UKGI00049060
UKGI00049060
Paul Scully MP
dee Department for Business, Energy &
Industrial Strategy
Department for 1 Victoria Steet
Business, Energy SW1H OET
& Industrial Strategy
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Tim Parker We mammcutn
Chair
Post Office Limited
Finsbury Dials May 2022
20 Finsbury Street
London
EC2Y 9AQ
Dear Tim,
POSTMASTER COMPENSATION
Thank you for your letter of 22 April regarding resolving historical matters and providing
closure for affected postmasters.
The Horizon scandal has had a terrible impact on many postmasters and their families, and
I am determined that my department and I continue to work at pace to provide appropriate
compensation to those who have been affected.
Following the anniversary of the first 39 cases being overturned by the Court of Appeal,
there is rightly a focus on compensation for those with overturned convictions. I am pleased
that we have been able to agree interim payments of up to £100,000 and that these
payments are being made quickly. That over £6.5 million has been paid in compensation so
far is an important start.
I agree that we must quickly resolve the full compensation that is due. I recognise your
concerns that the initial two cases are progressing slowly, and it is important that a way
through the current hurdles is found swiftly. I have asked my officials to continue to work
actively with your team and your lawyers to ensure that this happens. However, I would
stress that BEIS has been responsive to the multiple requests by Post Office for negotiating
mandates and is reliant on proposals developed by the Post Office and its legal team. In
order to be fair to all, including the taxpayer who is funding these costs, we do need to
consider what is appropriate for each case and use appropriate principles and approaches
that have been considered by legal experts.
We acknowledge that the recent discussion with QCs have not provided the clear
consensus and guidance we had been hoping for, but I understand that further proposals to
take the initial and subsequent cases forward are being developed. I hope that these will
provide a way forward for the next phase. My officials believe these proposals are
constructive, are capable of dealing with many of the issues that have slowed progress
recently and are ready to support the development of these proposals. To help with this, I
would encourage you to ensure that your team discloses the required materials to the
claimants’ solicitors and engages the full range of legal representatives, in order to allow us
to progress rapidly to the subsequent groups of cases once we have reached a resolution
on these first two cases.
UKGI00049060
UKGI00049060
With regards to the Historical Shortfall Scheme, I was pleased to hear that Post Office had
exceeded its target for 50% of offers to be made by the end of March. This will help with
achieving targets throughout this year. Managing cases in dispute is clearly a priority to
successfully delivering the Scheme. I understand that Post Office is still developing its plans
for the Dispute Resolution Process and we will respond to them as soon as we receive
them. As with HSS cases generally, BEIS is seeking a role only in cases that meet certain
exception criteria to ensure the process is able to move forward in a timely manner.
One point you make in your letter relates to the costs of running the HSS where you say
that there is a big opportunity to reduce costs if BEIS and UKGI take faster decisions, and
delegate more often to Post Office. We feel strongly that this does not describe accurately
the way HSS has operated, where we have been expressing concerns about the costs of
the HSS since the Summer of 2020. We believe we have been very responsive in the
decision-making process and have made many suggestions for improvements, some of
which have been taken up. The costs of HSS are high, partly for structural reasons (the
need for an independent panel for example), partly because the value of many of the claims
is low (leading to high costs of delivery relative to claim values) but also because of the
level of fees agreed with HSF, Post Office’s high degree of dependency on HSF and poor
controls over HSF’s activity. We have seen improved focus on controlling HSF recently and
are working with the team at Post Office to use our influence to obtain further reductions in
their costs.
Finally, on compensation to those who were in the Group Litigation Order, I welcome your
offer of assistance in this development phase. My officials are already in contact with yours
and I appreciate Post Office continuing to input ideas and relevant information into this
phase.
I would ask that Post Office continues to work proactively with my officials prior to our
having a meeting when diaries allow.
Yours sincerely,
PAUL SCULLY MP
Minister for Small Business, Consumers & Labour Markets
Minister for London