POST OFFICE LIMITED BOARD MEETING
Strictly Confidential
MINUTES OF A MEETING OF THE BOARD OF DIRECTORS OF POST OFFICE LIMITED HELD ON TUESDAY 31
OCTOBER 2023 AT 100 WOOD STREET, LONDON, EC2V 7ER AT 09:00 AM
Present: Henry Staunton
Lorna Gratton
Saf Ismail
Elliot Jacobs
Ben Tidswell
Brian Gaunt
Simon Jeffreys
Amanda Burton
Andrew Darfoor
Nick Read
In attendance: Rachel Scarrabelotti
Owen Woodley
Kathryn Sherratt
Asha Patel
Chris Brocklesby
Tim McInnes
Rebecca Greig
Chris Rawlings
Simon Recaldin
Ben Foat
Nick Vamos
Diane Wills
Dionne Harvey
Sarah Gray
John Bartlett
Martin Hopcroft
Richard Taylor
Simon Marshall
Martin Roberts
Chairman (Chairman)
Non-Executive Director (LG)
Non-Executive Director (SI)
Non-Executive Director (EJ)
Senior Independent Director (BT)
Non-Executive Director (BG)
Non-Executive Director (SJ)
Non-Executive Director (AB)
Non-Executive Director (AD)
Group Chief Executive Officer (NR)
Company Secretary (RS)
Deputy CEO (Observer) (OW)
Interim CFO (Observer) (KS)
Director of Strategic Financial Planning & Analysis (AP)
Chief Transformation Officer (CB)
Strategy and Transformation Director (TM)
Managing Director, Accenture Technology Strategy &
Advisory (RG)
Managing Director, Accenture Strategy (CR)
Remediation Unit Director (SR)
Group General Counsel (BF)
Partner and Head of Business Crime, Peters & Peters
Solicitors LLP (NV)
Public Inquiry Director (DW)
Head of IT Procurement (DH)
Group Legal Director (SG)
Head of Assurance & Complex Investigations (JB)
Director of Health & Safety, Environment and Business
Continuity (MH)
Group Corporate Affairs, Brand and Communications
Director (RT)
Head of Brand (SM)
Group Chief Retail Director (MR)
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Melanie Park Central Operations Director (MP)
Laura Joseph Customer Experience, Marketing & Digital Director (LJ)
Simon Oldnall Horizon and GLO IT Director (SO)
Apologies: Alisdair Cameron Group Chief Finance Officer (AC)
i, Welcome and Conflicts of Interest, Inquiry Undertakings
Welcome and Conflicts of Interest
A quorum being present, the Chairman opened the meeting. The Chairman called for the
Directors to disclose any conflicts of interest. The Directors declared that they had no new
conflicts of interest in the matters to be considered at the meeting in accordance with the
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requirements of section 177 of the Companies Act 2006 and the Company’s Articles of
Association.
The Board acknowledged the attendance of OW and KS as observers at the meeting. As
observers, the Board was aware that all contributions made by OW and KS to the meeting
were observations only, and did not constitute advice, recommendations, directions or
instructions. The Board confirmed that it would take due care not to be unduly influenced
solely by a contribution made by OW or KS and that it would reach its conclusions based
on a balanced and diligent assessment of all the facts available to it.
Inquiry Confidentiality Undertakings
The Board noted that DH, CR and RG did not have confidentiality undertakings accepted by
the Inquiry in place, and that these individuals would need to be excused from the meeting
should the need to discuss information confidential to the Inquiry arise.
Minutes and Matters Arising
TABLED and NOTED were draft Minutes from the Board Meeting of 26 September 2023.
Subject to the incorporation of comments by BT, AB and SJ, the Board RESOLVED that the
Minutes of the Meeting held on 26 September 2023 be APPROVED as a correct record of
the Meeting and be signed by the Chair.
The Board NOTED the action log and status of the actions shown. The Board NOTED the
Grant Thornton Scope of Work. Points were raised in relation to the following actions:
* Item 24 - SI advised that he did not think that the response addressed Sl’s point.
NR advised that he had worked with MR and local Postmasters would be invited to
take up new Banking Hubs first and that a process had been put in place for
offering Banking Hubs to the wider Postmasters population if local Postmasters
were not interested or were unable to participate. NR further advised that SI's
point in relation to improved Postmaster engagement on this issue had been
considered and that the process had been improved accordingly. NR noted the
key issue of finding the correct high street locations for Banking Hubs and that
management would look to work with Cash Action UK on this. NR was due to
meet with Cash Action UK the following week and would raise this point;
Item 1 - LG queried progress given the original action had been raised some
months ago. KS advised that her focus had been on the FY22/23 ARA and that
product profitability was due to be presented to the Board early next year;
LG noted that an item had been closed and removed from the action log in
relation to a request by BT in March to share the Employee Survey results; these
however had not been shared as yet. NR advised that he would be speaking to the
Employee Pulse Survey results later in the meeting;
AD queried what the work on product profitability would seek to achieve. KS replied
clarity as to costs allocation. EJ advised that from his perspective he wished to understand
which products were profitable for both the Company and Postmasters. The Chairman
referenced products, for example, fishing licences, which were not sufficiently profitable
to warrant being built on NBIT, so the product profitability work would also assist in
ensuring that the NBIT scope was correct.
