1 Friday, 14 October 2022 2 (10.00 am) 3 MR BEER: Good morning sir, can you see and hear me? 4 SIR WYN WILLIAMS: I can. Can you see and hear me? 5 MR BEER: We can. Thank you, sir. As you know, you're to 6 hear opening statements on behalf of the Department for 7 Business, Energy and Industrial Strategy this morning; 8 then UK Government Investments, UKGI; Fujitsu; and then 9 the Post Office. 10 We start with Mr Chapman on behalf of BEIS. 11 SIR WYN WILLIAMS: Thank you, Mr Beer. 12 MR CHAPMAN: Can you see and hear me now, sir? 13 SIR WYN WILLIAMS: I can. 14 MR CHAPMAN: Excellent. 15 SIR WYN WILLIAMS: If it's easier for you to sit down to 16 speak into the microphone, please do. It's entirely up 17 to you, all right? 18 MR CHAPMAN: I'm stood now, sir, I'll carry on standing, 19 thank you. 20 SIR WYN WILLIAMS: Fine. 21 Opening statement by MR CHAPMAN 22 MR CHAPMAN: As you know, sir, members of the panel, the 23 Department for Business, Energy and Industrial Strategy 24 established and sponsors this independent Public Inquiry 25 and, in that capacity, it would again like to restate 1 1 its thanks to you and to the entire Inquiry team for 2 undertaking this extremely important work. 3 In its separate and distinct task or role as a Core 4 Participant in this Inquiry, the Department is grateful 5 for the opportunity to make this opening statement. It 6 wishes to start by expressing again its sympathies to 7 each of those hundreds of postmasters and their families 8 who have so unfairly suffered the grotesque and long 9 lasting consequences of the Horizon scandal. 10 As the Department has previously stated, it should 11 never have happened and, indeed, should never have been 12 possible. 13 Many good people's lives have been devastated, 14 communities damaged and a national institution 15 undermined. The impact continues to be felt to this day 16 and can never be put right. It's all the worse because 17 the Post Office is publicly owned and exists to provide 18 a public service. 19 The Department is profoundly angry and dismayed that 20 these unforgivable events could ever have occurred. 21 Insofar as the Department might have in any way 22 contributed to them, it apologises unreservedly. 23 The Department set up this Inquiry in order 24 independently to establish the facts, to identify fault 25 and to make recommendations. As it has stated 2 1 previously, the Department's objective throughout this 2 Inquiry is to listen with humility and with a genuinely 3 open mindset and to learn, to learn the facts of the 4 past and to learn lessons for the future, with the aim 5 of preventing anything like this from ever happening 6 again. 7 The Department and the Government as a whole 8 recognises that as part of this process, it too must be 9 held to account. If it was at fault in any way, it will 10 not shy away from admitting it and, as part of a process 11 of continual improvement, it is determined to learn the 12 necessary lessons and will continue to make sure that, 13 wherever change is needed, it is implemented. 14 The Department therefore wishes me to make clear, on 15 its behalf, its commitment to continuing to assist this 16 Inquiry in whatever ways it can. 17 Whilst the Department believes that critical 18 self-reflection has been necessary throughout, it 19 recognises that is nothing like the complete picture. 20 The Inquiry's disclosure continues at pace but remains 21 in its relatively early stages and the Department has no 22 desire to pre-empt or second-guess what the evidence may 23 show. Instead, it will carefully consider the evidence 24 as it emerges in the forthcoming hearings before 25 attempting to make detailed submissions on any topic. 3 1 As the Inquiry-sponsoring Department, it takes this 2 opportunity to emphasise to all other institutional Core 3 Participants and individual witnesses its firm 4 expectation that they should share this same commitment 5 to openness, self-reflection and cooperation with the 6 Inquiry. 7 The Department believes that it will be able to 8 provide substantial assistance to the Inquiry in 9 relation to themes and issues arising in four of the 10 seven phases of the Inquiry. These are Phase 2, insofar 11 as it relates to the Government's political objections 12 for the Horizon project and its role in its coming into 13 being; Phase 5, particularly in relation to government's 14 role in the compensation scheme set up once the scandal 15 emerged; Phase 6, especially relating to the system of 16 government ownership of, and oversight over, the Post 17 Office; and Phase 7, which concerns improvements already 18 made and lessons for the future. 19 I'd like to briefly address those four phases in 20 turn, starting with Phase 2. 21 In relation to Phase 2, four departmental witnesses 22 have provided the Inquiry with statements accompanied by 23 hundreds of pages or hundreds of documents spanning over 24 two decades and you'll be hearing evidence from each of 25 them during the course of the hearings. These witnesses 4 1 include the former Secretary of State for Trade and 2 Industry, Stephen Byers, and two former ministers, 3 Sir Ian McCartney and Alan Johnson, the latter a former 4 postman who was subsequently Secretary of State for 5 Trade and Industry and Home Secretary . 6 Each of the Department's witnesses looks forward to 7 providing the Inquiry with their own unvarnished 8 account, setting out the various difficulties from their 9 perspective within Government, in getting the Horizon 10 project off the ground and the reasons why it was 11 thought so important to do so. 12 They will also, of course, provide the Inquiry with 13 an insight into what was known within Government about 14 technical problems within the system at the time of 15 their involvement. 16 In relation to Phase 5, the Department will be able 17 to assist the Inquiry in relation to what was known 18 within the Department about the emerging evidence of 19 serious problems with Horizon and the Post Office's 20 response. It will, of course, also be able to assist 21 the Inquiry in relation to its role in the compensation 22 schemes set up since the scandal came to light. 23 As I stated in the hearings in July this year, 24 ensuring that affected postmasters quickly achieve full 25 and fair compensation is a key priority for the 5 1 Department. It recognised then, and recognises now, 2 that progress has been slower than anyone would have 3 wished, and it again apologises for this. 4 I won't dwell on compensation issues now in the 5 knowledge that you've already held hearings and will 6 hold another hearing in December focused specifically on 7 compensation. 8 In our written opening statement, we provided some 9 detailed updates as to the current position in order to 10 address the issues which you raised in your progress 11 update and I'm conscious that POL has also done so. 12 Suffice it to say that, in relation to the 13 compensation schemes administered by the Post Office, 14 the Department continues to work actively with and 15 encourage the Post Office to complete these processes as 16 quickly as possible. It continues to work hard to 17 ensure that the financing is made available where 18 necessary. 19 Importantly, the Government has now announced that 20 it will extend its financial support to the Post Office 21 so that those who missed the deadline for applying for 22 compensation under the Historical Shortfall Scheme will 23 be able to make a late application, which will be 24 considered on the same basis as in-time applications, 25 and its financial support will now also extend to cover 6 1 increased legal costs. 2 In relation to the Government's own compensation 3 scheme, which concerns additional compensation to the 4 claimants involved in the Group Litigation against the 5 Post Office, the Department continues to work hard in 6 consultation with the claimants' representatives to 7 develop and progress the scheme and continues to make 8 very good progress in paying interim awards to those 9 affected. 10 Phase 6 concerns issues of governance and oversight. 11 No doubt one key question for the Inquiry in this phase 12 will concern the nature of the relationship between the 13 Government and the Post Office at various times and this 14 is an issue upon which the Department will be able to 15 provide assistance. 16 The Department will also be able to help the Inquiry 17 in relation to the extent to which, in practice, 18 information relating to Horizon was brought to the 19 Department's attention, via the system of corporate 20 governance and oversight which was in place. 21 The problems which the Horizon scandal have revealed 22 in the POL corporate governance and oversight 23 arrangements are of real interest to Government. As 24 I said in my opening remarks, it's not just that the 25 Horizon scandal should not have happened, it's that it 7 1 should never have been possible. For a variety of 2 reasons, the Government remains of the view that the 3 arm's length body model of ownership, whereby POL is 4 operationally independent of Government, is the right 5 model. 6 But that model depends on a properly functioning 7 system of corporate governance and oversight, one that 8 provides a very high degree of assurance, that the 9 Department, as POL's ultimate shareholder, would be made 10 aware of problems of this level of seriousness within 11 a short time of them emerging, so that it could act on 12 them. 13 Clearly the system failed here and it failed over 14 an extended period. The Department is extremely keen to 15 understand why it failed and, in particular, whether 16 there were problems with the way the system of corporate 17 governance and oversight was structured or how it 18 operated in practice, or both. In other words, was this 19 a systemic failure or an operational failure? 20 The lessons to be learned here may have implications 21 for the way in which Government engages with public 22 corporations more generally in the future, not just with 23 the Post Office. 24 That last point leads neatly to my remarks on 25 Phase 7, which concerns current practice and procedure, 8 1 lessons learnt and recommendations for the future. In 2 this phase of the Inquiry, POL will be able to describe 3 the corporate cultural changes which it's making to 4 prevent a recurrence of events in the nature of the 5 Horizon scandal. For its part, the Department will 6 follow with great care the evidence of the impact of 7 those changes to date and, as I've just explained, it is 8 also extremely important that the right lessons are 9 learnt in relation to the system of government oversight 10 over its public corporations, including, but by no means 11 limited to, the Post Office. 12 As set out in the Department's written opening 13 statement and in evidence, the Department has provided 14 to the Inquiry to date, since the Horizon scandal came 15 to light, the Department, together with UKGI, has 16 engaged in a process of reflection and learning and, as 17 a result, a number of changes have already been made in 18 order to improve the system of oversight over POL. 19 But I repeat and emphasise the point that the 20 Department knows that it's not in possession of the full 21 facts. It recognises that further lessons in relation 22 to governance and oversight are likely to emerge from 23 the evidence that the Inquiry will hear. 24 On this and all other issues, the Department will 25 continue to engage with the Inquiry proactively, fully 9 1 and openly. It's committed to making whatever changes 2 are needed and looks forward to receiving your report 3 and recommendations in due course. 