1 Thursday, 12 May 2022 2 (9.30 am) 3 SIR WYN WILLIAMS: Ms Hodge, before we get going with 4 Mr Brown, can I suggest the timetable, Mr Enright, 5 because part of it will involve you. We are going to 6 hear from Mr Brown, and then have a summary of his 7 wife's evidence read, as I believe, and then there is 8 one further witness scheduled before lunch, which, in 9 the normal way of things, would take us to, I don't 10 know, maybe 11.30, quarter to 12. So I'm proposing 11 that we have lunch whenever we finish, effectively, 12 and start again at 1 o'clock, if that's okay, if your 13 witnesses will be ready by this afternoon at 14 1 o'clock, and at any point which is convenient to 15 you, we understand that the remaining Scottish summary 16 is now on the system, so that summary can be read, and 17 if you would read four more of your choosing, then we 18 will have a comparatively limited number to read in 19 Belfast and we're all on track, so to speak. So if 20 everybody is happy with that, that's how we'll 21 proceed. 22 Good. Over to you, Ms Hodge. 23 EDWARD BROWN (sworn) 24 Questioned by MS HODGE 25 MS HODGE: Good morning, Mr Brown. My name is 1 1 Catriona Hodge, as you know. I'm going to ask 2 questions on behalf of the Inquiry. Please can you 3 state your full name. 4 A. Edward Brown. 5 Q. You made a statement, Mr Brown, on 7 February of this 6 year; is that correct? 7 A. That is correct. 8 Q. Do you have a copy of that statement in front of you? 9 A. I have. 10 Q. Please could you turn to the final page of your 11 statement. Do you see your signature there? 12 A. Yes, I do. 13 Q. Have you read the statement again since it was first 14 made? 15 A. Yes, I have. 16 Q. Is the content true to the best of your knowledge and 17 belief? 18 A. Yes. 19 Q. You worked as the subpostmaster of the Cardonald 20 post office on Paisley Road for approximately 21 21 years; is that right? 22 A. Yes. 23 Q. Before you became a subpostmaster, you'd worked in the 24 fibreglass industry; is that correct? 25 A. Yes. 2 1 Q. You were -- then later assisted your brother in 2 running his newsagent; is that right? 3 A. Yes. 4 Q. Where was that located? 5 A. At Cardonald, just about 200 yards away from where the 6 post office now stands. 7 Q. For how long did you work with your brother in his 8 newsagent? 9 A. Probably about five years. 10 Q. Why did you decide to apply to become a subpostmaster? 11 A. The opportunity came up and it seemed a good business. 12 Q. In which year were you appointed? 13 A. Oh, oh, well, I might come back to there. Hold on; 14 see if I've got it here. I was only 19. It must have 15 been; I probably should have had that worked out. 16 Q. That's okay. I think you've said February 1989 -- 17 does that sound correct? 18 A. That sounds right, sorry. 19 Q. That's all right. 20 Can you describe the branch? 21 A. It was -- when we first took over it was like a big 22 hut. It was run down. We bought the land the hut was 23 on, eventually knocked down the branch, built a couple 24 of shop units, and the post offices were in temporary 25 units, and I took over temporary, 28 year ago. 3 1 Q. You ran the branch with your wife; is that right? 2 A. I ran it with my wife in the old hut, and then we 3 moved into the new premises. 4 Q. How did you divide the work of running the branch 5 between you? 6 A. She done the work. I done anything else. Really, 7 she's a better accountant than me, so -- at the very 8 beginning it was very labour intensive, and I've not 9 got an attention span, so she really done the work and 10 I done what I had to do. 11 Q. You've mentioned moving premises. When did that take 12 place? 13 A. I think we were only in the old premises for under 14 a year, probably six months. 15 Q. When you moved premises, did you purchase the new 16 property? 17 A. No, it was a leasehold on the building. 18 Q. What changes did you make to the premises when you 19 took over the lease? 20 A. As I say, the old hut was on the land, and we knocked 21 that down, built five units -- well, my family built 22 five units, and we put it temporary into there, so 23 it's a brand-new unit. So in there we had to fit it 24 out with kind of a slat wall and we had to pay towards 25 the bandit screen, if I'm right; it was about £20,000. 4 1 So it was a very shiny office to start with. But at 2 that time, that only at the beginning, the post 3 offices had been kind of reinvented, so it was a nice 4 shiny office compared to what was available at that 5 time. 6 Q. What type of business did you run from the branch? 7 A. It was mainly post office. We did start to do 8 stationery and some -- but it was auxiliary; it was 9 only really part of the service, rather than a real 10 business. 11 Q. Now, the Horizon System wasn't introduced until almost 12 a decade after you were appointed; is that right? 13 A. Yes. 14 Q. How did you balance your business accounts in the 15 years before Horizon -- 16 A. It used to be on a Friday night, you had an 17 old-fashioned ledger and you put all the figures in, 18 calculated it at the end of the day; the difference 19 between the two sides of your ledger is what you were 20 short. 