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WESTMINSTER HALL DEBATE:
SUBPOSTMASTER MEDIATION
SCHEME
James Arbuthnot MP (Con, North East
Hampshire)
Wednesday 17 December, 14.00 — 15.30
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CORE SPEECH — 880 words
[Paragraphs 1 — 20, c. 8 minutes]
Introduction
1.1 congratulate the Rt. Hon. Member for North
East Hampshire on securing this debate on the
Complaint Review and Mediation Scheme
relating to Post Office Ltd’s Horizon accounting
software.
2.He has set out his concerns on this matter, and I
know how passionately he cares about this
subject. I remember well the statement that I
made in the House in July 2013, and the
important foundations that were committed to at
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that time, which led to the creation of the
Complaint Review and Mediation Scheme.
3. The Rt. Hon member has clearly laid out his
perception of the failings of the Complaint
Review and Mediation Scheme, which was
established last August, and is overseen by the
independent Working Group.
4.I have listened carefully to his concerns, and
those expressed by other honourable members
present here today, and will spend just a few
moments reflecting on those.
Background
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5. To understand the Rt. Hon. Members concerns, it
will be useful to establish and agree some key
facts.
6. First, there must be a degree of proportionality in
this debate. The system processes 6 million
transactions every working day across a Post
Office network in excess of 11,500 branches.
Nearly 500,000 users having used Horizon since
it was introduced, serving millions of customers.
7.Let us be clear, only a very small minority of,
mainly former, subpostmasters and Post Office
employees have made complaints about the
system. Whilst every case matters
tremendously, these do represent isolated cases.
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8. That brings me to my second point. Ensuring the
integrity of the system is of paramount and
overriding importance. That is why in 2012, the
Post Office commissioned an independent firm of
forensic accountants — Second Sight — to
examine the Horizon system.
9. Second Sight published their report in July 2013.
It pulled no punches, but we must always bear in
mind during this debate one overriding fact that
was Clearly written into their independent report.
There was no evidence of system-wide problems
with the Horizon software. This fact has not
changed to this day despite significant further
investigation through the cases in the Scheme.
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10. However, Post Office acknowledged that the
report raised questions about the training and
support offered to some subpostmasters and its
determination to address them.
11. This leads to my third point. Following the
publication of the independent Second Sight
report in July 2013, I made a statement before
Parliament that the Post Office was deliver three
initiatives in response to that report:
a. A Working Group would be created to review
cases;
b. This would be independently chaired; and
c. The Post Office would create a branch user
forum to create a feedback loop for users.
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12. At this point it is very important to clearly state
for the record that the Government plays no role
in the operation of the Post Office. And that the
Working Group was established entirely
separately of Government to ensure its
independence.
13. It is also important to clarify the establishment
of the Working Group. The Post Office was
involved in designing and setting up the Working
Group, but alongside the Justice for
Subpostmasters Alliance and, Second Sight.
The Rt. Hon. Member for North East Hampshire
acknowledged at the time that the mechanism
would lead to the process being fair, thorough
and independent.
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14. The Working Group has an independent chair.
Sir Anthony Hooper whose name was suggested
by the Justice for Subpostmasters Alliance who
publicly welcomed his appointment. As a former
High Court Appeal judge, Sir Anthony Hooper is
well equipped with the skills necessary to chair
this group as acknowledged by JFSA at the time
of his appointment and I welcome the role he has
played to date.
15. Since the Scheme began considering cases, I
understand that the Post Office has completed its
thorough and detailed investigations in virtually
all cases. Second Sight is also working hard to
produce its reviews of the cases.
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16. With the jointly designed Scheme now
operating and making recommendations based
on the evidence presented about whether to
recommend cases for mediation; it is regrettable
that the Rt. Hon. Member has felt that he must
now withdraw his support for the Scheme that he
was so closely involved in creating.
17. Finally it is worth making the point that the
findings of each case must remain confidential.
This is a core aspect of the process. The
Scheme requires applicants and Post Office to
endeavour to keep details of their cases
confidential and the detail of mediations are
confidential and undertaken in line with the
European Code of Conduct for Mediators (to
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which the external mediation provider CDER is
required to comply to maintain its accreditation).
