1.1.
2.1.
2.2.
3.2.
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POST OFFICE LTD BOARD SUB COMMITTEE
30" April 2014
The role of Second Sight in supporting the Scheme
Purpose
As requested by the Board Sub-Committee on the Initial Complaints Review and
Mediation Scheme (the Scheme) on 9" April 2014 this paper outlines the role of
Second Sight in supporting the Scheme to date and considers options to support them
or reduce their role. Likely stakeholder views are reflected to inform the analysis.
Background and current position
The background to this issue, and the concerns about Second Sight’s engagement in
the Scheme, has been set out a number of times in the past and is not, therefore,
rehearsed again here.
Even were we to have no concerns about the manner in which Second Sight are
performing their role, their resource is limited to three people and therefore it is unlikely
that they could clear the c140 cases in the Scheme within a reasonable timeframe.
Analysis and Options
Whilst Second Sight clearly enjoy the support of JFSA and a number of MPs, in
particular the Rt Hon James Arbuthnot MP, and the Minister has committed to Second
Sight’s ongoing involvement, albeit before the actual Scheme was announced.
However, it is increasing evident that their ongoing involvement in the Scheme, at least
in terms of fulfilling their current role is unsatisfactory.
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 for Second Sight to enable them to fulfil their role as
it is presently
ii. Limiting 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
3.3.
Informal discussions with a possible alternative and internationally renowned
professional services provider have highlighted that the commercial issue arising in
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respect of liability and professional indemnity make this an unworkable solution. In
essence, no professional services provider would work alongside another organisation
in this way.
(ii) Limit Second Sight’s role to a place on the Working Group
3.4.
3.5.
3.6.
3.7.
(iii)
3.8.
4.1.
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. Second Sight continue to be members of the Working Group and provide a
general challenge function to the findings of the investigation reports
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 are likely to be workable. Based on the evidence of their
approach to date it is unlikely that they would engage objectively with the results of
investigations undertaken by others and could result in joint JFSA and second sight
causing further questions to be asked as now and thus limit the benefits of removing
them from the investigation process.
Allowing Second sight to produce a further report at the end of the Scheme allows
Second Sight again 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
whether and how what is currently Second Sight’s ‘investigation’ role is performed.
The options include removing that part of the Scheme process and limiting the
investigation stage to the Post Office’s investigation, 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 consideration of that option is dependent on a decision about the future
shape of the Scheme.
Terminate Second Sight’s engagement
Experience to date suggests that Second Sight do not have the expertise, capacity or
impartiality required to fulfil the role needed to support the Working Group. The
evidence suggests that their continued involvement in any way short of what it is now
is likely to continue to be challenging to manage and frustrate the aim of bring the
scheme to a satisfactory conclusion.
Conclusion
As stated in 3.1 above, Second sight enjoy the support of a number of key
stakeholders and their removal from the Scheme will require careful handling and is
likely to be opposed. However, the Linklaters assessment of Second Sight’s work so
far (as previously discussed with the Board) and their question about whether Second
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Sight actually have the expertise to do the work to a satisfactory standard cannot be
ignored. The challenges of altering Second Sight’s role or terminating their
engagement, have to be balanced against the cost of keeping them engaged in light of
a compelling assessment that they are not able to fulfil a meaningful role in relation to
the Scheme.
4.2. Itis almost certain that, particularly because JFSA’s support for Second Sight any
action which affects Second Sight’s involvement in the Scheme could well result in the
JFSA leaving the Working Group. This paper deals solely with Second Sight but any
final decision on how to proceed in relation to Second Sight must be considered in the
broader context of the future of the Scheme and the extent to which it is decided to
retain the Scheme close to its current form.
5. Recommendation
5.1. That Second Sight’s engagement is terminated, subject to a final decision on the future
of the Scheme.
Chris Aujard
30 April 2014
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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 a another professional service
provider would be willing to engage.
Would 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 inappropriate
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 Sights
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 Second Sight 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 Scheme
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.
e 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)
e May result in parliamentary activity
(e.g debate/PQs therefore involving
the Minister.
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