Committee Reports (verbal)
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3.1 Remediation Committee
BT advised as follows:
In respect of the criminal cases triage work, cases had been identified where the
Company could concede, those that could be opposed, and those that were cases
where it was not known whether we could concede or oppose. This information
could come into the public domain shortly and could alter the narrative in respect
of whether any of the convictions were safe. ACTION SJ queried preparedness to
deal with potential media attention on this. NR took the point and advised that at
the next Board meeting he would return with details of what management saw as__NR/ RT
the media term strategy on this point and as against the coming phases of the
Inquiry. BG noted the position of the Advisory Committee as to the safety of
convictions. BT advised that this position had been discussed by the Remediation
Committee, however this was a matter for the Court of Appeal;
¢ The Board would be asked to consider the Malam case later in the meeting in
relation to the economic duress of the Postmaster’s contract with the Company.
ACTION AB queried the extent to which an audit had been undertaken of
Postmaster contracts. NR advised that a set of contract variations had been NR
prepared and that NR would share the details of these;
¢ The OC pecuniary principles had been approved by the Remediation Committee
and the Independent Pecuniary Compensation Assessment Panel established;
Progress continued on the HSS with the Shareholder setting a target of 95% of
outcomes to be issued by the Company to late applications received on or before
31 March 2023 by December 2023. The establishment of a HSS appeal process
remained under consideration by the Shareholder;
¢ Inrelation to Postmaster detriment, suspension payments, quality assurance
issues had been resolved and payments were being issued again;
e Shareholder funding for Postmaster detriment, POL Process Review, was
anticipated to be approved shortly.
3.2 Audit, Risk and Compliance Committee
Key discussion points were as follows:
SJ noted that the FY22/23 ARA had a number of dependent parts that were
moving, and ARC was working to keep these synchronised. The letter of support
was one of these dependant parts and the drafting of this remained to be settled.
The less supportive the letter of support then the greater the disclosures required
in the ARA;
« Management would need to make a recommendation to the Board in respect of
going concern and the Board would need to consider this and materiality issues;
¢@ The Chairman queried whether there was a possibility that the final form letter of
support might be acceptable to the Board however not sufficient for the auditors.
SJ advised that he thought that was an unlikely scenario; if we were not provided
advised further that these points would be considered at the ARC meeting
scheduled for the following week and that legal advice would be taken in terms of
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the wording and the pieces of evidence that could be relied on to demonstrate
going concern. BT clarified that any legal review would not be able to advise on
whether the Board was taking the correct decision; the legal advice would advise
on whether the process the Board had been through in making the going concern
assessment was correct, so almost a due diligence exercise on the information the
Board had been provided with, and a legal view on whether this matched with the
level of due diligence a director would be required to undertake in assessing for
going concern;
e AB queried when the Board was likely to be provided with the draft ARA in its
entirety. KS advised that Finance was aiming to issue this on 10 November in
order to allow a period for comments of Board members to be incorporated ahead
of ARC and Board at the end of November. KS referenced the weekly updates
being provided to the Board on the status of the ARA and requested that Board
members make KS aware of any other information they would like. ACTION KS
undertook to schedule time with each Board member ahead of the November
Board meeting to speak to the above issues, with BF to be in attendance as well;
* AB queried whether PwC had provided a draft of their audit opinion. KS replied
that they had, a ing revi advised his expe
was that an}
queried how this was likely to be perceived. KS advised that she thought that this
needed to be considered and incorporated as part of the media strategy and that
based on current timings it was likely that the ARA would be laid in Parliament and
filed at Companies House in January 2024; and
e SJ asked KS to speak to the TB Cardew review. KS advised that TB Cardew had
been engaged to review the draft ARA for tonal and voice consistency as well as to
identify any inconsistencies with statements that the Company had made aside
from the ARA. This review, along with the Deloitte assurance exercise,
represented additional reviews as against last year.
Remuneration Committee
AB advised that the Remuneration Committee had not met since the last Board meeting in
September, however an interim meeting was scheduled for the following Monday for the
Remuneration Committee to consider the current draft DRR along with some other
remuneration matters.
Nominations Committee
The Chairman advised that the Nominations Committee had similarly not met since the
last Board meeting however in the meantime there had been conversations with each of
the Directors to take their views on whether the SID to succeed BT should be appointed
internally or recruited externally and the decision had been taken that the SID would be
recruited for externally. The Chairman further advised that he was very conscious of
Director’s time commitments and the question of whether a further Non-Executive
Director needed to be appointed had been raised. However, the view of the majority of
the Board was not to increase Board size at present, although the Chairman would review
this position if need be. SJ shared his view that chairing a committee as well as being a
committee member of a further Board committee would be useful.
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Investment Committee
AD advised as follows:
© The Investment Committee had had its inaugural meeting yesterday. The main
item of consideration was the receipt of an update from management and
Accenture in relation to the SPM review;
The Accenture review contained a number of key observations along with a
number of recommendations in order to reset the programme;
* The Investment Committee were of the view that the Accenture review was
thorough and well thought out. For management it would be important to ensure
that the recommendations were implemented carefully on a reasonable time
basis;
e Accenture’s view was that the technology architecture was stable and modern
with evidence of a number of deliveries already made. SJ queried whether the
© The Investment Committee had also considered the level of large projects in place,
and it was estimated that 6-7 approvals would be coming to Board in relation to
these. The Investment Committee would review these proposals ahead of Board
and conduct post implementation review of these programs to assess whether
they had delivered what they needed to;
© Going forward the Investment Committee would meet quarterly ahead of periodic
Board meetings given the volume of large projects in place.
The Chairman queried whether an appropriate level of Non-Executive Director and
management support was in place to support the Investment Committee. AD advised that
he was satisfied on this point and OW noted the role of TM in overseeing the change
process and approval of drawdowns.