18. But these cases often involve very personal
information which participants would not want
disclosed publically, and could dissuade others
from participating in the scheme if that were the
case.
19. Whilst it is therefore easy to accuse the Post
Office of being secretive, this is a fundamental
part of the process which everyone has agreed to
respect. And in any event the cases and
evidence of necessity include a significant
amount of sensitive personal information which
cannot be disclosed and debated publicly.
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JFSA instigating legal action
20. It is also deeply concerning that I have learned
that the Justice for Subpostmasters Alliance has
recently engaged a legal firm with a view to
considering legal options.
21. The success of the Scheme rests on the
commitment of all the involved parties. This
includes the Post Office, but equally applies to
the Justice for Subpostmasters Alliance. The
actions of recent weeks have caused significant
damage to the Scheme and it will remain to be
seen if this can be recovered.
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22. It must not be forgotten that this Scheme was
established to provide a route for former and
existing subpostmasters to have their cases
considered through an independent Scheme.
The actions of the Justice for Subpostmasters
Alliance does nothing but cause uncertainty and
delay, and does not serve the applicants well.
23. The Government has not been involved in the
design of the Scheme, or in the independent
Working Group. But I would maintain that all the
parties that are involved are obliged to work
together under the processes that were jointly
agreed, to bring the investigations into the
applicants’ cases to a swift resolution.
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90% ACCUSATION — 140 words
[Paragraphs 21 - 24, c. 1 minute]
24. I have heard the Rt. Hon. Member for North
East Hampshire described the Post Office as
‘blocking’ 90% of applicants from the scheme or
mediation.
25. Sir Anthony Hooper, the independent Chair of
the Mediation scheme, has provided me with an
update on progress of cases in the Scheme.
26. Of the 24 cases recommended for mediation
by the working group, Post Office has only
declined to mediate on 2.
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27. Around a dozen cases have also been
resolved as part of the Scheme but before the
mediation process itself.
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NOT MEDIATING ALL CASES — 170 words
[Paragraphs 25 — 28, c. 2 minutes]
28. I must remind the Rt. Hon. Member that the
Government was not involved in the design of
the Scheme. This was the responsibility of the
Post Office, the Justice for Subpostmasters
Alliance and the Rt. Hon. Member himself who
welcomed the Scheme.
29. Post Office has assured me that every case is
fully investigated and the decision on whether to
mediate is made on the basis of the facts and
findings of the investigations. Each complaint is
considered on a case by case basis. But Post
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Office must base its decision on substance and
facts.
30. As regards criminal cases, it is important to
note two things; first that neither the Government
nor the Working Group can intervene in the legal
process to review or appeal past convictions.
Second a conviction cannot be overturned by
mediation, that is a matter which can only be
dealt with by judicial authorities.
31. Post Office is, however, under an absolute
duty to immediately disclose any information
which is capable of casting doubt over the safety
of a conviction.
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32. Post Office has made no such disclosures
during the course of the scheme and nothing has
to date surfaced that questions the safety of
those convictions.
33. The mediation scheme was not established to
overturn criminal convictions. Where an
applicant has been convicted in a court of law,
but believes their conviction to be unsafe, they
should appeal that conviction through the
relevant judicial routes.
34. I am not involved in the Scheme and not
familiar with the cases but it is difficult to
envisage what mediation could achieve where it
has found nothing in the course of its re-
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investigation which casts doubt on the safety of
the conviction. An applicant would have the
reports of their cases from the Scheme and be
able to consider whether they felt they contained
evidence to support an appeal.
35. There have also been allegations made that
Post Office pressured subpostmasters in to
pleading guilty to lesser offences.
36. Post Office only brings a prosecution when it
meets the tests set out in the Code for Crown
Prosecutors. This means that the prosecution is
in the public interest and is supported by
sufficient evidence.
37. Before pleading to any offence, a
subpostmaster has the benefit of seeing Post
Office's evidence and has the opportunity to take
legal advice.