4 Thank you. 5 SIR WYN WILLIAMS: Thank you very much, Mr Chapman. 6 Opening statement by MR SHELDON 7 MR SHELDON: Good morning, sir, I hope you can see and hear 8 me. 9 SIR WYN WILLIAMS: Yes, I can. You're slightly quiet, given 10 the distance between you and the microphone but I can 11 hear you, yes. 12 MR SHELDON: Thank you sir, I'll speak up. 13 SIR WYN WILLIAMS: Thank you. 14 MR SHELDON: Good morning. As you will be aware, I act, 15 along with Mr Paul Mertens, for UK Government 16 Investments, which you designated as a Core Participant 17 after the establishment of this Inquiry, and to which 18 I will refer in these brief opening submissions as UKGI. 19 You have not heard much from us so far, sir, and you 20 will not be hearing much from us in Phase 2 either. 21 There are no UKGI witnesses on your roster for these 22 hearings and we have little, if anything, to contribute 23 to your investigation of the procurement, design and 24 rollout of the Horizon System. 25 UKGI's involvement in this Inquiry, at least 10 1 directly, will become more prominent in the later phases 2 of your investigation and most particularly phase 6, 3 when you come to examine governance issues, including 4 the role of the Post Office Board and Central 5 Government. That is because the primary reason for 6 UKGI's participation in this Inquiry is that it and its 7 predecessor body, the Shareholder Executive, or ShEx, 8 acted as the main interface between Central Government 9 and the company, first as a division of the Department 10 of Business, Innovation and Skills and, later, following 11 our separation from the Department, on behalf of the 12 Department for Business, Energy and Industrial Strategy. 13 As a part of this role, we were responsible for 14 briefing Central Government on the activities of the 15 company and ensuring that decisions made by Central 16 Government were effectively communicated to the company 17 and their implementation monitored. 18 From 2012, we had a non-executive director seat on 19 the Post Office Board. This is a role which UKGI 20 performs with an inevitable degree of individual 21 variation for a number of other companies within its 22 portfolio, which are similarly owned by the Government. 23 For the purposes of this Inquiry and by reference to 24 your list of issues, we anticipate that you will be most 25 concerned with the oversight exercised by ShEx and UKGI 11 1 over the performance of the Post Office generally and 2 the strategy and decision making relating to Horizon in 3 particular. 4 We anticipate you will also be concerned with the 5 effectiveness of the steps taken by ShEx and UKGI to 6 hold the Post Office executive to account for its 7 actions and also with the lessons that have been learned 8 and improvements implemented by UKGI in the performance 9 of its corporate governance functions. 10 Sir, as I've said, all of this will come later and 11 I don't propose to take up time today with a detailed 12 analysis of the evidence you will not be turning to 13 consider until later phases of your investigation. 14 However, we understand that this is likely to be the 15 only chance we get to make an oral opening statement and 16 so we wish, at this earliest opportunity, to make UKGI's 17 position clear on a number of important issues. 18 First, sir, I wish to acknowledge, on behalf of the 19 organisation I represent, the profound suffering, 20 distress and hardship endured by many hundreds of 21 subpostmasters, their families and those close to them. 22 We are, all of us, acutely conscious that lives have 23 been ruined irreparably and the damage has been done 24 which can never be undone. 25 What happened in relation to Horizon is an affront 12 1 to any right-thinking person's sense of fairness and 2 justice and plainly calls for the most rigorous and 3 unsparing investigation. 4 I make these observations not just because they're 5 self-evidently true but because they form the basis of 6 the approach that UKGI wishes to take to this Inquiry. 7 Although UKGI's involvement in the matters you will be 8 considering is relatively narrow and self-contained and 9 although it will not be until much later in the process 10 that its role will be subject to detailed examination, 11 we wish to provide you, sir, and the other Core 12 Participants, at the very outset, with a detailed and 13 frank analysis of what we did, what we think we could 14 have done better and what lessons we have learned as 15 a result of the rigorous process of reflection we have 16 undertaken over the course of the last three years or 17 so. 18 To that end, these brief oral submissions in opening 19 are accompanied by a much more detailed set of written 20 submissions, which you will have seen and in which we 21 set out, by reference to the contemporaneous evidence 22 currently in our possession and by reference to what 23 seemed to us to be the key milestones in the chronology 24 as we currently understand it, our assessment of why 25 more effective steps were not taken by the Post Office 13 1 Board, and by UKGI in particular, to identify and 2 address the errors that were being made in the handling 3 of the issues relating to Horizon and the treatment of 4 subpostmasters, which now seem to be so stark. 5 The written submissions also address the work that 6 UKGI has done thus far to ensure that were a similar 7 situation to arise again in relation to one of its 8 assets, it would identify the problems more effectively 9 and deal with them much better. 10 Sir, we recognise that is a lengthy document and we 11 apologise for that but we hope it is a helpful one, at 12 least it will be, when the relevant stage of the 13 investigation is reached. 14 The analysis it contains is a reference to 15 a schedule of documents which were provided to the 16 Inquiry on Thursday last week. We make clear, as we 17 have done in writing, that we do not seek in any way to 18 anticipate and pre-empt the findings of your Inquiry and 19 we fully recognise you may come to different conclusions 20 than we have. 21 The motivation for providing you with our analysis 22 now, at the start of the hearings, is simply this: UKGI 23 serves as the Government's Centre of Excellence for 24 corporate governance, which is a role it takes very 25 seriously, as you would hope and expect. It seems to 14 1 us, frankly, that the handling of the Horizon Issues and 2 the treatment of subpostmasters by the Post Office must 3 reflect at least a potential shortfall in effective 4 corporate governance. That being so, it is incumbent 5 upon UKGI to identify why that may have happened and get 6 on with the job of ensuring that it doesn't happen 7 again. 8 That process started well before this Inquiry was 9 established and a great deal of work has already been 10 done. In those circumstances, it seemed to us that the 11 responsible thing to do was to provide you and the Core 12 Participants with the product of that work now, rather 13 than seeking to remain silent until later in the Inquiry 14 and waiting for the totality of the evidence to emerge. 15 Now, it may be, as we fully recognise, that, as the 16 Inquiry progresses, other issues may emerge, other 17 criticisms may fairly be made and other lessons may be 18 identified. But this is the product of the work we have 19 done to date. We hope you find it provides a useful 20 starting point for your analysis of UKGI's role. We 21 hope it provides the other Core Participants and, in 22 particular, the affected subpostmasters and their 23 families with some reassurance as to how seriously UKGI 24 takes its responsibility to assist this Inquiry in 25 uncovering the truth of what went wrong and as to the 15 1 strength of UKGI's determination to ensure that the 2 mistakes that were made are not repeated. 3 Sir, having made those introductory observations, 4 I propose to let our extensive written submissions speak 5 for themselves and confine myself to only a brief 6 summary of some of the salient aspects of UKGI's role in 7 the relevant chronology, which may assist in placing us 8 in our proper context. 9 We are aware that not everybody may understand who 10 we are and what we do and what part we played at key 11 points in the story, and what follows is intended to be 12 of some assistance in that regard. 13 Prior to 2012, when POL became a public corporation 14 operating independently from Royal Mail Group, the role 15 of UKGI -- or ShEx, as it was then known -- was very 16 limited, at least in respect of matters with which this 17 Inquiry will be concerned. Up until early 2012, as you 18 will have seen, the Post Office was a subsidiary of 19 Royal Mail Group and did not have its own board with 20 independent non-executive directors. ShEx did not have 21 a seat on the Royal Mail board and, in the years leading 22 up to 2012, the role of the Post Office team was 23 primarily to focus on funding issues and to facilitate 24 the process of separating the Post Office business from 25 Royal Mail. 16 1 In particular, ShEx had very little knowledge of, 2 and still less involvement in, the policy for 3 prosecuting subpostmasters for Horizon-related 4 shortfalls that was pursued by the Royal Mail Group. It 5 is for that reason primarily, sir, that the analysis of 6 the prosecution's issue at paragraphs 33 to 64 of our 7 written opening, focuses on the period from 2012, when 8 a ShEx non-executive director took up their seat on the 9 Post Office Board and started to be provided with 10 management information concerning the ongoing process of 11 prosecutions, and 2016, when the prosecution ceased. 12 Following the establishment of the Post Office as 13 a separate public corporation with its own board, the 14 role of ShEx changed materially. The ShEx shareholder 15 non-executive director took up their seat on the board 16 on 1 April 2012 and, from that point onwards, there was 17 a ShEx non-executive director on the Post Office Board 18 throughout the period with which this Inquiry is 19 concerned, although the identity of that individual 20 changed on a number of occasions during that period. 21 There was also a dedicated shareholder team within 22 ShEx during this time. 23 The powers and responsibilities of the ShEx 24 non-executive director were essentially equivalent to 25 those of any other non-executive director. As in almost 17 1 all companies, it was the responsibility of the 2 executive management team to provide the board with 3 accurate, up-to-date information on the operation and 4 management of the company and it was the responsibility 5 of the board to satisfy itself that the company was 6 being properly and effectively run, including by 7 requiring the management team to provide further 8 information, should that be necessary. 9 The ShEx non-executive director, like any board 10 colleague, could request sight of relevant documents, 11 could make proposals to the board as to how it should 12 deal with matters brought to its attention and could, 13 for example, propose that the board seek to exercise 14 more directive oversight of the company's handling of 15 particular issues. 16 The ShEx non-executive director participated in 17 collective decision making around the board table in the 18 same way as their director colleagues, and did not have 19 the power to dictate the actions of the board, or 20 override decisions of which they did not approve. 