CEO Report
TABLED and NOTED were the following papers:
(i) ‘CEO report’; and
(ii) ‘Retail Peak Conference - Executive Summary’.
NR advised as follows:
Despite macro head winds in retail more broadly, the business was performing
quite well. We were up against budget and higher Postmaster generating
products were delivering with the level of remuneration going to Postmasters
encouraging. Staff costs were broadly under control;
There was uncertainty as to what peak trading performance would look like,
however industrial action from RMG was not anticipated this year. In light of the
cost-of-living crisis and consumer sentiment, retailers were very nervous;
¢ The number of banking deposits was increasing, indicating consumers were
looking to retain their cash. From a transactional level on banking however,
consumers were withdrawing less and depositing less;
¢ Two Pulse surveys had been conducted. The Postmaster Pulse survey was due to
conclude on 10 November, however to date there was an increase in responses as
against last year. Progress appeared to have been made on 2 key metrics and that
was encouraging. The second survey was the employee Pulse survey where there
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had also been a good response rate. There were 4 key areas tested and there had
been an improvement in all metrics save for improving bureaucracy and strain. A
metric where there had been a significant increase in sentiment was in respect of
employees being held accountable. ACTION AD queried the strength of this
sentiment across employee grades. NR advised that the results needed to be
segmented and that NR would provide details. NR was pleased overall with the
results of the employee Pulse survey given the difficulties at the Company the past
few months;
The Postmaster Director recruitment process has been completed and M Eldridge
would succeed H Cheetirala, commencing 1 December;
Inrelation to the implementation of the Mails strategy, in branch sales of Evri and
DPD products would be launched next week. The levels of engagement for the
online platform had been lower than anticipated and thought was being given to
investing more in marketing direct online. The Chairman noted the significance of
this development and the progress that the Mails team had made. ACTION BG
advised that. he had spoken to N O’Sullivan last night and they had discussed
er:
IRRELEVANT
NR
ow/N
O'Sullivan
queried the possibility of customs paperwork being completed ahead of customers OW/N
coming into branch. OW advised that he would pick this up with N O’Sullivan. O'Sullivan
ACTION EJ referenced issues on SSKs in relation to the limitations on accepting
returns and advised that he thought that this was to be corrected ahead of
Christmas. OW replied that he was not aware of this and that he would need to
check. ACTION SI raised a concern around the marketing of the banking
proposition and queried whether issues with marketing would be perpetrated in
relation to roll-out of other carriers in branch. OW replied that the team did what gw/L Joseph
they could on marketing for banking within the confines of the budget and advised
that he would ask L Joseph to pick up with SI. NR advised that given the limited
marketing budget the focus had been more on local marketing;
© The first ever meeting between management and the Inquiry secretariat was
scheduled to take place next week. NR referenced the extensive section 21
request that had been recently received and that C Brocklesby was proposed to
provide the corporate witness statement in response. AB queried whether C
Brocklesby was the right person for this, given he was engaged as a contractor at
present, had only been with the Company for a short time, and that this would
divert his attention from SPM. BT queried who else in the business may be able to
provide the witness statement. EJ advised that the issue was that individuals with
the knowledge had exited the business. OW noted that DW was due to attend the
meeting later and suggested that DW be invited to speak on these points.
ow
AD queried progress with the Bol negotiations and noted the significant financial
implications of the relationship. OW replied advising that he was confident that the
negotiations would be concluded.
ACTION SI queried progress in relation to the Scottish forged notes. OW replied that MR ow/ MR
was running a task force on this and would find out the status.
ACTION SI queried anticipated volumes from the sale of Evri and DPD products in branch. ow/N
NR advised that a national forecast of anticipated volumes could be shared. O'Sullivan
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Finance
Financial Performance Report
AP joined the meeting at 10:45.
TABLED and NOTED was the P6 Financial Performance Overview. Key discussion points
were as follows:
«AP spoke to the headline results and drivers of this. Travel products had
performed very well and there was also out performance on banking. Deposits
had been impacted by lower transaction values however there was significant local
marketing taking place in relation to banking. AP detailed the level of variable
Postmaster remuneration and noted that staff costs were under budget however
this trend was expected to reverse;
e AD queried the role of the GE OPEX committee and whether this committee was
looking ahead to FY24/25. AP advised that the focus of the OPEX committee was
very much on FY24/25. Finance were looking at a draft budget for FY24/25 and
achieving costs savings remained a key priority. AD advised that he was not
confident on the achievement of cost savings based on the materials provided. KS
advised that savings had been achieved in other areas, however what was
reported to the Board were savings in relation to the categories in respect of the
bonus metric which management had committed to track against;
e AD queried who we benchmarked against and shared his view that a forward plan
to track progress of cost savings was required. KS noted the work K McEwan was
undertaking looking at operational design in order to address staff costs however
it was difficult to tackle the non-staff cost base given fixed costs arising from
contractual commitments. ACTION OW advised that details could be provided to
the Board setting out anticipated categories of cost savings for FY24/25. LG
advised that this would be helpful as LG was interested to see whether all cost
savings that could be made without investment had been taken out;
© SJ queried the extent to which procurement issues contributed to the costs base.
BG shared his view on the issue. KS advised that it came down to the Board’s risk
appetite. OW advised that there would be an update provided to the Board on
culture in November and this would include a deep dive on the Swindon deal. BT
advised that he was not sure that benefits were being fully maximised from the
framework and queried whether external support could be sought on this.
