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Witness Name: Lorna Gratton
Statement Number: WITN11310100
Dated: 13 September 2024
POST OFFICE HORIZON IT INQUIRY
FIRST WITNESS STATEMENT OF LORNA GRATTON
I, LORNA GRATTON, will say as follows:
1. I ama Director at UK Government Investments (“UKGI”). I currently sit on the
Board of Post Office Limited (“POL”) as the Shareholder Non-Executive
Director (“Shareholder NED”).
2. This witness statement is made to assist the Post Office Horizon IT Inquiry (the
“Inquiry”) with the matters set out in the Rule 9 Request dated 19 July 2024. In
making this statement, I have been assisted by Eversheds Sutherland
(International) LLP, the recognised legal representative for UKGI, a Core
Participant (as defined in paragraph 5(a) of the Inquiry’s Protocol on Witness
Statements) in the Inquiry.
3. I The statement is based both on my own knowledge and experiences and also
on information and documents provided to me by colleagues in UKGI. Some
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of the topics that I have been asked to address either pre-date my time working
on matters relating to POL, or deal with issues on which my personal
involvement has been limited (notably in respect of redress and compensation
schemes). I have tried to make clear in this statement where my evidence
comes from my direct knowledge and where I am more reliant on what I have
been told by others or learned from the documents that I have reviewed. This
has also affected the amount of detail that I have been able to give when
addressing the different topics.
Background and career history
4. I graduated from the University of Cambridge in 2005, obtaining a degree in
Philosophy and Politics. I also have a degree in International Development
from The School of Oriental and African Studies (“SOAS”) University of London
and am a qualified teacher. I started my career as a maths teacher at an all-
boys comprehensive school in Peckham. I was also a Member of the Board of
Trustees for Teach First from 2015 to 2021 and for Westminster Kingsway
College for over three years before that.
5. I joined the Civil Service in January 2010, working at HM Treasury in the
Enterprise & Growth Unit and serving as Private Secretary to the Chancellor. I
then joined Boston Consulting Group in January 2014, before returning to the
Civil Service as Private Secretary to the Prime Minister in July 2016. I worked
for the Department for Culture, Media and Sport from November 2019,
becoming Director of the Digital and Tech Policy directorate in May 2020.
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I joined UKGI as a Director in October 2021. The first UKGI Asset for which I
acted as the Shareholder Representative NED was Sheffield Forgemasters
following its acquisition by the Ministry of Defence that year.
In May 2023, I was appointed to my present role as Director with responsibility
for POL. In this capacity I lead the Shareholder Team within UKGI concerned
with POL. I also sit on the Board of POL as the Shareholder Representative
NED. I have attended Board meetings since March 2023, initially as an
observer (prior to my appointment as Shareholder Representative NED) once
it had been confirmed that I would be taking over from Tom Cooper as UKGI's
representative on the Board.
The Role of the UKGI Shareholder Team
The relationship between the Department and UKGI
8.
UKGI performs the shareholder function for a broad and diverse portfolio of
organisations on behalf of the Government Departments that own (in part or in
full) those Assets. In the case of POL, UKGI performs this function on behalf
of the Department for Business and Trade (“DBT” or the “Department’).
UKG's role is defined by the Memorandum of Understanding between UKGI
and DBT (Memorandum of Understanding between BEIS and UKGI with
annexes) (UKGI00013078). This Memorandum was signed in December 2019
between UKGI and what was then the Department for Business, Energy and
Industrial Strategy (“BEIS”) but it continues to have effect following the
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restructuring that led to the creation of DBT (an updated version of the MOU
is currently in the process of being agreed between UKGI and DBT). The MOU
applies to assets owned by DBT for which UKGI performs the shareholder
function, including POL. It sets out the terms of engagement by which UKGI
provides services to DBT. UKGI’s approach is defined at Section 3, which
contains provisions that (among other things), UKGI will provide independent
advice to DBT and its Ministers in a manner consistent with the Civil Service
Code and will engage formally with POL as an agent of DBT.
The MOU makes clear at paragraph 3.4 that DBT “will have responsibility for
developing or formulating policy.” I am aware that the Inquiry has heard
evidence about the distinction between the “shareholder function” and the
“policy function” in respect of arm’s length bodies (“ALBs”). The MOU
formalises the position that the policy function sits with DBT and not UKGI. For
POL, the policy function is primarily concerned with the size of the network of
Post Offices, the location of Post Offices, the services that those Post Offices
are required to provide for their communities, and the level of Government
subsidy — in effect, the social function of POL and the amount of public money
that the Government spends to achieve it. These matters of policy are decided
within DBT (sometimes aided by information and advice given by UKGI where
the Department considers this to be appropriate) and communicated to UKGI.
The shareholder function, on the other hand, focuses on how POL is being
managed, its capability and its organisational performance to deliver DBT’s
policy objectives. As the MOU states, UKGI will consider the Department and
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the Government's objectives when performing its shareholder representative
function.
The MOU sets out a high-level description of the role and activities UKGI will
perform in delivering its shareholder function for DBT Assets including POL.
Further detail on each of those activities is provided in the MOU. '
UKGI has drawn up an internal document entitled UKGI Portfolio Operating
Principles (“POPs”). The latest iteration of this document, dated March 2024
(version 4.4), is exhibited with this statement (UKGI Portfolio Operating
Principles with Guidance March 2024 v4.4) (UKGI00049040). The POPs set
out six principles describing the shareholder role that UKGI generally seeks to
carry out in respect of Assets. These six principles are referred to within UKGI
as its “Target Operating Model”. The POPs also break down the Target
Operating Model into 40 individual activities, which are supplemented by
internal UKGI guidance notes, as well as relevant external sources.
Whilst the POPs articulate a target model, there is no single ‘one size fits all’
governance model across the UKGI portfolio as the demands and relationships
in respect of each of its Assets differs. UKGI therefore expects some flexibility
in the approach taken by the shareholder function across its portfolio in order
‘These are set out at paragraph 8.2 of the UKGI-DfT MOU. They are to:
a. Establish and maintain appropriate and effective corporate governance foundations which
govern the Department-Asset relationship;
b. Promote effective objectives, business planning and performance against a business plan;
c. Promote strong corporate capability;
d. Promote effective leadership through high quality boards and senior management;
e. Promote effective relationships between the Department and the Asset; and
f. Support and supplement the activities above by providing an experienced Shareholder
NED on the Asset Board.
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to meet the unique demands of each organisation. The purpose of the POPs
is therefore to provide guidance rather than a fixed set of rules with which
shareholder teams must comply. The POPs are kept under review by UKGI's
Corporate Governance and Portfolio team and UKGI provides regular
guidance and training on them to shareholder teams.
The MOU applies to all DBT Assets for which UKGI performs the shareholder
function. The MOU (at paragraph 1.2) provides for the possibility of additional,
Asset-specific Framework Documents to be agreed between the Department,
UKGI and individual Assets. Such an agreement is in place between POL, DBT
and UKGI (“the Framework Document”) (Post Office Limited: Shareholder
Relationship Framework Document) (POL00362299). The Framework
Document became effective in April 2020 and, as I discuss below, is currently
in the process of being revised to be based on the latest HMT template and
guidance for Public Corporations as referenced in Managing Public Money
(“MPM”). This process includes the drafting of a Delegations Letter from DBT
to POL, something that POL has not previously received.
The Framework Document describes the parameters within which POL is
expected to operate, the obligations with which POL is expected to comply,
and how POL, the Department and UKGI (including the Shareholder NED and
Shareholder Team) are expected to interact with each other. It builds on POL’s
key governance documents (including its Articles of Association and the
Funding Agreement between POL and DBT) in describing expectations across
a range of matters, including, among others: Board composition, remit and
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responsibilities; information flow between POL and DBT/UKGI; performance
reporting; and legally privileged information/disclosure.
16. Further details about the MOU, the POPs, the Framework Document, and
other relevant aspects of the corporate governance architecture are contained
in the Second Witness Statement of Charles Donald (WITN10770200). I have
read that statement and agree with the contents of it insofar as it concerns the
period of time for which I have been in my present role at UKGI.
The role of the UKGI Shareholder Team for POL
17. The Shareholder Team is responsible for discharging UKGI’s responsibilities
in performing the shareholder function for POL. I spend the vast majority of my
time on POL matters. In addition to me, the team currently comprises two
Executive Directors (one for finance, the other for governance), three Grade 6
equivalent appointments, three Grade 7 equivalent appointments and an
administrative officer (none of whom work full-time on POL matters; most
spend around half their time on POL, and the remainder on other UKGI
Assets). As is typical for UKGI, those working on the Shareholder Team come
from a variety of backgrounds, some from the Civil Service and some recruited
from the private sector with experience and qualifications in accountancy and
corporate finance. I lead the team as a Director at UKGI, reporting to UKGI’s
Chief Executive, Charles Donald. The size of the Shareholder Team has varied
in line with its responsibilities, for example the team was larger when UKGI
played a greater role in matters concerning compensation and redress, as
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described below and in paragraphs 41 to 45 of Charles Donald’s Second
Witness Statement (WITN10770200).
As set out in Charles Donald’s First Witness Statement (WITN10770100, para
26), UKGI's shareholder responsibilities in relation to POL primarily focus on
corporate governance, strategy and monitoring POL’s stewardship of its
financial resources. The principal functional responsibilities of the Shareholder
Team include:
a. monitoring and evaluating POL’s corporate and financial performance,
including against policy objectives and the obligations in the existing
Funding Agreement (albeit that from 2018 this was primarily limited to
monitoring POL’s performance against its obligations to maintain an
appropriate network, in light of the creation of a policy team within the
Department) and reviewing POL’s strategic plan;
b. working to ensure the sustainability of POL’s financial position;
c. monitoring significant risk issues and reporting these to the Department;
d. acting as a liaison between POL and the Department to provide relevant
shareholder consents;
e. advising ministers in respect of the foregoing, and assisting the
Department to secure sufficient funding from HMG for POL to deliver the
Department's policy objectives, as well as supporting the Department
Ministers with Parliamentary or other stakeholder engagement;
f. advising on appointments to the POL Board, including remuneration for
these roles; and
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g. arranging and attending ad hoc meetings between the Shareholder
Team/Shareholder NED and POL management to discuss matters
relevant to the above.
More generally, the Shareholder Team seeks to enable effective
communication between DBT and POL. It helps the company to understand
the Shareholder’s objectives and perspective, and allows for information from
POL to be provided to Ministers and officials in DBT.
The Shareholder Team and I, as UKGI staff, have a duty to comply with the
standards contained within the Civil Service Code and MPM, which sets out
the main principles for dealing with resources in UK public sector
organisations. This means that we must, in exercising our role with respect to
POL, operate with integrity and ensure that public money and other resources
are used properly, efficiently and achieve value for money for the taxpayer.
The Shareholder Team contains a significant amount of technical knowledge
in matters relating to accounting, corporate finance and the public sector duties
with which POL are expected to comply, as set out in the Framework
Document. UKGI’s POL Shareholder Team is also able to draw upon wider
expertise in other Shareholder Teams which may have experience of issues
that are relevant to issues facing POL. Where legal matters arise, it has access
to the UKGI legal team which can provide a steer on what further steps or
challenges might be considered in the circumstances. UKGI maintains contact
with outside Government agencies who may be called upon to assist on
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specific points that arise, such as the Tax Centre of Excellence or the
Infrastructure and Projects Authority. However, UKGI recognises the limits of
its technical expertise and does not provide specialist advice to DBT or POL
on matters of law, or procurement, or on issues concerning IT systems. Where
such advice is required, external, specialist advice is sought by DBT. As I
describe below, this was done in respect of the work being undertaken on
providing a replacement for the Horizon system.
The policy function for POL sits with a team within the DBT, in line with the
arrangement set out in the MOU (UKGI00013078). That team reports to its
Director, Carl Creswell, who in turn reports to the Director General of the
Business Group, David Bickerton. The Shareholder Team works closely with
counterparts in the DBT Policy Team both formally and informally. The two
teams speak most days and hold regular meetings, for example to agree
quarterly priorities. The Shareholder Team also provides written reports to
DBT, including monthly reports to the Policy Team? and quarterly reports that
are addressed to the Permanent Secretary.
The MOU contains provision for the Shareholder Team to make submissions
directly to the DBT Permanent Secretary, Minister or Secretary of State
(UKGI00013078 paragraph 6.2). This could occur when there is a potential
tension between the shareholder and policy functions, for example when the
desired policy outcome is likely to impose a significant additional cost to the
2 I understand that although these monthly reports are addressed to the DBT Policy Team, in practice they are
circulated to the Permanent Secretary by the Policy Team. They are produced with that outcome in mind.
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business, although this has not happened during my tenure on the Board. In
practice, in most instances the Shareholder Team will liaise with the DBT Policy
Team (as is envisaged in the MOU) to produce a single submission that
differentiates between the advice coming from UKGI and that coming from
DBT. This is intended to provide the relevant decision maker with a
comprehensible and comprehensive summary of all the factors relevant to the
matter under consideration.
Further details of the discussions and reporting structures of the Shareholder
Team, within UKGI and to DBT, are contained in the Second Witness
Statement of Charles Donald (WITN10770200, paragraphs 10 to 16). I agree
with the description that he gives.
In my view, the relationship between the UKGI Shareholder Team and the DBT
POL Team is strong and mutually respectful. The two teams work together
closely and productively. There are mechanisms in place to ensure that
Ministers are given advice that is distinct and distinguishable from the policy
and shareholder perspective, which allows them to take informed decisions
having considered any competing interests.
The Government Internal Audit Agency ("GIAA") has recently carried out a
review into the management of the Department's sponsorship relationship with
POL and its responsibilities for governance and oversight. Naturally, this
included consideration of the Department's relationship with UKGI. In general,
the review identified a reliance on personal relationships, knowledge and
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judgment over formal structures. It provided recommendations on how to
address this, including by committing more matters to writing, formalising key
performance indicators for UKGI and clarifying who within the Department is
responsible for managing them. The review also made recommendations
about information management and avoiding duplication of work by
establishing clearer records of the roles and responsibilities of each team
across DBT, UKGI and POL. The audit found that the Framework Document
was broadly fit for purpose but needed to be updated (as is discussed above).
No issues were identified over the Articles of Association. UKGI is working with
the Department to implement the GIAA’s recommendations where relevant to
UKGI’s work.
Ministerial Intervention
27.
There are several ways in which the Secretary of State and Ministers at DBT
can and do intervene in POL’s governance and management. Most directly,
the Secretary of State has the power under the Articles of Association to
dismiss the Chair of the POL Board and POL Directors (including the Executive
Directors) (Articles of Association of Post Office Limited) (UKGI00044318,
Article 42(A)). Kemi Badenoch MP exercised that power when dismissing
Henry Staunton in January 2024, in circumstances that I describe further
below. The revised Articles of Association also allow the Secretary of State to
give directions to POL, which require POL to “take all steps within its power to
do what those directions require to be done” (UKGI00044318, Article 7(F)) (to
my knowledge this power has not been exercised). Further, the Secretary of
State has consent rights in respect of, among other things, remuneration of
Directors (UKGI00044318, Article 8.1(E)) and transactions outside the
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ordinary course of business over the value of £50 million (UKGI00044318,
Article 8.1(X)).
In addition to these “hard” powers, the Secretary of State has considerable
“soft” influence over the direction of POL. The most formal way of exercising
this is through the Chair’s letter, sent annually from the Secretary of State, the
relevant Minister, or the Permanent Secretary to the Chair of POL setting out
DBT'’s priorities for the company. There are also regular and ad hoc meetings
between the POL Chair and CEO and the Secretary of State or the Minister
responsible for POL. These are opportunities for the Department to influence
the direction and priorities for the Board and Senior Executive Group (“SEG”).
The Chair, Board, CEO and SEG are all aware of the Secretary of State’s
powers of direction and dismissal and are also aware of the reliance of POL
on high levels of public subsidy as determined by DBT and HMT. In those
circumstances a sufficiently informed, engaged and committed Secretary of
State or Minister can wield considerable soft power. Kevin Hollinrake MP,
Parliamentary Under-Secretary of State (and later Minister of State) for
Enterprise, Markets and Small Businesses from October 2022 to July 2024,
was willing to exercise these levers and did so effectively during his tenure as
Minister responsible for POL.
