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To: Jo Swinson
From: Laura Thompson G RO!
Date: 4 March 2015
‘ost Office mediation sch
Purpose: Post Office intend to change their approach to the mediation scheme dealing
with complaints about Horizon, on the basis that the scheme is not working in the way it
was intended. This submission is to inform you of POL’s planned changes, and seek your
views on how we should engage stakeholders, particularly Parliament.
Recommendation:
a) That you note the changes POL intends to make to the scheme, the timing and
handling of these, and likely stakeholder reaction
b) That you agree that on balance Government should not notify Parliament by
Written Ministerial Statement on the day of the announcement, noting that this is a
finely balanced decision and there is the risk of an Urgent Question being tabled
(which we will take steps to mitigate)
Timing: Urgent - POL propose to make the changes next week (w/c 9 March), probably
Tuesday 10 March to pre-empt the issuing of Second Sight’s draft report to the Working
Group.
Summary
1. The mediation scheme has been running for around 18 months now and is making
some progress, albeit slow, in considering the 136 applications which were eligible.
There are around 109 cases remaining in the scheme, and Post Office have
completed their detailed investigations for each of these. Those applicants are,
therefore, awaiting either their Second Sight report into the case, a decision by the
Working Group whether to mediate the case, and/or the mediation itself.
2. \tis becoming increasingly apparent that the scheme is not working in the way it was
intended and is taking too long to progress to mediation for applicants. POL report
(confidentially) that JFSA are refusing to engage in the Working Group, certain MPs
have publicly withdrawn their support for the scheme, and both JFSA and the MPs
supporting them are increasingly critical of POL. For example, Mike Wood MP.
declined to meet with POL to discuss the scheme or specific cases of his constituents.
3. Whilst the delays are due in some part to the complexity of the cases and the depth of
the investigations by both POL and Second Sight, they also arise from pressure from
JFSA, MPs and Second Sight to widen the scope of the scheme given that there has
been no “smoking gun” found to date on Horizon. Second Sight are attempting to
explore issues outside their remit (or indeed expertise), such as subpostmasters’
contracts and POL’s prosecutions policy, rather than focusing their efforts on the
individual cases they were appointed to investigate.
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. From POL’s point of view, the investigation and mediation scheme has demonstrated
that there is no evidence of systemic flaws in Horizon and no evidence that any of the
convictions are unsafe. Where POL may have fallen down in individual cases is on
training and support, and they are addressing those issues which have not already
been picked up. Their priority now is to ensure that the remaining cases in the scheme
can be heard as swiftly as practicable (POL have said publicly the aim is this calendar
year) and as such, a revised approach is needed.
. POL’s Board have agreed that, effective from next week, they will announce that POL
will adopt a presumption of mediating all non-criminal cases remaining in the scheme
(except in some very exceptional circumstances). This will render redundant the role
of the Working Group so it will be closed. POL will terminate their engagement with
Second Sight, but provide funding for any applicants who wish to have Second Sight
or other forensic accountants produce a report on their case before mediation
. POL believe this approach will enable them to meet their commitment to applicants
made at the outset. Even through this accelerated process, POL will still need to
commit significant resources to the scheme if they are to meet the commitment made
to the Committee that cases would be mediated by the end of this year. For example,
POL are currently mediating approximately 1 case every three weeks, but this would
need to increase to at least 2 cases per week in order to complete mediation to that
timescale.
. Itis also worth noting that the Centre for Effective Dispute Resolution (CEDR), who
are running the mediations, have prepared a report for the Working Group on the first
11 cases which have completed mediation. It is likely the report will be published.
Overall, it is positive towards POL, although there are elements which could be
quoted out of context e.g. the success rate of the mediation is around 45%, compared
to 65-75% average success rates for mediations (but CEDR note that expectations of
candidates in this mediation scheme may be unrealistic).
. The BIS Select Committee have not yet published their report into the scheme,
following their evidence session on 3 February. It is quite possible they will not
publish, as there are several other ongoing inquiries and a short window for
publication between now and Purdah. POL are in favour of publishing their change to
the scheme before any Committee report is issued.
Stakeholder reaction and handling
9.
The proposed changes are almost certain to provoke a negative reaction from JFSA
and the MPs supporting them, as well as Second Sight. This may also lead to
negative media coverage — one BBC journalist in particular has pursued this issue,
mostly at regional level but also on the BBC One Show. There is a substantial risk that
POL’s decision will be portrayed as an attempt to cover something up or to fetter the
independence of Second Sight. However, this should be considered in the context of
the publicity which is already around the scheme and is already negative, and likely to
continue.
10.Second Sight are due next week (Wednesday) to share a draft of their next report with
the Working Group. This report will be confidential to members of the Working Group;
however, based on precedent it is extremely likely that this report will be leaked.
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Second Sight said in their evidence to the Committee that the report will cover “19 or
so thematic issues” arising from their investigations. We can expect the report to be
critical of POL, and in all likelihood will discuss issues outside the remit of the scheme
and Second Sight’s contract.
11.POL intend to make their announcement before Second Sight issue their draft report,
so probably on Tuesday 10 March. The proposed choreography for the
announcement will be (all actions on POL):
This week e Board agreement (now completed)
e Share plans with ShEx / Minister
2 days before announcement e Inform Sir Anthony Hooper (who to date has
remained neutral)
Prepare individual letters for each applicant
Brief NFSP
Applicants receive letter
Inform SS and JFSA
Issue short factual press notice
Phone call to Kevan Jones MP (and potentially
James Arbuthnot MP)
Email to other MPs involved in scheme
Phone call to lan Murray MP
Phone call to Adrian Bailey MP
Publish Post Office report into scheme
Day before announcement
Day of announcement
12.While decisions around the scheme are commercial matters for POL, they understand
that you have made commitments to Parliament regarding the mediation scheme
which we need to ensure are met (a list is set out in the attached Annex). ShEx have
considered these commitments and assess that the approach is in line with what you
committed. The Working Group was set up and established the scheme, doing so with
an independent Chair and the full involvement of JFSA and Second Sight (and has
been running for 18 months). All applicants remaining in the scheme (which do not
involve criminal convictions) will be able to benefit from an investigation by a forensic
accountant, potentially Second Sight. We believe, therefore, that your commitments to
Parliament have been met.