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38. Post Office has no role in deciding what plea is
offered by a defendant — that is the defendant's
choice, and I would re-iterate that if they feel their
conviction is unsafe, they can appeal through the
relevant judicial routes.
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SCOPE OF THE SCHEME (INC TRAINING) — 95
words
[Paragraphs 29 — 31, c. 2 minute]
39. I note that in correspondence with Post Office’s
Chief Executive, which has been made public,
the Rt Hon Member for NE Hampshire
questioned what the mediation scheme now
encompasses.
40. The Scheme’s overall objective is to try to
achieve the mutual and final resolution of
Applicants’ concerns about Horizon and related
issues. I recall well that the concerns advanced
by honourable friends which resulted in the
appointment of Second Sight, was about the
Horizon system
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41. This encompasses, as recorded in Second
Sight’s interim report, the following:
42. “...Horizon relates to the entire application.
This encompasses the software, both bespoke
and software packages, the computer hardware
and communications equipment installed in
Branch and the central data centres. It includes
the software used to control and monitor the
systems. In addition, ...... testing and training
systems are also referred to as Horizon”
43. The scheme was therefore set up with a very
specific and defined purpose, but which was
sufficiently wide to encompass more than just the
software.
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44. I would remind everyone that nothing prevents
SPMRs from raising a wider grievance with Post
Office at any time through any other business-as-
usual channels.
45. With regard to training specifically, which has
been a source of complaint for some, this is
within the remit of the scheme.
46. However, it must be remembered that those
subpostmasters who have expressed complaints
represent a tiny proportion of the tens of
thousands of users who successfully use the
system.
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47. The Post Office has informed me that it
provides a comprehensive training package
including both classroom and on-site training
and has made considerable changes to the way
it provides support to subpostmasters over the
years.
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CONCLUDING REMARKS - 170 words
[Paragraphs 32 - 37, c. 2 minutes]
48. Having revisited the facts around the
background to the Scheme, how it was designed
and established, and how it operates, I will now
draw some conclusions.
49. Following a detailed independent report into
the Horizon system and related issues, a
Working Group with representatives from the
Justice for Subpostmasters Alliance was
established in line with the three initiatives
Government announced at the time.
50. After more than two-and-a-half years of
detailed forensic analysis, there remains no
evidence of system wide problems with Horizon.
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51. Whilst some Hon Members may not be
satisfied with some of the scheme’s findings
(which remain confidential) or outcomes to date, I
would encourage them to continue to support
and co-operate with the process as the best way
of determining the extent to which the complaints
of the members of the scheme are valid or not.
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NETWORK TRANSFORMATION — 70 words
[c. 1 minute]
Network Transformation
Alongside the plans to modernise and improve the
Crown network, Post Office Ltd is delivering its
Network Transformation Programme, which is
providing funding for all branches by 2018.
Nationally, over 4,500 subpostmasters have
voluntarily signed up to convert, and over 3,500
branches have now converted and are open and
operating. Under Network Transformation,
branches are improved, and there are nearly
always much longer opening hours bringing
significant benefits for customers.
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GOVERNMENT COMMITMENTS — 190 words
[c..2 minutes]
Government commitments
In 2010, we set out our commitments to the Post
Office network in our policy statement, “Securing
the Post Office network in the digital age”. I am
proud to stand here three years later and say we
are delivering on those commitments, and will
continue to deliver.
We said:
= There will be no programme of post office
closures under this Government. There isn’t,
and there won't be.
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= We have committed to provide nearly £2 billion
for the Post Office to modernise the network.
We are providing that funding, and the Post
Office is modernising.
= We want to see the Post Office become a
genuine Front Office for Government. The
company has won every contract it has bid for
in the last three years, including the vital DVLA
front office contract. Yesterday we announced
a Post Office would provide the Post Office
Card Account through to 2022.
= We said we would support the expansion of
accessible and affordable personal financial
services available through the Post Office. We
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are doing so, and Post Offices financial
services offerings are going from strength to
strength
We said we would create the opportunity for a
mutually owned Post Office. We have held a
public consultation, the company has through
engagement with its stakeholders agreed its
public benefit purpose, and the company
continues to make progress against the
mutualisation milestones that it has published.
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