21 Q. And can you please describe how your branch accounts 22 were reconciled at the time with the post office 23 accounts? 24 A. Well, you normally -- you started off with an opening 25 balance. You paid out money, you took in money, 5 1 anything else out and in, and by the end of the day 2 they had to balance with the opening figure and the 3 closing business against what you sold or what you 4 didn't sell. It left you with a difference, and you 5 were liable for that difference. 6 Q. You've mentioned in your statement that as part of the 7 balancing process you would send paperwork to the 8 Post Office accounts team in Chesterfield; is that 9 right? 10 A. Yes, we used to send a big black -- a big brown bag at 11 one point, with loads of -- all of the duplicate bits 12 of paper that you had ended up at Chesterfield. 13 Q. When Horizon was introduced, that system came to an 14 end? 15 A. It came to nil, aye. 16 Q. Do you recall when the Horizon System was first 17 installed in your branch? 18 A. Yes, yes. 19 Q. Forgive me -- 20 A. Oh, the time? Well, I think it was just -- it was 21 either early 2000, or just 1999. It's not exactly an 22 exact date. 23 Q. Did you receive training from the Post Office when the 24 Horizon System was first installed? 25 A. Yes. We went for two days in the Piping Centre in 6 1 Glasgow. There were some units there that weren't 2 online. They were working units but not online, and 3 they showed you what we thought was a fantastic 4 system, like it was going to save you all this time. 5 In theory, it looked as if it did save you all this 6 time, but in the long run it wasn't right. 7 Q. Did you have an opportunity during your training to 8 carry out a balance on Horizon? 9 A. No. No, they just showed you how to input 10 transactions, and I don't even think we had -- would 11 have had a terminal each. It was like a kind of group 12 session, so they really inputted the stuff, showed you 13 how wonderful it was, and at the end of the figures 14 tallied, but we weren't actually doing it. 15 Q. Were you satisfied at the time with the quality of the 16 classroom training you received? 17 A. I have to say yes, because we thought it was all new. 18 It wasn't good, and they weren't any more than -- as 19 it looked fantastic, the system, it should have done 20 what it said, but it didn't. 21 Q. How confident did you feel using the system when it 22 was first introduced? 23 A. Once again, computers were a new thing to everybody so 24 nobody was confident in using the computer itself. 25 The system, I thought, was going to work, but it just 7 1 didn't work, it just didn't work. 2 Q. Did you receive any further training from the 3 Post Office after Horizon was installed? 4 A. No, not really, no. 5 Q. You've mentioned in your statement that some trainers 6 came and attended your branch. Do you recall that? 7 A. I think I remember that. We were actually the busiest 8 post office in Scotland at one point, so we used to 9 have, like, six tellers. So we were quite close to 10 the Post Office at that time, and I can remember them 11 sending -- it wasn't usual for them to send trainers 12 into the branch for it, and I'm sure we had two. One, 13 I can't remember her name, but I'm sure we had two, 14 but how long, I think it was only a day or maybe 15 a half day. 16 Q. Do you recall carrying out a balance whilst the 17 trainers were with you in branch? 18 A. Yes, yes. 19 Q. Can you describe what happened, please? 20 A. Well, we got to the end of the night and they 21 were -- it was new to them as well, but they were 22 good, but it was new to them, and they couldn't 23 balance. So we spent more time trying to re-input the 24 stuff, and we ended up with £100 shortage. But that 25 fault wasn't seen at that time, and they thought it 8 1 was wonderful. 2 Q. What efforts did your trainers make to try and help 3 you get to the bottom of what caused that shortfall? 4 A. With hindsight, not a lot. All we did was just keep 5 redoing what we had already done in case we had done 6 it wrong, and it still came to £100 short. So they 7 didn't know how to fix it. 8 Q. What were you told to do to resolve that discrepancy? 9 A. Simply write a cheque. 10 Q. Is that what you did? 11 A. Yes. 12 Q. How did you feel about paying money in to cover 13 a shortfall which you could not explain? 14 A. Well, I was from a newsagent background, we don't have 15 shortfalls, so £100 was, it was just -- it cannot 16 happen, but it did, so I wasn't happy. 17 Q. Had you experienced shortfalls and discrepancies when 18 using your paper-based system? 19 A. Yes, but most of them you could either see that a 20 teller has done something wrong; you have done 21 something wrong. You might never have got it back but 22 you had a bit of paper there, you could see where it 23 went wrong. It made you feel a bit better, but you 24 still had to put something in. 25 Q. So you described some classroom training and then some 9 1 further training in branch for a day or two. Was that 2 the extent of the training you received? 3 A. Yes, that was it. 4 Q. What other guidance did you have available to you to 5 help navigate the system? 