To the best of my knowledge such Ministerial involvement has always been
possible in POL. For example, in September 2015 Baroness Neville-Rolfe
wrote to the then incoming Chair of POL to request that he prioritise getting to
the bottom of the concerns that had been raised about Horizon. This resulted
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in the Parker Review and the instruction of independent legal assistance from
a leading Queen's Counsel. Later, in 2020, it was made clear to senior figures
within POL that the Department considered that it would be unconscionable for
bonuses to be awarded in full considering the rulings of Fraser J in the
Common Issues Judgment (“ClJ”) and the Horizon Issues Judgment (“HIJ”).
As a result, bonuses were reduced by 50 per cent for Executive Directors and
20 per cent for General Executives/Senior Leaders. Where the Shareholder
makes clear what it expects of an Asset, and where that Asset is heavily reliant
on maintaining a positive relationship with the Shareholder to continue to
receive financial support, there will inevitably be considerable pressure on the
Chair, Board and Executive to respond to the Shareholder’s expectations.
Below the level of Ministers and the Permanent Secretary, part of the role of
the Shareholder Team, and my role as Director of that team and Shareholder
NED, is to ensure that POL is kept abreast of the Shareholder’s thoughts and
concerns about the way in which the business is running. This is an extension
of the Department's soft power and helps to ensure that the Asset understands
the Shareholder’s perspective and objectives.
While these opportunities for “hard” and “soft” interventions exist for Ministers,
they must take care when exercising them. Principles of good corporate
governance hold that shareholders should not involve themselves in the
operational running of the business and should leave matters of corporate
governance and oversight to the Board; the Framework Document
(POL00362299) also provides (section 1.2) that, as a Public Corporation, the
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POL Board retains responsibility for the operations of the Post Office, and
neither the Department nor UKGI have direct involvement in the day-to-day
operations of POL or in the management of its network of Post Offices and
staff. Further, if Ministers intervene too often, the POL Board and SEG will feel
undermined, making recruitment and retention difficult. That said, in my view
the principles that apply to running purely commercial companies need to be
tailored to take account of the policy considerations that underlie publicly
owned assets.
Risk Registers
32.
33.
34.
I am aware that the Inquiry has reviewed several risk registers already and that
they will be aware that the UKGI risk register process has evolved significantly
since the process was established in ShEx (“Shareholder Executive”). I set out
below my understanding of how UKGI's risk register currently operates.
UKGI’s internal risk reporting process provides a mechanism to identify,
escalate and manage risks faced by UKGI in exercising its mandate. These
risks predominantly relate to UKGI's ability to provide sound advice to client
departments and for UKGI’s Shareholder NEDs and Shareholder Teams to
perform their roles effectively. These are not the same as the risks being faced
by the Assets directly.
The risks captured within UKGI's risk register fall into two distinct categories:
delivery and reputational. Delivery risks are those risks which directly impact
the Shareholder Team's ability to deliver the objectives agreed with the
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Department, whereas reputational risks are those which relate to the wider
context in which UKGI operates on behalf of the Shareholder. The distinction
between delivery and reputational risk exists to ensure there is a delineation
between the risks that UKGI and its Board are accountable for (i.e. the
mandate which UKGI has agreed with the relevant Department), and those
which pertain to the wider context in which UKGI operates on behalf of the
relevant Department. UKGI is not concerned with reputational risk as a vanity,
or as an end in and of itself. As an organisation providing professional services
to HMG, a positive reputation is essential in order for us to be trusted to perform
our role and therefore enable us to deliver value on behalf of the taxpayer.
The POL Shareholder Team’s internal risk register is reviewed every two
months (as are those for other Assets within UKGI's portfolio, which together
make up the UKGI risk register). The register is subsequently reviewed by
UKGI's central risk team, which scrutinises returns to ensure consistency
across the UKGI portfolio, as well as by UKGI’s legal team to identify any
potential legal or compliance risks which should be explored further. The
central risk team compiles an overview paper for UKGI’s Executive Committee
(“ExCo”) which highlights the top risks to UKGI across its portfolio of Assets
and projects and the mitigation efforts being taken by each team. Following
review by the UKGI ExCo, this paper is subsequently shared with the UKGI
Board for discussion. As POL currently holds one of the highest risk ratings
within UKGI’s portfolio, the POL Shareholder Team also provides a more
detailed supporting paper outlining the primary mitigations in place. This is
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intended to provide the UKGI Board with sufficient oversight of the activities
and performance of both the Shareholder Team and the Asset.
As explained above, UKGI’s risk register is primarily an internal reporting
document and not intended to be the forum by which UKGI captures and
determines which Asset risks to escalate to the relevant Department, albeit
that they inform this process.
There are several routes for the POL Shareholder Team and Shareholder NED
to raise any issues or concerns with the Department. The principal forum for
POL and the UKGI Shareholder Team to escalate risks to the Department is
the Quarterly Shareholder Meeting (“QSM”). These meetings include
representatives from the Department, Shareholder Team and POL Executive
and are intended to discuss matters such as POL’s progress against its agreed
deliverables and priorities as set out in the annual Chair’s letter. As part of this
meeting, POL updates the Department directly on its key risks and UKGI
provides its own overlay to these risks, and any further information of which
the Department should be aware. This is informed by both my understanding
of the Board’s discussions around a particular issue, as well as any wider
information that my team may have identified. This means that the Department
will receive different perspectives on risk from POL and UKGI; for example, the
risks arising from Henry Staunton’s conduct as POL Chair (discussed in more
detail below) did not feature in POL’s own risk reporting to the Department,
whereas this was a key risk highlighted by UKGI to the Department at the time.
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In addition to QSMs, my team and I provide monthly reporting directly to the
Department sponsor team. These monthly reports summarise progress made
against key objectives since the last report, upcoming activities of relevance to
the Shareholder, and a risk update. Under BEIS, this information was provided
as part of a centralised online reporting tool, however DBT has not
implemented a replacement centralised reporting system. A further written
update is also provided to the Permanent Secretary, which summarises
performance in the last quarter. This quarterly update also includes key
financial information on POL’s performance for the period.
Outside of these regular meetings and reports, I meet regularly with both the
Department Director, Mr Creswell, and Director General, Mr Bickerton,
responsible for POL related matters. I consider my relationship with both of
these individuals to be open and collaborative and these meetings are a useful
forum to discuss current POL progress, provide an update on the recent issues
considered by the Board, and highlight any aspects that my team or I consider
may be of relevance to the Department. I exchange messages with them
outside these meetings as and when relevant issues arise (on both day-to-day
business and more significant topics such as whistleblowing).
Ultimately, should my team or I become aware of an issue that we do not
consider the Department has been fully sighted on, or has not fully considered,
it may be appropriate to provide a submission directly to the departmental
Minister or Permanent Secretary.
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It should be noted that the UKGI risk control framework does not impact the
Asset’s Accounting Officer responsibilities. It is the responsibility of the POL
CEO, as the designated Accountable Person, to identify and manage the risks
faced by the organisation and to report on those risks to the sponsor
Department. However, my team and I provide the Department with additional
commentary, context or visibility on material risks being faced by the asset. In
particular, through my position on the POL Board, I am able to provide the
Department with a more direct line of sight into the issues and risks being
raised to the Board, over and above the reporting that they receive directly
from the Asset.
The recent GIAA review, which I refer to above, identified some gaps in the
Department's risk reporting and analysis (as opposed to that of UKGI),
following the restructuring that led to the creation of DBT. One
recommendation was that the standing agenda for QSMs should be varied, as
risk had previously been the final item meaning that it was the most likely to
be omitted from discussion if time ran short (thought this was mitigated by the
provision of a report on risk in the written pack for the meeting). UKGI and the
Department are working to implement this and other recommendations that
touch upon UKGI’s work, including suggestions to ensure that the
Department's risk appetite is aligned with that of POL and that the sources of
risk assurance available within POL are shared with the Department.
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Conclusions
43.
The structures that are in place within UKGI, and between UKGI and the
Departmental owners of the Assets and projects with which UKGI are involved,
have evolved and will continue to evolve. There is no perfect system and UKGI
continues to learn from experience, reflection and review on how to improve
the mechanisms it uses to perform its functions. The most recent example of
this is the GIAA review and recommendations that are currently being
considered and implemented. The evidence heard by this Inquiry and the
Report that the Chair produces will further inform this process.
Role of the Shareholder NED
44.
45.
I was appointed Shareholder NED at POL on 12 May 2023 and my formal
responsibilities are set out in my Letter of Appointment (Letter to Lorna Gratton
re: Letter of appointment) (POL00363050, section 3). I attended my first Board
meeting as Shareholder NED on 6 June, having previously attended two Board
meetings and multiple committee meetings as an observer. I receive no
remuneration for my role as Shareholder NED beyond my salary as a public
servant.
I sit on all the POL Board's committees: the Remuneration Committee
(‘RemCo”), the Audit and Risk Committee (“ARC”), the Nominations
Committee (“NomCo”), the Remediation Committee, and the Investment
Committee. I am the only Board member to do so, although the current Chair
is entitled to attend each one. The POPs encourage the Shareholder NED to
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sit, as a minimum, on an Asset’s Audit, Remuneration and Nomination
committees (UKGI00049040, p.53).
The role of the Shareholder NED is summarised in the POPs (UKGI00049040,
p.9):
“Unless stated otherwise by Constitutional Documentation, the duties of
the UKGI NED on an Asset's Board must be the same as those of all the
other Directors, including any other Directors appointed by Ministers.
Those include to act in a way they consider, in good faith, most likely to
promote the success of the Asset for the benefit of its shareholders. These
responsibilities have different parameters to those of UKGI as an
organisation, performing the shareholder role. The personal
responsibilities of Directors of companies incorporated under the
Companies Act 2006 (or predecessor legislation) are set out in section 171
to 177 of the Companies Act 2006. The responsibilities of the Board cannot
be delegated, and include (but are not restricted to) the following:
+ Duty to promote the success of the company
- Duty to exercise reasonable care, skill and diligence
- Duty to exercise independent judgment
- Duty to act within powers
- Duty to avoid conflicts of interest
- Duty to declare interests in proposed transactions
- Duty to declare interests in existing transactions
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- Duty not to accept benefits from third parties.
UKGI understands that the UKGI NED will seek support in carrying out
their responsibilities from their shareholder teams, and UKGI! encourages
this insofar as UKGI team members can provide expertise and insight.
However, responsibility for Director duties cannot be borne by anybody
other than those on the Board of the Asset, including the UKGI NED.
Despite the need for UKGI NEDs to have the same responsibilities as all
other Directors, UKGI accepts that their functional relationship will differ
from Independent NEDs. UKGI NEDs by virtue of their HMG-facing roles,
have a special ability to facilitate relationships and understanding between
Departments and their Assets. UKGI NEDs will act as interlocutor between
Departments and Assets as necessary, to give HMG better insight as to
the quality of the Board in the performance of its governance function, as
well as to promote HMG perspectives and information flow at the Asset
Board. This role is critical in helping to deliver all the objectives of UKGI
and HMG.”
The guidance above was written for all Shareholder NEDs, and it applies to
my role on the POL Board. I can confirm that, in law, my duties and
responsibilities are the same as all other NEDs on the POL Board, including in
respect of the matters set out above. This is a term of my Letter of Appointment
(POL00363050, section 3). They include a duty to promote the best interests
of the company. However, and as the POPs make clear, I am not an
independent NED. My position on the Board is a consequence of my role in
UKGI exercising the shareholder function on behalf of DBT. There is, therefore,
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48.
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a Clear distinction between my position as a Shareholder NED and that of the
other NEDs.
This distinction is not as stark as it may first appear. POL, in its current form,
remains a going concern only because it receives very substantial financial
support from the Shareholder. That support is provided to ensure that POL
continues to perform its social function and is contingent on POL operating in
a manner that is consistent with wider DBT and Government policy. In those
circumstances, the best interests of the company include, as a necessity,
maintaining a good relationship with the Shareholder. One of my primary
functions as a Shareholder NED is to act as a conduit between POL and DBT,
to help the company understand, first, how its requests, decisions and actions
will land with the Department and, second, the processes and reasoning that
will inform the Department's response to the Company. I am, at present, the
only person on the Board with significant public sector experience (including
experience within HMT), which adds to the importance of this role.
To give an example, I describe below the establishment of the Board’s
Investment Committee, which was intended to oversee (among other matters)
the replacement of Horizon by a new IT system. I sit on this Committee, having
lobbied (together with my predecessor on the Board, Tom Cooper) for its
formation. During some of its early meetings I was aware of a sense of
frustration from some members of the Committee about the degree of
assurance that the Shareholder required in respect of the new system, which
inevitably added cost and delay. Part of my role was to explain the DBT’s
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50.
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position as to why this was necessary given the appalling history of the Horizon
system and the degree of public subsidy required to replace it. In bringing the
Shareholder’s perspective, and communicating it to my fellow Directors, I was
aiming to help the long-term interests of POL in maintaining the relationship
with DBT and HMT that was required to develop and fund the replacement IT
system.
In general, my experience has been that my Board colleagues understand and
respect the role that I play as Shareholder NED. This is helped by the fact that
a number of them have had experience on the Boards of companies that have
been wholly owned by a private investor, a position similar in some ways to the
position of a publicly owned ALB. I did have more difficulty in ensuring that Mr
Staunton understood my role, and it may be relevant that his experience was
more on Boards of listed companies and hence he had less experience of
shareholder intervention. He, and possibly some members of the Executive
Team at the start of their tenures, struggled with the fact that I was a conduit
to the Shareholder, not someone with delegated authority from the
Shareholder to make decisions on its behalf at Board meetings. This could
lead to frustrations that I could not give approval to matters that were reserved
for the Shareholder, in particular regarding remuneration, in respect of which I
directed the company to seek formally the views of the Department.
I am aware that there may be past or current members of the Board or the
Executive that feel that I, as Shareholder NED, have been too forceful in
intervening in Board meetings to share the Shareholder’s perspective or
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requirements on particular topics, or indeed may have been frustrated in the
level of oversight or intervention from the Department on certain issues. Some
of those views may have informed the Grant Thornton Governance Review
dated 25 June 2024 (POL00446477) that I discuss further below. There will
always be a balance to be struck and Board members might disagree
reasonably and in good faith as to where that balance should lie. The length of
the arm in an arm’s length relationship will vary with circumstances, in
particular with the degree of trust between the shareholding Department and
the Asset. Given the appalling injustice suffered by the Postmasters® as a
consequence of the events considered by the Inquiry, the immense and
justified public concern about that injustice, the worrying questions over
whether full and accurate information was provided in the past by members of
the POL Executive to the POL Board, UKGI and Ministers, and the large
amounts of public money required to rectify the position and replace the
Horizon IT system, it is not surprising that the arm is shorter than it might
otherwise have been. Had those events not happened, and were POL
financially solvent without subsidy, the position would no doubt be different.
Information Sharing
52. There are no general restrictions imposed by POL on how I share information
that I obtain as Shareholder NED with the UKGI Shareholder Team. The only
restrictions that are in place are those resulting from the confidentiality
undertaking that I and other Board members have given to the Inquiry. Subject
3 In this statement, I use the term “Postmaster” rather than “Sub-postmaster” because, in my experience,
that term is more widely used within POL. I do not believe there is now a material distinction between the
two terms.
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to that undertaking, I can and do share Board papers with the Shareholder
Team. The only occasions when I have felt that I should not do so is where
those papers have contained sensitive personal information about other Board
members (for example, details of health conditions). In those instances, I
provide oral updates to the Shareholder Team on the relevant information that
I consider should be shared with them.
My Letter of Appointment provides that I am permitted to disclose confidential
material obtained as Shareholder NED to Ministers, officials and their
professional advisers (among others) to the extent that the disclosure occurs
in the course of my employment at UKGI or is otherwise reasonably necessary
(POL00363050, paragraph 7.3). This means that I can provide information to
DBT without seeking prior permission of the Chair or anyone else in POL. As
a matter of practice, DBT does not require or expect me or the Shareholder
Team to share Board packs with the DBT POL policy team on a regular basis.
