Are sub-postmasters generally happy with the Horizon system?

By Tony Collins

Since complaints of sub-postmasters about the Horizon branch accounting system were first published in 2009, the Post Office has said it is a reliable system used daily by thousands of people and complainants are few.

But, apart from the branch sub-postmasters who have made their concerns about Horizon known to the corporate Post Office, how many others are contented or dissatisfied with Horizon?

The BBC reported yesterday on a former sub-postmistress in Northern Ireland who said she sold her post office after problems with Horizon.

Fiona Elliott ran a  branch from 2004 to 2009. It was attached to a convenience store. She told the BBC,

“At the end of the night, it was telling me that I had maybe minus £80, minus £100 or maybe £120 down.”

She put £8,500 of her own money into the post office to balance the books.  “If the computer system had been balancing properly, I would not have had to put my own money into it.

“This left the shop side of the business struggling so we ended up selling the whole business.”

The Post Office told the BBC, “We have confidence in our network of 11,500 post office branches and the systems underpinning it.

“The Horizon computer system is operated successfully by thousands of employees, postmasters and their staff to process 47 million transactions every week.”

Another sub-postmaster’s Horizon response

Recently I asked a sub-postmaster about the Horizon system a few days before he and his wife sold their village post office.

The sub-postmaster knew me by sight as a regular customer. His post office had been on the market for several months. I spoke to him a few days before he passed it over to the new owners and asked why he was leaving. He did not look of retiring age. He said he did not like the hours and the opportunities to take short breaks were few and far between. He and his wife were going into a different line of work.

In a tone of voice that invited a positive response,  I asked what he thought of the Horizon system.  He was passionate in his criticism. He did not stop giving me his views about Horizon and its frequent updates (while shaking his head now and then) until another customer began queuing behind me.

Not a failure

Given that Horizon has been operating in thousands of post office branches for nearly 20 years and has coped with many major changes, the Post Office could say with authority that the Horizon system has not been a failure.

But is it generally reliable? And are sub-postmasters happy with it? In the absence of any published, authoritative and independent survey of sub-postmaster views, it is impossible to answer either question with any authority.

Ex sub-postmistress “wrongly had to repay 16k” – BBC

Postofficetrial

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A pregnant sub-postmistress blacks out, is taken to hospital and wakes in handcuffs – due to an IT-related glitch?

By Tony Collins

Daily Mail headline – 1 December 2018

In a two-page spread at the weekend, the Daily Mail reported on what some MPs have called a national scandal – how the lives of individuals have been ruined by numbers shown on an imperfect computer system.

Pregnant sub-postmistress Seema Misra was one of those individuals. She went to jail.

She had paid £200,000 for her post office in West Byfleet, Surrey.  She experienced problems with Horizon from the day she opened in June 2005, said the Daily Mail.

Small amounts of money, under £100, appeared missing at first. Under a contract with the Post Office, sub-postmasters are responsible for any losses. To balance the books, Seema put in thousands of pounds of her own money but the deficits shown on Horizon continued.  She could no longer afford to balance the books using her own money.

In January 2008, two auditors turned up unannounced and found a £74,609 shortfall. They suspended Seema on the spot and sent someone else to run the post office. Naively, she felt relief, said the Daily Mail.  She thought her problems were over. She thought the Post Office would sort it out. “They were supposed to look after me,” she told the Mail.

In fact the Post Office took her to court. It charged her with theft and false accounting.

Standing in the dock at Guildford Crown Court in 2010, she was sentenced to 15 months in prison. She felt an agonising pain in her stomach and blacked out, said the Mail.  She was taken to hospital and, when she came round, found herself in handcuffs.  She’d never had as much as a speeding fine before.

Overcome with shame, she asked a prison officer to borrow his coat to put over her wrists.

She told the Mail, “Changing into my prison uniform that day was the worst experience of my life. If I hadn’t been pregnant, I would definitely have killed myself.”

Seema’s case is one of dozens being considered by the Criminal Cases Review Commission. The Commission could ask the Court of Appeal to review the convictions.

More than 500 former sub-postmasters and sub-postmistresses, including Seema, are suing the Post Office for financial loss, personal injury, deceit, duress, unconscionable dealing, harassment and unjust enrichment. The Post Office says it is robustly defending the case.

Conservative peer Lord Arbuthnot, a former MP who has led a parliamentary inquiry into the Post Office’s handling of the sub-postmaster cases, told the Mail,

“The behaviour of the Post Office throughout has been disgraceful. This is an organisation which is owned by the public, which needs to behave in a way the public should feel proud of.”

There’s excellent coverage of the High Court case by TV journalist Nick Wallis and by Karl Flinders of Computer Weekly.  Dogged campaigner Tim McCormack has written on the Seema Misra case.

Comment

At one level it is difficult to understand how a national institution with the Post Office’s reputation could take actions and decisions that led to a pregnant sub-postmistress finding herself recovering in hospital from a black-out – in handcuffs.

At another level, the Post Office’s decisions are understandable. Public institutions have access to an endless supply of public money with which to justify their decisions and actions.

Some at the MoD and RAF spent 17 years defending their decisions against two dead pilots whom they accused of causing a Chinook crash on the Mull of Kintyre that killed four crew and 25 senior intelligence specialists. Eventually, the miscarriage of justice was corrected and the pilots’ names were cleared but only because a minister intervened.

The Post Office has spent £5m on the High Court case so far, to justify its allegations against about 550 sub-postmasters. The case will eventually cost much more than £5m.

What of the personal accountabilities of those who are spending that money?

More importantly, what are the real costs of the Post Office’s decisions and actions in terms of human misery and the ruination of lives? Hundreds of lives.

