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Witness Name: Darren Heilig
Statement No: WITN11030200
Dated: 22 April 2024
POST OFFICE HORIZON IT INQUIRY
SECOND WITNESS STATEMENT OF DARREN HEILIG
1. I, Darren Heilig, of 185 Farringdon Road, London, EC1A 1AA, am a solicitor and
the Assistant General Counsel, Group Corporate and Finance and Deputy
Company Secretary employed by Royal Mail Group Limited (“RMGL’).
2. Imake this statement on behalf of RMGL in response to a Request for Information
received from the Post Office Horizon IT Inquiry (the “Inquiry”) dated 1 February
2024 (the "Request”).
INTRODUCTION
3. As set out in my First Witness Statement [WITN11030100] I was not employed
within the Royal Mail group of companies (the “Royal Mail Group”) during the
period which the Inquiry or the Request relates to. In providing the information
contained in this witness statement, I have therefore relied on information that is
publicly available or which I have ascertained from the Royal Mail Group’s
corporate records that are now available to me.
4. Some of the historic information provided with this statement has been derived
from Microsoft Word versions of documents (.e. not final, signed copies), from
which it is difficult to ascertain whether they are in final form and/or were approved
and implemented. Other information has been derived from scanned copies of
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6.
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documents, and as a result, sometimes the quality of the scanned versions mean
that it is similarly unclear whether those documents represent the final versions, or
are only drafts. Wherever possible I have indicated where I am unsure of the
credibility of any information, and provide the best available copies of relevant
documents to assist the Inquiry.
The Inquiry has requested a written statement that explains any written
arrangements and specifications of procedures and outcomes for RMG’s
evaluation of the performance of the Post Office Limited Board (the “POL Board”)
as a whole; individual members of the POL Board; the Royal Mail Group Board as
a whole; and individual members of the Royal Mail Group Board and any written
procedures and policies specifying how whistleblowing arising in Post Office
Limited (“POL”) or about POL was to be treated by RMG, including the required
escalation and reporting processes.
I have taken the terms below, as used in the Request, to mean as follows:
6.1. “RMG” — the entire Royal Mail Group at the relevant time; therefore, in the
context of the Royal Mail Group undertaking a performance evaluation of
its Boards of Directors, it would be the holding company of the Royal Mail
Group, Royal Mail Holdings plc (as it was named between November 2002
and September 2013), with Company Number 04074919 (the “Holding
Company”) that would undertake those evaluations; and
6.2 “Royal Mail Group Board” — the Board of Directors of RMGL, which I will
refer to in the remainder of this statement as the “RMGL Board”. In any
case, as I set out below, I have only found information relating to
performance evaluations of the Board of the Holding Company.
Performance Evaluation
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7. I have reviewed reports and accounts for the Holding Company as filed at
Companies House from its first financial year, 2000/01, through to 2011/12 (the
“Reports and Accounts”). The Reports and Accounts contain descriptions of
performance evaluations undertaken in relation to the Board of the Holding
Company itself. Whilst these performance reviews did not explicitly evaluate the
performance of the POL Board or the RMGL Board, the Holding Company Board
consisted of the key executive members of those subsidiary Boards. The
performance of the key executives of the POL Board and the RMGL Board would
therefore have been assessed as part of these reported evaluations due to their
membership of the Holding Company Board.
8. It is apparent from the Reports and Accounts that, in each financial year, the
Holding Company sought to comply with the provisions of the prevailing UK
Corporate Governance Code (the “Code”) and largely reported compliance in so
far as the provisions were appropriate to a public company with a single
shareholder. Part of complying with the Code appeared, from financial year
2004/05 onwards, to include a board evaluation process. I have extracted
summaries of that board evaluation process contained in the Reports and Accounts
into Document RMG00000338. The full Reports and Accounts are also available
in Documents RMG00000319, RMG00000316, RMG00000314, RMG00000312,
RMG00000315, RMG00000313, RMG00000310, RMG00000309,
RMG00000311, RMG00000344, RMG00000343 and RMG00000342.
