the knowledge that is contained within the reports that you mentioned just now, then I suppose what I should have done would be to go to my Secretary of State, first of all, and the Permanent Secretary, and say that we’ve got a massive problem here with the leadership of the Post Office, and corners within the Post Office who are behaving possibly illegally, certainly unethically, in a substantial way.
I suppose I should have done that, had I had all that information, as well as – I think the recommendations of the Swift Report were very sound and that should have been done, but you are right in, I think, what’s behind your question: would that have been enough based on what I would have then known? Probably not.
Mr Henry: But, basically, Government could have been made aware that the Post Office was staring disaster in the face, and that the litigation was going to be a ruinous, degrading failure?
Margot James: Yes, I think you put that very well.
Mr Henry: Could I just pick up one sentence in that paragraph, paragraph 74, where you say:
“If I had known about these reports, we might have been able to put pressure [et cetera, et cetera] rather than just commission, [that is the Post Office] yet more reports that served to delay the day of reckoning for the Post Office.”
You see it might be said by some Board members that they were being open and commissioning reports to get at the truth but from your assay of the issue, having looked at it now and being fully briefed on the matter, it looked like they were commissioning reports in accordance with a policy of obfuscation and delay, putting off the evil day, covering the reports in privilege and failing to detect or disclose the red flags within them. Is that what you mean when you say, “Rather than just commission yet more reports that served to delay the day of reckoning”?
Margot James: Yes, I think you put that extremely well. Yes, exactly what I think, yes. Because I was anxious, when you first read that quote out, that it looked as if I was saying that we should be – the Government should be commissioning more reports or not just commissioning more, because we hadn’t commissioned any reports. But what I meant was that the Post Office, rather than continuing to commission yet more reports, should actually face up to what’s in front of them and deal with it yesterday.
Mr Henry: Thank you. My final issue is a document that has been provided by Ms Vennells, and it’s PVEN00000503. This is an exchange of messages from 2017, when you raise the case of a subpostmaster directly with Paula Vennells, and you were later told by Ms Vennells that she had been the postmaster audited, which led to a loss being identified of £130,000, and Ms Vennells told you that the subpostmaster was vociferous and has been sharing various and varying accounts of what has happened.
We can pick it up there where you contact her over the weekend, because you’re concerned about the Post Office and the postmaster, and then can we go to the next page, please, and you’re on the matter, you agree to speak, and then you give the details of the Post Office, it’s Moresby, in Cumbria.
Then can we go down to:
“Hi Margot.
“We briefed Trudy Harrison in June as to exactly what was happening [I omit words].
“However, the postmaster was suspended in May as an audit showed she was missing over £130,000. That possibly explains why she was putting in her own money. She has since lodged a request to join the … Group Litigation – not unusual in this kind of situation.
“I don’t want to put more details into a text but I am happy to explain.
“The location has been supported by a temporary post office …
“The postmaster is vociferous and has been sharing various and varying accounts of what has happened.”
Then referring to Trudy, who I think is the local MP because it concerns her constituent.
From the papers that the Inquiry has seen, the Post Office in general used dismissive language like this to denigrate and discredit subpostmasters who suffered losses. Did you experience this in any other settings when you were liaising with the Post Office, that there was a generally dismissive and highly robust approach taken to subpostmasters who were complaining about Horizon?
Margot James: I would say that there was definitely an assumption on the part of the Board members of the Post Office that the postmasters were in the wrong. But there was – I mean, there was nothing wrong with Horizon. We’ve covered all of that. But you asked about the sort of demeanour and attitude towards the Post Office – the postmasters. I think that they sadly – tragically, the Post Office Board did regard them as criminal at best, incompetent at worst, yes, and that was the assumption. And, as I mentioned earlier, they were extraordinarily good at seeing themselves as the victim.
You know, this campaign and – it’s not just a campaign, it was an “orchestrated campaign”, as if to say there was absolutely legitimacy to this campaign whatsoever. That sort of thing. The language would be based on an assumption that postmasters were in general guilty of something. It might be fraud, it might be theft, it might be joining an illegitimate campaign to undermine something that the Post Office was doing, like putting the Mediation Scheme in place.
Yes, the postmasters were always in the wrong in any conversation you had with representatives of the Post Office.
Mr Henry: Well, those are my questions for you, Ms James. Thank you so much.