ACTION SJ advised that ARC could look at a deep dive on this along with
recommendations as to how to make procurement more effective;
* EJnoted the significant decrease in the provision for branch discrepancies and
queried whether it was thought that this would continue to improve. AP replied
that the forecast indicated that this would remain in budget until a strategy was in
place to deal with branch discrepancies.
KS
KS
AP left the meeting at 11:17.
ARA and funding update (verbal)
The Board referenced the earlier discussion in the ARC update on the status of the ARA
and funding.
Transforming Technology
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Strategic Platform Modernisation Programme (SPMP) Review
CB, TM, RG, and CR joined the meeting at 11:34.
TABLED and NOTED were the following papers:
(i) “Strategic Platform Modernisation (SPM): Programme Diagnostic Review’; and
(ii) ‘SPMP Review — Appendix 1’.
Key discussion points were as follows:
* Accenture’s summary of the review of the project was that whilst Accenture had
concerns, if these could be addressed, Accenture was confident that the Company
could achieve what they set out to;
* CR outlined Accenture’s findings in relation to 9 main observations including in
SPM scope, IT delivery capability, delivery methodology, governance, amendments
to timelines and cost forecasts, data-driven reporting, culture, IT delivery and the
combining of the NBIT and RTP teams. Board members raised queries in relation
to the impacts of the delivery methodology used and whether this may have
affected the integrity of the platform, the approach taken in relation to the
resolution of defects, and the level of confidence in internal resource;
‘IRRELEVANT
In relation to Accenture’s recommendations on governance the Chairman referenced the
establishment of the Investment Committee and noted the reporting the Board
anticipated receipting on progress as against the Accenture recommendations via the
Investment Committee. OW detailed the new executive level SPM Steering Committee
that had been established for SPM and CB advised that the rest of the governance forms
would be built out over time.
AB noted the backdrop of the Inquiry and the culture of risk aversion, particularly in
relation to SPM. CR agreed with this assessment; employees were more concerned and
less inclined to take decisions. It was very important that the CI) and HU
recommendations were traced through to the new system.
RG and CR left the meeting at 12:30.
CB shared his views on the recommendations and findings. AD advised that he was not
certain that a delivery partner was required. CB replied that he thought greater capability
was required however this could be achieved partly through recruitment and then partly
through engaging a third party such as Accenture to assist with some of the
recommendations, for example in relation to delivery planning, however we needed to
control the programme ourselves. SJ agreed that owning the programme was incredibly
important and queried the roles to be recruited for. CB advised that there were two or
three critical roles that needed to be recruited for including a delivery director and that
Accenture could potentially fill these roles until March 2024. SJ noted the conflict
however and the costs. CB agreed, however given the timing taken to recruit it was
unlikely there would be internal resource in place until March 2024. SJ queried whether
anything had emerged out of the review indicating certain activities could be stopped. CB
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replied no and spoke to the significant cuts to the team size. ACTION SJ queried the
resources of the Shareholder and whether it would be possible to engage resources from
the Shareholder on secondment for SPM. LG was not sure that resource would be
available for secondment from the Shareholder however agreed to ask. LG noted a
proficient technical resource from the Shareholder who could attend and observe
meetings of the Investment Committee.
LG
SJ queried what changes were going to be made to SPM governance and what the SPM
governance superstructure was going to look like. CB outlined the roles of the newly
established Investment Committee and SPM Steering Committee, then detailed a SPM
Programme Board that would be overseen by the programme director who would oversee
all the activities and for a beneath this. SJ queried whether there was a second line for
SPM and if so, what the assurance activities were. CB advised there would be an
assurance manager on the programme who would prepare an assurance universe for SPM;
this individual would be independent and would be responsible for preparing a dashboard
of assurance activities that the SPM Steering Committee would review on a periodic basis.
AD referenced the Accenture recommendations and shared his view that management
needed to be realistic about which recommendations they proposed to accept and
implement. CB agreed with this.
CB and TM left the meeting at 12:47.
Rebuilding Trust
SR, DW and BF joined the meeting at 12:48.
PFA Triage — case of Malam
TABLED and NOTED were the following papers:
(i) ‘PFA triage: Clive Malam — decision on stance’; and
(ii) ‘Appendix 1 - PFA triage - MALAM Clive’.
NV joined the meeting at 12:51. Key discussion points were as follows:
¢ SR spoke to the paper advising that
¢ BT noted that the Board had considered reviewing false accounting cases before
and queried whether the Board should be considering reviewing these cases again.
V left the meeting at 13:05.
The Board RESOLVED that the case of Mr C Malam be and is hereby APPROVED as a
concede case and that the Remediation Unit be authorised to issue a concede letter to Mr
C Malam on behalf of the Company.
NV left the meeting at 13:05. A short recess was taken, and the meeting resumed at 13:28.
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7.2 RU Update
TABLED and NOTED were the following papers:
(i)
(ii)
‘Remediation Unit Programme Update’; and
‘RU Finance Update’.