13.Government has remained at arms-length from the scheme to date and we
recommend that continues. However, you will want to consider whether you would like
to inform Parliament of the changes to the scheme yourself, probably through a
Written Ministerial Statement. There is a chance that an MP (such as James
Arbuthnot or Kevan Jones) may ask the Speaker for an Urgent Question when the
changes are announced. Tabling a WMS mitigates that risk to some extent, but does
not rule it out completely. The negatives to tabling a WMS are that it implies
Government has been involved in (or approved) these proposals, which is contrary to
our approach to date. On balance we recommend against tabling a WMS on the basis
that POL are informing the key Parliamentarians directly. We will pre-brief our Parly
Unit with lines to resist a UQ in case one is tabled. However, this is a fine judgement
and one on which you will need to be satisfied
13.1 Do you wish to table a WMS?
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14.Either way, we recommend reactive press only, and suggest this should be a BIS
spokesperson quote setting out the main messages that the scheme is independent of
Government and there are no systemic issues with Horizon. We could add that the
changes will ensure those in the scheme get resolution as swiftly as possible.
Annex: Commitments to Parliament
Copied to: Ministers’ offices, SpAds, Permanent Secretary, Mark Russell, Antony
Odgers, ShEx POL team, Parly Unit, Hannah Franklin-Wallis, Christina Murphy
Advice received from:
Finance SpAds Press Legal Analysts
No No Hannah Franklin-Wallis No No
Have devolution issues / impacts been considered?
Devolution Issues Equality Analysis [I__ ‘Impact on Families’
N/A N/A I NIA
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Annex B: Commitments to Parliament
Statement to the House: 9 July 2013
‘erial statement
First, it [POL] will set up a working party to
complete the review of cases started by Second
Sight, and will consider all 47 cases brought
forward by the JFSA and MPs. The JFSA has
been invited to join the working party. (col 198)
Met?
The Working Group has_ been
established, with JFSA taking part.
Secondly, an independent figures will chair a
review to determine how best to adjudicate
disputed cases in future. The JFSA and other
stakeholders will also be invited to take part in
this process. (col 198)
This “safety net” commitment is still to
be met (see note below)
Finally, a new branch user forum will provide a
channel for sub-postmasters and others to raise
issues at the highest level on business
processes, training and support. (col 198)
Post Office have established a Branch
User Forum and Paula Vennells has
pledge to make further improvements
on support and training.
The company will take forward the proposals as
an urgent priority (col 198)
Taken forward from July 2013
Clearly, if any evidence were to come to light
that had an impact on the safety of convictions —
I stress that that has not happened as a result of
this interim report — Post Office Ltd would have
a duty to look further at those issues as a
prosecuting authority to ensure that convictions
remain safe. (col 200) [In response to lan
Murray]
Mediation scheme pack for applicants
explains that “If at any stage during the
Scheme new information comes to
light that might reasonably be
considered capable of undermining the
case for a prosecution or of assisting
the case for the defence, Post Office
has a duty to notify you and your
defence lawyers. You may _ then
choose whether to appeal your
conviction or sentence.”
It is important that any further work is not only
independent, but seen to be independent, and
clearly the role of Second Sight in that is
important, as is the role of the JFSA. (col 201)
[In response to James Arbuthnot]
Working Group is independent and
involves both Second Sight and JFSA.
I shall happily give the hon. Gentleman [Mike
Wood] that assurance [that Second Sight will be
part of the working group]. The continued input
of Second Sight is incredibly important, given its
familiarity with the case so far and the fact that it
enjoys the confidence of many of those
involved. (col 202)
Working Group is independent and
involves both Second Sight and JFSA,
and has done over more than 18
months (the duration of the scheme).
Yes, I am happy to give my hon. Friend
[Jonathan Lord] an assurance that the working
party will be independent [and chaired by an
independent figure]. (col 204)
Working Group is independent and
involves both Second Sight and JFSA.
It is chaired by an independent Chair,
Sir Anthony Hooper.
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i erial statement Met?
I can certainly give an assurance that if there; Scheme was opened up _ to
are other cases that need to come forward, we I applications (three month window),
would not want to deny those people the I and those outside the scheme can
opportunity for that to happen. (col 205) [In I approach Post Office in the usual
response to Huw Irranca-Davies] manner.
The Post Office is now ensuring that it visits I POL has actioned
new sub-postmasters after one month, and
again after three months for the new local and
main operating models, to deal with any
teething issues or further questions that have
arisen from their working the process for a few
weeks. Improvements to the helpline are also
important, so that it does what it says on the tin
and is actually helpful to people who call it. One
thing that has improved the helpline is making it
available for extended hours. (col 206) [In
response to David Simpson]
Note on “safety net” point: This is the one commitment where there is some ambiguity
over whether it has been met. It talks about “disputed cases in the future” and that there
should be a review on how to consider these. POL consider that their existing
mechanisms for raising disputes (not just on Horizon) are sufficient, and that the NFSP
will support this. The review has also shown that there are no systemic issues with
Horizon so no need for a new approach to dealing with those issues. Our line to date has
been that we should deal with the cases within the scheme first, then consider whether
lessons can be learned, and we propose to continue with that line, although it appears
increasingly that no “safety net” procedures are needed.