6 A. The helpline. I think they had an A4 binder, what was 7 really brain surgery if you looked at that, but it 8 wasn't much help. That was good for referring back to 9 when the helpline was talking to you, but really it 10 was the helpline that was the major assistance. 11 Q. Did you continue to experience problems in balancing 12 your accounts after that first shortfall? 13 A. Yes, it became kind of normal. You could have periods 14 where you had nothing, and then it became normal to 15 have a shortage (audio distorted). 16 Q. How frequently would you say these shortages arose? 17 A. Oh, it was a long time ago, but it became -- if you 18 didn't have a reasonable shortfall every month, you 19 were doing really well. A reasonable shortfall being 20 in the hundreds. 21 Q. What steps did you take to try to resolve yourself 22 what had caused these shortfalls? 23 A. Well, at the beginning we just -- you blamed yourself. 24 So you were more accurate, you had people 25 double-checking what you had actually just done; you 10 1 double-checking other people's stuff. We put CCTV in, 2 pulled more staff in. There was just nothing else you 3 could do. We originally thought it was down to 4 ourselves because, according to the Post Office, it 5 worked, so it must work, so any mistakes were really 6 on us. 7 Q. You've mentioned contacting the helpline. Did they 8 assist you to get to the bottom of what had caused 9 these discrepancies? 10 A. Well, the helpline, as I say before (audio distorted) 11 at the time, but I know for a fact, because I knew 12 some of them on it, that they were counter staff that 13 had just been introduced to the system as well, so 14 they weren't any wiser than us. Helpful, but no real 15 help. 16 Q. What were you told by the helpline to do to resolve 17 the shortfall? 18 A. It depends on the case, but really a lot of times you 19 roll over and something would come back, or make it 20 good. It was more make it good than roll over. Roll 21 over was if you could actually think you had something 22 that might come back, they told you you had to roll 23 over the next morning or not open the branch. But 24 most of the time it was roll over. 25 Q. When you were told to make good the cash, did you 11 1 accept their advice and pay the money in? 2 A. Yes, yes. 3 Q. Why did you do that? 4 A. Well, my belief is that in my contract I was liable 5 for anything between my opening balance and my closing 6 balance, which seems fair if I make a mistake. But if 7 it's not my mistake I shouldn't be responsible for it. 8 Q. Did you believe that you were responsible for it at 9 the time? 10 A. Yes, I have to say we did. I believed that somebody 11 was responsible, and it could only be somebody in that 12 building. 13 Q. How did that affect your relationship with your staff 14 at the time? 15 A. It put strains on it, because everybody knew they were 16 working with a -- if you're working with a cash 17 business, they know it's a wee bit harder because you 18 have to have a certain type of mentality for it, but 19 it made the staff apprehensive, it made us 20 apprehensive. 21 Q. You've explained that your wife, Catrona, was managing 22 the branch, in effect. 23 A. Yes. 24 Q. Did it affect your relationship with her? 25 A. It became strained at times because somebody has to be 12 1 responsible, and I'm not touching it, it's not my 2 mistake, I'm only the one that's putting it in, but 3 somebody has to get blamed and maybe we blamed each 4 other. 5 Q. You've described on one occasion experiencing 6 a shortfall of £9,000; is that right? 7 A. Yes. 8 Q. And do you recall when this apparent shortfall arose? 9 A. Oh, I couldn't put a date on it, it was that long ago. 10 Q. Did you contact the helpline for assistance in 11 relation to that significant shortfall? 12 A. Yes. Yes. 13 Q. Did they help you get to the bottom of the 14 discrepancy? 15 A. No. They said they would contact Chesterfield and 16 contact (unclear) units. I'm not saying they didn't 17 contact the (unclear) units, but they were no help to 18 -- we were told to roll it over. You believed if you 19 had a small shortage it just went over the counter. 20 £9,000 couldn't go over the counter in a mistake, so 21 that had to come back, in your mind at that point, but 22 it never came back. 23 Q. What happened to that shortfall at the end of your 24 trading period? 25 A. I think we carried it for four weeks and then the 13 1 Post Office set up a repayment out of salary. Over 2 what period, I can't remember, but it was normal -- I 3 had to do that a few times, and normally it was over 4 the year. 5 Q. How much do you think you paid into the Post Office in 6 total to make good shortfalls shown by Horizon? 7 A. Oh, it's nearly -- yes, my accountant has worked out 8 £85,000. It's 85-plus; but 85 I can guarantee that's 9 what I lost in the accounts over the years. 10 Q. You were using Horizon for approximately 15 years; is 11 that right? 12 A. It was, yes. 13 Q. Your appointment came to an end in May 2015; is that 14 right? 15 A. Yes. 16 Q. You had been offered a leaver's payment under the 17 Network Transformation Programme; is that correct? 18 A. Yes. 19 Q. Why did you decide to accept the offer of this 20 payment? 