21 In addition to that broadly conventional role of 22 a non-executive director, the ShEx non-executive 23 director worked with the ShEx shareholder team to ensure 24 that the Department, including the relevant minister and 25 their team, were accurately briefed on the operation of 18 1 the company, and the way in which significant issues 2 were being handled. This was done through meetings with 3 the minister and their officials and the provision of 4 written briefing notes, a number of which appear in the 5 material disclosed to the Inquiry. 6 The ShEx non-executive director's role also included 7 ensuring that the Post Office Board was aware of, and 8 took into account, Government's perspective on 9 significant issues relating to the company when it was 10 making decisions. 11 As you have heard already this morning, the 12 Government did not and does not seek to run public 13 corporations like the Post Office itself nor does UKGI 14 seek to do so on its behalf. That is the job of the 15 company's executive management, overseen by the board. 16 Public corporations like other companies, have to be 17 given the freedom to operate in their own commercial 18 best interests, uninhibited by micro management, either 19 by Central Government or UKGI. However, there is 20 plainly a balance to be struck between arm's length 21 commercial autonomy, on the one hand, and effective 22 corporate governance on the other and, at some points in 23 the chronology, UKGI considers that, on reflection, that 24 balance should have been better struck. 25 Either through its seat on the board or through the 19 1 shareholder team, there are points at which the Post 2 Office management should have been challenged more 3 robustly on the story it was telling about Horizon, 4 points where further information should have been 5 requested and points when a more interventionist 6 approach should have been taken. 7 We identify what we consider those points to be in 8 our written submissions and I don't propose to take up 9 time, sir, in numerating them all now. 10 As you will have seen, in addition to the relatively 11 brief overview of the prosecution's issue, in respect of 12 which our involvement was, as I've explained, 13 peripheral, we have identified six key aspects of the 14 chronology: the Mediation Scheme; the Second Sight 15 Reports; the Deloitte review; the Panorama broadcast; 16 the Parker review and the litigation. These aspects of 17 the chronology, it seems to us, are of particular 18 relevance when one comes to consider the fundamental 19 corporate governance questions at the heart of this 20 narrative, namely whether and, if so, why, key pieces of 21 work undertaken or commissioned in order to investigate 22 the problems with Horizon were not presented to the full 23 board, whether assurances that were provided by the Post 24 Office executive management to the board as to the 25 integrity of the Horizon System were subjected to 20 1 adequate scrutiny and challenge and whether the scale of 2 the reported discrepancies and prosecutions of 3 postmasters should have served to cast doubt on those 4 assurances and prompt the commissioning of further 5 independent investigation on the part of the board. 6 To illustrate the nature of the analysis we have 7 undertaken and the type of conclusion reached, and 8 solely by way of representative examples, we explain in 9 the written submissions why we consider that, on 10 reflection, the Post Office executive management should 11 have done more to ensure that the board was provided 12 with important information concerning the operation of 13 Horizon, and that the board should have done more to 14 insist that such information was disclosed to it. 15 Key examples include the full Deloitte report in 16 mid-2014, the final Second Sight Report in April 2015 17 and the report of Jonathan Swift QC, commissioned by 18 Mr Parker in early 2016. 19 We further explain why the Panorama whistleblowing 20 allegations should have prompted a greater degree of 21 challenge on the part of both the board and the 22 shareholder team to the Post Office management's 23 assurances as to the integrity of the Horizon System and 24 we explain why we consider there should have been 25 a greater degree of oversight of the litigation strategy 21 1 on the part of the board in particular, especially in 2 the early stages of the litigation. 3 Whilst we subject each of these aspects of the 4 chronology to detailed consideration by reference to the 5 contemporaneous documentation in our possession at this 6 stage and, in each case, we set out our reflections, 7 including our provisional conclusions, as to whether 8 opportunities were missed to gain a better understanding 9 of the Horizon Issues, to challenge the narrative being 10 provided by POL as to the integrity of the system and to 11 exercise more effective oversight over the way in which 12 subpostmasters were being treated by the company. 13 I should make clear the use to which hindsight has 14 been put in the conduct of this analysis, as the proper 15 application of hindsight is always one of the most 16 challenging aspects of an investigation of this nature. 17 It should, of course, be excluded from any 18 assessment of the realtime actions and judgements of 19 those directly involved in the material events who did 20 not have the advantage of knowing what has now been 21 established through litigation and subsequent 22 investigation. However, the exclusion of hindsight from 23 the assessment of the actions of those involved in the 24 material events does not mean it cannot be applied in 25 learning lessons and identifying improvements. 22 1 It is a valuable tool in that process and there 2 should be no limitations on its use. That is the 3 approach that has been adopted by the UKGI in its 4 opening statement and we have sought to make clear where 5 we have reached conclusions based on the totality of 6 what is now known. 7 Sir, there is plainly and clearly a long way to go 8 in this Inquiry and a lot of evidence to be heard and 9 a lot of documents to be considered. However, even the 10 necessarily limited analysis we have undertaken for the 11 purposes of preparing the opening statement has made it 12 clear that, in general terms, both the Post Office 13 Board, including the ShEx non-executive director and 14 ShEx itself, placed too much faith in, and was 15 insufficiently critical of, the assurances they were 16 given by the Post Office concerning the integrity of the 17 Horizon System. 18 It is also clear, in general terms, that there were 19 opportunities for more robustly testing those assurances 20 which could and should have been taken, including by 21 requiring the Post Office executive management to 22 provide the material on which those assurances were 23 apparently based. 24 Finally, and at the risk of over-generalisation, 25 there are points in the narrative at which the balance 23 1 between active interventionist governance by the board 2 and management autonomy was wrongly struck and a more 3 interventionist approach was called for. 4 In reaching those provisional conclusions, we have 5 sought to keep in mind throughout the general context of 6 persistent concern being expressed by subpostmasters and 7 their representatives, which was very difficult to 8 reconcile with the assurances being provided by the Post 9 Office and ask why more concern was not expressed about 10 the inherent improbability of so many accounting 11 discrepancies and so many allegations of dishonesty. 12 In addition to placing too much faith in the 13 assurances given by the Post Office management, it is 14 also apparent that at no stage did the board commission 15 its own independent investigation into the workings of 16 the Horizon System to obtain a clear understanding of 17 its operation and potential failings and to test the 18 reliability of the assurances it was being given by the 19 POL management. 20 Accordingly, and in addition to the need to 21 rigorously scrutinise the information that is available, 22 a key corporate governance lesson to be drawn from the 23 handling of the Horizon Issues is the importance of the 24 board being proactive in satisfying itself that the 25 information and assurances provided by management on 24 1 complex and controversial matters is accurate. 2 Sir, we have focused our analysis on those points in 3 the chronology where more could and/or should have been 4 done to identify what was going wrong and to take steps 5 to mitigate the harm that was being caused. We 6 understand that these will be the aspects of the 7 narrative of most concern to the Inquiry and the Core 8 Participants and UKGI welcomes the scrutiny to which it 9 will inevitably be subject and, as I have said, has 10 already subjected itself to a great deal of 11 self-critical analysis. 12 However, at each relevant stage in the chronology, 13 it is plainly necessary to place the actions of the 14 board and ShEx and UKGI in their proper context. 15 Inevitably, the overall picture is a mixed with one with 16 some instances of effective corporate governance from 17 which valuable lessons can be drawn. The establishment 18 by the board of a litigation subcommittee in 2018, 19 including the ShEx non-executive director, and the role 20 it ultimately came to play in challenging the litigation 21 strategy and ultimately bringing the litigation to 22 an end, is perhaps one example and there may be others. 23 An important section of the written opening 24 statement is the part entitled "Lessons learned". As 25 you may have seen, sir, each section dealing with 25 1 individual parts of the narrative concludes with 2 a summary of UKGI's reflections, including the 3 identification of any aspects of UKGI's involvement 4 which, on reflection, could or should have been handled 5 better. Those reflections have been distilled into 6 a series of practical lessons, directed at the specifics 7 of what could have been done better and how to ensure 8 that it would be done better should a similar situation 9 ever arise in the future. 10 This section of the opening statement also includes 11 a summary of the practical measures that UKGI has 12 implemented or is in the process of implementing in 13 order to achieve that objective. There are sections 14 dealing with whistleblowing, corporate culture, 15 oversight of the company's handling of contentious 16 issues and the management of litigation. In each case, 17 the focus is on the role of the board and/or the 18 shareholder team within UKGI, in holding the company to 19 account and ensuring that high standards of corporate 20 conduct are maintained. 21 Sir, as with the rest of the opening statement, 22 nothing in that section is intended to pre-empt the 23 Inquiry's investigation or any conclusions you may 24 reach. This work have been done simply because UKGI 25 continues to play an important role in the governance 26 1 and oversight of a number of assets, including the Post 2 Office and, if there are lessons to be learned from the 3 Horizon story, then the sooner they are learned and 4 implemented, the better. They have been included in the 5 opening statement because it seems us to that if a Core 6 Participant has undertaken work of this nature, it 7 should inform the Inquiry about it at the first possible 8 opportunity. 9 As I have indicated, and as we explain in much 10 greater detail in our written opening, the review of the 11 evidence we have undertaken thus far and the process of 12 reflection in which UKGI has engaged leads to the 13 conclusions that, at a number of points in the 14 chronology, ShEx and the Post Office Board placed too 15 much faith in and were insufficiently critical of, the 16 assurances given by the Post Office management as to the 17 integrity of the Horizon System. 