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POST OFFICE LTD BOARD SUB COMMITTEE
Initial Complaint Review and Mediation Scheme
The role of Second Sight in supporting the Scheme
1. Purpose
1.1. As requested by the Board Sub Committee on the Initial Complaints Review and
Mediation Scheme (the Scheme) on 9th April 2014 this paper considers options to
support Second Sight or reduce their role. Likely stakeholder views are reflected to
inform the analysis.
1.2. This paper should be read in conjunction with the paper on options for
closure/accelerated completion of the Scheme.
2. I Background and current position
2.1. The background to this issue, and the concerns about Second Sight, has been set
out a number of times in the past and is not, therefore, rehearsed again here.
2.2. Even were there no concerns about the manner in which Second Sight are
performing their role, their resource is limited to three people and it is unlikely that
they could process the c140 cases in the Scheme within a reasonable timeframe.
2.3. It is acknowledged that there is no right option and this paper represents the
theoretical analysis carried out by the project team. It is intended to provide a basis
for discussion as the Sub Committee consider the future of the Scheme more
broadly.
3. Analysis and Options
3.1. Second Sight appear to enjoy the support of JFSA and a number of MPs, in
particular the Rt Hon James Arbuthnot MP. Further, the Minister has committed to
Second Sight’s ongoing involvement, albeit before the actual Scheme was
announced. That commitment should therefore be seen in the light of how the
Scheme has operated and Second Sight’s performance within it.
3.2. However, it is appears increasingly evident that Second Sight’s ongoing involvement
in the Scheme (at least in terms of fulfilling their role as the providers of expert
advice to assist the parties resolve their disputes) is unsatisfactory.
3.3. Three alternative options (with the high level pros and cons set out in more detail in
Annex 1) have been considered:
i. Provide additional support to work alongside Second Sight to enable them to
fulfil their role as it is presently defined.
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ii. Limit Second Sight’s role to a place on the Working Group, removing their
involvement in investigating cases.
iii. I Terminate Second Sight’s engagement.
(i) Provide additional support
3.4.
Discussions with a possible alternative and international professional services
provider have highlighted that the commercial issues arising in respect of liability
and professional indemnity make this an unworkable solution. In essence, no
professional services provider would work alongside Second Sight in this way.
(ii) Limit Second Sight’s role to a place on the Working Group
3.5.
3.6.
3.7.
There are variations on this option depending on the extent to which it would be
desirable to allow Second Sight to have a more active role:
i. I Second Sight continue to be members of the Working Group and provide a
general challenge function to the findings of the investigation reports; and
ii. I As above but also allowing Second Sight to compile a report, possibly their so-
called ‘thematic report’, at the conclusion of the Scheme.
Neither of these options is likely to work effectively. Based on the evidence of their
approach to date it is unlikely that Second Sight would engage objectively with the
results of investigations undertaken by others. This could result in both JFSA and
Second Sight continuing to ask further otiose questions thus limiting the benefits of
removing them from the investigation process. Moreover, allowing Second Sight to
produce a further report at the end of the Scheme allows them to look more at the
wider issues beyond Horizon and risks reopening matters that the investigation of
individual cases may have closed down.
In relation to this option, and option (iii) below, consideration would need to be given
to how Second Sight's investigation role” is performed. The options include
removing the Second Sight investigation stage from the process, and limiting the
investigation stage to that undertaken by Post Office, or engaging an alternative
professional services provider to fulfil the role. A very initial assessment of the cost
of the latter option is that it would be of the order of £1m, depending on the exact
scope of the task but further consideration of that option is dependent on a decision
about the future shape of the Scheme.
(iii) Terminate Second Sight’s engagement
3.8.
Second Sight have been working for the Post Office on Horizon and associated
issues since 2012, they have been working specifically on the Scheme since its
launch in August 2013. Their track record thus far has not demonstrated that they
will be able to deliver the Scheme’s requirements in a timely manner.
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3.9. Although it is acknowledged that a theoretical analysis of this situation would lead to
the conclusion that Second Sight’s engagement should be terminated, there are
wider political and stakeholder considerations in play which may obstruct delivery of
this solution.
4. Conclusion and recommendation
4.1. As stated in 3.1 above, Second Sight appear to enjoy the support of a number of key
stakeholders, and any change to their role would require careful handling and is
likely to be opposed. Moreover, it is almost certain that, particularly because of
JFSA’s support for Second Sight, any decision which affects Second Sight’s
involvement in the Scheme may result in the JFSA leaving the Working Group.
4.2. This paper deals solely with the role of Second Sight, but the decision about Second
Sight’s future engagement in the Scheme is a multifaceted one and should not be
considered in isolation but in the broader context of the future of the Scheme.
Accordingly, this paper should be considered as background to the paper on options
for closure/accelerated completion of the Scheme.
Chris Aujard
28 April 2014
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1.1.
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Annex 1
Option 1: Provide additional support for Second Sight to enable them to fulfil
their role as it is presently
Pros
Cons
Would address capacity and capability
issues, and potentially speed up the
time taken to complete the Scheme
Continues Second Sight involvement
therefore staying true to the Ministerial
commitments
Subject to Second Sight’s reaction,
would satisfy stakeholders who
consider only Second Sight have the
knowledge and independence to
investigate claims.
Commercial/liability issues for
alternative providers makes it unlikely
that another professional service
provider would be willing to engage.
Would significantly increase the cost
of delivering the Scheme — paying two
investigation teams instead of one
Any change to current arrangements
will be considered to be Post Office
interference.
Second Sight are unlikely to be
satisfied with results which do not
accord with their own assessment.
Option 2: Limit Second Sight’s role to a place on the Working Group
Pros
Cons
Allows Post Office to take control of
the “flow” of cases through the
Scheme.
Continued involvement of Second
Sight remains consistent with
Ministerial commitments.
Limits Second Sight direct
engagement (and therefore influence)
with applicants and their advisors.
Creates opportunity (if desirable) to
bring in a professional services
provider.
Inconsistent with Post Office public
commitments and agreements made
with JFSA and Second Sight when
designing the Scheme.
Could be viewed as Post Office
interference/fettering Second Sight’s
independence.
Second Sight may adopt an
adversarial role on the Working Group
There will still be cost for Second
Sight’s engagement and the
management overhead in managing
the relationship will remain (albeit to a
lesser extent).
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Option 3: Terminate Second Sight’s engagement
Pros
Cons
+ Significantly streamlines the process
to allow faster resolution
+ Enables Post Office to manage
engagement with applicants and their
professional advisers
+ Will enable completion of the Scheme
to be accelerated, reducing operating
costs and senior management
overheads
+ Creates opportunity (if desirable) to
bring in a professional services
provider.
« — Inconsistent with Ministerial
commitments about Second Sight’s
involvement.
¢ Any change to current arrangements
will be considered to be Post Office
interference/whitewash.
e Will attract adverse publicity.
¢ Will lead to conflict with JFSA and
Second Sight, may alienate the
Working Group Chair (if not properly
handled)
¢ May result in parliamentary activity
(e.g debate/PQs therefore involving
the Minister).
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