21 A. It was getting a bit weary. We were having to -- the 22 post office had -- it wasn't took over to make big 23 bucks. It was a steady living, and you were only 24 getting a steady living out of it. It was hard work 25 for -- hard work and a lot of responsibility for what 14 1 you got out of it, so we decided to take it and run. 2 Q. What was the effect on your personal finances of 3 making -- repeatedly making good shortfalls shown by 4 the Horizon System? 5 A. Well, you done without, it was as simple as that. You 6 done without. Things that didn't have to be done 7 wasn't done. 8 Q. Did you get into debt? 9 A. We went into debt but we had to -- at one point I took 10 money against my house to pay, so the post office 11 balanced. I think there was a couple of loans on the 12 go at one point as well. Yes, the money -- the 13 Post Office had to get the money. The long and short 14 is that if the Post Office didn't get the money, we 15 didn't have a post office. If we didn't have 16 a post office, we didn't have a business that was 17 sellable or viable. 18 Q. Can you describe how the financial processes you faced 19 affected your standard of living? 20 A. We lived, and that was about it. We went to work and 21 then we'd go home, and we went to work. There was not 22 a -- I'm not saying we didn't have a nice -- we made 23 it what it was, but we didn't have luxuries that we 24 probably should have had. 25 Q. You said in your statement there were times when money 15 1 wasn't so tight that you and your wife would visit 2 your relatives in order to have a hot meal. 3 A. Yes. Before the Inquiry, we actually forgot about 4 these times. We actually -- it made you rethink it, 5 how many times you went and visited people at certain 6 times. Yes, we did. 7 Q. Can you please describe what effect this hardship had 8 on your mental health? 9 A. On my wife probably worse than me. I'm quite good at 10 getting on with things, but it made life harder, it 11 made life harder. 12 Q. Can you describe how she was affected? 13 A. She probably takes things on board more than me, I can 14 shrug things off and get on with it tomorrow. 15 Tomorrow is another day and I've forgot about 16 yesterday. She was upset at the time. I have to say 17 that I wasn't getting things -- she would get things 18 before I got things, and the kids would get things 19 before we got things, but at times that was hard. 20 Q. You said in your statement that running the branch and 21 experiencing these shortfalls put a significant strain 22 on your marriage; is that right? 23 A. Yes, yes, yes. 24 Q. After your contract with the Post Office came to an 25 end, you and your wife continued to run the newsagent; 16 1 is that right? 2 A. Yes. 3 Q. And you're still running that today; is that correct? 4 A. Yes, we are. 5 Q. What effect did the loss of the post office have on 6 the retail side of your business, your newsagent? 7 A. Well, the newsagents is actually three doors away from 8 the post office, so we were -- we've still got the -- 9 we were relying on the post office being three doors 10 away because that brings the people into the right 11 side. In the post office it's -- the newsagents is 12 still okay, but we do -- we know working day-to-day in 13 the post office is a wee bit different than the 14 relationship we used to have when I was in, daily in, 15 to the post office. 16 Q. What are your working hours like today? 17 A. I do about 115 hours a week, but I don't -- that's the 18 way it is. That's the way it is. 19 Q. Is all of that in your newsagent, or do you have -- 20 A. All of that is in the newsagents. 21 Q. When you took on the post office, what had your hopes 22 been for your retirement? 23 A. Well, everything was planned for 55, because that 24 just -- out of the blue, we picked that figure years 25 ago. That's not going to happen. So it's had an 17 1 knock-on effect really. We've got nothing to show for 2 all the years. 3 Q. You've just explained now the post office branch 4 continued to operate, although you were no longer the 5 subpostmaster; is that right? 6 A. Yes. 7 Q. And you've explained in your statement that you've 8 continued to experience some problems with the 9 Post Office system -- 10 A. Yes. 11 Q. -- can you describe that? 12 A. My wife would have been better at that one, but the 13 Post Office is very slow to realise anything, so there 14 are still problems with the lottery with the 15 Post Office, and we've tried -- 16 Q. Do you have a terminal in your newsagent? 17 A. We have -- well, a funny set-up, because we have the 18 lottery and the newsagents. On a Wednesday night the 19 post office -- we do a balance on a Wednesday. On a 20 Wednesday night the post office shuts at 5.30. I take 21 it that the Post Office accounting system shuts; the 22 computerised side of it shuts down at 6 o'clock at 23 night. We are still open to 7.30 at night. If we do 24 a transaction at 7.30 -- at 6.40, that transaction is 25 now took over into the next day. But according to the 18 1 Post Office they've finished all their accounts on the 2 Wednesday night at 6.30, but it throws up errors if we 3 do transactions, and they don't understand this -- 4 Q. You said -- sorry. 