18 It also demonstrates that there were opportunities 19 for testing those assurances, which could and should 20 have been taken, and there were points at which the 21 balance between active intervention in the handling of 22 the Horizon issue and management autonomy was, with the 23 benefit of hindsight, wrongly struck. Whilst those are 24 necessary preliminary conclusions at this stage of the 25 Inquiry, they are nevertheless ones that call for 27 1 an apology to subpostmasters, their families and all 2 those whose lives have been detrimentally affected by 3 Horizon and the failure to identify the problems with 4 the system until it was far too late. 5 Sir, I sincerely offer that apology on behalf of 6 UKGI, its chief executive and its board. 7 Sir, can I end by giving you this assurance: it is 8 not uncommon, as you will know, for institutional Core 9 Participants at the start of a high profile inquiry into 10 a terrible tragedy to assure the chair of their 11 determination to be open and transparent and to 12 diligently provide the inquiry with such cooperation and 13 assistance as it may require. Sometimes those 14 assurances are fully discharged, sometimes less so, and 15 we are conscious that any Core Participant falls to be 16 judged by its actions not the assurances it gives in 17 opening submissions. 18 Nonetheless, on behalf of UKGI, I do wish to assure 19 you of our determination to provide you with the fullest 20 possible assistance in the conduct of your investigation 21 and to answer such questions, as the Inquiry and Core 22 Participants may have of us, as fully and frankly as we 23 can. We are acutely conscious that those affected by 24 Horizon expect and deserve nothing less from us. 25 We hope that the early provision of a detailed, 28 1 reflective and self-critical opening statement stands as 2 reassuring evidence of the approach that UKGI has taken 3 thus far and will continue to take hereafter. 4 That is all we propose to say by way of opening 5 statement. Although not directly involved in this phase 6 of the hearings, we will be following the proceedings 7 closely and, if the Inquiry identifies any issues in 8 respect of which we are able to provide some useful 9 assistance, we are, of course, sir, ready to provide it. 10 Thank you very much. 11 SIR WYN WILLIAMS: Thank you, Mr Sheldon. You have 12 correctly characterised your written submissions as 13 detailed and lengthy but, for my part, and putting it, 14 as you'd expect, entirely neutrally, as to conclusions, 15 it's nonetheless a very helpful document. So thank you. 16 MR SHELDON: Thank you, sir. We're very grateful. 17 MR WHITTAM: Sir, can you see and hear me? 18 SIR WYN WILLIAMS: At the moment, I can hear you, and now 19 I can see you. 20 Opening statement by MR WHITTAM 21 MR WHITTAM: Sir, as you know I'm instructed by Morrison 22 Foerster and I make this opening statement on behalf of 23 Fujitsu Services Limited. 24 SIR WYN WILLIAMS: Yes. 25 MR WHITTAM: Fujitsu is grateful to you for the opportunity 29 1 to make this brief opening statement and for the 2 opportunity to assist the Inquiry. The human impact 3 phase of the Inquiry reinforced the devastating impact 4 the events described by the subpostmasters had on their 5 lives and the lives of others. As stated by Paul 6 Patterson, director of Fujitsu Services Limited in 7 Fujitsu's corporate statement, dated 28 September of 8 this year, Fujitsu apologises for its role in the 9 subpostmasters' suffering. 10 From the outset, Fujitsu is being, and continues to 11 be, fully committed to supporting the Inquiry in order 12 to understand fully what happened and to learn from it. 13 The evidence that has been shared with the Inquiry 14 to date has been focused on the early stages of Horizon, 15 namely the design, pilot and development of Horizon and 16 its operation. The corporate statement outlines the 17 background to the procurement of Horizon and detailed 18 technical matters leading up to the rollout of Horizon 19 from 1999 to 2001. 20 As part of its commitment to helping the Inquiry 21 understand what happened, Fujitsu has devoted 22 considerable resources to responding to the Inquiry's 23 Rule 9 requests as fully and comprehensively as 24 possible. Warehouses have been searched, databases have 25 been processed and electronic documents from 30 1 approximately 120 Fujitsu individuals have been 2 collected. 3 Sir, that amounts to more than 30 million records, 4 electronic and hard copy: going back 25 years, they have 5 been collected. Fujitsu Services Limited, which is the 6 UK arm of Fujitsu, and its predecessors, have provided 7 IT services in the United Kingdom for more than 8 55 years. It has more than 9,000 employees in the 9 United Kingdom across all four countries. As the 10 Inquiry has heard and will continue to hear, Fujitsu's 11 IT systems support everyday life in the United Kingdom, 12 including the retail sector, transport, defence and 13 utilities. 14 It was in 1995 that Post Office Counters Limited and 15 the Department of Social Security, issued a tender 16 entitled "Bringing Technology to the Post Office and 17 Benefits Payments" to potential suppliers. 18 The goal was to computerise Post Office's 19,000 or 19 so branches across the United Kingdom and to automate 20 the payment of benefits to over 19 million claimants. 21 In May 1996, ICL Pathway Limited, part of the Fujitsu 22 group, won that tender. The ensuing project became 23 known, in turn, to ICL Pathway as the Pathway Programme. 24 The Post Office Board recognised that there was 25 a degree of technical risk with whatever system was 31 1 adopted, not least because of the size and complexity of 2 the proposed network. The development of the Pathway 3 Programme proved significantly more complex than the 4 contracting parties had anticipated and it took much 5 longer than was expected. 6 Numerous modifications were made to its design, 7 extensive negotiations took place between the 8 contracting parties. Sir, as you know, the Department 9 of Social Security pulled out in May 1999, three years 10 after the tender had been awarded. 11 The departure of the Department of Social Security 12 meant that a key part of the Pathway Programme, the 13 automated system for the payment of benefits, was no 14 longer part of the project. Rather than abandon the 15 project completely, Post Office and UK Government 16 decided to preserve that part of the system intended to 17 deliver the computerisation of the Post Office branch 18 network. That system became known as the Horizon 19 System. 20 Horizon is multi-functional system, which 21 encompasses point of sale services as well as over 22 100 additional services, including Financial Services, 23 government services, lottery purchases and others. It 24 is a large, bespoke and highly complex system, developed 25 by Fujitsu in conjunction with the Post Office for its 32 1 use in Post Office branches. Horizon initially was 2 rolled out between 1999 and 2001 and, as you know, sir, 3 it remains in use today. 4 Complex IT projects such as Horizon are governed and 5 substantial and complex contracts, which are subject to 6 ongoing amendment and variation. There are, to date, 21 7 conformed conversions of the Horizon contract, the first 8 being an agreement between Post Office and ICL Pathway 9 in July 1999. 10 The Horizon contract also includes hundreds of 11 Contracted Controlled Documents, which are used to 12 provide detailed specifications for operational 13 services. 14 Technical teams at Fujitsu and Post Office have 15 worked closely together, throughout the life of the 16 Horizon System, in design, development and acceptance of 17 Horizon to the present day. Some of those technical 18 teams have shared offices in the past. 19 There were numerous issues identified during the 20 acceptance process for Horizon prior to its national 21 rollout in 1999. Some of these were characterised by 22 the parties as Acceptance Incidents, this included 23 an Acceptance Incident relating to branch account 24 discrepancies. Ultimately, whilst certain Acceptance 25 Incidents remained unresolved, on 14 January 2000 it was 33 1 agreed between the Post Office and ICL Pathway that the 2 national rollout of Horizon could continue. By the end 3 of 2001, Horizon had been rolled out to Post Office 4 branches. 5 Sir, as was outlined in Mr Beer's detailed opening, 6 the Horizon System was changed over time in response to 7 changing Post Office requirements. There have been the 8 three broad phases to Horizon: what we have been 9 describing as Legacy Horizon between 1999 and 2010; then 10 HNG-X, or Horizon Online, from 2010 to 2017; and HNG-A 11 or Horizon Anywhere, from 2017 onwards. 12 Legacy Horizon was the original phase of the Horizon 13 System, it went through a number of substantial changes 14 between 1999 and 2010. HNG-X, or Horizon Online, was 15 rolled out to the majority of Post Office branches by 16 the end of August 2010. It was a replacement for the 17 Legacy Horizon system and was designed to take advantage 18 of advancements in technology since Legacy Horizon was 19 rolled out. 20 HNG-A, or Horizon Anywhere, was progressively rolled 21 out to branches from 2016. That development was driven 22 by the need to replace aging Windows NT4 branch counter 23 technology with Windows 10 operating system. 24 During its early phases, the Inquiry will examine 25 the existence, extent, knowledge and management of bugs, 34 1 errors and defects in the Horizon System and of remote 2 access. 3 Fujitsu acknowledges that there have been a number 4 of bugs, errors and defects with the Horizon System and 5 that, in some instances, those bugs had the potential 6 to, and indeed did, affect the integrity of the 7 subpostmaster branch accounts. 8 No complex IT system will ever be completely free of 9 bugs, errors and defects. It is for this reason that 10 processes governing the identification, communication, 11 escalation and resolution of bugs, errors and defects, 12 were put in place between Post Office and Fujitsu. 13 The issue of remote access is also of significance 14 to this Inquiry and to the subpostmasters. It was, as 15 you will have witnessed, sir, an important topic in the 16 human impact phase. In general terms, remote access is 17 the ability to access the Horizon System from a location 18 other than a counter at the branch. 19 Remote access includes all mechanisms by which the 20 Horizon System can be accessed remotely and all 21 mechanisms by which branch information can be changed by 22 a method other than branch staff entering data into 23 Horizon using the counter application provided at the 24 branch. 25 Sir, Fujitsu had, and continues to have, the ability 35 1 to remotely access Horizon in multiple ways via various 2 ingress access types. It had that from the time of the 3 initial rollout to date, including both Legacy Horizon 4 and Horizon HNG-X. The Post Office has been aware from 5 an early stage of Fujitsu's ability to remotely access 6 the Horizon System. 7 Sir, Fujitsu remains fully committed to supporting 8 the Inquiry in every way it can, in considering the 9 evidence as it is presented to your Inquiry, and that's 10 all that I propose to say in the opening statement on 11 behalf of Fujitsu. 