Post offices are regarded as vital assets within local communities. It’s generally believed that the Post Office runs village post offices. It doesn’t.  In the main, they are run by self-employed businessmen and women. These sub-postmasters and sub-postmistresses buy local post offices and run them under contract to the Post Office.

In acquiring post offices, the purchasers become the public face of the Post Office. They are in effect the Post Office’s local representatives.

How is it then that Post Office corporate HQ can trust the numbers shown an imperfect computer system more than they trust the words – the heartfelt, bewildered explanations – of their local representatives -those 557 sub-postmasters and sub-postmistresses?

Optimists will say that sense will prevail eventually. Indeed Mr Justice Fraser, the judge in the case of Bates v the Post Office, has shown a deeply impressive grasp of the labyrinthine technological and legal issues involved in the case.

But the question nobody can answer is at what cost sense will eventually prevail. For the human cost can never be measured.

An appalling cover-up? – Daily Mail two-page spread 1 December 2018

Postofficetrial – Nick Wallis’s coverage of the High Court case

Post Office held back information on Horizon IT system errors – part of Karl Flinders’ coverage of the High Court case in Computer Weekly

FT reports death after Horizon system shortfall

Shedding new light on Post Office Horizon controversy? – how institutions will defend their technology whatever new facts emerge

Whitehall’s changing truths over the “success” of the smart meters roll-out

By Tony Collins

Whitehall’s culture of over-optimism that has contributed to high-profile failures including the NHS IT scheme has also affected the smart meters roll-out programme.

Ministers and civil servants have regularly referred to the success of the roll-out and how smart meters will cut energy costs for consumers and reduce costs for suppliers. Radio and TV commercials urge people to install smart meters.

But a report published today by the National Audit Office – Rolling out smart meters – refers repeatedly to over-optimism and, in diplomatic wording, urges the civil servants responsible for the smart meters roll-out to “make sure the team culture does not become defensive, and resistant to inconvenient truths”.

The National Audit Office concludes that the programme is late and costs are escalating. It raises questions about whether millions of “SMETS1” smart meters installed by energy companies in recent years are already technologically obsolete.

It is uncertain whether the Capita-run data communications network that underpins the roll-out programme will ever work as well as originally intended.

Costs have been underestimated, benefits overstated and Whitehall’s attempted rushing of the roll-out programme has left energy companies having to support two different designs of smart meters, known as SMETS1 and SMETS2, as well as “legacy” meters. This is likely to add to capital and operational costs, says the National Audit Office.

Some who have chronicled the failures of some major government IT-related projects and programmes over decades may conclude that the smart meters roll-out follows the usual pattern of over-optimistic initial design and planning assumptions followed by a ministerial and civil service dismissal of all serious independent criticisms.

Although the Treasury has urged departments to include an “optimism bias” in their business case costings, officials responsible for the smart meters roll-out programme removed provision for optimism bias in their estimate of Data and Communications Company costs for the 2013 business case.

The National Audit Office warns that the Department for Business, Energy and Industrial Strategy, which is responsible for the roll-out, may still have a culture of over-optimism in its assumptions and forecasts. The NAO said,

“The Department’s cost–benefit analysis has been updated on several occasions throughout the life of the programme, but the last update took place two years ago.

“We have examined some of the main assumptions in the Department’s 2016 analysis and considered, in light of available evidence, whether there is a risk that these assumptions will prove over-optimistic.”

There is coverage of the National Audit Office today by Computer Weekly, the BBC, Guardian and Daily Telegraph among others.

Comment

It’s easy to conclude from today’s National Audit Office report on rolling out smart meters that the civil servants responsible for the programme have been over-optimistic to the point of deliberately misleading the public and ministers about the benefits and success of the programme.

But they were only doing their jobs. Whitehall’s culture on most of the major government IT-related programmes over the last 25 years has required over-optimistic design assumptions, over-optimistic business cases and over-optimistic timetables supported by over-optimistic ministerial and departmental statements.

Now any ministerial or civil service statement on the smart meters roll-out cannot be trusted.

This is not the fault of any individual. To succeed in their working relationships, senior Whitehall officials find they are expected to comply with an unwritten code that requires what the National Audit Office calls a resistance to inconvenient truths.

Business cases are written and regularly re-written on this basis. Regular departmental reports on the progress of the scheme are written on this basis.

It is only when the National Audit Office investigates and publishes its reports that the truth emerges – and then ministers and Whitehall officials, in their media and Parliamentary statements, quote selectively from the NAO’s reports to underline the department’s successes.

Until Whitehall ceases to operate within a bubble-like culture of over-optimism and resistance to inconvenient truths, the high-profile IT-related project failures will continue.

Meanwhile ministers and officials at the Department for Business, Energy and Industrial Strategy will continue to proclaim the success of the smart meters roll-out programme and will continue to ignore all inconvenient truths in making their case.

Whitehall’s “good news” culture requires that they do so.

Even if ministers and officials distrust their own public statements on the smart meters programme they know the charade must continue.

It’s an all-year pantomime that nobody has the power or will to stop.

Rolling out smart meters – National Audit Office report

Smart meter benefits cut by old technology and rising costs – Computer Weekly

Government will miss smart meters deadline watchdog warns – BBC

Smart meters rollout labelled a fiasco as consumers face extra £500m bill – Guardian

Smart meter roll out could cost households an extra £100 and means homeowners won’t feel the benefit for five years – Daily Telegraph

Will DWP board welcome today’s criticisms of Universal Credit programme?

By Tony Collins

A report of the Public Accounts Committee published today says that the Universal Department for Work and Pensions continues to have a culture of denial over problems with implementing Universal Credit.

Labour MP Meg Hillier who chairs the Public Accounts Committee, said in an interview on LBC this morning (26 October 2018) that the Department for Work and Pensions regards any comment or feedback on the Universal Credit programme as criticism and a political attack.