Rather, specific Board papers on issues of particular concern to DBT are
shared on an ad hoc basis when the Shareholder Team and I determine, in
dialogue with DBT, that it would be helpful for them to have such information.
I have never experienced a situation in which I have been prevented from or
have felt the need to refrain from sharing a relevant document or relevant
information with the Shareholder Team, the DBT Policy Team, or with other
relevant officials or Ministers within DBT or UKGI, other than material covered
by the Inquiry’s confidentiality undertaking or the sensitive personal data to
which I have referred above.
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There was one incident in which I delayed providing a paper to the Shareholder
Team and DBT until I had reassured myself that it was not covered by the
Inquiry’s confidentiality undertaking. This was a report on why the payment of
bonuses relating to co-operation with the Inquiry were erroneously said to have
been endorsed by the Inquiry Chair, an incident that occurred before I was
appointed to the POL Board, but which was under investigation when I took up
my post. Once I had taken advice and it had been resolved that this matter
was not covered by the undertaking, the document was shared with those that
I considered needed to see it.
Litigation protocols
56.
57.
As set out in Charles Donald’s Second Witness Statement (WITN10770200,
paragraphs 27 to 29), following the ClJ and HIJ, changes were made to POL’s
governance arrangements to provide greater visibility for UKGI and the
Department on material litigation involving POL. These changes included the
provision in the Framework Document for quarterly reporting from POL on any
active, threatened or reasonably anticipated litigation, and the requirement for
POL to enter into information sharing protocols for substantial litigation to
facilitate the sharing of legally privileged information.
In my view, these measures provide for sufficient information flow in respect of
material litigation from POL to UKGI and the Department. I understand the
importance of maintaining the status of legally privileged documents but have
not encountered any issues in obtaining privileged information from POL's
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legal team, or from passing such information to the Shareholder Team or
Department as appropriate. There is an expectation of transparency between
POL's legal team and the Board, and the Board is conscious of the need for
access to legal advice that may be relevant to its decision-making ability.
In addition, as referred to in Charles Donald’s Second Witness Statement
(WITN10770200, paragraph 29), POL appointed Ben Tidswell, a NED with
legal expertise, to the Board in July 2021 with UKGI’s encouragement.
Although Mr Tidswell has stepped down from the Board following the end of
his term in July 2024,4 Amanda Burton (NED and Chair of the Remuneration
Committee) is also a lawyer by background and I believe this is an important
skill set to have on the Board.
Experiences on the POL Board: Joining the Board
Training and induction as a NED
59.
POL is not the first Board on which I have sat. Before joining UKGI I was a
Trustee on the Board of Teach First, the education charity, for six years.
Following my recruitment to UKGI I was appointed as Shareholder
Representative NED for Sheffield Forgemasters, a precision manufacturer
wholly owned by the Ministry of Defence. I sat on that Board for around
eighteen months before my appointment to the Board of POL. Within UKGI
there is now a recognition that some Assets will require the appointment of a
“ Mr Tidswell has, however, continued to provide support to the Remediation Committee since stepping down
from the POL Board.
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Shareholder Representative NED with some prior experience in that role. POL
is regarded as one of these.
I have received, and continue to receive, training within UKGI on my role as a
NED. I attended the Institute of Directors course on the role of the Director and
the Board. I also undertook internal training on the POPs and the role and
responsibilities of a Shareholder NED. I participate in ongoing UKGI training
directed at enhancing the knowledge and capability of a Shareholder NED,
which includes:
a. Regular meetings and training sessions for UKGI Shareholder NEDs:
these sessions explore different topics (for example, participation in
Remuneration Committees) and provide a forum for the Shareholder
NEDs to share their experiences and discuss issues that have arisen in
different Assets as well as hear from external speakers on a range of
issues.
b. Amonthly Corporate Governance group meeting: this involves a slightly
broader group of individuals who are performing roles in Shareholder
Teams within UKGI’s portfolio of Assets.
c. Asmall group meeting of around five Shareholder NEDs once every two
months that is intended to allow for an open discussion of any matters
that we wish to raise. These sessions combine discussion, advice and
peer support.
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61.
62.
63.
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In addition to these training sessions, UKGI produces guidance notes and
documents for their Shareholder NEDs and other employees. The most
prominent of these is the POPs, which contains a section on Shareholder
NEDS (UKGI00049040, pp.52-54), among other relevant material. UKGI has
also produced specific guidance on issues including whistleblowing, litigation,
and culture within Assets.
These processes of training and continuing professional development are
constantly evolving.
On joining the POL Board I received additional training as a NED (as opposed
to training specific to being a Shareholder NED). I find it difficult now to
distinguish between the training I had from POL and the support I received
from UKGI colleagues, and it may be that other NEDs are better placed to
speak to the extent and effect of the POL training. I recall having the equivalent
of around two days training in total, spread over a period of time. This included
site visits to three branches that were intended to show a range of branch
formats and settings. During this training I was shown the Horizon IT system
and spoke to Postmasters about their experience of using it. I have also
attended the POL Operations Centre in Chesterfield and one of POL’s cash
centres as part of my continuing professional development.
POL also provides ongoing training to its NEDs, including on matters specific
to Board committees. For example, ARC members receive training on changes
to corporate governance codes and on topics such as cyber security. The
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Remediation Committee has had ad hoc sessions on POL’s remediation
schemes with barristers.
In addition to this organised training, I received an extensive handover from
my predecessor as Shareholder NED, Tom Cooper. I spent approximately
three months working part-time on POL issues before my formal appointment
in May 2023. As part of this process, I attended two full Board meetings as an
observer and multiple committee meetings. I also had a series of introductory
meetings with all of the other NEDs then in post and with the following
members of the POL Executive: the CEO (Nick Read), the CFO (Alasdair
Cameron), the Head of Legal (Sarah Gray), General Counsel (Ben Foat), the
Head of Assurance and Complex Investigations (John Bartlett), the Head of
Internal Audit (Johann Appeal), the Head of Risk (Rebecca Barker), the
Communications Director (Richard Taylor), the Chief People Officer (“CPO”)
(Jane Davies), the Financial Directors (Tom Lee and Katherine Sheratt), and
senior members of the Remediation Team, the New Branch IT (“NBIT”) Team,
the Mails Team, the Data Management Team, and the Improvement Delivery
Group Team.
I am asked to comment on the quality and completeness of the training and
induction that I received. I feel that the UKGI training was very thorough, and I
cannot think of any additional topics that I would have liked to have seen
covered. The UKGI training, including the ongoing training, is reflective and
iterative and I feel able to ask for things that I would find helpful.
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On the POL training, others would be better placed to comment on its
effectiveness given that there was considerable overlap between that and the
training I had received from UKGI. I can say that I found that members of the
Executive Team were always willing to speak to the Board or to me individually
on matters that were raised with them.
Training and induction on Horizon issues
68.
Before joining the Board, I was advised by Tom Cooper to read Nick Wallis’
book The Great Post Office Scandal and the ClJ. I took this advice and also
listened to Mr Wallis’ Radio 4 series and podcast on the Horizon scandal.
Through my discussions with Tom and my period of observing POL Board
business, I developed a further understanding of matters relating to Horizon
and the treatment of the Postmasters. I read the UKGI preliminary “lessons
learned” review document about Horizon compiled by UKGI Legal for the UKGI
Board; I am aware that this document has been through several drafts and I
cannot now recall which one I read, but I exhibit a version that has already
been provided to the Inquiry (UKGI Preliminary Internal Review into the Post
Office and the Horizon IT System) (UKG100048174). I am aware that there has
been ongoing work to incorporate some of these preliminary lessons into
internal training and guidance on matters such as whistleblowing and
corporate culture. I was also provided with training on the lessons learned by
UKGI from the Magnox litigation and inquiry, which included emphasis on the
handling of litigation involving Assets within the UKGI portfolio.
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70.
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POL provided training on both the ClJ and HIJ, though this focussed on
compliance. I am aware that there is a POL training module for employees on
Horizon. I do not know if this is offered to NEDs; it was not provided to me,
though this might have been a consequence of my having joined the Board
with foreknowledge of Horizon issues.
I am asked to reflect on the quality of the training I was provided with in respect
of Horizon. That which I received from UKGI was, in my view, very good and
was effective in providing me with an understanding of the Horizon scandal.
Again, I find it difficult to distinguish between the knowledge that I obtained
through the UKGI training and that which I received from POL. If the induction
that I received from POL on Horizon represents the totality of the training on
Horizon that is provided to all NEDs then I would suggest that it would be
helpful to have more information about the actual events concerned, in addition
to the material about the ongoing response to them. However, it may be that
other NEDs did receive this kind of training. I would also say that the induction
that I received from POL was good in respect of the topics that it did cover.
While the training and my pre-reading was extremely helpful, the evidence to
this Inquiry has furthered my knowledge and understanding of what went
wrong. In particular, I do not think that I realised, on joining the Board, the
extent to which information flows within POL and between POL and
Government were such an important feature.
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Experiences on the POL Board: Relationship between the Board and the SEG
72.
73.
It may be helpful to distinguish between the terms that have been and are used
to describe different groups of senior executives within POL. When I was first
appointed as Shareholder NED, the senior executive team was called the
Group Executive (“GE”), which comprised around thirteen people, almost all of
whom reported to the CEO. Below this tier was the Senior Leadership
Population (“SLP”), a larger group of around 25 to 30 people with various
responsibilities for aspects of POL’s work. For the reasons that I give below,
this system was reformed in early 2024 to disband the GE and create a smaller
senior team known as the Strategic Executive Group (“SEG”). This is made up
of the CEO, Deputy CEO, CFO, CTO and CPO, though others — such as the
General Counsel — may also attend meetings. The SLP remains in place, and
individuals from the SLP will regularly present at Board meetings and attend
meetings with Board members.
I have a lot of interaction with members of the SEG, primarily because I sit on
the Board and all its committees but also through my position as Director
responsible for POL within UKGI. Generally, I am scheduled to meet with the
CEO twice per fortnight and will be present when he meets with the Minister
(these meetings usually took place on a monthly basis when Kevin Hollinrake
was in post). I also have regular meetings with others within the SEG and SLP,
including pre-Board meetings when executives are due to present a difficult or
complex issue to the Board. I typically attend POL’s headquarters in person
once a week and make myself available for meetings in person during those
days and virtually on other days.
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74.
75.
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I understand that I spend more time with members of the SEG and SLP than
other NEDs. In part this is because I sit on all the Board committees; in part it
is a consequence of the nature of my role at UKGI, which means that I spend
more time on matters relating to POL than other NEDs. I understand that
members of the SEG and SLP do meet with the other NEDs outside of the
Board and its committees, with the amount of contact and range of people they
see varying between NEDs.
In general, the relationship between the Board and the SEG is now a positive
one. The Board is engaged and inquisitive and the SEG is receptive to the
Board's oversight and requests.
POL has faced, and continues to face, very significant challenges. In corporate
terms, the company has undergone a period of extreme distress, though this
must of course be seen in the context of the still greater human distress caused
to so many Postmasters. It has also seen a rapid turnover of senior executives
and non-executives, including the dismissal of the Chair by the Secretary of
State, the departure of the CFO and several CPOs, and several senior
executives taking leave of absence due to ill health. An unusually large number
of the SEG are, at the time of writing, interim appointments. It has been, to put
it mildly, a very destabilising period in POL’s history that has led to a very
stressed operating environment.
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77.
78.
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POL has been, and remains, under intense scrutiny, including from the Inquiry
and the media. This is not a cause for complaint as it is an inevitable
consequence of its past failures and the harm that POL caused. The
combination of this scrutiny, the knowledge of the past failures and their
consequences, and the destabilisation described above, means that a risk-
averse culture has developed in POL where decisions are escalated upwards
and legal advice and other assurance is sought on relatively minor matters. A
similar culture exists in HMG’s decision-making on Post Office. This has
created bottlenecks, has made decision-making very slow and has disrupted
the usual lines of accountability. This culture has been identified in the Grant
Thornton Governance Review, in my view correctly (POL00446477).
The Board and the SEG are in the process of taking steps to improve the way
in which POL is operating. The number of direct reporting lines to the CEO has
been reduced, the SEG has replaced the GE, committees have been made
smaller and more dynamic, and a programme of work has been undertaken by
the CEO's Chief of Staff to try to rationalise the way in which the Executive
operates. This work is ongoing. While improving these processes will assist in
improving the performance of the company, structural change is not on its own
enough. POL needs effective leadership in the most senior executive positions,
and it is the responsibility of the Board to ensure that this is achieved.
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Experiences on the POL Board: Cultural Change
The Importance of cultural change to the Shareholder
79. DBT and UKGI have identified cultural change within POL as a priority for the
Shareholder. This is reflected in the emphasis given to this and related issues
in the annual Chair's letters:
a. 2022/2023: The then Permanent Secretary of BEIS, Sarah Munby,
welcomed the appointment of Postmaster NEDs (discussed further
below), a new Legal NED and a new Director to provide leadership to the
Historical Matters Business Unit. She asked the Chair, Tim Parker, to
prioritise engagement with the Inquiry and reflection on its findings, and
to “drive forward the Company's cultural change programme, embedding
any lessons and changes.” (Letter from Sarah Munby to Tim Parker: POL
Strategic Priorities for 2022/2023) (UKGI00044315).
b. 2023/2024: The then Minister with responsibility for POL, Mr Hollinrake,
asked the then Chair, Henry Staunton, to “address POL’s historic failures
and set the business up for success in the future.” Among the activities
Mr Hollinrake identified were positive engagement with the Inquiry, the
provision of fair and timely compensation, and ensuring lessons were
learned from past failures including in respect of the development and roll-
out of the replacement IT system. The Minister also asked the Chair to
“demonstrate, with the support of external assurance where appropriate,
the company’s conformance” to the rulings of Fraser J in the ClJ and HIJ.
(Letter from Kevin Hollinrake to Henry Staunton: Strategic Priorities for
2023/2024) (UKG100044317).
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c. 2024/2025: The current Secretary of State, Jonathan Reynolds MP, set
out the Shareholder’s objectives and the topics on which the Department
would like to see progress over the financial year. The first of these was
“Intensifying existing workstreams to address POL’s historic failures and
setting the business up for future success.” He identified redress for
Postmasters, engagement with the Inquiry, conformance with Fraser J’s
judgments, and ensuring that lessons were learned including in respect
of the replacement IT system. The second objective was “Supporting the
cultural transformation of the Company and focusing on improving POL’s
capacity, capability and resilience at all levels.” Here, the Secretary of
State emphasised the need to engage and communicate with
Postmasters and other stakeholders, and the requirement to update the
Shareholder on how cultural transformation is being established. (Letter
from Jonathan Reynolds to Nigel Railton: Strategic Priorities for
2024/2025) (UKGI00049046).
80. The Shareholder Team has followed up these letters by seeking clarity from
81.
POL on how they would seek to monitor and report on cultural change within
the organisation. In response to this, and similar encouragement from the
Board, work was undertaken by POL in consultation with Institute of Business
Ethics to develop a cultural indicators dashboard, which is now produced and
presented to the Board.
Cultural change, and engagement with the Inquiry, have also formed part of
the metric used to calculate the remuneration of senior executives within POL.
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This is an example of the Shareholder and Board using standard levers of
corporate governance to incentivise the actions that they consider to be a
priority.
I have further emphasised the importance that the Shareholder attaches to
cultural change in my role as Shareholder NED, raising it when necessary at
the Board and committee meetings and with members of the SEG. I address
below some of the measures that have been taken.
Postmaster NEDs
83.
84.
The most visible example of cultural change is the appointment of two
Postmaster NEDs, selected through an election by Postmasters. The first two
NEDs to hold this post are Elliot Jacobs and Saf Ismail. A third Postmaster
NED will shortly be joining the Board to ensure a degree of continuity when Mr
Jacobs’ and Mr Ismail's terms come to an end. The Postmaster NEDs share
the same legal duties and responsibilities as the other NEDs but are intended
to bring the voice and perspective of Postmasters to the Board.