12 SIR WYN WILLIAMS: Thank you very much. Thank you. 13 Ms Gallafent? 14 MS GALLAFENT: Good morning. 15 SIR WYN WILLIAMS: I will be guided by you now. If you 16 don't think there's need for a mid-morning break, then 17 please continue, subject only to a 15-second delay while 18 I locate your written opening. But if you want to have 19 a mid-morning break, is now the best time or some time 20 into your submissions? 21 MS GALLAFENT: I suspect now is the best time, sir. 22 SIR WYN WILLIAMS: Fine, then we'll have a 15-minute 23 mid-morning break. 24 (11.00 am) 25 (A short break) 36 1 (11.15 am) 2 SIR WYN WILLIAMS: Ready when you are, Ms Gallafent. 3 Opening statement by MS GALLAFENT 4 MS GALLAFENT: Thank you, sir. 5 I would like to thank Counsel to the Inquiry and, of 6 course, all his team for his careful and thorough 7 opening statement earlier this week and all 8 representatives for their submissions. 9 I am obviously not going to attempt today to respond 10 to or address every point raised in those submissions 11 but they will equally, obviously, be the subject of very 12 careful consideration by Post Office going forward. 13 As the Inquiry will be aware, Post Office publicly 14 welcomed the Secretary of State's decision to establish 15 this Inquiry in September 2020 and, similarly, publicly 16 welcomed the Secretary of State's decision in May 2021 17 to convert it into a statutory Inquiry. 18 The start of this phase represents an important step 19 in the proceedings and Post Office is grateful for the 20 opportunity to make some short submissions in this 21 context. 22 I start by apologising unreservedly on behalf of 23 Post Office for the suffering and damage caused to every 24 person who has been affected by the Horizon IT scandal. 25 That includes not only postmasters directly affected by 37 1 Post Office's failures but all others, including, in 2 particular, their families, whose lives have been 3 impacted by those failures. 4 On the day that the human impact hearings began in 5 February this year, Nick Read, the chief executive of 6 Post Office, reiterated the apology that he'd personally 7 made on behalf of the Post Office before the BEIS Select 8 Committee in January of this year for the impact on 9 lives of all postmasters that was caused by historic 10 failures by Post Office. 11 As many of those involved in the Inquiry may know, 12 Mr Read joined Post Office in September 2019, after the 13 Common Issues judgment and before the Horizon Issues 14 judgment, and played an active role in working towards 15 the settlement of the Group Litigation in December 2019. 16 In his evidence to the Select Committee, Mr Read 17 also publicly stated that what happened was 18 unacceptable, that the Inquiry should get to the bottom 19 of what went wrong and that it provides an opportunity 20 to help draw a line for some people who have suffered 21 for decades. He expressed his determination that Post 22 Office does all it can to help the Inquiry achieve that. 23 The Post Office remains fully committed to those 24 objectives. It regards its role in this Inquiry as 25 having two key elements. The first is to listen and 38 1 learn from all the evidence and representations made by 2 other Core Participants. Although Post Office has 3 worked resolutely over the last few years to respond to 4 the issues raised in the judgments of Mr Justice Fraser, 5 it does not come before this Inquiry convinced that it 6 knows all the answers. Only by listening intently to 7 the evidence given during the course of the Inquiry, to 8 the representations, submissions and questions posed by 9 other Core Participants, as well, of course, by you 10 yourself, sir, and Counsel to the Inquiry, can Post 11 Office hope to understand fully exactly what went wrong. 12 We, therefore, do not seek at this stage to 13 anticipate either the evidence to come or the Inquiry's 14 potential conclusions in this or any other phase. 15 I would wish to make it clear that in not saying 16 anything specific about Phase 2 itself in this opening 17 statement, we certainly mean no disrespect to all of 18 those who have worked so hard to prepare for this first 19 substantive phase. 20 So far as the evidence that has already been given 21 during the course of the human impact hearings and via 22 the focus groups, Post Office can assure the Inquiry and 23 all those who have given evidence that their voices have 24 been heard. 25 Before those hearings, in his public statement, 39 1 Mr Read anticipated that their testimonies would make 2 for uncomfortable listening for Post Office but which it 3 needed to hear. He was right in both respects. He and 4 other senior officers and employees at the Post Office 5 have between them personally listened to a significant 6 amount of the testimony. In addition, they have been 7 provided of summaries of each day's hearing and other 8 witness statements which were submitted to the Inquiry. 9 They wish to pay tribute to everyone who gave 10 evidence, whether orally or in writing, for their 11 strength and courage in doing so. It was, rightly, 12 chastening to hear it. 13 Of course, listening, in and of itself, is not 14 enough. It's what happens as a result that really 15 matters. Before the human impact hearings, Post Office 16 created a team which was responsible for identifying and 17 recording action points arising from the evidence. That 18 team assigned each action point to a relevant business 19 area with the knowledge and expertise to address the 20 points. 21 Thereafter, the team has been responsible for 22 progressing responses to each one. As of yesterday, 23 there were 255 action points identified, 193 of which 24 have been resolved. In order for an action point to be 25 resolved, the response to it must have been formally 40 1 approved at group executive level or by a person who 2 formally reports directly to the relevant group 3 executive member. 4 By way of example, 28 of the actions points involve 5 allegations made about Post Office staff members, 6 including current and former staff members, where 7 they've been named or described. This includes 8 allegations in relation to the conduct of interviews, 9 inappropriate pressure being brought to bear on 10 postmasters or others and the withholding of evidence 11 from them. 12 All such points have been brought to the attention 13 of the Post Office 'Speak Up' team, which is the team 14 responsible for dealing with whistleblowing reports and 15 processes. That team advised that contact be made with 16 the witnesses involved to find out further information 17 to ascertain whether there are grounds for 18 an investigation. 19 In June of this year, Post Office wrote to the 20 representatives of those who had made such allegations, 21 to propose that the Speak Up team speak to the witnesses 22 directly or that the witnesses provide a written outline 23 of all information relevant to their allegations. 24 Post Office also recently invited the Inquiry to 25 notify one of the anonymised witnesses of its invitation 41 1 to Speak Up or provide information to the Speak Up team. 2 The Inquiry has since advised Post Office of the 3 identity of the representatives for the anonymised 4 witness and Post Office has written directly to them. 5 It is obviously a matter for individuals as to 6 whether they want to pursue this opportunity and we 7 recognise that some may feel this is either too little 8 too late or they simply do not want to engage with Post 9 Office in the light of their experiences. However, 10 I can assure all witnesses that Post Office genuinely 11 wants to investigate those allegations and will take 12 appropriate action where necessary and required and 13 would encourage those who wish to do so to speak and 14 engage with the Speak Up team. 15 In addition to action points relating to allegations 16 against specific individuals, Post Office has carried 17 out, or is in the process of carrying out, internal 18 investigations and reviews of contemporaneous documents 19 to verify other broader points raised by human impact 20 witnesses, these include, for example, alleged conduct 21 by Fujitsu. 22 Where the executive level member or the reportee 23 tasked with approving the resolution of the action point 24 considers it appropriate, feedback on the outcome of the 25 investigations will be provided to the individual 42 1 witness. 2 As indicated in our written submissions, Post Office 3 anticipates that a number of the outcomes of these 4 investigations will be relevant to forthcoming stages of 5 the Inquiry and it will, of course, be disclosing all 6 relevant information and outcomes in that context. 7 Several current postmasters gave evidence about 8 ongoing problems with Horizon and in respect of 9 training. In each case Post Office has looked into the 10 concerns and has taken, or is in the course of taking, 11 steps to resolve them. 12 A number of other action points resulted in Post 13 Office reviewing its policies to ensure an appropriate 14 policy is in place to prevent a similar situation 15 arising again. For example, this includes ensuring that 16 the current policy on suspension is sufficiently robust 17 to address any concern about inconsistency and that 18 weekly updates are provided to suspended postmasters to 19 avoid them being left uncertain as to the status of 20 an investigation. 21 Finally, there were a number of action points in 22 relation to the Historical Shortfall Scheme and other 23 compensation issues. Some of these have been resolved 24 by improvements to the website, for example to make it 25 clear that compensation payable under HSS could be made 43 1 to the estate of a deceased person. Others have led to 2 the changes which were considered at the interim 3 hearings on compensation, such as the removal of the 4 clawback clause in relation to interim hardship 5 payments. I'll deal more fully with other developments 6 in relation to compensation in a moment. 7 Post Office hopes that its proactive engagement with 8 the points raised by the human impact witnesses 9 demonstrates its commitment to hearing the voices of 10 postmasters, engaging with their concerns and doing all 11 that it can to resolve them, both for the sake of the 12 individual concerned and to ensure that such issues do 13 not rise again. 14 As the Inquiry may be aware, Mr Read, who is here 15 with me today, was here earlier this week and other 16 board members and senior police have been and will be in 17 attendance during the Inquiry hearings. These include 18 people with particular responsibility for remediation 19 issues, such as Ben Tidswell, who was appointed to the 20 board as a non-executive director in August 2021 and 21 chairs the historical remediation committee, which as 22 its name suggests, was established to oversee actions to 23 address past failures. They also include Simon 24 Recaldin, who joined Post Office in January of this year 25 as the historical matters director. 44 1 They, together with other board members and senior 2 employees, will hereafter be maintaining a very close 3 oversight of these proceedings, assisted by the steering 4 committee that has been established for the purposes of 5 the Inquiry. 6 Mr Read has asked me to make it clear that any 7 postmaster who wishes to raise a matter with him, either 8 in person or in writing, should feel free to contact him 9 directly. His contact details for this purpose appear 10 on the Historical Matters section of the Post Office 11 website. 