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POST OFFICE LIMITED BOARD MEETING
Strictly Confidential and Subject to Legal Privilege - DO NOT FORWARD
MINUTES OF A MEETING OF THE BOARD OF DIRECTORS OF POST OFFICE LIMITED HELD ON THURSDAY 17
SEPTEMBER 2020 AT 20 FINSBURY STREET, LONDON EC2Y 9AQ BY CONFERENCE CALL AT 13.30 HRS*
Present:
Tim Parker
Ken McCall
Tom Cooper
Carla Stent
Zarin Patel
Lisa Harrington
Alisdair Cameron
Nick Read
In attendance:
Veronica Branton
Ben Foat
Rodric Williams
Declan Salter
Richard Taylor
Richard Watson
Catherine Emanuel
Sir David Calvert-Smith
Zoe Johnson QC
Nick Vamos
Charlotte Tregunna
Brian Altman QC
Apologies: N/A
Agenda Item
Chairman (TP)
Senior Independent Director (KM)
Non-Executive Director (TC)
Non-Executive Director (CS)
Non-Executive Director (ZP)
Non-Executive Director (LH)
Group Chief Finance Officer (AC)
Group Chief Executive (NR)
Company Secretary (VB)
Group General Counsel (BF)
Head of Legal - Dispute Resolution & Brand (RWI)
GLO Director (DS) (from 2.15 pm)
Group Corporate Affairs and Communications Director (RT) (Item 7.)
General Counsel — UKGI (RW)
Herbert Smith Freehills (AW) (Item 7.)
QEB Hollis Whiteman (DCS)
QEB Hollis Whiteman (23)
Peters & Peters Solicitors LLP (NV)
Peters & Peters Solicitors LLP (CT)
2 Bedford Row (BA)
Action
1. Welcome and Conflicts of Interest
A quorum being present, the Chairman opened the meeting. The Directors declared that
they had no conflicts of interest in the matters to be considered at the meeting in
accordance with the requirements of section 177 of the Companies Act 2006 and the
Company's Articles of Association.
2. Minutes and Matters Arising
The Board APPROVED the minutes of the Board meeting to discuss the CCRC cases held on
27" August 2020.
The Board NOTED the action log.
} Participation in the meeting was entirely via Microsoft Teams from participants’ personal addresses. In such circumstances
the Company's Articles of Association (Article 64) require that the location of the meeting be deemed as the chairman's
location. However, it was not deemed appropriate to record personal addresses on the Company record. As such, the
Registered Office is recorded as the meeting location.
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4.2
5.2
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POST OFFICE LIMITED BOARD MEETING
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Action: BA/
ra)
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5.3
Action: BA/
u
Action: BA/
rH)
6.
Tom Cooper noted that it was not possible to tell the difference between a correction
transaction and a sale. That was difficult for the ongoing business positionand asked what was
being done to remedy this situation. Declan Salter reported that he had received assurances
on the position, including the questions the call handler had to ask before payment was
accepted; however, he would be visiting the Swindon office to see the position first hand.
7.
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9.
POST OFFICE LIMITED BOARD MEETING
Strictly Confidential and Subject to Legal Privilege - DO NOT FORWARD
Any Other Business
Zarin Patel requested an update on the Historical Shortfalls Claim Scheme. Declan Salter
reported that 2,246 claims had been received, quantified at £67m before internal
committee and panel review. A de minimis of 20k was proposed at the bottom end of
scheme, which would reduce costs and also allow us to issue offer letters in first week of
November 2020. We wanted to have addressed 90% of the claims within the first year.
Ken McCall noted that we wanted to be in position to have resolved a large number of the
claims. That would provide closure for those individuals. Declan Salter explained that the
rules of the Scheme had to be circulated before claims could be closed. Claimants had to
choose to accept the offer and if they did not could chose to go to mediation. The first
milestone would be sending the offer letters. Zarin Patel asked whether there was
anything in the offer letters that could set a precedent. Declan Salter explained that there
was a veto right for the internal committee that sought to avoid that position. We were
making arrangements to pay 21 distress cases next week.
Al Cameron noted that the estimated costs of the mediation scheme had increased to a
degree that made it unclear that we could afford them and we had received no
confirmation that the Government was going to meet these costs. As things stood the
current headroom position at the end of the financial year would be £0.
Tom Cooper noted that an envelope of costs would have to be agreed by the Board, as had
been decided earlier in the year, and this would then have to be agreed by the
Government. Government did not think it was paying for the HSCS Scheme claims other
than the sum that had been included in the funding request. Richard Watson noted that
we needed to seek approval of the communications about the Scheme with BEIS. £20k
had been the average claim received by GLO claimants and there would be questions
about this coming to Ministers and others. Declan Salter reported that he was preparing
information for discussion with the Department later in the month. He was aware of the
issues raised by Al Cameron and would not be making payments that could make the
company insolvent. If we did not have the money we would have to continue making
decisions about the claims but not make the payments. Tom Cooper advised that we
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Action: D
cs
Action: BF
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Tab 10 CCRC Minutes 17.09.2020 (approved 01 October)
e
POST OFFICE LIMITED BOARD MEETING
Strictly Confidential and Subject to Legal Privilege - DO NOT FORWARD
could not create a position which left the Minister with no options and this was why we
had proposed the funding envelope approach. Carla Stent noted that the key issue was
what we could afford now and there needed to be a cap. Al Cameron noted that he did
not understand how we could cap this base. Tim Parker noted that we had far more
claimants than anticipated and asked for clarification of how the funding envelope was
going to work.
Tim Parker suggested that at the Board meeting on 22™ September 2020, the Board:
* revisit the decisions taken on the HSCS
* review the extent to which payments were obligatory
consider whether we were able to impose a cap and how would that work with respect
to individual cases, noting that the Scheme had far more applicants that we had
anticipated.
TP noted that he could understand the Government’s position but we were a business and
had to understand how the cashflows would interact with the Scheme. Tom Cooper
thought we had the controls in place to respond to the current position. Ken McCall agreed
that we had set a process in place and had not yet made payments so needed to review
the current position, the costs, the options and how we should progress. The directors
could not allow anything to happen that would make POL insolvent. Tim Parker added that
we had always acknowledged that we could not control the number of applicants and had
believed it appropriate to publicise the existence of the Scheme widely; unless we had
fixed tariffs it was unclear what we could do to contain the costs. Carla Stent thought that
it would be appropriate to agree to make payment for the distress cases identified but
review the 20k de minimis proposed.
The costs and other matters would be discussed again on 22" September 2020.
There being no further business the Chairman declared the meeting closed at 4.00 pm.
ji 20 16:57
Chairman
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