9. In summary, in most years, it is recorded in the Reports and Accounts that an
internal process was undertaken to enable Directors’ perspectives on the
effectiveness of the Board and its Committees to be fed back to the Chairman and
the full Board. It appears from the Reports and Accounts that:
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9.1 these internal reviews were undertaken by either the Chairman or the Senior
Independent Director with the support of the Company Secretary;
9.2 performance reviews of Board Committees would be undertaken by the
Committee Chairs;
9.3 the Non-Executive Directors, led by the Senior Independent Director, would
review the performance of the Chairman and the Executive Directors;
9.4 — from financial year 2007/8, the Executive Directors, led by the Group Chief
Executive, would review the performance of the Non-Executive Directors;
and
9.5 _ in two financial years — 2009/10 and 2011/12 — the review was facilitated
externally by Professor Rob Goffee of the London Business School.
10. The outcomes of the evaluations were not reported in the Reports and Accounts.
I have however located a number of internal documents that appear to be outputs
of the performance evaluations of the Board of the Holding Company and its
Committees and these are at [Documents RMG00000334, RMG00000340,
RMG00000336, RMG00000341, RMG00000337, RMG00000333,
RMG00000335, RMG00000339, RMG00000332, RMG00000331], although I
cannot be certain that these are final versions, and they are not a complete set; I
have not located such documentation for each year in which a performance
evaluation was disclosed in the Reports and Accounts.
11. The following statements regularly appear in the Reports and Accounts to describe
the governance arrangements in relation to remuneration:
“The Board retains overall accountability for the framework and costs of executive
remuneration and the terms of the service contracts offered to all Executive
Directors, which require the consent of the Secretary of State for Trade and
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Industry. The Secretary of State also approves the remuneration of Non-Executive
Directors. The Remuneration Committee’s role is to develop the remuneration
policy for Executive Directors and their immediate reports and specifically to make
recommendations on their salary, benefits, bonuses and other terms and
conditions of employment’.
12.\t is also apparent from the Directors’ Remuneration Reports within the Reports
and Accounts that individual performance-related bonuses were also part of the
Holding Company Executive Directors’ remuneration packages. Again, since the
key executives of the POL Board and the RMGL Board were also members of the
Holding Company Board, their performance-related remuneration is disclosed in
the Reports and Accounts. Those targets tended to be measurable indicators of
business performance, including financial and customer or quality of service
thresholds and, in the later years, personal objectives are also referred to.
13.1 have located a number of other internal documents, including minutes and papers
for the Remuneration Committee of the Holding Company that appear to relate to
the performance-related bonus proposals for the Holding Company Executive
Directors, including personal objectives and outcomes, and these are at
[Documents RMG00000330, RMG00000324, RMG00000325, RMG00000323,
RMG00000326, RMG00000322, RMG00000328 and RMG00000327], although I
cannot be certain that these are final versions, and they do not appear to be a
complete set.
Whistleblowing
Code of Business Standards
14. The earliest copy of a policy relating to whistleblowing that I have identified is a
policy document titled “Code of Business Standards” dated 2003 (“2003 Code”)
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[Document RMG00000329]. Within that document an earlier version is referred to
that was published in 1998.
15. It appears that the 2003 Code applied to employees of POL as well as of RMGL.
16. The 2003 Code provided that: “/f you discover that the company’s standards and
reputation are being put at risk by unethical or even criminal behaviour, you should
report the facts to a manager. Ignoring bad behaviour is wrong and will damage
the reputation not only of the company but of everyone else who works for it. If you
feel that you can’t talk to your own manager, you should talk to a senior manager,
or your personnel manager. If you think that you may suffer intimidation at work
because you have made a report, you have a right to ask your Personnel Manager
to take steps to ensure that you can work without harassment or intimidation of any
kind.”
17. The 2003 Code also set out internal helplines which included telephone numbers
for: Bullying & Harassment helpline; and the Corporate Security Helpdesk.
Employee Disclosure (Whistleblowing) policy
18. The earliest copy of a standalone whistleblowing policy that I have identified is a
policy document titled “Employee Disclosure (Whistleblowing) (G7)” dated October
2006 (“2006 ED Policy”) [Document RMG00000317]. Within that document an
earlier version is referred to dated 28 July 2006. I understand from other
documents I have reviewed that there were whistleblowing helplines, both internal
and external, and that there may have been a standalone whistleblowing policy
before this date, but I have not identified any copies of any such policy.