Her committee’s report said that local DWP offices are helpful and listen to criticism of the Universal Credit implementation programme but not DWP corporately.

DWP officials have criticised even the National Audit Office. The report says,

“Following the Comptroller and Auditor General’s report, which raised concerns over the implementation of Universal Credit, the Department repeatedly denied the substance of his findings both in the media and in Parliament and maintained that Universal Credit was working well.

” The Comptroller & Auditor General wrote an open letter to the Secretary of State to ‘clarify the facts’ and to confirm that the report had been fully agreed with senior officials in the Department.15 On 4 July 2018 the Secretary of State had to apologise for misleading Parliament regarding the content of the report. Such defensiveness was also evident throughout the evidence session.”

As a credit to the IT professionals and civil servants who have been involved in developing the Universal Credit systems, the Public Accounts Committee report is largely about the programme’s effects on claimants rather than the technology.

Comment:

DWP’s mandarins are likely to be comforted by criticisms of the Universal Credit implementation programme in today’s report of the Public Accounts Committee.

They  remain convinced that Universal Credit is working well and that criticisms are policy-related. To some extent they are right. In the past year, criticism of the programme has gradually moved away from the performance of the IT.

Today’s report of the Public Accounts Committee is about the intricacies of the Universal Credit implementation programme but hardly mentions the IT. This is much to the credit of those developing the systems. Universal Credit replaces six systems that are each of labyrinthine complexity: housing benefit, employment and support allowance, jobseeker’s allowance, child tax credit, working tax credit and income support.

Many Universal Credit payments are wrong and late but these criticisms are not in the mainstream, eclipsed perhaps by legitimate criticisms of how Universal Credit works rather than whether it works.

Of concern, though, is the fact that the Universal Credit programme is years from being fully rolled out. The DWP claims that just over on million people are claiming it, which is a seventh of the total numbers expected to claim.

Whether the IT will work well at scale is not known. The DWP routinely keeps secret independent evaluations of the Universal Credit systems.

It is this culture of secrecy that makes the Department of Work and Pensions an organisation ill-suited to spending large sums of public money on IT-enabled programmes.  Universal Credit IT is, to some extent, working well in spite of the corporate culture. But we don’t know how well it will work when put under much more pressure.

Could the DWP’s defensive, dismissive and secretive culture end up sinking the Universal Credit programme when the number of claimants rise substantially?

What is worrying is that the DWP will probably not recognise that the boat is sinking until it is too late for rescue.

In its report published today, the Public Accounts Committee describes the  Department of Work and Pensions as a “department disturbingly adrift from the real-world problems of the people it is there to support”.

The PAC report adds that the DWP is in denial and cannot learn from its mistakes (which is a criticism of a departmental culture that goes back decades).

The DWP hierarchy may be pleased at this criticism because the more outsiders and particularly MPs criticise Universal Credit,  the more some senior Whitehall officials seem to have a settled belief that they are on the right track.

The only thing that deeply upsets DWP officialdom is a leak of authoritative information to outsiders in the media or to MPs.

Leaks have led in the past to internal inquiries led by the security services. Even a leak to the media of the results of an internal survey of staff morale on the Universal Credit programme prompted a top-level investigation.

This is what the PAC said,

Denial

“The Department’s systemic culture of denial and defensiveness in the face of any adverse evidence presented by others is a significant risk to the programme.”

Blinkered

“The Committee has regularly commented on the Department’s blinkered approach to risks and problems with Universal Credit’s implementation.”

Unresponsive

“We are disappointed that this culture of denial remains firmly in place. Local organisations have found the Department unresponsive to issues they have raised, and told us that the Department is not learning lessons and applying them to the programme. In addition, when the Comptroller and Auditor General raised concerns over the implementation of the programme in his report, the Department repeatedly questioned the substance of the report both in the media and in Parliament.”

“The Department’s defensive approach was further evident in the way it responded to criticism during our evidence session, refusing to accept that Universal Credit causes hardship for many claimants, and believing that issues raised were reflecting the policy not the implementation.

“But unless the Department learns to listen, it will not be able to adapt the programme to make it a success.”

Perhaps the only solution is a secretary of state who would be willing to criticise the DWP. It has not happened yet except briefly when Stephen Crabb took over the role from Iain Duncan Smith for  few months in 2016.

Esther McVey the current secretary of state is what DWP mandarins would call a “safe pair of hands”.

For the DWP, the culture of denial, defensiveness and unresponsiveness will remain unconfronted. All of which bodes ill for the Universal Credit implementation programme when it is put under the pressure of having millions of claimants.

Thank you to campaigner David Orr for the Universal Credit links

Public Accounts Committee report – Universal Credit

Universal Credit DWP statistics

Horizon IT High Court case could have a “material” effect on Post Office accounts.

By Tony Collins

Directors of the publicly-owned Post Office have said that an adverse outcome of a High Court dispute with former subpostmasters over the Horizon IT system could have a material impact on the consolidated accounts.

The directors also say that £3m was spent on legal costs in 2017/18 and “we expect costs to be more significant in 2018/19 and 2019/20”.

Hundreds of owners of local post offices are taking part in a Group Litigation case against the Post Office. They say their lives and finances have been ruined by problems related to the performance of the Post Office’s Horizon accounting system.

The High Court case is to determine whether the Post Office was legally justified in taking the actions it did against the subpostmasters and whether the shortfalls shown on the Horizon system, for which subpostmasters were held personally liable, were genuine deficits or merely numbers generated by an unreliable system.

Three years ago the directors of the Post Office said in their annual report that the outcome of a High Court dispute with the former subpostmasters would not have a material adverse impact on the consolidated position of the Group.

