Five things we learned from Post Office inquiry as Tory peer slams 'deception'

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The Post Office was “stringing MPs along” with a “behind-the-scenes deception process” when the Horizon scandal began to emerge, former Tory minister Lord Arbuthnot has told the Post Office Horizon IT inquiry.

Lord Arbuthnot, who was an MP from 1987 and 2015, and served in several ministerial posts, was one of the first parliamentarians to begin campaigning for sub-postmasters caught up in the scandal.

More than 700 sub-postmasters were prosecuted by the Post Office and handed criminal convictions between 1999 and 2015 as Fujitsu’s faulty Horizon system made it appear as though money was missing at their branches.

Lord Arbuthnot first learned of issues with the Horizon system from sub-postmasters in his constituency, including Jo Hamilton, who was falsely accused of stealing £36,000 from the Post Office branch she ran in South Warnborough, Hampshire.
His evidence session was followed by that of Sir Anthony Hooper, former Lord Justice of Appeal and former chair of a scheme to resolve concerns raised by sub-postmasters – the Working Group for the Initial Complaint Review and Mediation Scheme.

Here are five key things that we learned from the two witnesses today.

Government had ‘not me, guv’ attitude to Horizon issues

Lord Arbuthnot sent a letter in 2009 to then-business secretary Lord Mandelson, asking what could be done to investigate complaints made by sub-postmasters about the Horizon IT system.

In the letter, shown to the inquiry today, Lord Arbuthnot said: “There does appear to be a significant number of postmasters and postmistresses accused of fraud who claim that the Horizon system is responsible, including at least two in my constituency.”

He asked for help in resolving the issue, but received a reply from then-minister Pat McFadden, which stressed that the Government maintained an “arm’s-length” relationship with the Post Office, which had said that there were no problems with the Horizon system.

Lord Arbuthnot said that he was “frustrated and annoyed” with this response. “It was clear that the Government was saying it was nothing to do with them and I didn’t see at that stage where I could take it.

“I wanted what had seemed to me to be something that was potentially an injustice to be sorted out and, since the Government owned the Post Office, I assumed that the Government would be in a position to sort it out. But they were saying: ‘No, not me, guv.’

“What this ‘arm’s length’ arrangement essentially means is that the Government is refusing to take the responsibilities that go with ownership and I don’t think it’s right to do that for various reasons.

“One reason is that if you have an organisation that is as important to the community as the Post Office, then the people have got to be able to have proper control over it, if the people own it.

“There’s a sort of democratic deficit that is popping up here if the Government is refusing to take responsibility for it.”

Vennells ‘falsely claimed courts had always backed Post Office’
Former Post Office CEO Paula Vennells wrote to Lord Arbuthnot in 2012 to defend the Horizon system after he raised concerns, saying that there was “no evidence” to support allegations made by sub-postmasters about bugs in the software.

She continued: “We have no reason to doubt the integrity of the system, which we remain confident is robust and fit for purpose.”

In another letter to former Tory minister Oliver Letwin, Ms Vennells claimed that the courts had “in every instance” found “in [the Post Office’s] favour” when prosecuting sub-postmasters for theft or false accounting.

He asked Lord Arbuthnot if he would have known at the time that it may have been a false statement, to which he replied: “No, I wouldn’t.”

Lord Arbuthnot added he would have expected public officials “to tell the truth” but “would have had, at the back of my mind, the knowledge that the Post Office had been, as a matter of almost routine, telling lots and lots of sub-postmasters that they were the only ones.

“So I might have had some questions about what they were saying.”

He also said that he was “not satisfied” with the “brush off” he received from Ms Vennells, as: “The sub-postmasters I had met seemed to me to be transparently honest. I do not remember anyone suggesting to me that the introduction of a new computerised accounting system had uncovered previously hidden fraudsters.

“If they did I would have given it little credence, both because of the self-evident honesty of the sub-postmasters I had met and because of the sudden rash of similar allegations appearing shortly after the installation of a new computer system, an exercise which inevitably will have teething problems.

Ms Vennells also suggested that “temptation” to borrow money from the tills was an issue among a small number of postmasters, rather than faults with the Horizon IT system.

Post Office was ‘stringing MPs along’

Lord Arbuthnot told the inquiry that he thought the Post Office was “stringing MPs along” in a “behind-the-scenes deception process” to protect the organisation’s “existence,” when questions surrounding the Horizon system became more pressing.