19.It appears that the 2006 ED Policy applied to POL as a member of the Royal Mail
Group.
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20. The 2006 ED Policy provided that it was: “the Royal Mail Group Policy for enabling
employees to disclose information (“whistleblowing”) about breaches of its policies
and standards of conduct. This policy will be supported by each of the Royal Mail
Group businesses, which will maintain arrangements for giving confidential and fair
consideration to such disclosures, and for taking appropriate and effective remedial
action”.
21.It further provided that each Business Unit (including POL) would nominate a
Senior Manager to be the contact point for dealing with employee disclosures and
these managers will ensure that any disclosures are investigated fully and fairly.
22.The 2006 ED Policy also set out various internal helplines which included
telephone numbers for: Post Office Security; Bullying & Harassment helpline; and
Public Concern at Work.
23.In 2010, the Audit & Risk Committee decided to appoint an external third party to
provide a new whistleblowing helpline. InTouch Management Communication
Systems Limited (“InTouch”) was appointed to provide this service pursuant to an
agreement dated 2 August 2010 (the “InTouch Agreement’) [Document
RMG00000318]. Under the InTouch Agreement, InTouch provided a telephone
service and secure web reporting facility for Royal Mail Group personnel which was
expressly stated to include employees, staff, agents, subcontractors and advisors
of RMG and its subsidiaries (which would have included POL). It was also
expressly stated to include POL sub-postmasters. The InTouch Agreement states
that the service is intended to be used for the recording of concerns of a
“whistleblowing” nature and other malpractice issues, including fraud, financial
irregularities and HR concerns.
Employee Confidential Disclosures Policy
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24.1 have also identified a policy document titled “GO7 Employee Confidential
Disclosures”, stated to be effective from 2 August 2010 (‘2010 ECD Policy’)
[Document RMG00000321], which appears to have replaced the 2006 ED Policy.
The scope of the 2010 ECD Policy was stated to apply to “...a/l business units
within RMG_ including...Post Office Ltd...". It also sets out various key
responsibilities under the Policy being:
“Group Executive Committee (GET)
¢ Approval of the Employee Confidential Disclosures Policy;
e Ensuring that resources are made available within RMG as required:
Internal Audit & Risk Management (IA&RM)
* The development and maintenance of the Employee Confidential
Disclosures policy;
« The development and maintenance of the framework and associated high
level processes;
* Co-ordinating the receipt of cases from RMG’s hotline provider and
reporting back on progress and outcomes;
e Reporting incidents and outcomes to the Audit & Risk Committee and to
GET;
¢ Chairing a working group consisting of the subject matter experts, to ensure
that serious claims are effectively investigated; and
¢ Contractual management of the 3rd party hotline provider.
Group Functional Heads
e Facilitating a consistent approach to investigations that cover multiple
business units /group functions, and for developing any cross-unit plans that
are required.
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« Deploying the resources to ensure that the applicable business unit / group
function develops and maintains its disclosure investigation capabilities so
it complies with this policy and associated procedures.”
25.The 2010 ECD Policy set out a number of ways in which personnel could raise
concerns, including through line managers; through the confidential hotline
provided by InTouch via phone or online web service; via email and telephone
numbers for the “Security Helpdesk” or the “Corporate & Social Responsibility
Helpdesk”; a telephone contact number for the “Bullying & Harassment Helpline”;
and a contact email for “Ask Adam”.
Speak Up Policy
26.1 have also identified a policy document titled “Speak Up (Whistleblowing) Policy”,
stated to be effective from 28 April 2012 (2012 Speak Up Policy”) [Document
RMG00000320]. POL ceased to be a subsidiary of RMGL in April 2012 and the
2012 Speak Up Policy expressly provides that “This policy applies to all employees
of Royal Mail Group Ltd.....Employees working for Post Office Ltd should refer to
their own Speak Up Policy’.
Statement of Truth
GRO
Dated: 2 ZTHET rE cot
I believe the content of this statement to be true.