In my opinion, Mr Jacobs and Mr Ismail have added a huge amount of value
to the Board. They have changed the nature of discussions at Board level and
ensure that the actual experiences of Postmasters are heard. In my experience
they have been listened to, particularly when discussing issues relating to how
policies and practices contained in Board papers will affect Postmasters on the
ground. To give one example, Mr Jacobs and Mr Ismail brought the issue of
how stamps were sold within branches to the Board. Although this sounds like
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a niche operational issue, the different methods of selling stamps (through
booklets, physical stamps on sheets, or labels printed in branch) impact on
auditing, stock losses, and productivity within Post Offices. This issue, which
is of practical and financial importance to the Postmasters on whom POL’s
future depends, would not have reached the Board had it not been for the
presence of the Postmaster NEDs. Their perspective on this and other
important issues — particularly those that affect POL’s cost base, and therefore
ultimately have a significant effect on Postmaster livelihoods — has been
invaluable.
There have plainly been some issues with the way in which the Postmasters
NEDs have been inducted and integrated onto the Board. There were also
occasions when the Postmaster NEDs, in my view, did not fully distinguish
between their role as Directors (with the fiduciary duties that this entails) and
their position as both active Postmasters and representatives of the wider
Postmaster community. I think that such teething problems were unsurprising
given that this is a new feature of POL’s governance and that Mr Jacobs and
Mr Ismail are the first Postmaster NEDs to have to strike what can no doubt
sometimes be a difficult balance. I understand that work is being undertaken
to provide more training for future Postmaster NEDs, which is appropriate. I
hope and expect that improvements will continue to be made to ensure that
the Postmaster NEDs get the information and support that they need to fulfil
their duties effectively.
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86.
87.
88.
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The Inquiry has asked me to comment upon an article in the Times dated
9 February 2024, which refers to criticisms made by Mr Ismail and Mr Jacobs
in a “leaked memo” (News article from The Times titled 'Postmasters on Post
Office board ‘ignored and unwanted’) (RLIT0000201). In particular, the Inquiry
suggests that the article quotes Mr Jacobs as saying that he and Mr Ismail
were ignored and seen as an annoyance by other members of the POL Board.
Having read the article, and the memorandum on which it was based (Email
from Elliot Jacobs to Saf Ismail, Henry Staunton Re: Project Pineapple)
(POL00448300) (discussed below), I do not think that this is an accurate
characterisation of what Mr Jacobs was recorded to have said. While he did
complain of being “ignored and seen by many as an annoyance” he is not
recorded as directing this criticism to the NEDs or other members of the Board.
The memorandum as a whole suggests that his and Mr Ismail's criticisms were
directed more towards elements within the Executive, and in particular the
Retail and Investigations teams. I have not formed the impression that Mr
Ismail and Mr Jacobs are “ignored and seen ... as an annoyance” by the NEDs
on the Board, or by the past and current Chairs. I value their contribution, and
I believe that other NEDs and the Chair do as well. There are, of course, some
points of contention and tension when issues are discussed at Board level, but
this is an inevitable and welcome consequence of inviting two Board members
to bring a different perspective to those discussions.
I understand that the memorandum on which the Times article (RLIT0000201)
was based was written by Mr Staunton following a meeting with Mr Ismail and
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Mr Jacobs. It was subsequently disclosed in error to members of the Group
Executive, including those who were directly criticised in strong terms by Mr
Ismail and Mr Jacobs. This, understandably, caused friction between the
Postmaster NEDs and some members of the Executive. Mr Jacobs and Mr
Ismail gave their views in what they believed to be a confidential meeting with
Mr Staunton, and it is regrettable that their reasonable expectation of privacy
was not respected. Some of the language used by Mr Jacobs and Mr Ismail in
this confidential meeting was, in my view, unnecessarily forceful and personal
given the role of Board members in scrutinising the work of the Executive.
I cannot comment on many of the specific complaints raised by Mr Jacobs and
Mr Ismail in the memorandum as I do not know on what evidence these are
based, and certain allegations are the subject of ongoing investigations.
However, I agree with their points that the Board needs to “grip” the issue of
cultural change within POL and the POL Executive, and that the company
needs to be “more PM [Postmaster] centric.” Considerable work has been
done to achieve this, but it remains work in progress with the new Chair giving
particular focus to this issue.
In addition to the role of Shareholder NEDs, I am also in favour of exploring
the possibility of expanding the involvement of Postmasters in other aspects
of POL’s decision-making. One way of doing this would be through a
Postmaster Council, at which Postmaster representatives would have an input
into operational decisions on matters such as marketing, which products will
be sold, how rewards for operational excellence should operate, and other
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91.
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issues that directly impact upon how they operate and grow their businesses.
Such councils are common in franchise businesses and there are active
discussions on how POL could adopt appropriate models.
I am aware that the National Federation of Sub-Postmasters (“NFSP”) has
proposed the creation of an Advisory Board, which would comprise
stakeholders including Postmasters to act in effect as a shadow to the fiduciary
Board. I do not support this as I think the broad interests of the stakeholders
proposed can be captured in other, less onerous ways, and there are multiple
issues that the fiduciary board of a large organisation considers (such as cyber
security, or contract approvals) that require specific skill sets that one would
not expect to find on an Advisory Board. In my view, the inclusion of Postmaster
NEDs on the fiduciary Board, as well as the further involvement of Postmasters
in operational decisions (for instance through the use of councils), is a far more
effective way of ensuring that the Postmaster’s voice is heard in decision-
making.
Other measures taken to change the culture within POL
92.
In addition to the Postmaster NEDs, a Postmaster Director has been appointed
to fulfil an equivalent function of placing a Postmaster perspective at the heart
of the POL Executive. Hithendra Cheetirala was the first appointment to this
role in 2021. Following the end of his term in December 2023, he was
succeeded by Mark Eldridge. Mr Eldridge works in POL Head Office for two
days per week and liaises with relevant Executive teams to provide the
operational experiences, and concerns, of Postmasters. I understand that the
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93.
94.
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Postmaster Director has played a significant role in the Operational Excellence
Programme, which is intended to provide a financial incentive to Postmasters
to meet operational best practice (such as cash declarations) at close of
business each day. He has also presented to the Board on its most recent
away day. As with the Postmaster NEDs, improvements can and will be made
to the support provided to future Postmaster Directors on taking up the role
and to ensure that they are properly embedded within the Executive Team.
A number of workstreams have been undertaken by the POL Executive to
encourage and embed cultural change following Fraser J’s judgments and the
commencement of the Inquiry. Many of these pre-date my appointment to the
Board and so others will be better placed to speak to them. Two of the more
recent projects have been the Ethos programme and the Strategic People
Plan. The former was a cultural change programme that drew upon external
advisors and consultants, including the Institute of Business Ethics,
Businessfourzero, and Grant Thornton to address the following core areas:
assurance, ethics, governance, people, Postmasters and the Group Executive.
The Ethos programme was initially led by Tim Perkins, the Programme
Director, and Owen Woodley (Deputy CEO), but has recently transferred to
Karen McEwan (the CPO).
The Strategic People Plan grew from the Ethos programme and is an ongoing
three-year project with the intention of making POL “a great place to work for
all.” It is led by Mr Perkins and Ms McEwan. Importantly, and related to this
Plan, the People Team within POL has been restructured under Ms McEwan.
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95.
96.
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This follows a period of instability within the Team arising from the departure
of Ms McEwan’s predecessors as CPO.
There have also been efforts to change the working culture at the Operations
Centre and to make it more focussed on the needs of the Postmasters. Policies
relating to engagement with Postmasters were brought in following the ClJ and
these are agreed with the NFSP and regularly reviewed by ARC. The Branch
Support Centre has changed how it recruits and trains colleagues to help them
better meet the needs of Postmasters. I understand that the Inquiry will be
hearing from others who will be better placed to discuss the detail of this work.
My reflections on these efforts to instigate and embed cultural change are that
the work described above is well-intentioned and has made considerable
progress, though much still needs to be done. While the listening exercises,
workshops, forums and feedback surveys are all necessary and helpful, I am
not convinced that all Postmasters yet feel they are being heard. It is also
unclear how many Postmasters are reached by these initiatives; despite the
best intentions of those involved, it is difficult to measure the extent to which
the very large number of Postmasters across the country have been engaged.
My concern on these points arises in part from listening to the views of the
Postmaster NEDs about these workstreams, and in part from a review of the
surveys undertaken to measure Postmasters’ feedback to POL. Those surveys
have shown some improvement, but this is both modest and from a low base.
It is difficult to tell how much the work on cultural change affects these surveys
as Postmaster satisfaction levels are affected by numerous factors, the most
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97.
98.
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significant of which is the financial well-being of individual businesses. The
challenging trading environment for Postmasters over the past decade, the
increased cost of HQ as a proportion of total POL revenue, the wider economic
environment in the country, the Horizon scandal, and the turnover of senior
figures at Executive and Board level have, inevitably and understandably,
caused considerable concern among Postmasters. Cultural change
programmes can only do so much to improve that situation. I have shared my
views on these matters with the Department through discussions with the
Minister. Culture is a regular topic of discussion at QSMs and the Department
has acknowledged the difficulties in instigating cultural change.
There are, however, grounds for optimism. The Board is closely engaged with
the efforts to affect and embed cultural change and provide both challenge and
support for those on the Executive working on these matters. The restructuring
of the People Team, and in particular the appointment of Ms McEwan as CPO,
has helped to provide greater leadership, energy and “grip” to these
workstreams. In my view, Ms McEwan is doing an excellent job in difficult
circumstances, though there is plainly still much to be done.
One matter that causes tension, both within POL and in the coverage and
scrutiny of it, is the retention of employees whose actions in relation to the
Horizon scandal have been subjected to criticism, including from individuals
who have given evidence at the Inquiry as well as from other observers. This
is an issue raised by the Postmaster NEDs with Mr Staunton in the
memorandum that was leaked to the Times. I can understand why
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Postmasters and others are concerned about this matter. The Board is aware
of and has discussed those concerns and the underlying matters giving rise to
them on numerous occasions. The individual employees concerned have
employment rights, and these must be respected and a fair process must be
followed, based on the totality of available evidence. In those circumstances, I
do not think I can say anything more in this statement about individual cases,
though I acknowledge that this remains a source of tension within POL’s
working environment. Work continues in this area.
The Investment Committee and the Replacement for the Horizon IT System
99.
100.
As the Inquiry has heard, one aspect of the culture at POL that has been said
to have contributed to the Horizon disaster is the perceived lack of curiosity
shown by the Board in the past about the IT system that POL was using and
the problems that had been reported about it. Horizon is now in the process of
being replaced and in my view it is essential that the current Board, supported
by the Shareholder, exercises proper oversight of this large and complex
project.
The project to replace Horizon with a new IT system pre-dated my appointment
as Shareholder NED. It was and remains a matter of considerable importance
to the Shareholder, as reflected in the Chair’s letters cited above, because of
the history of the Horizon scandal, the considerable amount of public money
required to fund its replacement and the need to provide Postmasters and
customers with a modern, fit-for-purpose IT system. Within POL, the project is
led by the NBIT team.
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101.
102.
103.
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During 2023, the Shareholder Team, the Board and I developed increasing
concerns about the NBIT programme and the leadership of the NBIT team.
Some of these related to the inherent expense and complexity of the project,
some to the concerns about the risk of delay and the consequent need to
continue the Horizon system beyond its contractual end date, and some to
complaints about the culture within the NBIT team (a matter I discuss below).
In response to these concerns a number of steps were taken at the suggestion
or request of the Shareholder, the Shareholder Team and myself acting as
Shareholder NED.
First, an Investment Committee was established to ensure strategic leadership
and monitoring of the project at Board level. I sit on this committee, which also
comprises Andrew Darfoor, Mr Jacobs (one of the Postmaster NEDs) and now
the new Chair, Mr Railton. The committee’s remit extends beyond NBIT to
other capital projects, but NBIT is the single biggest project with which it is
concerned. Changes were also made to the leadership of the NBIT team,
including the removal of the former head of the team.
Second, external assurance was sought on NBIT, in the first instance from
Accenture (as commissioned by the Group Executive with input from the
Board). Public Digital were then commissioned by the Department to provide,
on UKGI's recommendation, an additional layer of assurance. Public Digital
remains engaged on the project, acting as agent for the Shareholder. Public
Digital's role is to provide the technical expertise required to challenge and
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104.
105.
106.
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support the project from the Shareholder’s perspective, including by assessing
the viability of NBIT in meeting POL’s future needs with a focus on POL’s
capability to deliver the programme, the technical approach being taken and
value for money.
Third, NBIT was enrolled on the Government Major Projects Programme, a
register of large and contentious projects involving Government that is
administered through the Cabinet Office. This imposes gateways for funding
and allows for assurance reviews by the Infrastructure Projects Authority
(“IPA”), the Government's centre of expertise for infrastructure and major
projects. The IPA gave a “red” rating in respect of NBIT in Spring 2024, which
means that funding for the project cannot be considered and approved until
POL has made sufficient progress against the IPA’s action plan.
Fourth, an extensive programme of engagement with Postmasters has been
commenced, including forums to test the functionality of the new system with
Postmasters and to listen to their requirements for and concerns about it. It is
recognised by all involved that the roll-out of the new system, and the support
and training provided to Postmasters using it, will be of fundamental
importance.
Providing a replacement for Horizon that is effective and reliable, and which
meets the Government’s requirements for the level of public funding that it
requires, remains a highly challenging task. Due to the structures that I have
described above, the POL Board, the Shareholder NED, the UKGI Shareholder
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Team and DBT are all closely engaged in the project and are able to provide
informed scrutiny and challenge. They do so with the knowledge of the
disastrous consequences of the procurement and roll-out of the Horizon
system.
The Board's relations with other stakeholders
107.
108.
As a NED I do not typically engage directly with any of the NFSP, the
Communications and Workers Union or Fujitsu. The CEO, as an Executive
director, engages with all these groups, as well as the Postmaster-run
organisation “Voice of the Postmaster”, and reports back to the Board on those
engagements.
Very recently I attended a workshop, facilitated by the POL communications
and strategy teams, designed to understand how Postmaster voices can be
better engaged and influence decision-making in POL. At this workshop there
were representatives from the NFSP and Voice of the Postmaster.
Experiences on the Board: Whistleblowing
Whistleblowing policies and structures
109.
In his Third Witness Statement, Charles Donald has provided evidence about
the development of whistleblowing policies in POL since 2012
(WITN10770300, paragraphs 40-42). I do not repeat that evidence and can
confirm that the description of the current policy — Speak Up — and the role of
the Board in providing oversight is accurate to the best of my knowledge. Mr
Donald referred to the May 2023 iteration of Speak Up (Post Office Group
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110.
111.
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policy - Speak up Policy - Version 8) (UKGI00044337), which is still in
operation (save for minor amendments).
As Mr Donald says, the Board oversees the Speak Up policy in various ways.
First, a NED is appointed as Speak Up Champion. This is currently Amanda
Burton. The role of the Speak Up Champion is to ensure and protect the
integrity of the policy, including by ensuring that anonymity and confidentiality
is respected in any complaint and that a complainant faces no retaliation. The
Board also has an Investigations Champion, currently Andrew Darfoor, whose
role is to be a point of assurance for the integrity, objectivity, independence and
effectiveness of investigations undertaken by and on behalf of POL. This will
include investigations that are instigated in response to complaints raised
through Speak Up.
Second, the ARC receives regular reports from the Speak Up Analyst and the
Head of Assurance and Complex Investigations. These are subjected to
scrutiny and challenge at ARC and specific issues may be escalated to the full
Board. I sit on ARC and hence have sight of these reports. I also ask for
updates on specific investigations and cases when I consider that to be
necessary. This results in papers or oral reports being provided to me, to ARC
and (where appropriate) to the Board. I inform the Department of significant
whistleblowing allegations.
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112.
113.
114.
115.
116.
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Third, the Speak Up policy is subject to annual review and approval by ARC.
The question of whether POL can do anything more to encourage people to
raise complaints is also frequently discussed at ARC and at the Board.