5 A. -- so you have to argue with the helpline every time. 6 If you happen to have that transaction, they want to 7 send you an error for the total of that transaction, 8 whereas you can easily explain there, it's in black 9 and white, what has happened, but they can't 10 understand it. They just don't have the ability. 11 Q. So do you find that you're continuing to have problems 12 liaising with the helpline? 13 A. We continue to have problems. 14 Q. Were you aware at the time that these shortfalls were 15 occurring that there were others like you who were 16 affected by problems with Horizon? 17 A. No. You see, well before the internet you were on 18 your own, unless you actually had a colleague that you 19 were speaking to, or even going to the Federation 20 meetings where I feel they should have known more 21 about it. They were the hub. They're 50 postmasters 22 meeting together. They should have been able to pick 23 up on this information. If you failed you were on 24 your own, because you got told it was only you that 25 was making a jacksy of it; everybody else was okay. 19 1 Q. Who was telling you that you were the only one? 2 A. Well, the Post Office, when you phoned up, but if you 3 were having regular shortages, it just cannot be 4 right. You're watching the tellers, you're watching 5 the CCTV, it can't be right, and you were told 6 everybody else is fine, it's only you. 7 Q. When did you discover that others had been affected by 8 failings in Horizon? 9 A. Oh, I think we read something in one of the papers at 10 one point, and I made a call to the Federation. They 11 still were very -- not taking sides at that point. 12 I'm sure there was just something in the Mail when I 13 realised, how long ago I don't know. 14 Q. Have you taken any steps to obtain compensation from 15 the Post Office? 16 A. I was part of the 555, but I believe that I'm still 17 exempt from joining the HSS at the moment, so, no, 18 I've not made any steps, apart from the original 555. 19 Q. Did you receive some compensation when that litigation 20 settled? 21 A. I received £8,000. 22 Q. How do you now feel about the Horizon System and the 23 treatment that you received from the Post Office? 24 A. Now that I know that they knew about it, it doesn't 25 seem fair, and unfortunately I still think of the 20 1 Post Office as being special, even after what they've 2 done, or they should have been special. They're 3 special to communities. But somebody has to take the 4 blame, or somebody has to apologise, because it just 5 wasn't fair. 6 Q. There are no further questions that I'd like to ask 7 you, Mr Brown. Is there anything you would like to 8 say on your behalf, or on behalf of your wife? 9 A. I've got a closing statement that I've been 10 practising, but ... right, okay? 11 Q. Yes. 12 SIR WYN WILLIAMS: Please read it, Mr Brown. 13 A. Thank you. 14 SIR WYN WILLIAMS: And am I right in thinking you're going 15 to read something on behalf of your wife as well? 16 A. I've got my wife's as well. 17 SIR WYN WILLIAMS: Good. Well, you do it in your own time 18 and at your own pace, okay? 19 A. I've practised mine; my wife's I just got an hour ago, 20 so, right, excuse me. 21 I would like to thank Sir Wyn Williams and the 22 Inquiry team for being so efficient. It made life 23 just that wee bit easier. It is my hope that 24 the Inquiry will not only financially compensate the 25 subpostmasters involved, but will go some way to act 21 1 as closure for the pain, injustice and unfairness 2 myself and many subpostmasters were inflicted with. 3 No financial compensation can replace the lost time of 4 a young family, time with friends, but with time I'm 5 sure most -- sorry -- I am sure most will put any 6 compensation to good use, repaying debts and making 7 the memories lost. Once again, thank you for all your 8 team involved in the Inquiry. Thank you. That's my 9 own. 10 SIR WYN WILLIAMS: Fine. Before you -- 11 A. Sorry. 12 SIR WYN WILLIAMS: Before you get on to your wife's, can 13 I just ask this question while it's in my mind: you 14 told us quite frankly what you received by way of 15 compensation. Did your wife receive a separate 16 amount, or was that the amount between you? 17 A. No, that was the amount between us. 18 SIR WYN WILLIAMS: Fine. Thank you very much. 19 Mrs Catrona Brown, statement summarised 20 MR BROWN: Okay. I've got my wife's. 21 Right. She started it as if she's made a witness 22 statement, so: moving forward from this, I would like 23 to think that the Post Office will at best reimburse 24 anyone affected by the mistake they made; maybe even 25 apologise for the lives ruined and severely disrupted 22 1 by this miscarriage of justice. I think myself very 2 fortunate in that myself, my marriage, my family and 3 my business came through this, although I am angered 4 at the fact that I can never be compensated for the 5 family time lost, the holidays the children did not 6 have -- sorry about that -- family time lost, the 7 holidays the children did not have and the time we did 8 not spend. Thank you very much to the Inquiry team. 9 Nice and short. Thank you. 10 SIR WYN WILLIAMS: Short and to the point, Mr Brown. 