This is from the Post Office’s 2015/16 annual report,

“A High Court claim has been issued on behalf of a number of postmasters against Post Office in relation to various legal, technical and operational matters. Full particulars of the claim (including as to quantum) have not yet been received by Post Office. The Directors do not consider the outcome of any current claim or action will have a material adverse impact on the consolidated position of the Group.”

The following year, the directors reported thatthey will “keep under review” whether the outcome of the case will have a material impact on the consolidated position of the Group.

 The Directors do not currently consider, but continue to keep under review whether, the outcome of any current claim or action will have a material adverse impact on the consolidated position of the Group,” – Post Office 2016/17 annual report.

Last month, in their 2017/18 annual report, the directors of the Post Office said that an adverse outcome of the case “could be material” to the consolidated position of the Group.

While the Directors recognise that an adverse outcome could be material, they are currently unable to determine whether the outcome of these proceedings would have a material adverse impact on the consolidated position of the Group, and are unlikely to be able to do so until the Court has made further determinations and the Claimants have provided the necessary information about the value of their claims. The Directors continue to keep this under close review. In 2017/18 the costs of £3 million included in operating exceptional items relate to Post Office defending the Post Office Group Litigation. These have been disclosed as operating exceptional items because we expect costs to be more significant in 2018/19 and 2019/20.”

Comment:

Whether concerns about the dependability of Horizon were being raised by MPs, by BBC’s Panorama or by Second Sight, the forensic accountants the Post Office commissioned to look into subpostmaster complaints, the Post Office’s board has always stood by its decisions and actions.

Do Post Office directors believe that the legal issues matter more in the case than the lives of hundreds of people who used to work for them?

Some subpostmasters have been jailed or declared bankrupt. Some have sold their homes to cover the shortfalls shown on the Horizon system. Most have lost their livelihoods. Do their lives matter more than proving the legal grounds of decisions and actions taken?

It is not as if the decisions and actions of the directors are infallible. Judge Fraser, in a pre-trial ruling earlier this month, rejected some of the Post Office’s legal arguments.

The Post Office could lose the case.  The judge could then order the Post Office (in other words taxpayers) to pay large sums in costs and compensation. As the directors recognise, an adverse outcome could have a material effect on the Post Office’s consolidated accounts.

It was the decision of the Post Office’s directors to, in effect, mount a High Court defence of their actions and the Horizon system.  It was their decision to spend millions of pounds of public money on lawyers rather than on settling the dispute and paying compensation to the subpostmasters. It’s clear that the directors remain convinced that there is no merit in the subpostmasters’ case.

If the Post Office loses the case (and any subsequent appeals) will its directors be held accountable for their decisions?

If they decide now to settle the dispute, will they be held accountable for the millions of pounds of public money already spent on legal fees?

Whatever the outcome of the case, lawyers will have to be paid.   With every week that goes by without a settlement, the legal costs are mounting. The amounts of public money at risk are increasing.

It is almost certain nobody in government will interfere with the Post Office’s decision to continue its defence of the subpostmasters’ actions. It is therefore the directors’ decision to continue to fight.

No doubt they are convinced their actions and decisions will be vindicated. But what if they are wrong? What will happen then? Who will be responsible for the millions of pounds of public money spent on a case that did not have to be fought?

If the current directors have left their jobs by the time of any appeals in 2020, will they still be held accountable if the Post Office loses?

Thank you to Tim McCormack, a former IT consultant and owner of local post offices in Scotland who has been a critic of the Horizon system and the Post Office’s actions aganst subpostmasters. He spotted what the Post Office was saying in its various annual reports about the High Court case and has written about it on his blog “Problems with POL [Post Office Limited)”.

Tim McCormack’s blog

Tim McCormack on Twitter:  @Jusmasel2015

Nick Wallis’s blog on the High Court case

High Court Horizon IT case has cost £10m – and the trial has yet to start

 

High Court Horizon IT case has cost £10m – and the trial has yet to start

bBy Tony Collins

vague threats” , “undoubtedly aggressive”, “dismissive”

These are words a judge has used in his pre-trial ruling on a High Court case between hundreds of subpostmasters and the Post Office over its Horizon IT system.

Judge Fraser used the words when referring to the Post Office.

Freelance journalist Nick Wallis, who has received crowdfunding to cover the trial, has written an excellent blog post on the ruling.

The trial of 600 subpostmasters and Crown Office employees versus the Post Office starts next month. Subpostmasters say the Horizon accounting system was defective at times and the shortfalls they were held responsible for did not really exist. The Post Office stands by the integrity of its Horizon system. It has persisted with recovering the shortfalls, which has left some subpostmasters bankrupt. The FT reported that attempts to recover the shortfalls could have contributed to one premature death and an attempted suicide.

The judge’s latest ruling on 10 October 2018 said the litigation is on a subject of “obvious public interest”.

The ruling reveals that both sides have together spent £10m on legal costs so far.

The costs of lawyers for the subpostmasters are being met by private funding.  On the other side, the Post Office has no private money at risk. The Post Office is owned by the government’s Department for Department for Business, Energy and Industrial Strategy.

If each side has spent about the same on legal fees, it means the case has so far cost the Post Office more in legal fees than the whole organisation received in increased trading turnover (£4m) during 2017/18.

The subpostmasters say the Post Office unjustly pursued them for accounting shortfalls that were the result of software coding errors, bugs and defects and the way the Horizon accounting system operated.

The Post Office pursued the shortfalls “with vigour”, said Judge Fraser. He went further: he said the Post Office’s treatment of the subpostmasters was “highly controversial”.

He said some subpostmasters covered the shortfalls out of their own resources even though they did not accept that there was anything deficient in their accounting. Others found accounting irregularities in their favour. A few were convicted in the criminal courts of false accounting, fraud, theft or other offences. Some had their contracts with the Post Office terminated, “sometimes very abruptly”.