Fourth, the Chair of ARC (currently Simon Jeffreys) provides updates on Speak
Up to the Board as part of his report on ARC’s work.
Charles Donald has also explained the UKGI support provided to Shareholder
NEDs and Shareholder Teams in respect of whistleblowing, including the
guidance note “Whistleblowing and Serious Allegations: Key Corporate
Governance Issues (updated November 2023)” (UKGI00044274, paragraphs
58 and 59). I will not repeat Mr Donald's summary of some of the questions
contained within this Guidance, but I can confirm that I have read the Guidance
and received UKGI training on this important topic while sitting on the POL
Board. I am also able to take advantage of the peer support and ongoing
training available to Shareholder NEDs that I have described above.
In my view, the structures put in place in POL on whistleblowing are consistent
with good corporate governance. There is an appropriate policy in place, which
is subject to Board oversight and regular review (including, as Mr Donald has
described, external assurance from a suitably qualified independent body
(WITN10770300, paragraph 41(b)).
Such structures are a necessary part of a whistleblowing policy, but their
effectiveness will depend on the approach taken by those charged with
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implementing and monitoring Speak Up and the investigations that arise from
it. In my experience, my fellow Board members have, in general, taken
whistleblowing complaints very seriously and have respected the processes
that have been put in place.
An exception to this has been the approach of the former POL Chair, Henry
Staunton, who I felt saw some whistleblowing and other complaints as being
an unwelcome intrusion into company business. In an email dated 5 July 2023,
which I discuss in more detail below, I expressed concerns to David Bickerton,
the DBT Director General, about Mr Staunton’s reaction to complaints made
about the NBIT programme, which included complaints about the CEO and
other senior figures within the Executive (Email from Lorna Gratton to David
Bickerton and Carl Cresswell dated 5 July 2023) (UKGI00049035). A few
months later, during a regular monthly meeting on 30 November 2023, I raised
further concerns with Mr Bickerton about the approach Mr Staunton was taking
to an investigation into allegations against him and the CEO. As I discuss
below, similar concerns were subsequently raised with me by NEDs Amanda
Burton and Ben Tidswell and are echoed in the findings of the independent
barrister who was asked to investigate allegations of misconduct by the CEO,
Nick Read. Mr Staunton’s approach to whistleblowing and complaints was
worrying, which is why I escalated the matter to the Shareholder and discussed
it with Ms Burton and Mr Tidswell. These concerns contributed to the growing
consensus in DBT, UKGI and among some of the Board that Mr Staunton’s
position as Chair was untenable. I discuss Mr Staunton’s departure in more
detail below.
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Specific examples of whistleblowing
118.
119.
120.
I am asked whether I am aware of any whistleblowing complaints made that
are relevant to issues being explored by the Inquiry and, if I am, to summarise
the nature of the complaint and the response of the Board and any individuals
named in the complaint, insofar as I can do so while protecting the identity of
the whistleblower.
In answering this question, I am conscious of the need to avoid undermining
POL’s Speak Up policy. As the Inquiry has recognised, there is a need to
maintain the confidentiality of the person making the complaint. This requires
care to be taken to avoid giving information that may allow others to work out
either who the whistleblowers were, or the positions and teams in which they
worked. There is also a wider need to respect the fact that Speak Up is
intended to create a safe space where colleagues can make disclosures and
complaints in confidence. There is an obvious risk that providing detailed
evidence about those complaints in a witness statement that will be published
on the Inquiry website might undermine the trust and confidence that POL
employees have in the Speak Up process.
For these reasons, and as I have been asked only to summarise the relevant
complaints, I have provided a broad outline of the information of which I am
aware, focussing on the most significant matters that seem to me to be most
relevant to the Inquiry’s Terms of Reference. I have done this in the knowledge
that this statement will be provided to the Inquiry in draft form, in line with the
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121.
122.
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Inquiry’s usual procedures. This process allows the Inquiry’s legal team to ask
me for further details, should they think that this is appropriate. However, other
individuals from within POL who are more closely involved in the investigation
of the complaints set out below (and any other complaints) may be better
placed than me to provide such further details.
Not all the information that I describe below necessarily came from, or was
treated in line with, the Speak Up policy. Some of the complaints were
assessed to be grievances and were investigated according to the relevant
processes. I cannot now recall precisely which information I understood to
arise from Speak Up and which was treated as a grievance.
Project Rose: The CEO received a letter from a named individual in mid-2023.
The letter contained several complaints about senior individuals, including the
CEO (Nick Read). Later the same complainant made allegations against the
Chair, Mr Staunton, and these were ultimately added to the investigation
underway. I recall POL considering carefully at the outset which of the
complaints amounted to protected disclosures for the purposes of the Speak
Up policy, and which should be seen as grievances. An external law firm that
considered the complaints summarised them as relating to behavioural issues,
poor management of public money and spending, feedback on NBIT, poor
RemCo governance, and policy and conduct breaches and failure by senior
management to engage with actions.
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123.
124.
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The Board was informed of the complaint and legal advice was sought. I
shared information about the complaint with the Shareholder, including by
providing updates when further detail was provided by the complainant. An
independent barrister was asked to investigate. At my request, the proposed
Terms of Reference were shared with a NED, Ms Burton, and me, as we were
charged with overseeing the investigation. Given the serious nature of the
complaint I thought it important that the investigation had proper oversight from
Board members and I asked to participate as I considered it important that I
could update the Shareholder, at a high-level, on whether the governance and
conduct of the investigation was robust and thorough. In addition, I recall
discussing the governance arrangements and Terms of Reference with UKGI’s
GC in order to consider whether POL’s approach was in line with what UKGI
considered to be best practice. The report was provided in Spring 2024. The
report did not uphold the complaints against the CEO, though it did suggest a
degree of self-reflection on certain issues. The complaint against the (by then
former) Chair, Mr Staunton, was upheld. As I have noted, the barrister also
indicated that she was concerned by what she described as Mr Staunton’s
“outdated view” of the Speak Up process and investigations; she reported that
he had said that investigations were a “cancer” in the organisation. Further, the
barrister found that POL failed to follow some procedures in respect of a bonus
payment and the recruitment and employment arrangements of some
employees.
Some of the elements of this complaint, and in particular those regarding Mr
Read, were put into the public domain. Following the conclusion of the report,
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125.
126.
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POL produced a public statement noting that Mr Read had been exonerated
following an investigation (Post Office Comment on Investigation Into Speak
Up Allegations) (UKGI00049045). The statement recorded that the barrister
who had conducted the investigation had made some recommendations on
where improvements could be made to POL processes. POL committed to
ensuring that those were properly and promptly addressed. I am satisfied that
it is doing so and POL’s performance in this respect is monitored through its
internal audit team.
Complaints against a senior member of the Executive team: I am aware that
shortly before I was appointed to the Board complaints were made about the
behaviour of a member of the Group Executive. These complaints were
investigated by an external law firm. Some were upheld, including findings of
behaviour that could constitute bullying. My understanding is that this
investigation was managed by the Executive rather than the Board, though the
outcome was shared with the Board and the Shareholder. A decision was taken
that the subject of the complaints should not continue in post or in the
employment of POL and the individual has left the company.
Project Willow: A series of complaints were made in mid-2023 concerning the
behaviours and leadership of some of those involved with the NBIT
programme. These included anonymous complaints that were sent to the then
Chair, Mr Staunton. John Bartlett, the Head of Assurance and Complex
Investigations, devised a proposed approach for dealing with the complaints,
which was shared with and discussed by the Board in mid-2023. This involved
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127.
128.
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establishing three investigations into different aspects of the complaints and
engaging external firms to conduct some of that work. An oversight group was
formed comprising the then Senior Independent Director (“SID”) Mr Tidswell,
Ms Burton, Mr Bartlett and his line manager, Sarah Gray.
I informed the Shareholder about these allegations, via an email on 5 July 2023
to Mr Bickerton (Director General in DBT) and Mr Creswell (Director of the DBT
POL Team) (UKGI00049035). Mr Bickerton and Mr Creswell were the two most
senior officials at DBT dealing with POL matters below the Permanent
Secretary. The email also set out the changes the CEO intended to make to
the NBIT programme, including external assurance, the hiring of a new
transformation director to oversee the project with the existing management
stepping back, the formation of a new Board committee (what would be the
Investment Committee), and a pause on the programme while those actions
were taken. In my mind, and as I said to Mr Bickerton and Mr Creswell, the
changes were sensible and long overdue. After this email, I provided Mr
Bickerton and Mr Creswell with oral updates on the progress of the
investigations.
I have discussed earlier in this statement the further steps that were taken by
the Board/Executive and the Shareholder in respect of NBIT, including the
commissioning of external assurance from Accenture and then Public Digital,
the replacement of the leadership of NBIT, and the enrolment of NBIT in the
Government Major Projects Programme. These changes addressed the core
concerns about the way in which NBIT was being managed.
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129.
130.
131.
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While some of the investigatory work has completed, part of it remains
ongoing. I asked for updates on 7 December 2023, 6 February 2024 and 4
March 2024. It is regrettable that this investigation has not yet concluded. I
understand that this is in part because of delays caused by contractual issues
between POL and the external firm engaged to conduct the investigation. I also
understand that some parts of the investigation have been deprioritised as the
senior staff involved are no longer employed by POL. The investigation is
currently due to conclude by the end of September.
Project Acer: I am aware that a serious allegation was made that a POL
employee instructed his/her team to destroy or conceal material of possible
interest to the Inquiry. POL informed the Inquiry of this matter and there is an
ongoing Metropolitan Police investigation. POL continues to engage with the
police through an external law firm. Given that there is an ongoing criminal
investigation I make no further comment on the allegation or the investigation.
Project Alder: The principal allegation in Project Alder is that figures involved
in the handling of compensation claims had been working at a deliberately slow
pace to extend their tenure on this matter. An external law firm has been
engaged to conduct an independent investigation. A recent update provided to
the Board suggests that no evidence to date has been found to support the
central allegation, but the investigation continues.
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132.
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Letter from group of POL employees (Letter from POL Whistle-blowers to Nigel
Railton, Jonathan Reynolds MP, Rt. Hon. Liam Byrne and others re: POL
employees seeking support in addressing the ongoing intolerable leadership
and cover up within POL) (POL00448519): POL received a letter in May 2024
which claimed to be from a group of disenfranchised POL employees. A
number of allegations are made in the letter, including with respect to alleged
failures of leadership and culture within POL. The letter was passed on to
POL’s Head of Investigations (Mr Bartlett), who conducted an investigation into
some of the factual allegations that were made. He found that there was no
evidence to support those factual allegations.
Whistleblowing: reflections
133.
134.
My experience is that whistleblowing is and has been treated seriously and
professionally by the Board, with the exception of the concerns I have raised
about Mr Staunton. I have confidence in the approach that has been taken in
respect of the specific incidents of whistleblowing set out above. The policies
and structures in place are appropriate and have been subject to regular
review and external assurance, in line with UKGI guidance and best practice.
POL has tended to use external firms for the most serious of these
investigations. While this is appropriate and understandable, it inevitably adds
to the length of time that these investigations take, and this can be upsetting
for the complainant and is potentially destabilising for the business.
Importantly, the whistleblowing measures described above mean that the
Board has good visibility of whistleblowing issues, and I have been able to
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share progress updates on significant issues with the Department and UKGI
Legal, with the latter providing guidance on best practice and reviewing terms
of reference and other relevant documents where appropriate.
135.1 am asked whether I think the culture within POL actively encourages
whistleblowers to speak openly and honestly about their concerns. The POL
Board/Executive has made significant efforts to try to ensure that this is the
case. They have actively promoted the Speak Up policy, including at
Postmaster-facing events. There have been discussions at the Board on what
more can be done to encourage people to report concerns, including how we
can understand what it feels like to raise a concern within POL. The number of
complaints that have recently been raised on high profile and sensitive issues
suggests to me that colleagues feel comfortable reporting issues through the
processes currently in place at POL.
The Departures of Henry Staunton and Alisdair Cameron
Henry Staunton
136. Included among the Project Rose complaints were allegations that a senior
figure within POL had used racist and misogynistic language in a work setting.
The senior figure involved was not originally identified, but in late November
2023 further information was provided that named Henry Staunton as the
person in question. Mr Staunton was informed of the allegations in December
by the SID, Ben Tidswell.
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137.
138.
139.
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I informed Mr Bickerton of the allegations concerning Mr Staunton during a
monthly meeting on 30 November 2023. By then, the allegations had been
added to those being considered as part of Project Rose by the independent
barrister. As I have discussed above, I had by that time already raised with Mr
Bickerton my concerns about the way in which Mr Staunton had approached
other complaints that did not concern him.
Coincidentally, at the same time as the allegations against Mr Staunton
emerged, a process was underway to appoint a new SID to replace Ben
Tidswell who was standing down from the role. On 7 December 2023 Mr
Staunton wrote to the Minister responsible for POL, Kevin Hollinrake, to
request approval for the recruitment process. He emphasised that a rigorous,
transparent and objective procedure would be used. (Letter from Henry
Staunton to Kevin Hollinrake MP dated 7 December 2023 regarding ‘Senior
Independent Director Recruitment — Post Office Limited) (UKGI00049047).
Over the course of December and early January, Mr Staunton’s behaviour
became increasingly erratic and concerning. On 20 December 2023, he told
me that he wanted to end the whistleblowing investigations concerning the
CEO as they were putting extreme pressure on Mr Read and the business.
Over the following weeks I learned that Mr Staunton had similar conversations
with Ms McEwan (CPO), Mr Foat (GC), Mr Tidswell (NED) and Ms Burton
(NED).
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140.
141.
142.
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On 15 January 2023 I sent a short email to Charles Donald, UKGI’s Chief
Executive, ahead of a scheduled meeting he was due to attend with Mr
Staunton (Email from Lorna Gratton to Charles Donald dated 15 January 2024)
(UKGI00049036). Among the lines I suggested that Mr Donald might wish to
emphasise in the meeting was: “Where there are investigations, these need to
be thorough. POL’s approach needs to be beyond reproach.” This reflected the
concerns that I had, and that I had heard others had, about Mr Staunton’s
conduct in respect of the ongoing investigations.
The same email also referred to the need to re-emphasise with Mr Staunton
that the “public sector environment is unique, but ultimately not that dissimilar
to a privately held company - there is a framework and we operate within it.”
This reflected a long-held concern I had that Mr Staunton was not sufficiently
receptive to the need to listen and respond to the Shareholder’s perspective,
including over matters of remuneration. I had several experiences in which Mr
Staunton acted in a way towards me that was dismissive and aggressive.
These included a hostile response to my views on Ms Burton's report about
the mistakes that led to POL’s Annual Report erroneously recording that an
element of the bonus paid to senior executives had been endorsed by the
Chair of the Inquiry. I understood that Mr Donald shared my concerns in this
regard.
At around this time, Mr Staunton held his meeting with the Postmasters NEDs
that led to the production of the memorandum that I have discussed above.
That memorandum was erroneously shared with members of the Group
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143.
144,
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Executive, including those of whom Mr Ismail and Mr Jacobs were critical, such
as Mr Foat, the General Counsel. In an email to the CEO (to which the SID
and Ms Burton were copied), Mr Staunton complained that the circulation of
the note would cause certain members of the executive named within the
memo to take issue with him. Mr Staunton also claimed that he was being
given insufficient time to prepare his case and alleged that, “There seems to
be a determination to trash reputations despite being completely innocent.” Ms
Burton forwarded this email to me on 19 January 2024 (Email from Amanda
Burton to Lorna Gratton dated 19 January 2024 with subject “Fwd:
Investigation”) (UKGI00049037).
On the previous day, 18 January 2024, Mr Staunton abandoned the process
that had been in place to recruit the new SID in favour of an internal
appointment. He called a meeting of “independent” NEDs, to which I was not
invited, and announced the appointment of an existing NED, Andrew Darfoor,
as SID.