Key discussion points were as follows:
The Chairman queried the response from claimants in respect the optional £600k
offer from HMG for OC. SR advised that he thought the announcement had been
well received in that it would enable the issuing of payments to claimants quickly
and without excessive legal fees. The period in which the offers were to remain
open was unclear and the Minister had been applied to for clarity on this point;
The Chairman noted that the Company continued to work at risk in relation to the
GLO disclosure exercise;
AD queried the level of RU legal fees that remained unpaid and as to why. SR
spoke to the review and scrutinization process in respect of invoices and DW
advised that costs in relation to disclosure remediation remained on hold;
SR outlined progress made on tax top-up payments for HSS claimants and advised
that it was anticipated that the tax top-up payments could be fully administered by
31 March 2024;
SR noted the release of information to the Advisory Board in relation to the PFA
work. This showed that there were 27 cases that had been identified as cases the
Company could concede and also that there were cases that should not be
overturned. EJ queried this approach. BF advised that
73 OC Pecuniary Principles
TABLED and NOTED were the following papers:
(i)
(ii)
(iii)
iv)
(v)
‘Overturned Convictions (OC) Pecuniary Compensation Principles and
Independent Assessment Process - Report’;
“OC Pecuniary Compensation Assessment Process’;
‘OC Principles Underlying Offers of Pecuniary Compensation’;
‘Terms of Reference for the Independent Pecuniary Compensation Assessment
Panel’; and
‘Referral Application Form to the Independent Pecuniary Compensation
Assessment Panel’.
Following presentation of the paper from SR and an opportunity to ask questions, the
Board RESOLVED:
(i) The OC Pecuniary Compensation Assessment Process in the form tabled be
and is hereby APPROVED;
(ii) The OC Principles Underlying Offers of Pecuniary Compensation in the form
tabled be and are hereby APPROVED;
(iii) The Terms of Reference for the Independent Pecuniary Compensations
Assessment Panel in the form tabled be and are hereby APPROVED;
(iv) The Referral Application Form to the Independent Pecuniary Compensation
Assessment Panel in the form tabled be and is hereby APPROVED; and
(v) The Remediation Unit be authorised to issue items (i) — (iv) above to all OC
claimant representative be and is hereby APPROVED.
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Application of Conflicts Policy update
Key discussion points were as follows:
SR spoke to the process that was being worked through within the RU team. An
independent committee had been established, and if employees were found to be
conflicted, they would be offered alternate positions at the Company outside of
RU, or, if no alternative positions were available, they would be exited;
¢ BF outlined}
LG queried the size of the population under review. SR advised of the 160
employees in RU that there had been 40 interviews conducted. BF advised that
LG queried whether the reviews
would have been completed ahead of the commencement of Phase 7 of the
Inquiry. NR advised that they would be.
Post Office Limited Process Review (PPR) Compensation
TABLED and NOTED was a paper, ‘PPR Compensation — Funding Commitment’.
SR spoke to the paper. AD noted that the funding proposed was up until 31 March 2026
and queried confidence levels to process applications ahead of this period expiring. SR
advised that he was confident of processing all applications ahead of the funding period
expiring.
The Board RESOLVED:
(i) The Company’s request for a funding commitment from the Shareholder for
compensation payments in relation to the Post Office Limited Process Review
compensation programme (‘PPR’) be and is hereby APPROVED;
(ii) The form of the PPR funding commitment letter in the form tabled be and is
hereby APPROVED however with authority delegated to the:
(a) Remediation Unit Director to settle any minor drafting amendments; and
(b) Remediation Committee to approve an operations agreement with the
Shareholder in relation to the PPR; and
(iii) Management be authorised to make an application seeking Shareholder
approval for entry into the PPR funding commitment and associated
commitment letter be and is hereby APPROVED.
BF left the meeting at 13:59.
Inquiry Update
TABLED and NOTED were the following papers:
(i) ‘Post Office Horizon IT Inquiry: Update’; and
(ii) ‘Post Office Horizon IT Inquiry — Appendices’.
DW advised as follows:
e Inrespect of the Inquiry timetable, a further update had been received from J Beer
KC and the expectation was that Phase 4 of the Inquiry would run into next year
with closing speeches at the beginning of February. Phases 5 and 6 would be
combined, to commence in February through to April. Phase 7 would follow and
was expected to be of short duration, with closing speeches in June. All the
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messaging was that the Inquiry was utterly committed to having the hearings
completed by summer;
«e Ameeting had been scheduled with the Inquiry secretariat next week in response
to the letter DW had referenced at the last Board. DW outlined what the Inquiry
team wished to achieve from the meeting including building relationships, having
POL employees leading in the meeting as opposed to BSFf to demonstrate POL
control, and establishing if there were any further ways in which we could
facilitate, for example, being sighted on upcoming rule 9 requests;
¢ Another issue with disclosure had arisen which had been advised to the Inquiry
previously. It was anticipated that this point would come up in the disclosure
hearing in January and further correspondence was being issued to the Inquiry on
this today. BT queried whether the issue with disclosure identified could be an
issue with the GLO disclosure also. DW replied that it could;
¢ Operating under threat of criminal sanctions was making working conditions very
difficult. The Chairman shared his view and queried whether our KC was doing
enough. NR advised that core participants could be giving the Inquiry a difficult
time on disclosure, so the Inquiry’s stance was understandable even if it was
difficult.
ACTION BT referenced the conversation earlier in the meeting in respect of the corporate
witness statement that CB had been asked to provide. DW clarified that CB did not need
to provide this, however the Inquiry had asked for a senior member of management to
provide the statement and there were limited people of sufficient seniority who were not
conflicted. BT took the point however noted that this was a very critical time for CB in the
business and queried the conflict point. DW advised that the Inquiry team had worked
through an exercise of who might be called and the evidence they may give and their
resulting conflicts so they could not be represented by BSFf who were preparing the
corporate witness statement. BT accepted the point however asked that this be
considered again and pointed out that this issue would be come up again so the overall
approach should be considered. DW
DW left the meeting at 14:18.
Procurement
Procurement Requests
KS noted the absence of L Carroll. DH and SO joined the meeting at 14:20.