The judge said the subpostmasters are of the view that the Post Office, over time, came to know about difficulties with the Horizon system, but did not address them and did not publicise these problems.

The subpostmasters claim damages for financial loss and personal injury. They allege deceit, duress, unconscionable dealing, harassment and unjust enrichment.

The Criminal Cases Review Commission is reviewing the convictions of a “significant number” of the subpostmasters, said the judge.

The Post Office denies the subpostmasters’ claims and has produced many pages of legal evidence in defence of the Horizon system and the Post Office’s actions against the subpostmasters.

Post Office’s “supernatural” foresight?

The judge’s ruling contains some unflattering words about the Post Office pre-trial legal attempts to strike out some of the subpostmasters’ written factual evidence.

He urges the two sides’ legal teams to save time and money but says a  “counter-productive approach”  lurks in the background to the Post Office’s application to strike out “large parts of the factual evidence” served by the subpostmasters.

He said the Post Office had first raised concerns about the scope of the subpostmasters’ evidence in October 2017 – many months before the subpostmasters actually submitted their evidence.

“Given the [subpostmasters’] statements themselves were only served in August 2018, that shows considerable, if not almost supernatural, foresight on the part of the defendant [Post Office],” said the judge.

He added,

“There have been various proxy wars about the claimants’ witness statements in the period from October 2017 onwards, even though no such statements were in existence.

“Indeed, notwithstanding the high number of interlocutory appearances before me, it was a rare hearing when the subject was not mentioned.

“Given there were no witness statements available to be considered on the majority of these occasions (and indeed not at all prior to the short notice hearing on 11 September 2018), this was a highly unusual situation. All it did identify was that there was a major interlocutory battle looming. And so it has proved.”

He went on to say that the attempts by each side to outmanoeuvre one another in the litigation has led to constant interlocutory strife.

“This is an extraordinarily narrow-minded approach to such litigation,” said the judge.

The judge rejected the Post Office’s application to strike out parts of the subpostmasters’ statements. The judge said,

“The application by the [Post Office] to strike out this evidence appears to be an attempt to hollow out the Lead Claimants’ [subpostmasters’] case to the very barest of bones (to mix metaphors), if not beyond, and to keep evidence with which the defendant [the Post Office] does not agree from being aired at all.”

The judge suggested that, in the background to the Post Office’s application to strike out parts of the subpostmasters’ evidence, the Post Office was “simply attempting to restrict evidence for public relations reasons”.

Nick Wallis’ article has more on the judge’s  warnings about the “tenor of this litigation generally”.

All credit to Wallis [@nickwallis] for covering the case and obtaining crowdfunding to do so. He is reporting on the case at www.postofficetrial.com.

Computer Weekly was the first publication to report on the Horizon scandal (in 2009). It has a timeline of events.

Comment:

The Post Office’s decision to pay its lawyers millions of pounds to fight the subpostmasters rather than use that money to compensate the same subpostmasters, shows where the Post Office’s priorities are.

Public institutions in general care about managing their reputations and justifying their decisions. The Post Office’s directors could have chosen to be different. They could have chosen to care in the way institutions usually  do not.  How astonishing it would be if the directors now decided to say to their lawyers,

“Until now our legal teams have dealt with the subpostmaster cases. Now the Board is taking over responsibility. These cases are about the lives of the people who used to work for us and their families. The cases are no longer about proving the correctness of esoteric legal arguments.

“The subpostmasters have suffered enough. We are a large institution. We can afford to give them the benefit of the doubt. No computer system is infallible.

“We believed we were contractually entitled to take the actions we did but that did not make our actions right. Home Office officials said the Windrush deportations were legally justified but that didn’t make the deportations right.

As the barrister Sir Robert Morton said in “The Winslow Boy “, Terence Rattigan’s play about injustice, “Let right be done”.

Nick Wallis’ Post Office Trial blog

Civil servants exclude some major IT and other projects from proper oversight, finds National Audit Office

By Tony Collins

Civil servants are excluding some of the biggest and riskiest IT and other projects from oversight by the Infrastructure and Projects Authority, the National Audit Office has found.

A report of the NAO, which is published today, raises questions about why officials are removing projects from oversight for no clear reason.

Amyas Morse, head of the NAO, calls for the Infrastructure and Projects Authority to exercise a “tougher discipline over the terms on which projects are included, or more to the point excluded from its oversight”.

The NAO report says that 29 major ICT projects costing about £10bn fall within the Authority’s remit, as well as a further 41 major projects worth £83bn that are described as “Government transformation and service delivery” projects. These 41 projects include the modernising of government “back office” activities.

Specific major projects that fall within the Authority’s remit include the Universal Credit IT programme, the separate Department for Work and Pensions “IT transformation” and the Department for Business, Energy and Industrial Strategy’s smart meters roll-out.

The NAO criticises the “poor records and incomplete reporting of the process for projects entering or leaving” the Authority’s portfolio. This lack of transparency “increases the risk and perception that projects are removed inappropriately”, says the NAO.

Major IT projects such as the one that supports the roll-out of Universal Credit are not subject to independent oversight where the results are published, except when the National Audit Office investigates or when the projects are reported on in a general and vague sense by departments. Public Accounts MPs regard oversight by the Infrastructure and Projects Authority as important because it reveals whether projects have had “red”, “amber” or “green” traffic light reviews.

But for years senior civil servants have resisted publication of the traffic light status of their major projects. A test case went to the High Court in 2008 when the civil service fought the publication of “Gateway Reviews” which included the traffic light status of the ID cards scheme.