I was informed of this meeting in a call from Ms Burton on the morning of 19
January 2024. At around lunchtime that day I spoke to Mr Tidswell. Both were
deeply concerned about Mr Staunton’s conduct. At that time, Ms Burton, Mr
Tidswell and I were the only members of the Board that were aware of the
whistleblowing allegations against Mr Staunton. Ms Burton and I knew of them
as we had been asked to oversee the investigation. Mr Tidswell became
involved as we had asked him, as the SID, to inform Mr Staunton of the
allegations. We had not shared the allegations with the other members of the
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145.
146
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Board out of fairness to Mr Staunton (given that they were serious allegations
that were still under investigation), and in order to protect the integrity of the
investigation and the identity of the whistleblower. This was in keeping with
POL’s policies and wider corporate practice. It meant, however, that we were
the only three Board members sighted on the wider context in which Mr
Staunton was acting. In our view, this gave rise to still more serious concerns
about his behaviour and the motives for it. Ms Burton and Mr Tidswell both
expressed the view that Mr Staunton’s position as Chair was no longer tenable.
Either in that conversation or in another at around this time, Ms Burton
indicated that she would not be able to continue to serve on the Board if Mr
Staunton remained as Chair.
Mr Staunton phoned me later in the day on 19 January 2024 to inform me of
the “appointment” of Mr Darfoor, presenting it as a collective decision. My note
of that call recorded this about that part of the conversation:
“Independent’ NED meeting earlier in the week. To ‘get others up to speed’.
Decided to scrap SID process, and appoint someone from the inside. Want a
postmaster centric strategy. Want a board committee on culture.
‘Before when I spoke to them, support for Amanda was the leader, that has
evaporated, but that has now gone to Andrew [Darfoor]. He’s ‘won the race’.
(Simon Jeffery’s on the fence).”
. The following day, Saturday 20 January 2024, Mr Staunton sent an email to
the Board congratulating Mr Darfoor and referring to a “vote” that had taken
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place, while noting that the “appointment” still required approval by the
Nominations Committee, the Board and others (he erroneously refers to it
requiring the approval of UKGI, rather than the Shareholder, a characteristic
mistake). In response, Ms Burton sent me an email stating: “Wow! Just to be
clear I haven't been involved in any vote to appoint Andrew. This is a mess!”
(Email from Amanda Burton to Lorna Gratton dated 20 January 2024 with
subject ‘Fwd: SID’) (UKGI00049038). Mr Tidswell sent an email to the Board
around half an hour later, stating that this was a decision that “required a proper
board discussion and the agreement of the shareholder, neither of which have
occurred.” He also noted that the external recruitment process was both live
and in the public domain (Email from Ben Tidswell to the POL Board dated 20
January 2024 with the subject ‘Re: SID’) (POL00458053).
Following the exchange of emails set out above, I wrote to Mr Bickerton and
Mr Donald to alert them to the fact that Mr Tidswell wished to speak to them
as Mr Staunton “has done something this morning that he led [Mr Tidswell] to
think he needs to go asap” (Email from Lorna Gratton to David Bickerton dated
20 January 2024 with subject ‘Contact details so Ben Tidswell can call you?’)
(UKG1I00049039). Mr Tidswell spoke to Mr Creswell on the following Monday,
22 January, to set out his numerous concerns about Mr Staunton. These are
recorded in Mr Creswell’s note of the call (Note of call between Ben Tideswell
and Carl Creswell dated 22 January 2024) (UKGI00049030). Mr Tidswell said
that many members of the Board had low levels of trust in Mr Staunton, and
he urged DBT to act quickly as Mr Staunton’s behaviours were problematic
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148.
149.
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and causing disruption in the business. These were extremely serious and
extensive criticisms, made by a respected SID.
On 23 January 2024 a submission was sent under my name and that of Mr
Creswell to the Secretary of State, Kemi Badenoch MP, and Mr Hollinrake
concerning Mr Staunton (Submission from Lorna Gratton and Carl Creswell to
Minister Hollinrake and Secretary of State dated 23 January 2024)
(UKGI00049033). This referred to the concems set out above and commented
that: “His repeated attempts to stop the investigation into whistleblowing
allegations would be unacceptable in any environment, but is particularly
egregious in the context of Post Office and the historic failings of the business.”
It also noted that Mr Staunton had not, over a year into his post, offered the
leadership or cultural change that POL needed, and there was no evidence
that he was making progress towards offering this leadership. The
recommendation contained in the submission from UKGI and the Department,
supported by Mr Tidswell and Ms Burton, was that Mr Staunton should be
removed as Chair.
The submission provided two options to the Secretary of State for Mr
Staunton’s dismissal: (i) to inform him of the decision and offer him the
opportunity to resign, which was recommended on the basis that this would be
the least disruptive option for the business; or (ii) to remove him from his post
directly, which is the option that was ultimately followed by the Secretary of
State.
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150. Following the submission, there were some exchanges between UKGI and
151.
senior officials within DBT regarding the practicalities of dismissing Mr
Staunton. The Secretary of State decided that she wanted to inform him of the
decision herself, rather than delegate this to Minister Hollinrake.
Mr Staunton was informed in a call from the Secretary of State on 27 January
2024 that the Shareholder was exercising its right under the Articles of
Association to dismiss him as Chair of POL. Aread out of the call was prepared
by the Secretary of State’s Private Office. A briefing had been prepared for the
Secretary of State suggesting a form of words that she might use (Briefing titled
‘Call with Henry Staunton Post Office Chair’) (UKGI00049031), but I
understand from her Private Office that she departed from this in the call (Email
from BDT for Lorna Gratton dated 27 January 2024 with subject ‘Re: Read out:
[to action today] — Letter to Post Office Chair’) (UKGI00049032). The briefing
contained the following explanation for Mr Staunton’s dismissal, which I
understand to be an accurate summary of the reasons why he was dismissed:
“Now more than ever the Post Office is rightfully under a heightened level of
scrutiny. Culture in an organisation is set right at the top, and we, as
Shareholder, have a duty to make sure the culture in today’s Post Office is
nothing like the Post Office of the past. This includes full investigation of
whistleblowing allegations and fostering an environment of respect and
openness, so colleagues feel able to speak up.
We understand that your behaviour regarding open whistleblowing
investigations in Post Office has not met that standard. We understand that
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you have repeatedly put pressure on Executive team members and other
board members to stop whistleblowing investigations. We have heard this
from multiple different parties who have expressed their concerns to us.
This unacceptable in any circumstance, but particularly egregious in a Post
Office context, of historic failings in respect of whistleblowing.
In addition, we understand your behaviour in the workplace has been
disruptive to the Executive and not in keeping with standards expected of
your position.
Finally, we understand that you have displayed a disrespect for due process
on governance matters such as the appointment process for the SID and
other matters requiring approval by the Shareholder or HMT. Again, a matter
than is of particular concern in the sensitive operating environment of the
Post Office, and its public subsidy.
When you were appointed as Chair of the Post Office your Letter of
Appointment set out the expectations of your role, and frankly the behaviour
above does not meet those expectations.”
Alisdair Cameron
152. As I mentioned earlier in this statement, I met Mr Cameron, who was then
CFO, prior to my formal appointment as Shareholder NED as part of the
handover process from Mr Cooper. By the time of my formal appointment, Mr
Cameron was absent from work, initially on leave and subsequently on
grounds of ill health. I do not think that I met him again.
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153.
154.
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My understanding of the background to the Mr Cameron's exit from POL is set
out in a submission that was sent to the Minister, Mr Hollinrake, on 17
December 2023. This submission was sent under my name and that of Mr
Creswell. It was prepared by members of my UKGI team who had been in post
at the time of at least some of the matters referred to in the submission and
who had consulted contemporaneous documents. I read some of those
documents when finalising the submission but had no first-hand knowledge of
the events prior to my appointment that they describe. The submission reflects
my understanding, then and now, about the position reached in December
2023 and I have no additional information that I can add to it. (Submission from
Lorna Gratton and Carl Creswell to Minister Hollinrake dated 17 December
2023) (UKGI00049034).
By that time, three options had emerged as possible resolutions to the
situation: a negotiated settlement by which Mr Cameron would leave POL, a
staged return to work in some capacity with the intention that Mr Cameron
would (by agreement) resign shortly thereafter, or dismissal. The view of the
POL Executive and Board was that Mr Cameron’s return to work would
destabilise the management team and would not be compatible with the
cultural changes required at POL. UKGI were sympathetic to that assessment,
insofar as it referred to Mr Cameron returning as CFO. The Executive and
Board also wished to appoint a permanent CFO. Ministers were kept informed
of the position and were provided with relevant legal advice.
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155. Mr Cameron was subsequently invited to participate in an assessment by
POL’s occupational health provider to establish whether he was fit to return to
work. The result of that assessment was that Mr Cameron was assessed to be
unfit to work and so he did not return to POL.
156. Mr Cameron took ill-health retirement and exited POL on 25 June 2024.
Reflections on Corporate Governance
Composition of the Board
157. I am asked for my view on the current composition and effectiveness of the
Board with regards to experience, expertise and abilities.
158. The Board is currently seeking to recruit three new NEDs: one with
organisational design experience, one with digital transformation experience,
and another with public sector experience. All three are intended to provide
greater expertise at Board level on matters of ongoing importance to the
company. POL is undergoing a strategic review and is expected to undertake
a significant restructuring as a result, hence the intention to recruit a Board
member with experience in organisational design. As I have discussed, the
NBIT programme is the largest and most complex investment and
infrastructure project POL is currently undertaking and the Board will benefit
from the addition of a NED with expertise in digital transformation. The decision
to recruit from this field was made as a consequence of Board effectiveness
reviews and a recommendation from the Shareholder Team. In respect of the
third proposed appointment, at present I am the only member of the Board with
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159.
160.
161.
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a background in the public sector and the shared view of the Board and
Shareholder is that a second NED with such experience will assist in helping
the Board better understand and navigate the realities of working with a
Government sole shareholder. More generally, the proposed additions to the
Board are part of a rebalancing exercise to add members with experience of
managing and operating projects to the professional advisory expertise that
the Board already has.
I strongly support Postmaster representation on the Board through the
Postmaster NEDs, for the reasons that I have given earlier in this statement.
Recruitment for those positions is underway and will be managed to ensure a
degree of continuity as and when the first Postmaster NEDs are replaced.
I have been asked about the desirability of having Board members with legal
experience. Mr Tidswell is a lawyer and the Board has undoubtedly benefited
from his tenure for the last three years. He has been invaluable to POL’s work
on remediation. Whist the Board is not replacing Mr Tidswell's skill set like for
like, Ms Burton is also a lawyer by background and I agree this is an important
skill set to keep on the Board.
In considering the effectiveness of the Board, it is helpful to reflect on the
strengths and weaknesses in the Board committees:
a. The Remuneration committee has made a lot of progress over the last
year in addressing the recommendations of the various reviews of POL’s
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remuneration governance. The metrics in the bonus scheme are now
purposefully simpler and more easily understood, so they can genuinely
incentivise outcomes. The administration and governance of the schemes
have also seen material improvement, with the quality of papers coming
to the Committee having improved (though there is still work to be done)
and decisions and approvals being sought in a more timely manner. I think
that RemCo is a more effective committee now that it has simplified
remuneration schemes and re-set expectations about when bonuses will
(and will not) be paid. Under Ms Burton it has a good understanding of
what the Shareholder thinks, which, given the sole-shareholder structure
of POL’s ownership, is imperative. Given the visibility that the Shareholder
expects on RemCo matters and the approval rights that the Shareholder
has on certain matters, ensuring that the Department has sight of these
matters via the Shareholder NED’s presence on the Board is key. The
improvement in RemCo has also been greatly assisted by the input of the
new CPO, Ms McEwan.
. The Remediation Committee has proved effective in offering challenge to
and engagement with the Executive. Arguably, too many decisions were
escalated to the Committee, but there was an emphasis on encouraging
the Executive to find ways to speed up payments to Postmasters. Mr
Tidswell proved an effective Chair. The number of issues considered by
the Committee has decreased since DBT has started carrying out more
remediation work directly (as explained in more detail below).
. The Nominations Committee has, in my view, been a little less effective
than the other Committees, with a sense that the Committee meetings
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were short and too quick to approve decisions that had been reached
before the meeting. This situation is changing, with greater emphasis on
succession planning and more strategic thinking about how arrivals and
departures from the Board and SEG can be better managed. Some of
these improvements have come from the Board effectiveness reviews.
The Grant Thornton Governance Review (POL00446477) also identified
succession planning as a weakness.
d. ARC is a relatively effective committee but is hampered by the risk averse
culture at POL that I have discussed above. This has resulted in too many
issues and papers being brought to ARC, which must then work through
these rather than focus on strategic management and resolution of risks.
This is a consequence of the culture within POL as a whole and is not a
reflection on ARC or its members. Efforts are being made to address the
situation, notably by the Chair, Simon Jeffreys, and through structural
changes in the Executive, such as the appointment of a Group Assurance
director who will act as a filter in terms of the material that is going to ARC.
e. The Investment Committee is relatively new and is still evolving its
processes. The greater involvement of DBT in the NBIT programme
means that an increasing amount of work on that is being done directly
between the Executive and the Shareholder, rather than through the
Committee.
162. Grant Thornton has recently produced a Board Effectiveness Review dated 19
June 2024 (the “BER”) (POL00446476). The BER’s key findings were that
there was a lack of clarity on the purpose of the Board, low levels of trust and
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163.
164.
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team identity, no unifying purpose or strategy, a lack of succession planning,
shortcomings in team process and meeting discipline, and a need for more
proactive involvement from the Board in cultural and “people” issues. Overall,
it found the Board to be of limited effectiveness. It did, however, highlight some
positive aspects to the Board’s work, including “the diversity of debate, the
engagement of Board members and the tactical work being undertaken within
ARC and RemCo alongside a general willingness to enhance governance and
decision-making.”
The BER took place at a time of high tension. Extremely sensitive comments
from a private meeting between the Postmaster NEDs and the Chair had been
leaked to the press. The Chair had been dismissed in the circumstances that I
described above. As the authors of the BER acknowledge, POL was operating
under “constant pressure” and intense public scrutiny, resulting in a “complex
and demanding environment, impacting on its ability to engage proactively with
stakeholders, focus on strategic governance, and address fundamental
questions about POL’s purpose and function.” There had also been a
considerable turnover of senior executives that had contributed to “a significant
strain in terms of capacity”. In those circumstances, it is perhaps unsurprising
that the BER identified a number of issues of concern, particularly regarding
Board’s sense of identity, strategy and mutual trust.
The findings of the BER reflect the fact that the Board, and POL more
generally, has been operating in “crisis mode”, which has made it difficult to act
strategically rather than reactively. This tendency has been made more
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165.
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pronounced by the scale of the challenge facing the Board (and the company),
the breadth of material that has been placed before the Board as a
consequence of those challenges and the risk averse culture in POL, and the
strained resources which has led to the Board often receiving material at a
relatively late stage, thereby limiting the opportunity for strategic interventions
(as opposed to making decisions on the only remaining options).
A new Chair is now in place and a recruitment exercise is underway for
additional Board members. In my view, the Board is more cohesive and united,
in part because Board members have spent more time with one another
outside formal meetings. As I have set out above, steps have been taken to
improve the operation of the SEG and to address risk-averse culture within
POL that has seen too many operational issues escalated to the Board, the
CEO and the GE/SEG. Board packs have been rationalised and improved to
make them more digestible and there is a conscious effort, led by the Chair, to
refocus the Board on strategic issues. Work has been done to improve the
work of the Nominations Committee, particularly in respect of succession
planning. The CPO has provided greater grip and leadership to what the BER
refers to as cultural and “people issue” and that will help the Board to engage
more effectively on these matters. This reflects a wider point that there is a
close relationship between the effectiveness of the Executive and the
effectiveness of the Board, which in turn reinforces the need for strong and
effective leadership in all senior roles.
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166.
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I encouraged POL to send the BER (together with the Grant Thornton
Governance Review) to DBT, noting the Cabinet Office’s guidance on board
effectiveness reviews for ALBs. I understand that Deputy Chief Executive
Owen Woodley wrote to Mr Bickerton and Mr Creswell on 18 July 2024 to note
the Grant Thornton reports and POL’s action plans in respect of the same.