The Witness: Thank you very much.
Sir Wyn Williams: Mr Stein?
Questioned by Mr Stein
Mr Stein: Sir, I do have questions that are less than five minutes but I note the time is 1.35.
Sir Wyn Williams: Then I will give you to 1.40 since you will be less than five minutes. Off you go.
Mr Stein: Thank you, sir.
Ms James, you once heard questions very early on from Ms Price in relation to when you first came in to deal with matters concerning the Post Office, and you were referring to the May 2015 manifesto pledge which was to retain the Post Office for all of its purposes, including the social purposes that it serves; do you recall giving that evidence?
Margot James: Yes, I do.
Mr Stein: You, like all of us, no doubt understand that the people that operated these branches, the Post Office branches, also felt that what they were doing was operating the branch for purposes of supporting their own families, but also an important place within the local community; do you agree with that?
Margot James: I agree strongly with that.
Mr Stein: Because the post of a subpostmaster or a subpostmistress is a prestigious one in the local community. It has meaning socially; do you accept that?
Margot James: I totally endorse that.
Mr Stein: You’ve discussed in your statement, paragraph 2 – I don’t need to take you to it because I can simply refer to it – you wish to express your deepest sympathy for all subpostmasters and subpostmistresses and their families who have been subject to such a terribly miscarriage of justice. Later on in your evidence, you spoke about the Post Office victims – you said that at just gone 12.00 today – the victims of the Post Office.
Now, at the Inquiry today, there is Terry and Cindy Seeney. Terry was the subpostmaster at the Bere Regis branch of the Post Office in the Dorset. He held that post from February 2002 to July 2006. Now, that’s well before your time in your dealings with the Post Office.
What happened in his Post Office branch, though, is perhaps important on this question of the victims and who have been affected. He had the usual litany of shortfalls that he had to account for, and he had to pay on a regular basis out of their own funds. He employed his wife within the branch. What happened was that, when trying to reconcile the amounts on any given week, he would spend evenings and into the late night in the post office branches. They find it funny now, they certainly didn’t find it at the time: Cindy actually thought he was having an affair because he was spending so much time working at the Post Office branch.
At the end of days, it got to the point whereby he, Terry Seeney was searching the bags of the people he employed within the branch. So I go back to your evidence where you speak about the Post Office victims, and in the excellent questions you have been asked by Ms Price, and also the great questions being asked by my learned friend Mr Henry, you have also considered the question of the failures in governance by Government.
Do you agree the victims of both the Post Office, Fujitsu and Government failures, those victims include not just the subpostmasters, subpostmistresses but the partners, the children, the wider family effects?
Could you say yes or no to that, so we have a record here?
Margot James: I most certainly agree with you and I would add – I don’t know whether you include the staff in branches, as well as family members. Yes, and a whole network, I would imagine, of family, friends. Your statement did touch on some of the consequences that are not automatically visible to people from this tragedy. When you mention the length of time Mr Seeney was spending in the Post Office let his wife to doubt him, it can have – and I’m sure has had – so many effects on people’s friendship groups and, you know, their esteem within the community. You didn’t mention that, that’s people’s personal reputations.
All of this has obviously been widely commented on and I know, and I hope, it’s well understood but I agree with what is behind your question.
Mr Stein: Thank you, Ms James. One last point before I finish just about within the time limit set by the Chair.
Those individuals, the partners, the family members, do you agree they are no less deserving of recompense and redress and compensation?
Margot James: I do agree that they are deserving. Of course, yes, I do. Most certainly. I mean, that obviously –
Mr Stein: Thank you.
Margot James: – is not for me to judge but that is my opinion, yes.
Sir Wyn Williams: All right. Thank you very much.
Is that it, Ms Price?
Ms Price: Yes, sir. It is.
Sir Wyn Williams: Well, thank you, Ms James, for giving evidence today in circumstances where you are recovering from an illness. You’ve been extremely helpful to the Inquiry in facilitating our work, both in providing your evidence and in doing so in a manner which you would have preferred not to do. So thank you very much.
The Witness: Thank you very much.
Sir Wyn Williams: We’ll resume again at 9.45 tomorrow.
Ms Price: Yes, sir. Thank you.
(1.42 pm)
(The hearing adjourned until 9.45 am the following day)