Co-presenter of the BBC R4 Today programme John Humphrys covered the High Court case at the time. He began his interview with Computer Weekly by saying,

“The government does not want us to know how its big IT projects are going. It’s using an ancient law to keep these massive projects, most recently ID Cards, from public view…”

Thanks to the insistence of the then Cabinet Office minister Francis Maude, who introduced measures in 2011 to force departments to be more openness about major IT projects, the annual report of the Infrastructure and Projects Authority contains short summaries of the status of major projects.

But the civil service continues to refuse FOI requests to publish the results of its reviews of the status of major projects such as Universal Credit and the smart meters roll-out.

And today’s NAO report – “Leaving the government major projects portfolio” – underlines the fact that departments close down some major IT and other projects without mentioning anything to Parliament or the public. The NAO calls on the civil service to “publish a statement on project closure that assesses what has been delivered”. The NAO says,

“Departments are responsible for delivering the benefits of projects and such a statement would close the gap in visibility of major projects…Publication of evaluations would help departments learn lessons from major projects, including the realism of expected benefits.”

The NAO finds that the Infrastructure and Projects Authority is agreeing to requests by departments to remove major projects from the Authority’s oversight.

The NAO goes further: it says it is not clear why some programmes were not included in the Authority’s portfolio of projects in the first place.

The NAO report also found that the civil service has:

  • Revised a project’s original plans and targets, then given the project a “green” traffic light status based on the revised baseline rather than the original plan. The NAO cited the Mobile Infrastructure Project to fill gaps in commercial mobile telephone coverage. The Department for Digital, Culture, Media & Sport worked in partnership with four mobile network operators. It initially committed to building 575 mobile telephone masts to expand coverage to 60,000 premises, at an estimated cost of £150m. But after approval, these targets proved over-optimistic and ultimately unattainable. It built 75 masts against a revised target of 40, reaching 7,199 premises at a cost of £36m. The Infrastructure and Project Authority’s exit review gave the project a “green” traffic light status against the new baseline. The subsequent evaluation used only the revised baselines and reported that they had been achieved.
  • Changed the scope of projects without reporting it.
  • Withdrawn projects from the Authority’s oversight without carrying out a final “Gate 5 Review” – or any other exit review – of whether the project has achieved the intended benefits. Sometimes departments are “not clear” what the withdrawn project has achieved”, said the NAO.
  • Withdrawn projects from the Authority’s scrutiny after they have obtained poor results during reviews (Par 14).
  • Withdrawn projects before they are complete or have achieved their objectives. “The Authority monitors benefits when a project is on the Portfolio but is not in a position to monitor whether they are realised once it leaves,” says the NAO.
  • Withdrawn projects from the Authority’s scrutiny without anyone knowing why. The NAO report said, “We saw very limited documentation to support the Authority’s agreement to remove a large number of projects from the Portfolio on three occasions. This reduces transparency. Similarly, departments often had difficulties in responding to our questions about sample projects when relevant people had moved on, indicating a lack of central record-keeping on projects within departments.”
  • Embarked on major projects without a dedicated project team, a clear end point or a business case. “Out of the 302 projects that left, the Authority recorded 48 as having no business case,” said the NAO.

Comment:

The NAO report is thorough. It suggests that little has changed in decades.

MPs and the public have no secure right to know if major IT projects are failing, have been cancelled or are going massively over their budget.

Francis Maude tried to force departments to be open about their major IT projects but since he left as Cabinet Office minister the civil service has returned to its old unaccountable ways.

Tens of billions of public money are being spent on major IT-related projects. Why would any government want information published on whether its major projects are failing?

As John Humphys of the BBC Today programme said in 2008, “The government does not want us to know how its big IT projects are going”. It’s up to public accounts MPs and the NAO to continue to campaign for this to change.

Projects leaving the government major projects portfolio – NAO report

 

Uupublished plan to throw another £13bn at the NHS’s IT problems?

By Tony Collins

The Health Service Journal yesterday revealed details of NHS IT investment plans that have been costed at about £12.9bn over the next five years.

The HSJ’s award-winning technology correspondent Ben Heather  says the sums currently involved – which could reduce as proposals are “reined in” – are on a par with the notorious National Programme for IT in the NHS.

He says that officials working on the plan have produced an estimate of between £10.9bn and £12.9bn for the cost of supporting proposals across 15 long-term plan “workstreams” ranging from creating personalised care to improving cancer survival.

The figures form part of the work of the digital and technology workstream for the long term plan, which is being developed by NHS England and NHS Improvement.

“The sum would be on par with the National Programme for IT, the most expensive push to improve IT systems in NHS history and an infamously costly and troubled project. It is likely to reduce substantially, however, as ambitions for the plan are negotiated and reined in over coming weeks.”

The plan is due to be published in late November or early December. The health secretary is known to be a keen advocate of new IT-related investments.

It is likely that a sizeable portion of the new £20bn planned for the NHS – which will be financed partly by tax increases that are due to be announced in the budget later this month – will go on NHS technology.

But the Health Service Journal suggests the investments will be controlled centrally, which may be a bad sign given that one of the major flaws in the failed £13bn NPfIT was that money was controlled centrally rather than by local groups of doctors and nurses.

Comment

On the face of it the current investment proposals bear no resemblance to the NHS IT programme NPfIT which was “dismantled” in 2011.

The NPfIT comprised a handful of specific major projects that were to be implemented nationally under the umbrella of “ruthless standardisation”.

The current proposals look very different. The investments fall into vague categories such as digitalising secondary care, improvements to IT infrastructure, data gathering and analytics.

The proposals have all the appearance of a different way the NHS has found to waste vast sums of public money.

It has never been acknowledged by the Treasury, NHS England or the Department of Health that the NPfIT wasted billions on spending that was invisible to the public, such as numerous consultants, years of globe-trotting by officials, first-class hotels across the world, sponsored conferences and unreported funds for marketing items that included DVDs and board games designed especially to promote the IT programme.