11 A. Thank you. 12 SIR WYN WILLIAMS: So thank you for giving evidence to 13 the Inquiry, and sorry your wife hasn't felt able to 14 do it, but will you pass on my good wishes to her. 15 A. I will. Thank you very much. Sorry again. 16 SIR WYN WILLIAMS: No, no, that's fine. Thank you very 17 much, Mr Brown. 18 A. Thank you very much. 19 SIR WYN WILLIAMS: Right, well, I think since that's 20 a remote session, we'll have a short break to 21 reconfigure ourselves, so to speak. So my colleagues 22 and I will leave for 10 minutes. 23 (10.00 am) 24 (A short break) 25 (10.21 am) 23 1 CHRIS DAWSON (sworn) 2 SIR WYN WILLIAMS: Yes, Ms Hodge. 3 MS HODGE: Thank you, sir. Our next witness is 4 Mr Chris Dawson. 5 Questioned by MS HODGE 6 MS HODGE: Mr Dawson, as you know, my name is 7 Catriona Hodge, and I ask questions on behalf of 8 the Inquiry. Please can you state (audio distorted)? 9 A. (audio distorted). 10 Q. Was that 2022; is that right? 11 A. That's correct. 12 Q. Do you have a copy of that statement in front of you? 13 A. I do, yes. 14 Q. Can I ask you, please, to turn to the final page of 15 your statement. Can you see your signature there? 16 A. I can. 17 Q. Have you had an opportunity to read the statement 18 again since it was first made? 19 A. I've read through it a couple of times, yes, I'm happy 20 enough with it. 21 Q. Is the content true to the best of your knowledge and 22 belief? 23 A. It is. 24 Q. Thank you. I'd like to begin by asking you a few 25 questions about your background. 24 1 A. Yes. 2 Q. You moved to the Perthshire area when you were 3 19 years old, is that right? 4 A. That's correct, in 1993. 5 Q. What did you do for a living before you took up the 6 running of a Post Office branch in your local area? 7 A. When I first arrived at (unclear) Loch there, it was 8 as a restaurant manager in one of the local hotels. I 9 then went on to be assistant manager in another hotel. 10 Q. Sorry, could I ask you to speak up a little bit. I 11 think the air-conditioning has just started up. 12 A. I arrived in Pitlochry in 1993, initially as 13 restaurant manager of one of the hotels. I then went 14 on to be assistant manager of one of the other hotels, 15 bars and restaurant manager in a further hotel, before 16 going back to the second hotel as general manager. 17 And then after the birth of my first daughter, the 18 hours weren't conducive for family life so I started 19 working in retail up at the House of Bruar just 20 outside Blair Atholl. There I worked for a number of 21 years and then left and went over to help start up 22 a friend -- his new business at The Courtyard in 23 Kenmore. 24 Q. Why did you later decide to apply to become 25 a subpostmaster? 25 1 A. I hadn't actually applied to become a subpostmaster. 2 First I was -- I had worked at the House of Bruar and 3 then went on to Kenmore, and the local councillor 4 actually approached me, came to my house, and said to 5 me, "You've got a good background in retail, a good 6 knowledge of it, you obviously know what sells, there 7 is a good retail space in this post office and the 8 current postmaster is looking to retire, and would you 9 be interested?" Initially, I first thought: What do 10 I know about post offices, but I was told kind of all 11 the training would be given, etcetera. And so I 12 approached the bank and managed to secure a loan. And 13 it basically went from there. 14 Q. You were quite heavily involved in your local 15 community at the time; is that right? 16 A. I was, yes. I was a member of the Red Cross. I used 17 to go out and do -- we would cover first aid for local 18 events, Highland games, cycling events; anything that 19 was going on in the area. I was involved with the 20 local branch of the SMP, and I was also a master of 21 the local Masonic lodge. 22 Q. And you've mentioned before you became a subpostmaster 23 you'd had one child. Were you married at the time? 24 A. Yes, I was married in 1996. 25 Q. And did you and your wife just have the one child? 26 1 A. No, no, we went on to have another one. 2 Q. You were appointed, having applied, I assume -- you 3 were appointed as the subpostmaster of the Pitlochry 4 sub-post office in April 2007; is that correct? 5 A. Yes, aye, just before -- the Easter weekend. 6 Q. How old were you then? 7 A. Oh, 33. 8 Q. Only two months later, you took on the Kinloch Rannoch 9 sub-post office as well; is that right? 10 A. I can't remember exactly. It was very quickly 11 thereafter, within three to four months, I was 12 approached by a couple of representatives of the 13 community up at Kinloch Rannoch who hadn't had 14 a post office for quite some time. They had a wee 15 community restaurant, cafe, and they set aside a room 16 for me. It was laid out with Post Office equipment 17 and they didn't want it run as a full-time operation, 18 it's a small hamlet run in a village, I would have 19 said, so I did take that on and just provide them with 20 postal services a couple of days a week. 21 Q. So in the Kinloch Rannoch post office you were 22 effectively just operating from a retail premises 23 owned by someone else, is that -- 24 A. Yes. 25 Q. And your Pitlochry post office, did you purchase that? 27 1 A. I had to purchase the leasehold from the goodwill of 2 the business. The business -- the building itself had 3 formerly been a Crown Post Office that was owned by 4 the Post Office. They had then, for some unknown 5 reason, sold the building to a private landlord and 6 then rented it back at a huge amount of rent that 7 was -- they agreed to that contract, and then 8 basically forced the postmaster to then also have to 9 agree to it. 10 Q. You've mentioned purchasing the goodwill of the 11 business. How much did you pay for that? 12 A. It was in the region of £25,000, plus some stock. 