Signe
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Index to Second Witness Statement of Darren Heilig
No, I URN Document Description Control Number
1. RMG00000319 001 Consignia Holdings plc VIS00014171
Accounts 2000-1
2. I RMG00000316 002 Consignia Holdings plc I VIS00014168 —
Accounts 2001-2
3. RMG00000314 003 Royal Mail Holdings plc VIS00014166
Accounts 2002-3
4. RMG00000312 004 Royal Mail Holdings plc VIS00014164
Report and Accounts 2003-4
5. RMG00000315 005 Royal Mail Holdings plc VIS00014167
Report and Accounts 2004-5
6. IRMG00000313 —*I 006 Royal Mail Holdings ple I VIS00014165
Report and Accounts 2005-6
7. RMG00000310 007 Royal Mail Holdings plc VIS00014162
Report and Accounts 2006-7
8. RMG00000309 008 Royal Mail Holdings pic VIS00014161
Report and Accounts 2007-8
9. RMG00000311 009 Royal Mail Holdings plc VIS00014163
Report and Accounts 2008-9
10. I RMG00000344 010 Royal Mail Holdings plc V1IS00014195
Annual Report and Financial
Statements 2009-10
11. IRMG00000343. —«*I 011 Royal Mail Holdings ple VIS00014195
Annual Report and Financial
Statements 2010-11
12. I RMG00000342 012 Royal Mail Holdings pic VIS00014194
Annual Report and Financial
Statements 2011-12
13. I RMG00000338 013 Extracted text from VIS00014190
Corporate Governance
sections of Annual Report and
Accounts relation to Board
Evaluation
14. I RMG00000334 — 014 Royal Mail Holdings plc VIS00014186
Board Performance Evaluation
Questionnaire - 2005
15. I RMG00000340 015 Royal Mail Holdings plc- I VISO0014192
Board Performance Evaluation
Questionnaire - 2006
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16.
"I 016 Royal Mail Holdings ple
Board Performance Evaluation
Questionnaire - 2007
VIS00014188
17.
RMG00000341
017 Royal Mail Holdings plc
Board Performance Evaluation
Questionnaire Results — 2007
VIS00014193
18.
RMG00000337
018 Royal Mail Holdings plc -
Board Performance Evaluation
2007 — actions agreed
VIS00014189
19.
RMG00000333
019 Royal Mail Holdings ple -
Board Performance Evaluation
Questionnaire - 2008
VIS00014185
20.
RMG00000335
020 Royal Mail Holdings plc -
Board Performance Evaluation
- Results - 2008
VIS00014187
21.
RMG00000339
021 Report to the Royal Mail
Group — Board Governance
Assessment 2009
22.
RMG00000332
022 Royal Mail Holdings ple -
Board Performance Evaluation
Questionnaire - 2011
VvIS00014191
viso0014184— I
23.
RMG00000331
023 Report to the Royal Mail
Group — Board Governance
Assessment 2012
VIS00014183
24,
RMG00000330
024 Royal Mail Holdings pic
Remuneration Committee
2005-06 Annual Bonus
proposals
ViS00014182
25.
RMG00000324
025 2005-06 Annual Bonus
proposals - Appendix 1
VIS00014176
26.
27.
RMG00000325
026 2005-06 Annual Bonus
proposals - Appendix 2
VIS00014177
RMG00000323
027 Royal Mail Holdings plc
Remuneration Committee
minutes dated 2 May 2007
VIS00014175
28.
RMG00000326
028 Royal Mail Holdings plc
Remuneration Committee —
Bonus and LTIP Outturns
2009-10
VIS00014178
29.
RMG00000322
029 Royal Mail Holdings pic
Remuneration Committee
Executive Director Bonuses
2010-11
VIS00014174
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30. I RMG00000328 030 Royal Mail Holdings pic VIS00014180
Remuneration Committee
Moya Green personal
objectives proposal - 2010-11
!31. I RMG00000327 031 Royal Mail Holdings plc I VIS00014179
Remuneration Committee
minutes dated 3 June 2011
32. I RMG00000329 032 Code of Business V1IS00014181
Standards 2003
33. I RMG00000317 033 Employee Disclosure VIS00014169
(Whistleblowing)(G7)
34, I RMG00000318 034 InTouch Agreement dated I VISO0014170
2 August 2010
35. I RMG00000321 035 G07 Employee VIS00014173
Confidential Disclosures
36. I RMG00000320 036 Speak Up VIS00014172
(Whistleblowing) Policy