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Supplementary written evidence from the Justice for Subpostmasters Alliance (POM 31)
Further to appearing in front of your committee on 3 February 2015, we write to ask that the
committee considers supplementary information with regard to the questions it asked of the
witnesses at the session, and which it was not possible to provide an answer due to time
constraints.
Q2 Chair: The issues between sub-postmasters and the Post Office on the Horizon system seem to
have been ongoing for some years. Have all those issues been resolved? If not, what is still
outstanding?
The issues have not been resolved, and the list of outstanding issues is long. However in the
interest of brevity the key points are:-
e A Post Office management, that (as the committee has seen) is in denial about the very
real problems this matter has raised and the consequences of its actions upon individuals.
Post Office’s only concern with this issue is the protection of the brand at any cost.
e The failure of Post Office to investigate any cases where a Subpostmaster has had
problems, preferring to go straight to prosecution. After all, Post Office is the only one ina
position to access all the relevant data, as the Subpostmaster is removed and denied all
access to the data for which they are being held liable for.
e Post Office personnel continuing to inform Subpostmasters that they are the only ones
who have ever suffered with a problem with Horizon, so it must be their fault. This was a
practise heavily used by Post Office in the early days of Horizon, yet JFSA continues to hear
of new cases where such comments are still being made.
© Post Office’s failure to introduce an insurance scheme to help Subpostmasters cover
unexplained losses. This is despite Post Office covering all losses from Crown Offices,
without their staff being held liable for losses through the courts.
e Post Office’s refusal to allow a recognized trade union or any other organization other than
the National Federation of Subpostmasters (NFSP) to represent Subpostmasters. This is an
issue in its own right that requires further investigation, as in effect the arrangement is
little different to a ‘closed shop’.
e The failure of the NFSP to undertake its own external investigation of Horizon and the
associated issues that have been affecting its membership, instead of blindly following the
bidding of Post Office.
e The failure of the NFSP to insist a new and relevant contract was created for
Subpostmasters at the time of the introduction of IT at post offices.
e The 114 page contract, which not every Subpostmasters received, and which was
considered out of date at the time the Government’s own Performance and Innovation
Unit produced its report ‘Modernizing the Post Office’ in 2000, when it commented “The
majority of sub-postmasters still work under a contract that can be traced back a hundred
years” (Box 3.4, Page 24, ‘Counter Revolution — Modernising the Post Office Network’ —A
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Performance and Innovation Report June 2000). A contract so onerous that it has been
likened to a charter for white collar slavery.
e The failure of Post Office to provide a mechanism to deal with cases that did not appear
during the 12 weeks the Initial Case Review and Mediation Scheme was open to applicants,
despite Post Office giving such an undertaking to do so ina press release dated 7*" July
2013, when it stated that there was to be “A review chaired by an independent figure to
determine how an independent safety net might be introduced to adjudicate in disputed
cases in the future. Again the JFSA and other stakeholders will be invited to take part in this
process.” Yet this has never taken place.
o. The importance cannot be overstated for the need of a third party, independent
body that Subpostmasters can approach confidentially and that has the authority to
investigate historic and current issues. The majority of Subpostmasters have paid
many tens of thousands of pounds for the privilege of running a post office,
however within the wording of the 114 page contract Post Office is able to
terminate a contract with a Subpostmaster by giving just three months’ notice and
without giving a reason. This allows Post Office to be vindictive if it so chooses and
to use the clause as a threat to those Subpostmasters who dare to challenge it.
Two Freedom of Information requests have revealed that between 1999 & 2008,
263 Subpostmasters lost their offices this way without being able to recover their
original investment. Taking on a post office is very much like handing the Post
Office a loaded financial gun which they can hold to a Subpostmasters’ head.
Q9 Caroline Dinenage: As the Chairman said, I think we have got your views on this, but ina
nutshell if you could say: Second Sight’s 2013 interim report gave a preliminary conclusion that
there was no evidence of system-wide or systemic problems with the Horizon software. Can you
just tell me—yes or no, really—whether you believe that this remains a fair assessment of the
system’s functioning?
As the committee would have heard, the work of Second Sight since the interim report in 2013 has
significantly added to the pool of knowledge about the problem areas that Subpostmasters have
had to face due to Post Office and its Horizon system. Many of these issues should be included in
the forthcoming Second Sight Part Two report, however JFSA is concerned that members of the
committee and other MPs may not be allowed to see it.
During the time JFSA has been engaged with the original case investigations and also the more
recent Initial Case Review & Mediation Scheme, it has become blatantly obvious that Post Office is
sitting on considerable information that would greatly assist the investigators looking into the
cases. It is our view that they are using every means possible to stop that information emerging,
which is why, until Post Office itself is investigated by an external body, the full extent of the
problems with Horizon and its associated issues may never be known.
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Q14 Caroline Dinenage: To your knowledge, are sub-postmasters continuing to experience the
issues that have been previously reported.
JFSA’s position on this point is that there are still many problems being experienced by serving
Subpostmasters, albeit that nowadays there may not be as many as those that occurred in the
early years of the system, and also there is now a far smaller network of post offices. JFSA is also
of the opinion that apart from the funding the NFSP receives from Post Office, the main reason the
NFSP is denying its membership are having problems with the system is to assist its members to
sell their offices. Otherwise the very poor market for post offices may well dry up.
It is worth noting that after the committee evidence session on 3" February, JFSA received a
number of emails from serving Subpostmasters. Many of them made the comment, that already
knowing the position the NFSP and Post Office takes over Horizon system problems, it was
pointless ever to raise problems with them. The main hope voiced by these Subpostmasters is
that they are selected for closure and compensation under the network transformation
programme.
There has never been a truly independent and confidential survey of Subpostmasters to discover
the full extent of the problems being experienced with the system.
Q15 Mr Binley: I used to be an area manager for pubs—a lot of pubs. There is a real similarity in
the problems you are talking about because if you employ staff, money—unless you are very
careful—walks out of the front door on two legs, quite frankly. It is not difficult to analyse where
the money is being lost.
There are some big sub-post offices which employ a few people, but many of them are a
husband and wife team or, to be modern, two partners running a business together. Those are
really very small businesses. What analysis has been done on that basis? That would answer the
point that I think you are making, Mr Thomson, which is that where staff are employed, people can
walk out the door and can make mistakes that are very difficult for the sub-postmaster in charge to
manage. What analysis has been done in that respect?
Further to the response by Kay Linnell to this question, it is important to point out that due to the
complexities of this system and the vast amount of services available through it, there is a lack of
intuitive flow with its operation. Furthermore this failure in the system design adds to the
problems of tracking down where or if mistakes have been made, or what has happened to
particular money, and in the long run it is the Subpostmaster who has to pick up the tab, so why
should Post Office worry. It is all about transference of risk from the Post Office to the
Subpostmaster.
Q16 Mr Binley: But how can the sub-postmaster be responsible?
Within the current 114 page 1994 Subpostmaster Contract, item 12 of section 12 states:
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“The Subpostmaster is responsible for all losses caused through his own negligence,
carelessness or error, and also for all losses caused by his Assistants.”
This clause is regularly used by Post Office to collect any shortages a Subpostmaster suffers
however caused and without any investigation as was mentioned later in the session. This is
despite Post Office being the only body able to access all relevant data.
Should the committee require JFSA to expand further on the issues we have raised here or to
provide information on many of the other aspects that over the years we have identified as being
cause for conflict between Subpostmasters and Post Office Limited, then we would welcome the
opportunity to do so.