For officials, there’s nothing more exciting than going to work on a £13bn technology programme where money flows more freely than water. It’s no wonder officialdom is lobbying for the money.

No doubt it will be easy for officials to obtain the new billions. At any time in the recent history of the NHS it would have been easy on paper to justify £13bn for new NHS technology. Much of the £13bn could be justified simply enough by submitting plans to HM Treasury to modernise what already exists.

It was easy to justify the NPfIT. Tony Blair approved it at a Downing Street meeting that lasted 40 minutes. Computer Weekly obtained minutes of the Downing Street meeting after various FOI appeals.

But the NHS needs £13bn to be spent wisely on technology. The last thing the NHS needs is for Whitehall officials to be involved. History shows that Whitehall has the reverse Midas touch when it comes to major NHS IT investments. It is local groups of doctors and nurses who know how to spend the money wisely.

If either NHS England or the Department of Health and Social Care is involved in the new proposals for NHS IT investments – and they both are – it’s almost certain the new plans will end up as costly failures.

How would the public feel if they realised that a sizeable portion of their increased taxes for the NHS is almost certainly destined for the dustbin marked “mismanaged Whitehall IT schemes”.

Revealed: Officials’ £13bn funding ask to modernise NHS IT

Another NPfIT scandal in the making?

How widespread is undetected fraud and corruption in UK local government?

By Tony Collins

Private Eye’s “Rotten Boroughs” has two stories in its current edition that seem unrelated but there may be a link.

One of the stories is about a £2m fraud at Tory-controlled Barnet Council. It was committed by a former council employee whose job was outsourced to Capita. He made use of his budget-holder status on Capita’s Integra financial system. He gave instructions for 62 payments, totalling £2,630,972, into his own bank accounts between July 2016 and December 2017.

Internal and external auditors failed to spot the fraud. Highly-paid local government officers did not spot it; and accounting controls were ineffective, in part because they were geared to highlighting irregularities of £15m or more. The fraud was detected by chance, by a query raised by the employee’s bank. This raises the question: could other frauds be happening now in local government across the country, unnoticed?

The other Private Eye story in the current edition is about attempts by various (Tory-controlled) councils, Harrogate, Nottinghamshire and Thurrock, to stifle reporting of their affairs. And at South Ayrshire Council the chief executive wanted councillors to attend mandatory re-education sessions on why they should not talk to journalists.

What does a fraud at Barnet have to do with attempts by councils to stop journalists looking too closely at what’s going on?

Comment:

Local reporters (and local bloggers) may turn out to be the only effective check on local councils exploiting local taxpayers. Is this one reason many councils seem to regard journalists’ scrutiny as an unnecessary evil?

It may be difficult for some in British society to imagine it but what if some local council officials and councillors found themselves operating in such a void of accountability that they realised that frauds and corruption were likely to go unnoticed?

Have the sums spent in local government – the plethora of multi-million contracts – become so vast that it’s easy for small amounts – say £2m – to go unnoticed? Does the lack of accountability in local government encourage some officials and councillors to look after their own interests?

Auditors are beholden to councils for future work. This may give them a disincentive to be too nosy when things don’t look right. They’ll investigate – but how deep will they want to dig? How much cooperation will they have if they dip too deep?

An incentive to stamp out fraud and corruption exists when council officers have a public service ethos which most undoubtedly have – but what when they don’t?

It could be said that the public service ethos went out the window years ago when departmental officers began receiving private sector-type salaries for jobs in which a failure to run the department properly was no drawback to a successful career in local government.

Failure matters only to taxpayers – and how much do they matter?

Some blame Capita and outsourcing for the Barnet fraud but it could have happened unnoticed whether or not the council had outsourced IT and other services to Capita. The point about the fraud is that it was spotted by chance. Could undetected fraud and corruption be prevalent in local government?

The uncomfortable truth is that nobody knows; and taxpayers will remain in the dark if councils continue to avoid the accountability and oversight provided by journalists (and local bloggers).

At least Barnet knows what to do to put robust controls in place, thanks to Grant Thornton’s in-depth report on the causes of the fraud. Will other councils have the slightest interest in Grant Thornton’s report? They have not the slightest incentive to read it let alone check whether they have the same weaknesses.

In 2013 Transparency International published a report funded by the Joseph Rowntree Charitable Trust Corruption in Local Government: the mounting risks”. It said that a “disturbing picture emerges”, and one on which experts and interviewees were agreed:

“On the one hand, the conditions are present in which corruption is likely to thrive – low levels of transparency, poor external scrutiny, networks of cronyism, reluctance or lack of resource to investigate, outsourcing of public services, significant sums of money at play and perhaps a denial that corruption is an issue at all.

“On the other hand, the system of checks and balances that previously existed to limit corruption has been eroded or deliberately removed. These changes include the removal of independent public audit of local authorities, the withdrawal of a universal national code of conduct, the reduced capacity of the local press and a reduced potential scope to apply for freedom of information requests. We have identified 16 areas in which we find a marked decline in the robustness of local government to resist corruption.”

Some will argue that the cases of fraud and corruption that have come to light, including the Barnet fraud, will represent the tip of the iceberg. Others will argue equally strongly that the relatively small number of obvious corruption and fraud cases is a sign that there is no iceberg.

But one point made by Transparency International is unarguable:

“When accountability is absent, public officials may exercise their power for private ends unchecked by scrutiny, complaint, or the threat of punishment. Clear opportunities exist for unethical officers and members to exploit public trust for private gain. In any sector, corruption tends to increase as oversight and enforcement are weakened.”

Private Eye reports regularly on attempts by councils to gag local reporters. Perhaps some councils are aware that in trying to escape journalistic scrutiny they are providing the perfect conditions in which fraud and corruption thrive.