Those action plans are shared with the Shareholder Team and the Department
to monitor how POL is considering the issues and implementing changes.
Relationship between POL and the Shareholder
167.
168.
There remain tensions in the relationship between POL and the Shareholder,
as is reflected in the Grant Thornton Governance Review. POL is a highly
commercial ALB operating in extremely competitive markets, notably banking
and retail. Historically, there has been a culture of baulking at perceived
Government “interference”.
There are areas in which I think there is some justification to the concerns
raised in the Grant Thornton report with respect the clarity of the existing
governance arrangements. The existing Framework Document agreed in 2020
does require refreshing and there is a process underway between POL, UKGI
and DBT to review and enter into a new agreement. The revisions to the
Framework Document (POL00362299) will seek to further clarify the
arrangements between the parties on certain topics which are not working as
effectively as they should. This has inevitably created tension when
interpretations between the parties have varied, particularly in relation to how
in practice the Government-wide guidance (as set out in Appendix 2 of the
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169.
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Framework Document) should be applied. For example, the main body of the
existing Framework Document does not set out the circumstances in which
Shareholder approval is required for legal settlements and if this can be
delegated to POL. It also does not currently contain delegation limits for POL,
which we now consider it to be best practice to include. A review process is
underway and it is proposed that a delegation letter is added to the suite of
governance documentation. The proposed changes are intended to provide
both clarity and practicability through the inclusion of clear delegations and
limits that define the relevant framework for required approvals. The UKGI
Shareholder Team is open to discussing with POL any further clarifications to
the Framework Document that are considered necessary following the Grant
Thornton review. I do not, however, agree with Grant Thornton’s observation
that there is “obscurity around the practical application of the foundational
documents”; the foundational documents are generally clear and mutually
understood, but there are some areas where it has been identified that further
clarification could be helpful.
Another area for improvement is the way in which POL are asked to comply
with Government policy documents. At present, the Framework Document
appends several policies which POL are either expected to follow or consider
in its operations. As part of the revision of the Framework Document, a review
is being undertaken to provide further clarity on which Government policies
apply to POL as a Public Corporation and to provide POL with an opportunity
to discuss with its Shareholder how certain of these policies are intended to
operate in practice.
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170. Other areas will always be a cause of friction between ALBs and Government.
171.
One example is the pace of recruitment: ALBs, particularly the more
commercial ALBs, are frustrated by the processes required by Government
when senior appointments are made and the subsequent slow pace of
recruitment. A second is the length of funding cycles, which ALBs see as too
short to allow for long-term strategic planning. These are areas where a degree
of tension is inevitable between a Government shareholder and the company
it owns. Greater understanding at Board and Executive level of the modes of
working within the public sector, and the reasons for them, may help lessen
tensions and improve the processes employed. This is one of the reasons why
a NED with public sector experience is currently being sought for POL.
I do not, however, accept the wider critique contained in the Grant Thornton
Governance Review, to the effect that the Shareholder is too interventionist in
POL to the long-term detriment of the company. I have touched upon this
earlier in my statement. POL is a company that continues as a going concern
only because it is in receipt of a large subsidy from public funds. Through the
use of Horizon, POL has contributed to grave miscarriages of justice that have
had disastrous effects for hundreds of innocent Postmasters and their families.
There are very serious questions about whether full, accurate and honest
information was provided to the Shareholder and Parliament by POL. The
remediation and compensation schemes require further extensive funds from
the public purse. POL has also seen a significant churn of senior figures,
including the dismissal of its Chair in the circumstances described above.
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172.
173.
174.
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There is continued public concern and anger at these events and intense
scrutiny from the Inquiry and the media. In my view it is unsurprising that the
Shareholder is closely engaged with the company given these factors.
The NBIT programme is a case in point. The scheme is to be funded by a large
amount of public money and is intended to replace a system that gave rise to
the tragic events considered by this Inquiry. Significant concerns were raised
at Board level about the way in which the programme was being managed by
the Executive, which were properly escalated to the Shareholder. The
Shareholder then sought greater Board oversight, external assurance, and the
enrolment of the programme in the Government Major Projects Programme.
This degree of Shareholder involvement might not have been needed in a
standard IT procurement process in a private sector company, but it is
understandable and justifiable in the circumstances in which POL finds itself.
I also do not accept that the role of the Shareholder NED is unclear. I have the
same legal and fiduciary duties as other POL NEDs but approach them from
the point of view of the Shareholder, rather than being independent. For the
reasons I have given, I do not think that this gives rise to a fundamental conflict
of interest — it is in the interests of POL to retain a good relationship with the
Shareholder that provides it with the subsidy that allows it to operate in its
current form.
Any analysis of the corporate governance structures of POL needs to give
appropriate weight to the recent history of the company and the public sector
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environment in which it operates. If POL demonstrates a period of success and
stability, and effectively builds a greater level of trust with the Shareholder, then
the length of the arm in the ALB relationship will increase. That remains a work
in progress.
Redress and Compensation
175.
176.
In my capacity as a NED, I sit on the Remediation Committee, which oversees
the administration of POL’s redress and compensation schemes. I am involved
in decision-making at the Remediation Committee and also at the POL Board
to the extent that matters concerning redress and compensation are raised
there. Much of the decision-making at the Remediation Committee is now
administrative in nature — for example, concerning the levels of offers to
claimants, remediation principles, and exception criteria (i.e. decisions that
cannot be taken by POL without approval from the Remediation Committee).
However, as explained in Charles Donald’s Second Witness Statement
(WITN10770200), the wider UKGI team’s involvement in matters concerning
redress and compensation has been reduced to a strategic role focussing on
monitoring progress and POL’s performance against objectives and budget.
This arrangement was agreed with DBT, and UKGI began stepping back from
its previously more involved role in September 2023. Since then, DBT has
taken on greater involvement in compensation matters, as set out in more
detail in Charles Donald's letter to David Bickerton dated 19 September 2023
(UKGI00049042). The arrangement reflected an expansion in personnel and
in knowledge of the DBT team on compensation matters, and the progress that
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177.
178.
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had been made on the schemes. By this time, for example, over 99 per cent
of the original Horizon Shortfall Scheme (“HSS”) cohort had received
compensation offers, and a new approach to remediation was being
implemented for the Overturned Convictions Scheme (“OCS”).
There was a short period of time between my appointment as Shareholder
NED in May 2023 and this change in UKGI's role, though I knew at the time of
my appointment that UKGI would be stepping back from its involvement in
individual cases and DBT would be taking on an enhanced role, so my focus
was already on strategic issues and supporting and challenging POL on the
different compensation workstreams as a NED. I summarise below the
involvement that the Shareholder Team and I have had in compensation
workstreams since my appointment as Shareholder NED. Given my own
limited personal involvement, I have obtained input from members of the
Shareholder Team regarding workstreams in which they were involved.
However, I cannot comment on some of the questions that have been put to
me on matters of compensation and redress where the substantive issues
predate my tenure.
When I started in my role, the compensation schemes were at different stages
of delivery. The HSS was relatively well established but working through some
difficult cases and issues. The OCS had been set up and POL was developing
its remediation approach to help speed up progress. The Postmaster
Detriment Scheme (“PMD”) for suspension pay (i.e. where Postmasters were
not paid for periods of time during which they were suspended by POL) was
Page 82 of 103
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well established, and there was a business case in the process of being
approved by Government to provide funding for compensation covering wider
detriment to Postmasters (i.e. detriment not directly caused by Horizon, such
as ATM and foreign currency losses), now known as the Post Office Process
Review. I was not involved in the establishment or operation of the GLO
Scheme, though members of my team attended meetings with the Department
to support consistency and fairness across the compensation schemes.
The principal forums in which compensation matters have been discussed
since my appointment as Shareholder NED are:
a. The POL Board, which receives regular updates on Remediation
Committee matters. Since my appointment, the Board has not extensively
discussed or taken decisions on many matters relating to compensation
and redress, as this is for the most part delegated to the Remediation
Committee. However, three Board members sit on the Remediation
Committee (Nigel Railton and Brian Gaunt, in addition to me) and can
escalate matters to the Board if appropriate to do so.
b. The Remediation Committee, the Board sub-committee overseeing the
administration of the compensation schemes (further details on its
mandate are set out in the Remediation Committee Terms of Reference
(UKG100049044)). I am a member of Remediation Committee, which has
been chaired on an interim basis by Brian Gaunt since Ben Tidswell
stepped down from the POL Board in July 2024.
c. The Department's Steering Committee for the HSS (“HSS SteerCo”),
which is responsible for providing approval on behalf of HMG to POL on
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key decisions being made by POL in respect of the HSS. I have attended
as an observer and my team provides support to the Department, but it is
the Department, not UKGI, which has responsibility for making decisions
on matters referred to HSS SteerCo. My observer status means that I can
provide relevant insight and information obtained through the
Remediation Committee and the POL Board, ensuring that the
Department has sight of the key issues.
. The Department’s POL Overturned Criminal Convictions Board (“POC
Board”), which is similar to HSS SteerCo but for the OCS, and which I
have also attended as an observer.
. The Horizon Compensation Programme Board (“HCPB”), a Department-
led board. I attended some of the early meetings of this board as an
observer. It considers cross-cutting issues between the compensation
schemes and how to achieve consistency between them.
180. When I started in my role in May 2023, I was supported on compensation
181.
issues by the UKGI Shareholder Team. My team worked across the different
schemes and met POL and Departmental colleagues on a weekly basis. In
addition to weekly internal meetings, my team and I attended monthly
monitoring meetings with POL and the Department to review progress and
risks to delivery.
Since the start of 2024, following the change in UKGI's role as described
above, my team has had less involvement in compensation issues, but
continues to monitor and support progress at a strategic level, for example
Page 84 of 103
HSS
183.
184.
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assisting with financial monitoring on compensation scheme spend (a member
of the Shareholder Team has monthly meetings with POL on this). The
Department has much greater involvement in and resource dedicated to
compensation and redress. Updates on compensation and redress have been
a regular feature of QSMs (and, during Mr Hollinrake’s tenure, monthly
meetings with the Minister). My role as Shareholder NED means that I also act
as a conduit between POL and DBT where either party is having difficulty
understanding the other’s position on issues relating to compensation and
redress.
. I set out below my involvement in and reflections on key compensation and
redress matters since my appointment as Shareholder NED.
By the time of my appointment as Shareholder NED, POL had made offers to
around 97 per cent of the original cohort of HSS applicants (the remainder
tended to be more complex cases, such as those involving dissolved
companies), and there was a well-established process in place to assess
claims, issue offers and deal with disputes.
My understanding of how the HSS operates is that cases are assessed against
a set of principles (developed by POL’s lawyers and approved by Remediation
Committee and HSS SteerCo) which provide a range of values for each
applicable head of loss. The HSS’s Independent Advisory Panel of Experts
(the “IAP”) then makes an assessment of the claim and recommends a fair
Page 85 of 103
185.
186.
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outcome within the given range for each head of loss. I understand that in
some cases this might be more than the amount claimed; the [AP has made it
clear that it has adopted a practice of acting as advocates for claimants, rather
than as disinterested arbiters (Minutes of the Horizon Compensation Advisory
Board (“the HCAB”) of 14 June 2023) (RLIT0000250). The vast majority of
offers have been accepted by the claimants, which indicates that they are
content with the offer received 5
Where there have been delays to the resolution of HSS claims, these have
been caused by various factors. There were a significant number of late
applications to the scheme: as of 31 July 2024, POL had received 1,513
eligible claims after October 2022, and had made settlement offers in respect
of 323 of these (Horizon Shortfall Scheme — latest data on progress)
(UKG100049043). A number of applications have been made after the ITV
series was aired in January 2024. This has led to a welcome increase in the
level of engagement with the scheme, and as a consequence, and in order to
allow these claims to be considered, an end date for the HSS has not yet been
agreed with the Department.
UKGI has not been directly involved in communications and negotiations with
HSS applicants during my tenure, and the cases on which I have had visibility
have for the most part been those going through the Dispute Resolution
Procedure (“DRP”). POL’s use of individual case handlers for those claims,
5 POL regularly publishes the latest data on HSS progress: (UKGI00049043)
Page 86 of 103
187.
188.
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alongside more formal lines of communication where a claimant had legal
representation, appeared to work well.
Funding for legal fees (as well as other fees such as accountant and medical
expert fees) was made available, with POL approving fees up to £10,000 and
any amount above that requiring approval from HMG (this policy was in place
before my appointment as Shareholder NED). There have been instances
where an individual claimant did not have legal representation after an offer
was made. Where this has come to my attention, I have suggested that POL
encourages the claimant to take up legal representation (others, including for
example Ben Tidswell, have also made this suggestion). Analysis presented to
the Remediation Committee in July 2023 showed that average offers were
higher for claimants who had legal representation than for those who did not,
and this analysis prompted the Remediation Committee to recommend offering
legal representation to potential applicants up front, rather than after an offer
had been made, to ensure that all claimants had the best opportunity to
maximise their claim value.
I am asked what has gone well and what could be improved in relation to the
HSS. One of my concerns has been that POL’s external lawyers have
sometimes taken a conventional legalistic approach to negotiations with
claimants (i.e. their approach appears to have been geared towards achieving
an outcome that is least financially detrimental to POL within the range of a fair
settlement). My view is that, given the history of the matters in respect of which
settlements are made, a different approach is needed and POL should be
Page 87 of 103
189.
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giving the benefit of the doubt to claimants — even if that means a greater
payout than one that might result from a hard-fought negotiation in line with a
conventional legalistic approach. Similarly, I have felt that at times the external
lawyers have spent too much time and resource negotiating relatively small
amounts before a settlement is agreed. In my view, this risks compromising
the overall purpose of the scheme, which is to provide just recompense to
claimants as quickly as possible: the value of the scheme to the Shareholder
is not just about the cost. I think this is perhaps a cultural clash between the
approach taken by commercial litigators and the requirements of the
circumstances. I have raised these concerns at various points at the
Remediation Committee, and have also spoken to Mr Hollinrake about them,
who broadly shared my concerns.
In addition, the process and timing for dealing with those cases where offers
have not been accepted, and which have therefore had to go through DRP,
has, in my view, not been particularly effective. The number of cases going
through the DRP has remained steady for some time. The Remediation
Committee has regularly reviewed the DRP and challenged POL to find ways
of speeding up the process, some of which have now been implemented (for
example, the removal of the requirement to hold a Good Faith Meeting as the
first step in the DRP). POL has also recently settled a number of cases through
mediation following the Remediation Committee’s approval of an increase in
the negotiation mandate at mediations. A significant number of cases remain
unresolved, but the forthcoming implementation of an appeals process should
enable these to be resolved in the near future.
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190. I have been reassured by the involvement of the IAP in the HSS process, which
191.
has, as I have said, adopted a practice of acting as advocates for claimants
and is given a wide margin of discretion in its terms of reference (Horizon
Shortfall Scheme Terms of Reference of the Horizon Shortfall Scheme
Independent Advisory Panel) (POL00448026) to formulate a recommended
offer guided by broad considerations of fairness. On the basis of this and the
proportion of offers accepted by claimants (as of 31 July 2024, 2,262
settlement payments had been made while 390 claims were going through the
DRP), the IAP appears to be having a positive effect on the resolution of HSS
claims. It also has an appropriate level of expertise on the panel to deal with
complex or higher value claims, including legal and forensic accounting
specialists as well as retail experts, with particularly complex cases also being
discussed at the Remediation Committee and HSS SteerCo.
A number of reflections and recommendations in respect of the HSS were
made in the minutes of the Horizon Compensation Advisory Board (‘the
HCAB”) of 14 June 2023 (RLIT0000250), including the introduction of an
appeals process. I have sympathy with many of the reflections raised by the
HCAB, which were discussed at length at the Remediation Committee. I
understand that POL is planning to write to potential HSS applicants in the
coming months with details of the £75,000 offer and the forthcoming appeals
process once this has been finalised and agreed by the Department.
Page 89 of 103
CS
192.
193.
194.
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When I started in my role, POL was piloting its remediation principles in the
assessment of pecuniary claims, and had shared a first tranche of draft
principles with claimant representatives. My team supported DBT in its review
of the draft principles and POL’s proposed future ways of working.