13 I can't remember the exact amount. 14 Q. Do you recall how you funded the purchase? 15 A. I had to remortgage my house. 16 Q. Can you describe the type of business that you 17 operated from your two branches? 18 A. Well, Pitlochry, I mean it is basically the gateway to 19 the Highlands. It's a very touristy town, a very busy 20 town, lots of coach parties, day-trippers, as well as 21 people heading up to the Glenshee skiing in the 22 winter, so, yes, I mean, it's a busy place. So I did 23 stock it up with gifts, toys. A lot of people in 24 Pitlochry who originate from Pitlochry had family 25 members that lived in South Africa, Canada, Australia, 28 1 New Zealand, they had taken up the sort of £10 ticket 2 back in the '60s, so we had a good mainstay of people 3 coming in who were collecting their pensions, but 4 whilst they were there they were also buying the 5 birthday cards for the grandkids that lived abroad, 6 presents, parcels to post. So I stocked up with lots 7 of nice, good quality kids toys, cards, but also, for 8 the tourist market, designed my own label 9 incorporating Pitlochry Dam on the label, and 10 Pitlochry fudge, toffee, rock; the sort of usual 11 tourist paraphernalia. 12 Q. What kind of income were you bringing in from the 13 post office and your retail business at the time? 14 A. The post office, the income was in the region of about 15 60,000 a year, which basically only paid the rent, the 16 rates, and the electric. I mean, like I said, it was 17 a huge amount of rent that the Post Office were 18 charging us. 19 Q. You said £33,000 a year? 20 A. £33,000 we had to pay in rent. 21 Q. And £12,000 in -- 22 A. So I mean it was £45,000 before you'd switched the 23 light on. When you were getting paid 3p in the pound 24 for selling stamps, I don't know how they ever 25 expected anybody to be able to fund that, but that was 29 1 what they'd agreed to with the private landlord and 2 then -- 3 Q. And you employed staff as well, is that right? 4 A. I did, yes, I had probably about six staff, ranging 5 between full and part time in the shop and in the 6 post office. 7 Q. And you've mentioned your income from the post office. 8 What were you able to earn on the retail side? 9 A. The retail side, the last year of trading was about 10 122,000; 61,000 of that being profit. 11 Q. So it was a successful business? 12 A. Oh, it was very successful. It was doing extremely 13 well. I mean, it was only going to get better and 14 bigger. 15 Q. When you took on the branch, you received four to 16 five days of training? 17 A. Four days' training. 18 Q. Four days of training. Do you recall who provided 19 that training? 20 A. I couldn't tell you the trainer's name. 21 Q. Can you describe what your training covered? 22 A. Not a lot, to be perfectly honest. I took the keys to 23 the premises on Good Friday, so it was a bank holiday 24 long weekend, so between the Friday, Saturday, Sunday 25 and Monday I obviously had to get all my shelfing 30 1 units, stock, repair works, done, into the business 2 and, as you can imagine, the busiest two days of the 3 week for people coming in to collect their pensions, 4 a lot of the local businesses, the woollen mills 5 especially and off-licences, they used -- they banked 6 with NatWest, the nearest branch being down in Perth, 7 25 miles away, but as a partner of the post office, so 8 they could do their business banking at the 9 post office, so when I opened the doors on Tuesday I 10 had everybody in the town that was of pensionable age 11 waiting for their pension; I had all these businesses. 12 So my training consisted of, "Right, okay, start 13 inputting that." It was probably the busiest day that 14 they could have came to give me training, and it was 15 not taken to the side or taken on to a side till and 16 at a slow pace taken through it. It was mind-blowing, 17 I mean the amount of transactions that can be done on 18 the Horizon System, and I knew nothing about them 19 until the doors opened at 9 o'clock on that Tuesday 20 morning. There was three of us behind the counter, 21 plus the trainers. It was crowded; it was confusing. 22 They were meant to be there to tell me how the system 23 worked, and I basically sat there just giving out 24 pensions and selling stamps, with no real knowledge of 25 the till. 31 1 Q. Were you shown how to carry out a balance on the 2 system? 