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From: Permanent Secretary[/O=EXCHANGELABS/OU=EXCHANGE
ADMINISTRATIVE GROUP
(FYDIBOHF23SPDLT)/CN=RECIPIENTS/CN=3109B3DC828545FFBF265AAB4
BEC9017-SECRETARY,]
Sent: Thur 02/05/2019 03 PM (UTC)
To: Mark Baker}
Ce: Permanent Secretary,
Subject: RE: Misuse of a Public Authority Grant
Attachment: LetterACtoMB.pdf
Hi Mark,
Please find attached a letter from the Permanent Secretary, Alex Chisholm. Apologies for the delay in
responding to this letter. Alex wanted to take the time to ensure we could provide a substantive and
accurate response on this complex matter.
Thanks very much for getting in touch,
Kind regards,
Ben
Benjamin Steyn — Private Secretary to the Permanent Secretary — Department for Business, Energy
and Industrial Strategy
From: Mark Bake
Sent: 20 March 2019 14:23
To: Permanent Secretary),
Subject: Misuse of a Public Authority Grant
Alex Chisholm
Permanent Under Secretary of State
Dept Business, Energy, Industrial Strategy.
Dear Mr Chisholm.
lam writing to you as a concerned tax payer and as someone who has over 40 years service within
the Post Office Industry.
I note that you are the principle accounting officer with your department and I wish to bring to your
attention a matter that I believe to be an inappropriate use of tax payers funding provided to the Post
Office by the Government for Network Transformation. A program that the Government invested
nearly £3 billion in.
My concerns are regarding funding the Post Office has provided to an organisation known as the
National Federation of Sub Postmasters (NFSP) a Company limited by guarantee. Prior to
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incorporating as a limited company the NFSP was a registered Trade Union but was struck off by the
Certification Officer in 2013.
lam aware of past Freedom of Information requests where your department has admitted that they
were aware and condoned the use of Network Transformation (NT) funding by the Post Office to pay
the NFSP for their support for the NT program.
lam also aware of a recent Freedom of Information request where you had to write to the recently
departed CEO of the Post Office Paula Venells to effectively ask for the return of £2.5 million of NT
funding that the Company had ring fenced within their accounts to use for legal costs to support the
High Court litigation that they are currently embroiled in and have just lost the first round of the 4
hearings associated with this case.
The point of my communication to you is that I am concerned that the Post Office is still using money
that is provided by Government to finance a Grant Funding Agreement it has struck with the NFSP.
This Grant featured in the Judgement recently handed down by Justice Frazer in the first part of the
High Court litigation the Post Office is currently facing.
The Judge was highly critical of the Grant Funding that the Post Office provides to the NFSP and
declared that the NFSP was not independent of the Post Office as a result of this Grant and went on
to say that the NFSP placed its own interests above that of the people it purports to represent.
This has to raise the question, is this a good use of money by a publicly owned company ?
The Grant is not insignificant it is a total of £2.5m per annum over the next 15 years and would
normally be subject to EU procurement precesses. But the Post Office has channeled the funding via
the Public Authority Grant process.
As you will know such Grants are subject to Cabinet Office guidance on the provision of such Grants,
this guidance even applies to Arms Length Organisations (ALO’s) which the Post Office is categorised
as.
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/
722193/Grants-Standards-Guidance-INTRO.pdf
I recently challenged the Post Office about their non compliance with this guidance. Their response
was that they did not consider that the guidance applied to them.
https://www.whatdotheyknow.com/request/compliance_with government _guida?nocache=incomin
£-1291253#incoming-1291253
Given the past record of the Post Office of taking liberties with Gov provided funding I would be
obliged if you would conduct an inquiry into the Grant Funding Agreement that the Post Office has
with the NFSP to ascertain its legitimacy and given the comments by the Judge in the High Court
decision recently handed down, its actual purpose.
Yours sincerely
Mark Baker
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Larkhill Post Office
The Packway
Larkhill
Salisbury