Under the new approach, POL case assessors would review claims received
from claimants and prepare offers consistent with case principles agreed with
claimant representatives. The aim was to reach settlement faster than had
been possible under the previous “negotiated” approach, where case
principles had not been agreed with claimant representatives. The principles
established an agreed evidential basis for heads of loss that could reasonably
be provided by claimants and were proportionate to the value of claim,
enabling POL case assessors to resolve cases quickly by making offers by
reference to the agreed principles and available evidence.
My team continued to work with POL and the Department over the summer of
2023 to develop and finalise the remediation process, compensation principles
and terms of reference for an independent panel to review disputed heads of
loss and give recommendations. Support from the Shareholder Team included
financial analysis and modelling for the compensation principles, for example
assessing benchmarks for the level of interest payable on a claimant's loss of
earnings where it was difficult to identify a counterfactual.
Page 90 of 103
195.
196.
197.
198.
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By the end of 2023, when UKGI’s role was pared back, the significant
components of the new remediation approach had been established.
Principles for pecuniary remediation had been shared with claimant
representatives and substantially agreed, with some final points remaining to
be agreed through the independent assessor and the assessment of cases. At
that point, POL was also in the process of finalising the agreement with
claimant representatives on the appointment of the Chair of the independent
panel, Sir Gary Hickinbottom. I understand that there was some delay to his
appointment but do not know the reason for this.
The independent panel was established after the implementation of UKGI's
revised arrangement with DBT, so I have not had significant involvement with
it. I understand that no potential claimants have yet issued civil proceedings.
The policy of making a final settlement offer of £600,000 to applicants under
the OCS was developed between March and July 2023 in response to the slow
pace of the compensation scheme up to that point. POL had been developing
its new remediation approach (as described above), which was planned to
increase speed, however, it had become clear that this would take time to
agree with stakeholders and implement. The fixed sum offer was intended to
speed up full and final compensation payments and also attract more
applicants.
The Department led on the development of the policy and drafted the advice
to Ministers on available options. DBT also led the modelling necessary to
Page 91 of 103
199.
200.
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establish the value of the fixed sum offer. My team used its understanding of
the compensation schemes and expertise in financial analysis to provide DBT
with advice on policy development and financial modelling with the available
data.
The policy was agreed by the DBT Minister in July 2023 and by HMT in
September 2023. There was then a period of negotiation with claimant
representatives over the terms and conditions of the offer before the first
payments were made in December 2023. By August 2024, 110 claims had
been received by POL and of the 56 claims that received full and final
settlements, 52 were through the upfront offer of £600,000, representing
around £30 million of the approximately £54 million paid in compensation to
date through the OCS. Claimants who had previously been assessed as
having claims worth under £600,000 also had their settlements topped up to
this amount.
The intention of this policy has been to provide an option to claimants to
achieve settlement quickly without the need to go through the long and
sometimes difficult process of making a detailed claim. The policy includes
provision for claimants to receive legal advice and help ensure that it is a fair
settlement of their claim, while the increased speed and streamlined process
have resulted in lower spend on legal fees than has been the case for detailed
assessments. The policy will also help keep pace with the expected volume of
claimants following the implementation of the blanket exoneration policy
through the Post Office (Horizon System) Offences Act, enacted in May 2024.
Page 92 of 103
201.
202.
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A significant number of claimants have chosen to take this route which
suggests it is having its intended effect.
GLO
As noted above, I was not involved in the establishment or operation of the
GLO Scheme. A member of the Shareholder Team attended the GLO working
group as an observer and a UKGI manager has been on secondment at DBT,
using their experience on the HSS and OCS schemes to assist with the
operation of the GLO scheme and ensure consistency of approach where
appropriate between the different schemes.
General reflections
In my view, POL has made considerable efforts to identify and engage with
Postmasters that may be eligible to apply for the compensation schemes.
a. On the OCS, as described in the July 2023 HCAB minutes (Horizon
Compensation Advisory Board — Report of sixth meeting held on 31 July
2023) (UKGI00049041), POL conducted a tracing exercise to contact the
700 Postmasters who had been convicted in cases which might have
relied on Horizon. It sent three sets of letters offering disclosure and
inviting them to appeal. It also asked the Criminal Cases Review
Commission to send a further round of letters, in acknowledgement of
concerns around the way in which approaches from POL might be
received by convicted Postmasters. This work has largely been
superseded by the implementation of the blanket exoneration policy, and
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engagement is almost always through an applicant’s legal representative
(the reasonable costs of which are fully covered by POL). POL has also
contracted with Citizens Advice to provide support and information for
potential applicants, and has encouraged the few applicants who do not
have legal representatives to seek legal advice to help expedite their
claims.
. On the HSS, much of the work to identify potential applicants had been
done before my appointment as Shareholder NED, including through
writing to current and former Postmasters who met the eligibility criteria
and by publishing information on POL’s website. The HSS saw huge
increases in the number of applicants following the 2022 Panorama
programme and then again following the 2024 ITV series, and POL is now
planning to write again to potential applicants setting out details of the
£75,000 offer, the forthcoming appeals process and the end date for the
scheme.
203. The question of how to further increase engagement with potential applicants
204.
has been discussed at the Remediation Committee. Significant efforts have
been made, but events have shown that external factors — notably the ITV
series — have in some respects been more effective than POL’s efforts to
increase applicant numbers.
I am asked about the way in which POL has communicated with applicants. I
am aware of concerns raised over the wording of POL’s offer letters and that a
complaint has been made to the SRA. I understand POL has now changed the
Page 94 of 103
205.
206.
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wording in its letters and am not aware of any other major issues concerning
POL’s communications with claimants. My broad understanding is that
communications with legal representatives have been effective and that those
directly with applicants have been more difficult, however I have not seen
enough POL communications with applicants to comment substantively. I note
that POL has internal timing KPls in place in this respect which are seen by
the Remediation Committee. Similarly, the timing of offers and compensation
payments is not something I am closely involved with but my understanding is
that this is being done relatively quickly and in line with POL’s internal KPls.
POL has generally been open to suggestions from, among others, claimant
representatives, the Department and UKGI to improve the effectiveness of the
schemes in fully and fairly compensating Postmasters. For example, it has
reconsidered heads of loss where not originally covered by the schemes and
has paid compensation when advised that such head of loss would have been
available to the claimant through another legal route (a recent example being
a claim for gratuitous care). POL has also taken an expansive approach to
considering other forms of detriment that might have been suffered by
Postmasters resulting from non-Horizon related practices, and a compensation
scheme for such detriments is currently being piloted with a wider scheme to
be launched in due course.
The impetus to achieve fairness between the schemes has driven a number of
changes to the schemes throughout my tenure. Tax is a good example of this.
Different schemes took different approaches to the treatment of tax because it
Page 95 of 103
207.
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was considered at different stages of scheme delivery, and the schemes
involved different levels of payments and evidence. While the OCS and PMD
schemes included exemptions for all taxes (including capital gains and
inheritance tax), meaning that compensation awards were calculated net of
tax, HSS did not. To ensure parity between schemes, HSS claimants were
awarded an additional amount to cover the amount of tax (as it was not
possible to retrospectively apply a tax exemption). The UKGI Shareholder
Team was involved in considering with the Department the various options
available to effectively top up the HSS awards (though I was not directly
involved).
Another example is the £75,000 Fixed Sum Payment offer to HSS applicants.
The Shareholder Team and I saw this as a necessary consequence of the
decision to make a minimum payment of £75,000 to GLO scheme claimants,
as it would be required to ensure parity between the schemes. We made it
clear to the Department that this figure should be built in to cost projections for
the HSS rather than viewed as a risk that may not materialise. In January 2024,
the Remediation Committee was told that DBT was awaiting a request from
POL to standardise the minimum HSS payment at the same level as that for
the GLO scheme, and the following month a paper was circulated on
increasing the HSS minimum payment to £75,000. The Remediation
Committee discussed this from a value for money perspective, in line with
POL’s obligations under MPM, and decided to sanction the proposal. The offer
may be regarded as generous to some Postmasters who have only declared
small losses from Horizon. However, I agree with the rationale for introducing
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minimum payments to the GLO scheme (namely to enable payments to be
made quickly and increase the proportion of spend going to claimants rather
than representatives), and I support parity between schemes, so I view it as a
necessary step in the HSS process.
208. I have sought to answer the questions on compensation and redress that have
been put to me by the Inquiry to the best of my knowledge and understanding,
but repeat that I have done so, where necessary given my limited personal
involvement, by obtaining information through colleagues in the Shareholder
Team.
Conclusions and Reflections
209. POL’s current operating environment is unprecedented, extraordinary and
extremely stressed. The scale of the challenges facing those in the company is
immense and the range of those challenges is broad. From what I have seen,
the overwhelming majority of those working at POL feel the weight of what
happened in the past very heavily and are doing their best to address the wrongs
that occurred. They are also working hard to make the company better, to secure
its future, and to deliver for the Postmasters on which it relies and the
communities that it serves.
210. All working at, and closely with, POL are operating under intense scrutiny. As
I have said, this is entirely understandable given the Horizon scandal and the
tragedies that it caused, but it does, nonetheless, have an impact. It has
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contributed to a high turn-over of staff and, in my view, has impacted on the
behaviours of many of those involved in high profile decisions and events. It has
also contributed to a risk-averse culture which has led to cumbersome
processes, slow decision-making and delayed actions. This has affected all
levels of POL, up to and including the Board.
211. The problem is much easier to diagnose than to resolve and the observations
in my statement should be read with that in mind. I have tried to provide the
Inquiry with open and candid reflections on what I have seen during my tenure
as Shareholder NED, and on where the company currently is. I do not suggest
that there were, or are, easy and obvious solutions to the issues that I have
discussed.
212. Part of my role as Shareholder NED, and the wider role of UKGI, has been to
facilitate, support and — where necessary — challenge the company in the
changes that it needs to make. I am sure that others will have different
perspectives on how we have performed those functions and whether the
correct balance has been struck in terms of Shareholder oversight and
intervention. It will be important for UKGI and the Department to reflect carefully
on what others say and, as I have stressed throughout this statement, relevant
models, structures and practices will continue to evolve. However, it remains my
clear and unequivocal view that the overarching architecture for managing the
relationship between the Shareholder and the company, including the
appointment of a Shareholder NED from UKGI, is appropriate and fit-for-
purpose. I know of no suggestion for a better alternative.
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213. Cultural change at POL remains a huge challenge. While I am clear that
significant progress has been made in policies, processes and fair treatment of
Postmasters, there is undoubtedly still significant work to be done before the
organisation reaches a place with which all concerned can be happy.
Statement of Truth
I believe the content of this statement to be true.
Signature
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Index to First Witness Statement of LORNA GRATTON
WITN11310100
WITN11310100
No.
Inquiry URN
Document Description
Inquiry Control Number
UKGI00013078
Memorandum of
Understanding between
BEIS and UKGI with
annexes
UKGI023872-001
UKGI00049040
UKGI Portfolio Operating
Principles with Guidance
March 2024 v4.4
UKGI057792-001
POL00362299
Post Office
Shareholder
Relationship Framework
Document
Limited:
POL-BSFF-0190809
WITN10770200
Witness
of Charles
Second
Statement
Donald
WITN10770200
WITN10770100
First Witness
Statement of Charles
Donald
WITN10770100
UKGI00044318
Articles of Association of
Post Office Limited
UKGI052980-001
POL00363050
Letter to Lorna Gratton
re: Letter of appointment
POL-BSFF-0191079
POL00446477
Grant Thornton
Governance Review
dated 25 June 2024
POL-BSFF-099-0000003
UKGI00048174
UKGI Preliminary
Internal Review into the
Post Office and the
Horizon IT System
UKGI056931-001
10.
UKGI00044315
Letter from Sarah Munby
to Tim Parker: POL
Strategic Priorities for
2022/2023
UKGI052977-001
11.
UKG100044317
Letter from Kevin
Hollinrake to Henry
Staunton: Strategic
Priorities for 2023/2024
UKGI052979-001
12.
UKGI00049046
Letter from Jonathan
Reynolds to Nigel
Railton: Strategic
Priorities for 2024/2025
UKGI057799-001
13.
RLIT0000201
News article from The
Times titled 'Postmasters
on Post Office board
‘ignored and unwanted’
RLITO000201
14.
POL00448300
Email from Elliot Jacobs
to Saf Ismail, Henry
POL-BSFF-WITN-005-
0010720
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WITN11310100
WITN11310100
Staunton Re:
Pineapple
Project
15.
WITN10770300
Third Witness Statement
of Charles Donald
WITN10770300
16.
UKGI00044337
Post Office Group policy
- Speak up Policy -
Version 8
UKGI054544-001
17.
UKG100044274
UKGI - Guidance note 21
Whistleblowing and
Serious allegations - Nov
23 (updated)
UKGI052998-001
18.
UKGI00049035
Email from Lorna Gratton
to David Bickerton and
Carl Creswell dated 5
July 2023
UKGI057783-001
19.
UKGI00049045
Post Office Comment on
Investigation Into Speak
Up Allegations
UKGI057798-001
20.
POL00448519
Letter from POL Whistle-
blowers to Nigel Railton,
Jonathan Reynolds MP,
Rt. Hon. Liam Byrne and
others re: POL
employees seeking
support in addressing the
ongoing intolerable
leadership and cover up
within POL
POL-BSFF-WITN-027-
0000008
21.
UKGI00049047
Letter from Henry
Staunton to Kevin
Hollinrake MP dated 7
December 2023
regarding ‘Senior
Independent Director
Recruitment - Post
Office Limited
UKGI057801-001
22.
UKGI00049036
Email from Lorna Gratton
to Charles Donald dated
15 January 2024
UKGI057784-001
23.
UKGI00049037
Email from Amanda
Burton to Lorna Gratton
dated 19 January 2024
with subject “Fwd:
Investigation”
UKGI057785-001
24.
UKGI00049038
Email from Amanda
Burton to Lorna Gratton
dated 20 January 2024
with subject ‘Fwd: SID’
UKGI057786-001
25.
POL00458053
Email from Ben Tidswell
to the POL Board dated
POL-BSFF-WITN-004-
0055745
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WITN11310100
20 January 2024 with the
subject ‘Re: SID’
26.
UKGI00049039
Email from Lorna Gratton
to David Bickerton dated
20 January 2024 with
subject ‘Contact details
so Ben Tidswell can call
you?’
UKGI057791-001
27.
UKGI00049030
Note of call between Ben
Tideswell and Carl
Creswell dated 22
January 2024
UKGI057788-001
28.
UKGI00049033
Submission from Lorna
Gratton and Carl
Creswell to Minister
Hollinrake and Secretary
of State dated 23
January 2024
UKGI057793-001
29.
UKGI00049031
Briefing titled ‘Call with
Henry Staunton Post
Office Chair’
UKGI057789-001
30.
UKGI00049032
Email from BDT for
Lorna Gratton dated 27
January 2024 with
subject ‘Re: Read out: [to
action today] — Letter to
Post Office Chair’
UKGI057790-001
31.
UKGI00049034
Submission from Lorna
Gratton and Carl
Creswell to Minister
Hollinrake dated 17
December 2023
UKGI057800-001
32.
POL00446476
Grant Thornton Board
Effectiveness Review
dated 19 June 2024
POL-BSFF-099-0000002
33.
UKG1I00049042
Letter from Charles
Donald's to David
Bickerton dated 19
September 2023
UKGI057795-001
34.
UKGI00049044
Terms of Reference for
the Remediation
Committee
UKGI057797-001
35.
RLIT0000250
Minutes of the Horizon
Compensation Advisory
Board (“the HCAB”) of 14
June 2023
RLIT0000250
36.
UKGI100049043
Horizon Shortfall
Scheme - latest data on
progress
UKGI057796-001
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37. I POL00448026 Horizon Shortfall I POL00448026
Scheme Terms of
Reference of the Horizon
Shortfall Scheme
Independent Advisory
Panel
38. I UKGI00049041 Horizon Compensation I UKGI057794-001
Advisory Board — Report
of sixth meeting held on
31 July 2023
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