By Tony Collins
The Public Accounts Committee and the National Audit Office have been alerted to the costs of the High Court trials over the Post Office Horizon IT system.
Parliamentary committees have the power to hold people to account after they have left an organisation.
Could this happen in the case of the publicly-owned Post Office whose directors have decided to spend, potentially, tens of millions of pounds on an avoidable High Court litigation?
Nearly 600 sub-postmasters are suing the Post Office because they say their lives were ruined when the Post Office required them to make good non-existent shortfalls shown on an imperfect Horizon system. The Post Office says Horizon has always been robust and that they were entitled to hold the sub-postmasters liable for losses shown on Horizon.
The Post Office appears resolved not to settle the case despite campaigns for justice in Parliament and by the Justice for Sub-postmasters Alliance. One unanswered question is whether the Post Office board is hardening its position in the face of the campaigns.
Campaign4Change emailed the Public Accounts Committee about costs of the litigation. As a result, the National Audit Office, which works closely with the accounts committee, contacted UK Government Investments, which represents the Government’s interest as sole shareholder of Post Office Limited.
The Committee told us,
“The NAO has now completed its enquiries and reviewed supporting evidence.
“Post Office Limited is a government owned company which is primarily funded through income from it is operations and is not audited by the Comptroller and Auditor General.
“The NAO has therefore limited its enquiries to understanding the role of UKGI [UK Government Investments] given it has no remit to audit the actions of Post Office Limited.
“The NAO discussed the case with UKGI to understand the governance in place between Post Office Limited and UKGI and to confirm there was appropriate oversight of Post Office Limited’s decision to defend the litigation.”
Regarding the accountability of individual Post Office Limited’s directors, the National Audit Office said, “Since Post Office Limited’s inception in 2012, UKGI has had a representative on the Board as a Non-Executive Director. The same government representative is also a member of the subcommittee of the Board which specifically considers this issue. These committees are involved in decision making around the litigation case and the representative regularly reports to ministers on these matters.
“From the work performed by the NAO, they have concluded that the involvement of UKGI in decision making appears appropriate and the level of oversight proportionate.”
The Committee said the National Audit Office has not directly considered the actions taken by the Post Office Board but the case is being kept under review.
Following the NAO’s investigation, the Department for Business Energy and Industrial Strategy, which is responsible for the Post Office, sought an assurance from the Post Office’s CEO Paula Vennells that departmental funds meant for transformation and business investment will not be used on the Horizon litigation.
Also the BEIS department now requires regular written assurances that BEIS funding will be used for the intended purposes only.
When a Parliamentary committee decides to summon a witness formally, the witness is summoned to attend the committee by an order signed by the chairman.
Failure to attend a committee when formally summoned is a contempt and if a witness fails to appear, when summoned in this manner, his or her conduct is reported to the House of Commons which can deal with the matter as an act of disobedience.
MPs and peers are expected to look more closely at the actions of the Post Office in the light of its decision to try and remove Sir Peter Fraser, the judge in the Horizon IT case. The Post Office’s application to remove the judge could greatly increase costs of the case which are already expected to run into tens of millions of pounds.
Following the Post Office’s application for the judge’s removal, the second of four High Court trials has been suspended and will not resume until 3 April.
Journalist Nick Wallis reports that the application for the judge’s removal coincided with evidence being given, in part, by the chief architect for the Horizon system at Fujitsu. He was being questioned on the system and possible errors.
Thank you to campaigner Tim McCormack whose Freedom of Information requests unearthed the letter dated January 2019 to the Post Office from the Department for Business, Energy and Industrial Strategy that seeks assurances on funding for the Horizon IT litigation.
Postofficetrial– Nick Wallis
The power to summon witnesses
The process for formally summoning a witness is outlined in a House of Commons paper:
“When a committee decides to summon a witness formally, the witness is summoned to attend the committee by an order signed by the chairman. Failure to attend a committee when formally summoned is a contempt and if a witness fails to appear, when summoned in this manner, his conduct is reported to the House… If he still neglects to appear, he will be dealt with as in other cases of disobedience.
“It is the House which will ultimately decide how a case of disobedience should be dealt with.”