TABLED and NOTED were the following papers:
(i) ‘Procurement Report’;
(ii) ‘Legal Risk Note — Data Centre Operations and Central Network’;
(iii) ‘Legal Risk Note — Peters and Peters’; and
(iv) ‘Legal Risk Note — KPMG Relativity modification’.
Horizon Data Centre Operations and Central Network Services plus HNG-X Test Rigs
DH spoke to the paper noting the cessation of the Belfast Exit programme and the refresh
of certain Belfast Data Centre infrastructure requested by Fujitsu. Discussion followed as
to the risk of Fujitsu declining to proceed with an extension of the Data Centre Operations
and Central Network Services, with DH advising that she perceived this as being minimal.
AB queried the anticipated life of the capital upgrade items requested by Fujitsu. ACTION
SO advised that the Oracle hardware upgrade would sustain operations until circa 2035,
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and the test environments for a further 2 — 3 years. AB queried further whether the costs
would be accounted for over a number of years. KS advised that she would consider
whether the costs could be capitalised. is
The Board RESOLVED to APPROVE:
(i) Entry by the Company into a one-year extension commencing 1 April 2024
concluding 31 March 2025 with Fujitsu under the Horizon Agreement in
respect of Data Centre Operations and Central Network Services and HNG-X
Test Rigs;
(ii) additional funding in the amount of £6.85m for the Data Centre Operations
and Central Network Services and £1.33m for the HNG-X Test Rigs in respect of
the extension in (i);
(iii) the delegation of authority to the Group Executive, with the Group Executive
in turn delegating to the IADG, to approve the drawdown of the additional
funding referenced in (ii) above; and
(iv) any authorised signatory of the Company be authorised to sign the resulting
amendment to the Horizon Agreement in respect of the amendments
referenced at (i) and (ii) above.
Peters & Peters
DH spoke to the paper outlining the proposed increase in quantum of the value of the
directly awarded Peters and Peters contract to account for the provision of additional
criminal law advice for the RU and subject matter expert advice for the Inquiry. In terms of
compliance with the PCR 2015 Regulations, reliance on regulation 10(1)(d)(ii) was sought
however additionally it was considered there was a low probability of challenge. SR
detailed the items from a RU perspective that had contributed to the proposed increase
being the CCRC case studies and the Scottish disclosure. There was discussion in respect of
the hourly rates of Peters & Peters with BT sharing his view that he thought the hourly
rates were reasonable and SR noting that cost controls were in place with Peters & Peters
so that the RU team were notified in advance if monthly set costs were anticipated to be
exceeded. ACTION LG queried whether the process controls in place for BAU spend as
opposed to change spend were applicable to programmes and referenced an action from KS
ARC in relation to this. KS advised that she would look into this.
The Board RESOLVED that:
(i) an increase in the directly award contract to Peters & Peters be increased in
value from to a maximum value of fi for the provision of criminal
advice to the RU and the provision of subject matter expert advice to the
Inquiry team be and is hereby APPROVED;
(ii) any authorised signatory of the Company be authorised to sign the resulting
amendment to the Peters & Peters contract in respect of the amendment at (i)
above be and is hereby APPROVED.
eDiscovery Services
DH spoke to the paper and the proposed increase in contract value. The Chairman noted
that there had been issues with the professional services firm, however. SR referenced
the sourcing strategy mentioned in the paper for a new contract to provide the required
services until the conclusion of the Inquiry. SJ queried the status in relation to making
recoveries for disclosure remediation issues. NR advised that invoices had not been paid
at present.
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The Board RESOLVED:
(i) that an increase in the KPMG eDiscovery service contract value from
a maximum Of iimeeevarbe and is hereby APPROVED;
(ii) any authorised signatory of the Company be authorised to sign the resulting
amendment to the KPMG eDiscovery contract in respect of the amendment at
(i) be and is hereby APPROVED;
(iii) the sourcing strategy for a new contract to provide eDiscovery services until
the end of the Inquiry be and is hereby APPROVED;
(iv) authority be delegated to the Group Executive to determine the contract
award for the new eDiscovery services contract be and is hereby APPROVED;
and
(v) any authorised signatory of the Company be authorised to sign the resulting
new eDiscovery services contract be and is hereby APPROVED.
External Audit
DH spoke to the paper. KS advised that the proposed sourcing strategy recognised that
PwC’s current engagement would come to an end this financial year so the proposed
procurement approach to potentially engage a different external auditor needed to be
commenced at this point. SJ and AB requested clarity as to the proposed sourcing strategy
with AB noting the typical tender process that would be conducted to source an external
auditor. KS detailed reasons as to why a restricted procedure was proposed and advised
that no firms would be precluded from participating in the process. If at the conclusion of
the restricted procedure, there were no tenders a direct award could be made.
The Board RESOLVED that the sourcing strategy for the procurement of external audit
services as set out in the paper be and is hereby APPROVED.
Commercial Vehicle Maintenance Provider
DH spoke to the paper. BT queried the level of proposed headroom in the contract value.
DH replied that this was linked to the end of service life on a number of the vehicles and
that the contract value covered the purchase and modification of new vehicles. MR
joined the meeting at 14:50 and advised that the procurement exercise had been quite
difficult given the aging fleet however early indications from the current supplier were that
they were performing well. EJ queried the costs of maintenance for the vehicles over the
4-year period seemed very high. MR replied that maintenance costs were higher for the
fleet given the age of the vehicles. There was discussion as to the make-up of the contract
value between maintenance costs and vehicle replacement.