Conclusion

Is fraud and corruption widespread in UK local government? The most obvious answer is that we don’t know. It could be. But it’s not the British way to force councils to act. In the circumstances, taxpayers have only one effective control against widespread fraud and corruption in UK local government: trust.

Thank you to openness campaigner David Orr for his help on this blog post.

Postscript

It’s tempting to praise Barnet Council for publishing Grant Thornton’s report on the fraud but a much-respected local blogger Mr Reasonable has provided the facts that show Barnet was, initially, less than open.

Mr Reasonable was aware of the fraud in February 2018 but nothing was mentioned publicly until April when a major fraud investigation was mentioned at an Audit Committee meeting, although no details were given. In July some councillors were given a draft copy of the Grant Thornton Report in private session. Mr Reasonable asked the council at the time why the public were not allowed to see this report. The reason?

Council officers/the report author determined that Appendix 1 (the Grant Thornton report) should be exempt. Capita has made a request for more time to respond on the accuracy of this document and this was considered”.

The Grant Thornton report was not published until September 2018 – by which time it was in its seventh draft.

Mr Reasonable has an excellent analysis of the GrantThornton report here.

Corruption in local government: the mounting risks

 

Ex Tory minister expresses “horror” at the way NHS IT money is allocated. But will anything change?

By Tony Collins

On Monday 29 October the Chancellor will announce his 2018 budget. Taxes are expected to go up to provide extra funds for the NHS.

Health secretary Matt Hancock has already said that part of £20bn extra for the NHS will be spent on making “making the NHS an ecosystem for the best technology available”.

But a former Conservative minister George Freeman – who is an advocate for more NHS IT spending – has expressed his “horror” at the way money has been allocated to NHS IT.

His comments suggest that no lessons have been learned from NPfIT, the disastrous £10bn NHS IT programme.

Freeman is no stranger to the world of IT. Before entering politics he ran a predictive toxicology business that created an algorithm to look at existing drugs and side effects and how drugs could be more effective.

When in government in 2014 he was Life Sciences minister with a responsibility for digitising the NHS. In 2016 he moved to head up the upcoming Prime Minister Theresa May’s policy board. He resigned from that role last year.

Now the BBC reports a talk by Freeman to the Taxpayers’ Alliance in which he described his “horror”, when he was Life Sciences minister, at being handed £4.2bn to create a “paperless” NHS in England by 2020 without a plan how to do it.

Although Freeman’s ministerial role was digitising the NHS, he had not been involved in the 2016 public spending talks. He said his civil servants were ordered to set out how they would spend the money only after it was allocated.

This is how things are done in government, said Mr Freeman. This is why schemes go wrong, he suggested.

“The deal was done between Jeremy (Hunt) and George (Osborne) – it was a good thing, a big chunk of money to digitalise the NHS,” he said. His civil servants were delighted to have secured the money, he said, but when they were asked to produce a delivery plan, involving 26 different “work streams”, the “system” proved incapable of doing it.

When he visited the team charged with designing a new digital health care system, he found the designers were “nice people” who had based their work on academic literature rather than the experiences of patients and clinicians.

Freeman wanted to make his point that “top down” solutions never work. He said,

“The Treasury should have said you are not even having a penny until we have got your delivery plan and until we know that you are not just going to buy a system off the shelf from some big company.”

Freeman said it was scandalous that the health service still relied on “paper and cardboard” – and 20 year-old computers – when doctors, nurses and patients all had smart devices that could be used to access records and online communities.

He said the answer was “lots of local digital solutions” designed by doctors – and he claimed the IT industry would “quickly” work out how to get the different systems to talk to each other.

“Hiring an off-the-shelf big package from one of the big companies has been proven time and again to fail,” he said.

NPfIT – in which big IT companies were given contracts worth billions of pounds – was “dismantled” in 2011 as a failed £10bn scheme.

As in Freeman’s time as Life Sciences minister, the NPfiT began as a generalised scheme without any clear or precise plan as to how the new billions would be spent.

Comment

It’s astonishing that after 30 years of repeated and costly IT failures in the NHS, little or nothing in Whitehall seems to have changed in the way policy-makers allocate central funds to NHS IT.

All governments want to digitise the NHS without knowing what that involves and without getting the basics right.

Today ministers will talk at every opportunity about the benefits of artificial intelligence and “building an ecosystem for the best technology available” rather than listening to what clinicians and nursing staff want. Clinicians and nurses do not want to spend 20 minutes or more every day logging into a plethora of different systems that don’t talk to each other.

Clinicians and doctors do not want to hear from ministers about how much is going to be spent on a paperless NHS, or on making the NHS world-class, when their existing systems are, for various reasons, unavailable.

It’s true that, apart from all GP practises and a small number of hospitals where impressive systems are part of the culture of the organisation, the NHS is still largely reliant on paper. Still, that does not justify spending £4.2bn without a clear idea of what clinicians and nurses want and need.

How many more governments will over the next 30 years continue the apparently hard-wired trend in Whitehall of professing to have learned lessons from past failures while overtly displaying a contempt for those same lessons?

As Freeman suggests, the best way to spend money on NHS IT is to allocate it to groups of local clinicians and nurses (and especially not hospital boards) to decide how to spend it within a coherent national plan for systems to talk to each other, over secure internet links if necessary.

This isn’t to the taste of senior Whitehall officials who’d rather have central control and a grand strategy to announce in ministerial statements.

Will anything change? Probably not. The likelihood is that we’ll all be paying increased taxes – to be announced on 29 October – for more NHS IT disasters.

Thank you to openness campaigner David Orr for alerting me to Freeman’s comments. 

MP’s horror at getting £4.2bn to spend on digitising the NHS without a plan – BBC

£20bn for the NHS … not spent like this please.