Post office inquiry clarifies the ambiguous position on the postal sub-administrator’s compensation

The head of the public legal investigation into the Horizon scandal has made it clear that he will investigate whether the 555 former sub-managers who took the Post Office to court will receive fair compensation.

It comes after the president of the Justice for Subpostmasters Alliance (JFSA) withdrew the campaign group’s primary participation status.

JFSA members have so far been excluded from any compensation scheme, other than what was awarded to them after they took the post office to court and established that the financial shortfall was caused by a computer system at the post office, not by them.

In 2009, an investigation into Computer Weekly revealed for the first time that subprogram managers were blamed for unexplained accounting deficiencies, which many suspected were caused by the computer system they use to do the calculations. (See below for a timeline of Computer Weekly stories about the scandal.) They had to cover the shortfall with their own money and many went bankrupt. There were also 736 prosecutions of former branch office managers for financial crimes, and many of them were imprisoned.

When the head of the public inquiry announced the final list of issues to be covered by the investigation, he said financial compensation for victims would be included, but it wasn’t clear if that included the 555 that the Post Office took to court and won.

After winning a multi-million pound class action lawsuit, 555 former sub-managers were awarded £57.75 million in damages. However, due to the need for litigation funding to fight a government-owned organization willing to spend more than £100m, only £11m was left for sub-post employees.

When distributed to the victims, it didn’t even include the money many paid the post office to cover unexplained losses.

compensation plan

As part of the settlement, the Post Office had to open a compensation system for any secondary postal officials affected by the errors in the Horizon system, but it ruled out having them taken to court. The Post Office and the government repeatedly stated that the funds awarded for the settlement were complete and final. The court case also gave rise to grounds to challenge criminal convictions for unexplained losses. To date, the convictions of 72 sub-postal managers who received criminal convictions for false accounting or theft have been overturned. The government promised them a temporary compensation of £100,000.

None of this would have happened had it not been for the victory of the JFSA and the Supreme Court.

The JFSA has always stated that its number one requirement in the investigation is fair compensation for its members. This includes reimbursement for legal costs of £46m, all the money sub-postmasters paid to cover losses that didn’t really exist, and compensation for losses and suffering over the years since members were wrongly blamed for accounting errors.

Last week, Alan Bates, who formed the JFSA in 2009, asked members to withdraw their support for the investigation while it was unclear whether fair financial compensation was included.

After the JFSA withdrew from primary involvement, the investigation wrote to the campaign group to confirm that it would include financial compensation for its members in the investigation.

He said: “On behalf of the President, Sir Wayne Williams, I can confirm that paragraph 183 of the List of Inquiry Issues is intended to consider whether all Postal Sub-Managers, Directors, Directors and Associates affected, including the 555 claimants in the class action have been compensated. In the case of Alan Bates et al. v. Post Office enough for the wrongs they suffered.”

Bates wrote to JFSA members: “It may just be a coincidence that the statement appeared after the JFSA withdrew and encouraged others to join in, because the issue of the group’s financial compensation was missing from the final list of issues, or perhaps it was the failure to make the point when [the list] books. You decide, but now it is there, in writing.”

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