ACTION Subject to KS circulating an email to the Board setting out further the costs for
vehicle maintenance as opposed to costs for vehicle replacement, the Board RESOLVED:
(i) that the sourcing strategy to undertake the procurement for the provision of
commercial vehicle maintenance and associated services with a maximum
contract value up t and otherwise as set out in the paper be and is
hereby APPROVED;
(ii) authority be delegated to the Group Executive to determine the contract
award for the commercial vehicle maintenance and associated services
contract be and is hereby APPROVED; and
(iii) any authorised signatory of the Company be authorised to sign the resulting
commercial vehicle maintenance and associated services contract be and is
hereby APPROVED.
SR, and SO left the meeting at 14:56.
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Procurement Strategic Pipeline
TABLED and NOTED was a paper, ‘Strategic Procurement Pipeline September 2023 —
August 2024.
DH spoke to the paper. The Board RESOLVED that the proposed Strategic Procurement
Pipeline for September 2023 — August 2024 as set out within Appendix A of the paper be
and is hereby APPROVED. DH left the meeting at 14:57.
Requests with Presentation
Disclosure of Evidence to Support Police Investigations
TABLED and NOTED were the following papers:
(i) ‘Request for evidence release to Police Scotland and discussion of broader
policy change - Report’;
(ii) ‘Appendix 1 — Draft Witness Statement for Police Scotland’; and
(iii) “Appendix 2 — A&Cl summary of Portree Case’.
BF, SG and JB joined the meeting at 14:58. Key discussion points were as follows:
°
The Board RESOLVED that the provision of authority to the Assurance and Complex
Investigations Unit to provide the information to Police Scotland as set out in the paper be
and is hereby APPROVED.
BF, SG and JB left the meeting at 15:14.
ACTION BT suggested that it could be valuable for Postmasters to look at the policies and BF/ JB/ SG
process in place and perhaps for a mock case to be run under these. LG suggested that the
Postmaster director could participate.
Noting Items with Presentation
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Health & Safety Report
TABLED and NOTED was a paper, ‘Health & Safety Monthly Report’.
MH joined the meeting at 15:28. Key discussion points were as follows:
© MHnoted that overall, Health and Safety performance was quite stable and that
there were mitigations in place for most Health and Safety risks;
« MHnoted that robberies were on a downward trend. SJ queried the extent to
which there was a duty of care was owed to Postmasters in respect of robberies.
MH replied that there was a duty of care owed to the extent that the Company
provided Postmasters with security equipment to ensure that the equipment was
suitable, and that Postmasters had received adequate training. AD noted the
percentage of robberies that were unsuccessful. MH advised that successful and
non-successful robberies were monitored, and the Health and Safety team
responded to put in place proportionate measures. AD referenced a recent
branch visit and the concern the Postmaster had expressed in relation to a robbery
given a local bank branch had just closed and queried if there was more, we could
be doing. NR advised that areas were kept under constant review and that there
would be different risk assessments with different mitigations for different areas;
¢ MH outlined the people risk identified and the steps taken with Optima Health in
relation to employee well-being;
* MH detailed the RAAC review that had been undertaken and the ongoing full
assessment of the estate with our surveyors;
* MH noted the storms that were forecast and the need to make sure we made the
right decisions in relation to this particularly in respect of flooding. Best practice in
this regard continued to be shared on Branch Hub. AB queried when a Post Office
was flooded what support was provided to Postmasters. MH replied and NR
contributed that we were very good at assisting with mobilisation after an issue.
MH left the meeting at 15:42.
Post Office Brand
RT and SM joined the meeting at 15:44.
TABLED and NOTED were the following papers:
(i) “Post Office Brand’;
(ii) ‘August 2023 - Brand Tracking metrics’;
(iii) ‘Consumer Brand research - initial debrief’; and
(iv) “Book of Consumer Stories’.
Key discussion points were as follows:
¢ SM spoke to the paper outlining potential options and time frames for re-
branding;
The Chairman asked SM to detail further the comments in the paper around how
the brand was perceived differently across different cohorts. SM replied, advising
the different feelings held by each of the cohorts;
e ADraised the relevance of the Post Office to the next generation and shared his
view that there needed to be focus and a strategy on how we achieved
engagement with the next generation;
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¢ BT noted the potential timeframes for re-branding post the Inquiry; BT queried
however the divorcing of the past from the brand given the associated nostalgia
and history and the potential destruction of this;
¢ OW contributed that there were no funds available to rebrand at present and that
there was remaining analysis to be undertaken on consumer propositions
including how we might pursue SMEs. EJ noted the importance of not losing sight
of the long-term value of the customer and agreed that work needed to be
undertaken to engage the upcoming generations. EJ further noted the
mechanisms the Company needed to have in place with Postmasters in order to
achieve a level of uniformity in branding; that said the brand was the local
Postmaster and this needed to be built into any requirements;
© ACTION The Chairman noted that the online aggregator could assist with
attracting the younger generation. SM agreed and noted that the establishment
of the online aggregator as an app could assist. SI agreed. OW advised that this
would need to be costed and funds found;
* LG queried whether there were measures in place to track brand perception. SM
replied that there were measures in place which were tracked on a monthly basis
however not NPS. LG shared her view that it was unusual not to have NPS and
thought that this would be of interest to Postmasters. OW contributed that we
did not hold customer data to follow up with customers on their views, so we
needed to find a better way to track customer perception;
¢ ABnoted that the brand was wider than the name and needed to link intrinsically
to value and culture.
ow/ cB
RT and SM left meeting at 16:05.