12 While he was chair of Post Office, Tim Parker wrote 13 to every postmaster whose conviction was overturned with 14 a personal and heartfelt apology. Post Office has 15 always recognised and understood the value of such 16 personal apologies. There may be some postmasters who 17 do not wish to be contacted by Post Office in this or, 18 indeed, any way, which position Post Office of course 19 respects. 20 Having carefully considered the submissions made on 21 behalf of postmasters represented by Howe+Co, Post 22 Office invites any postmaster who would like to meet 23 a senior member of Post Office and receive a personal 24 apology, to contact Post Office via Mr Read in order for 25 that to be arranged. 45 1 The newly appointed chair of Post Office, Henry 2 Staunton, will be taking up his post on 1 December 2022. 3 He has also asked me to confirm his unequivocal 4 commitment to supporting the work of the Inquiry. 5 The other key role of Post Office is in doing all 6 that it can to assist the Inquiry with its work. A core 7 element of is assistance is, of course, responding to 8 requests for documents and witness statements. As of 9 yesterday, Post Office has disclosed just under 95,000 10 documents to the Inquiry. 11 The issue of the disclosure of documents by Post 12 Office, which was, of course, traversed on Tuesday 13 morning, will be the subject of the further interim 14 disclosure statement to be provided to the Inquiry next 15 Tuesday afternoon and may be the subject of further 16 consideration during the course of this phase. 17 I therefore say no more about it at this stage, save to 18 reiterate Post Office commitment to assisting the 19 Inquiry, both in respect of requests for documents and 20 for witness statements. 21 I now move to the issue of compensation. Post 22 Office wishes to thank you, sir, for your detailed and 23 insightful progress update on issues relating to 24 compensation. As we made clear in our written 25 submissions, Post Office has carefully considered each 46 1 of your conclusions and has taken action in nearly all 2 cases by acting in accordance with your provisional 3 views and conclusions. 4 In relation to the Historical Shortfall Scheme, HSS, 5 the statistics up to the end of September were set out 6 in our written submissions. In short, Post Office 7 remains on track to meet the target of making offers in 8 95 per cent of eligible applications by the end of this 9 year. 10 As of yesterday, offers have been made in 1,976, 11 that's 83 per cent, of cases. After the tax on interest 12 has been removed, this amounts to a total value of 13 £55 million. Payments have been made in 1,600 cases, 14 which, again, after removing to tax on interest, amounts 15 to a total value of £34.5 million. 16 1,654 applicants have accepted offers in settlement. 17 Of those who did not initially accept the offer, 48 have 18 subsequently accepted it; 23 accepted it before any good 19 faith meeting; 16 accepted it after a good faith meeting 20 but before any escalation meeting; 11 cases have 21 proceeded to an escalation meeting, of which four 22 accepted the offer and two applicants have asked to 23 proceed to remediation. A further 161 cases are being 24 actively supported through the HSS dispute resolution 25 procedure by the dedicated dispute resolution team. 47 1 Sir, this team wasn't the subject of any discussion 2 at the interim compensation hearings so it may assist 3 the Inquiry to know it consists of experienced Post 4 Office employees, many of whom have been postmasters 5 themselves. Every applicant who has indicated that they 6 wish to engage the dispute resolution procedure is 7 assigned a designated lead person from the dispute 8 resolution team who will communicate with them by phone 9 or email in order to understand their concerns, answer 10 their questions and assist them throughout the process, 11 which Post Office recognises may be regarded as complex 12 and unfamiliar to many postmasters. 13 There is also an independent wellbeing support 14 telephone line engaged by Post Office to support 15 applicants going through the scheme. This line is 16 operated by a company called Optima, who are fully 17 independent of Post Office and they can provide 18 emotional wellbeing support to individuals who are 19 beginning their applications and who feel they need 20 further emotional support. There is no charge for this 21 service. 22 Post Office remains in agreement with your 23 observation that there is a balance to be struck between 24 the speed of decision-making and ensuring that offers 25 which are made are full and fair. It is satisfied that 48 1 the continuing progress towards its target has not been 2 at the expense of the fairness of the process. In 3 particular, Post Office is mindful to ensure that 4 applicants and other external stakeholders have 5 sufficient time to collate and provide any relevant 6 information or evidence before an offer is made and 7 during the dispute resolution procedure. 8 If applicants or other external stakeholders 9 consider the process is too fast or too slow or have 10 views on it, that is obviously something they should 11 raise with Post Office, which, throughout the running of 12 the HSS scheme, has welcomed feedback and sought to act 13 on it where appropriate. Indeed the action of the 14 dispute resolution team was precipitated by relevant 15 feedback. 16 Turning to the issue of late applicants to the 17 scheme, Post Office fully accepts your conclusion that 18 the delay in determining whether outstanding 19 applications received after November 2020 should, or 20 indeed could, have been accepted into the scheme was 21 wholly unacceptable and Post Office apologises for its 22 part in this delay. 23 Sir, you may have seen the formal announcement made 24 by the Minister on 6 October that BEIS and His Majesty's 25 Treasury have now approved Post Office's proposal for 49 1 funding in respect of late applicants to the HSS. 2 Post Office is in the process of writing to all 3 224 postmasters who told us they wished to join the 4 scheme after the extended deadline and are not currently 5 included in HSS. They have provided copies of the 6 application form, the consequential loss principles and 7 guidance. As of noon yesterday, 97 letters had been 8 sent out and Post Office expects to send the majority of 9 the remainder by early next week. It has also put 10 a notice on the historical matters section of its 11 website, inviting any further applications. 12 The eligibility criteria for the consideration of 13 late applications will reflect those of current HSS 14 terms of reference, save that, of course, instead of 15 having to apply by the November 2020 deadline, 16 applicants will instead be asked to explain why they 17 were unable to submit an application by that deadline. 18 By way of guidance on the website, examples of possible 19 reasons provided might include that they didn't know 20 about the scheme or were poorly, overseas or caring for 21 a relative. That is obviously not an exhaustive list of 22 circumstances. 23 In the event that Post Office were minded not to 24 accept an application on the basis of timing, it has 25 accepted your recommendation, sir, to introduce 50 1 an independent decision-maker to whom an applicant could 2 apply for a formal determination of whether their 3 application is eligible. Post Office has not yet 4 finally determined whether that role should be fulfilled 5 by one of the King's Counsel members of the current 6 Independent Advisory Panel, that might detract from the 7 time they can spend on decision making in relation to 8 substantive applications, or another independent body, 9 such as a different senior barrister, but we will 10 obviously keep you appraised of its final decision on 11 that point. 12 As the Minister's statement made clear, the 13 Independent Advisory Panel will carry out the same role 14 for late applications as it currently does in making 15 a recommendation to Post Office on settlement amounts. 16 This will ensure consistency and objectivity. 17 Post Office is currently considering whether there 18 should be any other variations to the current process 19 but I can assure you that no variations will be made 20 that would, in any way, result in a less fair process 21 than that currently provided for under the existing 22 scheme. 23 As noted in our written submissions, Post Office has 24 also reviewed its position on eligibility for the 25 scheme, where the branch was operated by a limited 51 1 company which has since been dissolved. 2 On 30 August, Post Office announced it had 3 re-examined the position where that was ineligible and 4 will be writing to all postmasters, who were previously 5 treated as ineligible, to explain it's now reviewing 6 their claims. There are 29 claimants in this position, 7 of which Post Office has already written to 22, and it's 8 working out how best to contact the remaining seven 9 where there's an issue as to whom Post Office should 10 correspond with as a result of bankruptcy or insolvency. 11 Turning to the issue of legal assistance, Post 12 Office recognised the force in your view that fairness 13 to the remaining applicants in the scheme demands that 14 these allowed for advising on offers, which are made 15 henceforth, should be increased to levels commensurate 16 to the work reasonably carried out by an applicant's 17 lawyer and, as a result, for offers made from this week 18 onwards, post Office will offer to pay an applicant's 19 reasonable legal costs. 20 As a starting point, Post Office considers that £400 21 is reasonable for the cost of consulting a solicitor on 22 an offer and its full and final settlement terms, where 23 it's offered to pay the applicant's claim in full or 24 largely in full, and that £1,200 is reasonable where it 25 has not. But it will invite any applicant who considers 52 1 that additional legal support is required to discuss the 2 position with Post Office, so they can obtain the advice 3 they require in the confidence that Post Office will pay 4 their reasonable costs. 5 Post Office has also considered your view in 6 relation to the legal assistance at the dispute 7 resolution phase. Post Office, at that point, will now 8 also offer to pay applicants their reasonable legal 9 costs. Again, Post Office has a starting point but not 10 a fixed point that, in such cases, the sums of £5,000 11 for cases which relate solely to a shortfall loss and 12 £10,000 for cases which have other heads of loss may be 13 appropriate, but to give the applicant comfort and with 14 the aim of avoiding collateral disputes on costs, Post 15 Office will seek to agree those costs with applicants in 16 advance of them being incurred. 17 Finally, in relation to the scheme, I turn to the 18 issue of hardship payments. On 29 July, Post Office 19 published a statement on the Historical Matters section 20 of its website, to reflect the existing but 21 unpublicised, by then, practice of considering making 22 early payments of up to £10,000 to applicants who are 23 experiencing financial difficulties or suffering serious 24 health issues. On 22 August, it updated that statement 25 to confirm that if an applicant has received an offer 53 1 but needs more time to dispute it, it will consider 2 paying part of the offer for applicants who are 3 experiencing financial difficulties or suffering serious 4 health issues. 