10.3 Technology Sub-Committee Dashboard
TABLED and NOTED was a paper, ‘Technology Sub-Committee Dashboard’. CB joined the
meeting at 16:06.
CB spoke to the form of the Dashboard and the revisions made including the addition of
narrative. CB noted cyber security issues with colleagues accepting phishing emails and
down-loading content and that there was currently education underway in relation to this.
CB advised that a new defect had been found on Horizon that could result in Postmaster
detriment; this had been fixed now and no instances of Postmaster detriment had been
identified as yet. ACTION SI noted that there had been instances in some branches of one
counter charging customers twice. CB advised that he would look at this. CB left the cB
meeting at 16:10.
10.4 Retail Dashboard
MR and MP joined the meeting at 16:13.
TABLED and NOTED were the following papers:
(i) ‘Retail Performance Dashboard — P6 Report’; and
(ii) ‘Retail Performance Dashboard’.
Key discussion points were as follows:
¢ MP spoke to the operational excellence programme that covered amongst other
issues branch discrepancies and outlined the different initiatives that had been put
in place and those that were being considered for example the provision of cash
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counters to Postmasters given the increased volumes of cash in the network. MR
outlined the cost and NR advised that a suitable note counter could detect
counterfeit notes also. LG noted that the investment in cash counters could have
a quick re-payment period. EJ shared his view that the introduction of cash
counters would improve the experience for the customer and benefit both the
Postmaster and the Company;
¢ ACTION The circulation of Scottish counterfeit notes in the network was
considered. SJ queried whether any patterns of use could be identified. MP.
advised that analysis was undertaken, and MP could look to share this;
¢ MP spoke to a review looking at how we could reward Postmasters with additional
remuneration for robust back-office process. EJ agreed that Postmaster
excellence should be the norm and thought that most Postmasters would agree
with this approach. MR spoke to the recent review of Postmaster back-office
processes and NR advised that the business case for improving Postmaster back-
office processes was being reviewed. LG queried the timing for the introduction of
additional Postmaster remuneration for the achievement of operational excellent.
MP advised that if this was taken forward it would be in place for next financial
year;
¢ Inrelation to branch discrepancies, MP outlined the circumstances in which the
Company may look to recover;
¢ MP noted that some aspects of Postmaster training could be improved, and MR
advised that a review of Postmaster training was underway in response to
Postmaster views that they wished for training to be more classroom based, at
times that suited Postmasters, and at venues that provided them with an
opportunity to gather together;
¢ MP noted that the initiatives detailed could together have an impact on the
branch discrepancy landscape.
MR left the meeting at 16:41.
Christmas operational readiness
U joined the meeting at 16:41.
TABLED and NOTED were the following papers:
(i) ‘Christmas Peak 2023 Project Plan and Marketing Update - Report’; and
(ii) ‘Christmas Marketing Plan’.
MP spoke to the paper outlining key activities in the lead up to peak, the daily reporting on
KPls that would be initiated shortly, and the material risks the team had identified. AD
queried how we were assisting with the risk of parcels exceeding branch space constraints.
MP noted procurement issues and advised that the possibility of parcels excess to space
and solutions for this was being considered by the teams as part of the mail strategy
rollout. EJ advised that carrier collection frequency was also an issue; BG shared his view
that he would not be hopeful of collection frequency increasing. MP advised that there
was a process in place to request an exceptional collection.
U spoke to the feedback received from Postmasters last year in relation to Christmas
marketing materials and advised that in response the number of marketing materials for
Postmasters to choose from had been reduced and that this in turn had been well
received. The cost-of-living crisis continued to bite, and consumers did not expect to
spend as much on the peripheries for Christmas, nor did people expect to finish their
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shopping until the week before Christmas, so heavier footfall may not be seen until later in
December. The marketing team had been very conscious of the cost-of-living crisis and
striking an appropriate note; crafting came through in the marketing materials which
might also appeal to younger generations. AD queried whether the same decorations
were used across the network. LJ advised that they were. AD further queried whether LJ
sensed whether the marketing had been well received. LJ asked SI and EJ to respond. EJ
replied that he thought the materials were well pitched felt modern.
The Board, U and MP moved to the proofing room to view the Christmas marketing
materials.
Governance Items
Board Evaluation — update on progress
TABLED and NOTED was a paper, ‘Board and Committee Evaluations 2023/24’. The
Chairman spoke to the paper outlining the proposal for an external Board and Committee
evaluation to be instructed for 2023/24 and asked for views of Board members as to
whether an external party aside from Grant Thornton, who were engaged to undertake a
governance review for the Company, should be appointed. The majority of Board
members expressed their preference for an external party aside from Grant Thornton to
be instructed.
Sealings Report
The Board APPROVED the affixing of the Common Seal of the Company to the document
set out against item numbered 2223 in the Register of Sealings.
Future Meeting Dates
The future meeting dates were NOTED.
Forward Agenda
The Forward Agenda was NOTED.
Any Other Business
There being no other business the Chairman declared the meeting closed at 16:58.
Date of next scheduled meeting
28 November 2023 11:00 — 17:30.
5:36
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Voting Results for POL Board Minutes from 31.10.2023 (approved on 28.11.2023)
‘The signature vote has been passed. 1 votes are required to pass the vote, of which 0 must be independent.
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Vote Response Count (%)
For 1 (100%)
Against 0 (0%)
Abstained 0 (0%)
Not Cast 0 (0%)
Voter Status
Name Vote Voted On
Staunton, Henry For 01/12/2023 15:36
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