5 Post Office did not consider it was necessary to 6 amend the terms of reference of the scheme to that 7 effect. Its current view is that this is sufficient to 8 mitigate the risk of hardship prior to a claim being 9 definitively resolved but it will continue to keep this 10 approach under review. It is conscious that there have, 11 so far, been relatively few cases to enter the dispute 12 resolution procedure, just 209 to date. 13 As the meetings as part of those procedures 14 continue, Post Office will take into account whether 15 there are particular issues or themes arising which 16 would justify making interim payments other than on 17 hardship grounds and, if so, will reconsider its current 18 policy. 19 Moving on to Post Office's approach to the 20 overturned historical convictions. As you heard earlier 21 this week from Mr Moloney, progress continues to be 22 made. As of yesterday, Post Office paid approximately 23 £8.9 million in respect of this aspect of compensation 24 across both interim and final payments. 25 As we set out in our written submissions, of the 54 1 81 overturned convictions, applications for initial 2 interim payments have been made in all but one case and 3 that's the choice of the intended applicant. 4 Interim payments have been offered in all but three 5 cases and all of those offers have been accepted, save 6 in one case where the applicant has only recently 7 instructed his lawyer but his lawyer has indicated that 8 his client intends to accept. 9 No further applications over and above what I'm 10 going to characterise as the public interest only cases 11 have been declined. In addition, Post Office has made 12 second additional interim payments in respect of three 13 cases. To date, there remain only the three public 14 interest only cases where an interim payment has been 15 refused or challenged. These are, of course, the cases 16 referred to the Crown Court by the Criminal Cases Review 17 Commission, prior to the Court of Appeal's judgment in 18 Hamilton, a judgment that brought very helpful clarity 19 in this area. 20 Although Post Office cannot eliminate the 21 possibility that new, unexpected issues will emerge in 22 the future, there are good reasons to believe that this 23 issue, created by the so-called public interest only 24 cases is a problem of three and will remain so. Against 25 that background, Post Office has carefully considered 55 1 your conclusions in relation to potential challenges to 2 a refusal of Post Office to make an interim payment, 3 namely that a person or panel should be appointed to 4 deal with all such issues, rather than Post Office being 5 the final arbiter in such circumstances. 6 As the Inquiry is aware, the three former 7 postmasters whose applications for interim payments have 8 been refused are all represented by Hudgells Solicitors. 9 Post Office has continued the constructive work it 10 commenced with Hudgell Solicitors on this issue on April 11 of this year and I can now confirm that, in order to 12 seek to resolve matters, Post Office and Hudgells 13 solicitors have agreed to go to mediation with 14 an independent mediator. 15 We and Hudgells solicitors will obviously keep the 16 Inquiry updated on progress made in this respect. 17 Were any other cases to arise in the future where 18 an interim payment was refused by Post Office, which, as 19 I've indicated, we regard as unlikely, Post Office would 20 seek to adopt the same constructive approach to 21 identifying the best route forward via some form of 22 independent dispute resolution process. 23 Moving on to final compensation and Post Office's 24 current approach to resolving those cases. As you're 25 aware, sir, Lord Dyson provided his evaluation at the 56 1 end of July and this was provided to you, sir, last week 2 at your request. 3 Following receipt of Lord Dyson's evaluation, Post 4 Office confirmed it fully endorses his Lordship's 5 findings and has agreed to be bound by them in future 6 cases. The value of the early neutral evaluation 7 approach is amply demonstrated by the fact that, to 8 date, six of the ten claimants involved in that process 9 have now formally settled their non-pecuniary claims 10 with Post Office in light of the advice provided by 11 Lord Dyson and two of those having reached full and 12 final settlements on all aspects of their claims. 13 Post Office anticipates the remaining four 14 non-pecuniary loss claims should be agreed shortly. 15 Post Office will also be reflecting the ENE outcomes 16 when considering future applications for interim 17 payments. 18 Following the approach to evidence adopted in the 19 ENE, Post Office has shared or offered to share the 20 evaluation with the legal representatives of all 21 potential claimants with overturned convictions. It is 22 inviting all concerned to submit evidence in support of 23 their non-pecuniary claims so these can be settled 24 swiftly in advance of their pecuniary claims and damages 25 paid out in short order. I repeat that invitation 57 1 today. 2 To date, Post Office has received non-pecuniary 3 claims from 31 claimants, including the ten involved in 4 the early neutral evaluation, with overturned 5 convictions. It has already made offers worth more than 6 £4.5 million across 19 cases; it expects to make further 7 offers in the coming weeks. It is hoped that offers 8 will be made by Post Office in the majority of 9 non-pecuniary claims by the end of this year. Post 10 Office, UKGI and BEIS are all working hard to see that 11 this is accomplished and encouraging all claimants to 12 come forward with their claims as soon as possible. 13 Post Office will offer more help and support to 14 those claimants with overturned convictions, who do not 15 currently have the benefit of legal representation. 16 There is currently, in fact, only one unrepresented 17 claimant. They will do so to ensure they are not 18 prejudiced, that they too are aware of the opportunity 19 to take their non-pecuniary claims forward on 20 an expedited basis and they are aware of what they need 21 to do in order to do so. 22 A further development we've flagged up in our 23 written submissions was confirmation on 23 September by 24 His Majesty's Treasury that all compensation payments to 25 postmasters with quashed convictions are to be exempt 58 1 from tax. Post Office notified all the affected 2 postmasters on the same day of this positive news. This 3 followed several months of work by Post Office and 4 officials at UKGI and BEIS working together to put 5 forward the proposal to His Majesty's Treasury. 6 The exemption is hugely beneficial to those seeking 7 compensation from Post Office. It will allow Post 8 Office to process their claims more quickly and, 9 crucially, provide certainty to postmasters who 10 understandably might have worries about the tax effect 11 of their compensation payments. 12 Post Office is grateful to His Majesty's Treasury 13 for making this tax treatment possible. 14 In relation to pecuniary claims, as I've indicated, 15 the two initial cases that we've previously reported on 16 in our submissions have now been settled, one following 17 a mediation. A further six claims with supporting 18 schedules of loss have been received, in respect of 19 which Post Office is working with the solicitors 20 concerned on evidential matters to enable opening offers 21 to be made. Again, Post Office wishes to encourage all 22 claimants and potential claimants to present their 23 claims as soon as they are able to do so. 24 It was reported to Post Office that a challenge for 25 claimants was the lack of ready, available information 59 1 from HMRC. To assist claimants in that regard, Post 2 Office, BEIS, HM Treasury and HMRC have created 3 a simplified process which will allow claimants to 4 access that information within 28 days. That has been 5 communicated to all claimants. It is hoped that that 6 will assist those bringing claims to advance them with 7 greater ease and expedition. Again, we are grateful to 8 all parts of Government involved for their assistance in 9 this respect. 10 It is against this background, sir, that I turn to 11 your view that there should be contingency planning as 12 to how disputes about final compensation should be 13 reviewed. That is a matter which the Post Office has to 14 date dealt with by adopting the dispute resolution 15 procedure, which is considered to be most appropriate to 16 the point in issue, as agreed with the claimants in 17 question, and, in that regard, as I've indicated, have 18 already used the ENE process and a mediation process to 19 positive effect. 20 The issue of whether there should be one single 21 process which would be applicable in every case is being 22 considered internally and, crucially, being discussed 23 with legal representatives of claimants who may wish to 24 avail themselves of it. As you've heard, Post Office 25 and Hudgells solicitors have worked constructively to 60 1 date to seek to resolve those claims and it is clear 2 that Post Office must have regard to a range of views as 3 well as potential solutions, before landing on any 4 particular contingency plan. To be clear, though, Post 5 Office is committed to seeking consensual resolution to 6 disputes, facilitated by alternative dispute resolution 7 procedures in all cases. 8 In this context, you've noted that, to date, less 9 than 20 per cent of the postmasters whose conviction 10 could be Horizon related have sought to have their 11 convictions quashed to date and, in this context, we 12 note the potential distinction between a Horizon related 13 case and a Horizon case, as defined by the Court of 14 Appeal, those being cases as well as those conceded on 15 public interest grounds, which are capable of being 16 successfully appealed. 17 Post Office would like to reiterate its 18 encouragement to affected postmasters to consider their 19 options for appeal. Whilst it has written to the vast 20 majority of the 706 individuals who have potentially 21 relevant convictions, or their relatives, there remain 22 12 individuals who Post Office has been unable to 23 contact -- I'm sorry, 12 that they will continue to 24 trace but so far are unable to contact -- and 20 who 25 they've been unable to contact because all efforts to 61 1 trace them to date have been unsuccessful. 2 Post Office continues to support the CCRC in their 3 endeavours to independently contact those who have not 4 responded to Post Office or who Post Office have been 5 unable to trace. We very much hope that the publicity 6 surrounding the Inquiry, as well as publicity as to 7 settlements being made by Post Office, may assist in 8 communicating that important message to them, and Post 9 Office will continue to keep under review options for 10 doing so. 11 Post Office also continues to provide support to the 12 Crown Prosection Service, the Department for Work and 13 Pensions, the Public Prosecution Service in Northern 14 Ireland, the Scottish Criminal Convictions Review 15 Commission, the Crown Office and Procurator Fiscal 16 Service and the Royal Mail Group, in respect of 17 individuals who are not prosecuted by Post Office. This 18 support has included providing documentation held by 19 Post Office, tracing services, as well as round table 20 and individual meetings to insist in their independent 21 reviews. 22 Post Office identified 97 potential cases in 23 Scotland and Northern Ireland and 182 Crown Prosecution, 24 Department for Work and Pensions and Royal Mail Group 25 cases. Two cases are currently before the Court of 62 1 Appeal in Northern Ireland. 2 There is one further matter in relation to 3 compensation which Post Office wishes to draw the 4 Inquiry's attention to, albeit one that may fall 5 indirectly within the Inquiry's terms of references if 6 at all. Post Office's annual report for 2020-2021, 7 published in April of this year, recorded three items in 8 relation to exceptional and contingent funding. Those 9 were the HSS, compensation payments in relation to 10 overturned historical convictions and what was referred 11 to as postmaster remediation. The particular potential 12 liability identified in the report was future payments 13 to eligible postmasters who did not receive remuneration 14 during periods of suspension before March 2019 when Post 15 Office policy changed following the Common Issues 16 judgment and Mr Justice Fraser's comments on that 17 position. 18 However, in the annual report, the directors noted 19 and acknowledged that, as Post Office continues to 20 review its historical practices and policies, further 21 associated liabilities may arise. In April of this 22 year, Post Office wrote to all current postmasters who 23 were potentially affected by the policy of suspension 24 without remuneration and put a statement on its website 25 to confirm it's working hard to ensure that arrangements 63 1 are put in place as quickly as possible to address the 2 impact of this previous policy, including working with 3 the Government to secure the necessary funding to make 4 payments to the people affected. 5 At that time, as recorded in the annual report, 6 Government have provided Post Office with a comfort 7 letter stating its intention to provide support in 8 respect of these liabilities. The data required for the 9 completion of the business case for funding was provided 10 to UKGI and BEIS over several months, the remaining 11 requested detailed provided at the start of May. Post 12 Office hopes to have the final position on funding 13 confirmed as soon as possible. 14 Subject to that, Post Office will then write to all 15 potentially eligible postmasters confirming its 16 intention to make payment to them, to compensate for the 17 absence of remuneration during the period of their 18 suspension. 19 Post Office's review into other aspects of business 20 activities which could have given rise to detriment, 21 potentially, to postmasters is ongoing, but an example 22 of one where other detriment has already been identified 23 relates to maintained error limits. The individual 24 amounts may be small, around half of them are for £1 or 25 less, but Post Office has already remediated all current 64 1 postmasters who suffered such losses and remains fully 2 committed to remediating former postmasters who have 3 done so. 4 Post Office does not consider that areas of 5 potential detriment, such as these, fall directly within 6 the Inquiry's terms of reference, which of course 7 concerns the failings associated with the Post Office's 8 Horizon IT System, or rather then in relation to other 9 business policies or procedures. But it fully 10 recognises that, in the course of considering issue 214, 11 that is the extent to which changes and improvements 12 have been made to the culture, policies and procedures 13 of organisations, including Post Office, the Inquiry may 14 wish to take into account Post Office's approach to 15 identifying potential areas of detriment, other than 16 those arising from Horizon, but which nevertheless 17 require remediation, and affecting that remediation. 18 In those circumstances, POL thought it right to 19 raise the matter at this stage. 20 Finally, I would like to conclude with some comments 21 on Phase 7. During that phase, you will hear evidence 22 from Post Office as to the very considerable changes 23 that have been made since the events that led to the 24 Horizon scandal. I do not seek to anticipate that 25 evidence today, not least as improvements will continue 65 1 to be made during the period leading up to Phase 7. 2 However, it is right that, at the outset of these 3 substantive phases, the Inquiry should have at least 4 a sense of the scale and pace of changes that have 5 already been made since the Common Issues judgment and 6 the Horizon Issues judgment. 7 In particular, Post Office has sought to reset its 8 relationship with postmasters, upon whom we all depend. 9 At the highest level of governance, this aim has been 10 supported by the additional of two non-executive 11 director postmasters, elected by other postmasters on 12 the Post Office Board, to ensure that decision making 13 fully takes into account the reality of the postmaster 14 experience. All of those involved in this Inquiry are 15 aware the Common Issues judgment included significant 16 findings about the contractual relationship between Post 17 Office and postmasters. 18 Immediately following that judgment, Post Office 19 prioritised a contract review and restatement exercise 20 to make sure that the contracts with all new and 21 existing postmasters included the implied terms set out 22 in that judgment. Moreover, there have been a number of 23 external, as well as internal, reviews, and a gap 24 analysis undertaken to improve and identify improvements 25 against best practice. 66 1 To track the improvements resulting from the various 2 recommendations from those reviews, an Improvement 3 Delivery Group was set up in February 2021 to provide 4 oversight at group executive level within Post Office. 5 That group categorised a total of 447 CIJ related 6 actions, delivery against which is closely monitored. 7 When last reported to the board in July of this year, 8 407 actions were considered to be complete, and Post 9 Office expects 443 of them to be complete before the end 10 of March next year. 11 By way of examples, these actions include the 12 establishment of an independent appeal panel, including 13 former postmasters, to review disputed investigations, 14 suspensions and terminations; new training, content and 15 learning aides to support postmasters better in how 16 their branch should be run and their business grown, and 17 a system called Brunch Hub, which is a portal for 18 postmaster communications, trading data, chat help, 19 e-forms and other operational support. 20 By way of further assurance, Post Office has 21 commissioned a series of reviews from its internal audit 22 function, as well as an independent external review, to 23 assess the actions taken or planned by it at that date, 24 as to whether Post Office was conformant, or on a path 25 to conformance, with the issues in the CIJ. 67 1 Of the 43 separate themes and sub-themes that were 2 identified by the independent reviewer as being in the 3 CIJ, as at September 2021, Post Office was found to be 4 fully or substantively conformant in 24 of them, and on 5 the path to conformance for a further ten. For the 6 remaining nine, Post Office was found to need to be 7 developing a path to substantive conformance on three, 8 and five were not scored, as either overlapping with 9 other themes of falling outside of the CIJ remediation 10 work, or falling within the scope of remediation work in 11 registration to the Horizon Issues judgment. 12 Based on this report, and progress made to date, by 13 the end of March 2023 the Post Office expects to be 14 fully or substantively conformant against 40 of those 43 15 themes. 16 Turning to the Horizon Issues judgment, Post Office 17 has similar embarked upon an exercise of internal and 18 external scrutiny and improvement in the light of 19 Mr Justice Fraser's findings on the 15 Horizon Issues. 20 Whilst Mr Justice Fraser recognised that the version of 21 Horizon operational at the time of handing down his 22 judgment was relatively robust, and far more robust than 23 that operational in and before 2017, he didn't 24 differentiate in his findings between issues which 25 pertained to pre-and post-2017. Accordingly, all issues 68 1 identified have been considered, even if they may no 2 longer be relevant. 3 To address those issues, in November 2020 Post 4 Office set up a dedicated Horizon IT team, initially 5 supported by a specialist third party. This team 6 undertook an extensive gap analysis to establish its 7 current position against the themes of the HIJ, 8 determine the actions required to close those gaps until 9 the Horizon platform is retired. 10 Through this course of action, Post Office 11 identified a range of the required outcomes with 12 different levels of priority and urgency. Most of the 13 outcomes have already been achieved. 14 Whilst Post Office remains committed to continuing 15 its remediation work in relation to the existing Horizon 16 System, as the Inquiry will be aware, it has also 17 embarked upon an ambitious and accelerated large-scale 18 effort to retire Horizon by 2025 and replace it with 19 a new system which will be simpler, faster, and more 20 intuitive. The design and testing for the new system is 21 being undertaken in conjunction with the focus group of 22 240 postmasters to ensure that their views and needs are 23 fully taken into account. 24 The first small-scale pilots of the new system 25 started this month, and they will be carefully evaluated 69 1 over the next few months before gradually being expanded 2 to more branches. 3 By Phase 7, Post Office will therefore be in 4 a position to demonstrate in real life what its future 5 electronic point of sale system will look like. 6 Post Office will seek to show, in Phase 7, that 7 lessons truly have been learned and concrete changes 8 have taken place or are under way. As part of that 9 process, Post Office intends to adopt the same approach 10 in Phases 2 to 6 as it did to the human impact hearings; 11 that is to identify the issues raised during the course 12 of the hearings with a view to providing immediate 13 clarifications or responses, where appropriate, or to 14 investigating further where necessary, and making 15 changes to current procedures or policies as required. 16 Post Office recognises that the forensic scrutiny to 17 which its past will be subject during Phases 2 to 6 will 18 be uncomfortable for many, but it nevertheless welcomes 19 the inevitable criticisms as part of the essential 20 process of change and improvement. 21 Thank you again for the opportunity to make these 22 submissions. 23 SIR WYN WILLIAMS: And thank you, Ms Gallafent, including my 24 thanks for your various updates on issues which we've 25 been looking at for some time now. 70 1 So, does that conclude the oral submissions? 2 I should ask formally whether there are any Core 3 Participants in the room who have had reason to rethink 4 their view as to whether they wish to make oral 5 submissions, because if they do not make them now, they 6 won't be making them. So is there anyone else who 7 wishes to speak? Otherwise, Mr Beer, does that conclude 8 our business for today? 9 MR BEER: Sir, there are no bidders for submissions, and 10 that does conclude our business for today. We're back 11 at 10.00 am on Tuesday, when you will be hearing from 12 the Inquiry's expert over two days, Mr Charles Cipione. 13 SIR WYN WILLIAMS: Thank you. So, until Tuesday, I wish you 14 a good weekend, everyone. Bye bye. 15 MR BEER: Thank you, sir. 16 (11.58 am) 17 (The hearing adjourned until 10.00 am on Tuesday, 18 18 October 2022) 19 20 21 22 23 24 25 71 1 I N D E X 2 Opening statement by MR CHAPMAN ......................1 3 Opening statement by MR SHELDON .....................10 4 Opening statement by MR WHITTAM .....................29 5 Opening statement by MS GALLAFENT ...................37 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 72