3 A. At the end of the day, yes. I mean, the previous 4 postmaster had very kindly sort of said that he would 5 stay on for a period of time and his two sons who had 6 worked for him -- his eldest son in particular worked 7 for me full time, and his youngest son part time. So 8 there was a wealth of experience already there, which 9 in all honesty was to my advantage because I didn't 10 feel the training had been, so I was learning from 11 them far more than what I was learning from the 12 trainers. 13 Q. What did the previous subpostmaster tell you about his 14 experience of using Horizon? 15 A. He did warn me that the computer system is not fit for 16 purpose, it was already out of date. There had been 17 rumours of peoples having problems with them. So 18 I mean, I was scared to go over there. I had never 19 worked with computers before. 20 Q. Did you yourself experience problems when using the 21 Horizon System? 22 A. I didn't personally feel as if I was experiencing -- 23 I mean, occasionally you would be up £10, down 20 24 quid, down 50 quid. I mean, in all honesty you were 25 so busy you just thought: If I've given somebody £20 32 1 too much extra in their pension and you're having to 2 make it good out of the retail; a couple of times when 3 you were sending money back because it was a big 4 cash-holding post office, because you had all these 5 businesses and their takings, so we were sending cash 6 back every single week, sometimes twice a week, 25, 7 50, 75 (audio distorted) I mean (audio distorted) 8 £1,000 in that envelope, there was only £950 in that 9 envelope of 50s, and you just had to believe them. 10 I mean, I phoned up a couple of times querying it, "Oh 11 no, well, you have to make it good, your signature is 12 on it." 13 Q. In terms of making good the shortfalls, how much do 14 you think you paid? 15 A. I never ever once kept a note of it. I mean, you were 16 balancing every day, and you could be up 10p one day, 17 down 9p the next. I mean, on the wee shelf behind my 18 seat I kept a cup. If I was up 10p one day, it went 19 into the cup; if I was down 9p the next day, it came 20 out of the cup. When it was larger sums, I took it 21 out of the retail side, but we never kept any records 22 of it. I mean, it happened certainly; definitely more 23 than once. I wouldn't say it happened every week. 24 Q. You've mentioned in your statement a shortfall of cash 25 occurring when one of your staff members made an 33 1 error -- 2 A. Yes, the Horizon keyboard, unlike most keyboards, had 3 a double zero on it, so it was one of the businesses 4 -- it was one of the local off-licences, Threshers -- 5 had come in to do the banking from the weekend, and it 6 was £4,200, give or take, whatever. Unfortunately, 7 the double zero had been hit instead of the single 8 zero, so it had been inputted into the system as 9 42,000, rather than 4,200, which left me with an 10 obvious shortfall of, what, 37,800. 11 Q. So Horizon had recorded, in effect -- 12 A. We identified that at the end of the night. I mean, 13 we were able to pinpoint it straightaway, went and 14 checked it with the off-licence, and, one, they had a 15 receipt, so it was easily identified. We phoned it 16 up, we reported it; it was logged. We were told that 17 it would take about six weeks to rectify itself, which 18 I found very strange. I mean, why would it take 19 six weeks? I mean, surely it could have been 20 rectified the next day or at the end-of-month balance. 21 Six weeks just seemed quite strange to me, but that's 22 the way it was. 23 Q. Was the error successfully rectified by the 24 Post Office? 25 A. After about six weeks or so I suddenly wasn't 38,000 34 1 short, I was 17,500 short. I thought, "Oh." By this 2 time I had become quite annoyed, disillusioned with 3 the Post Office as an organisation and as a body. 4 They never even sorted it right. So I thought: Well, 5 it will sort itself out in a few weeks. 6 Q. Did you notify the Post Office that this shortfall 7 remained? 8 A. I hadn't notified them that shortfall was there 9 because I assumed that it was part of the original 10 shortfall, and I had already reported that. 11 Q. What did you do when it became apparent that that 12 shortfall wasn't going to rectify itself? 13 A. Well, obviously because I had been saying that -- 14 inputting it that everything was fine, because I was 15 just waiting on them rectifying it. I became quite 16 worried. I knew that I was responsible for the money, 17 and then it became apparent after a few months that 18 this isn't going to rectify itself, I made the 19 decision to just start paying it back in myself, 20 £500 a month, whatever I could afford, to pay it back, 21 to make it right, because at the end of the day it 22 wasn't my money. 23 Q. You've explained in your statement that your branch 24 was audited at some point in the summer of 2009; is 25 that right? 35 1 A. The auditors arrived. They were there prior to my 2 arrival. 3 SIR WYN WILLIAMS: Sorry, before we go there, can I just 4 ask you about something which you say at paragraph 17 5 of your statement, because you talk about the 6 Post Office actually sending you a memo that the 7 37,000 had been corrected, and I just want to 8 understand this. My understanding of your statement 9 was that on the one hand you get a memo from the 10 Post Office saying the 37,000 has been corrected, but 11 on the other, Horizon is still showing a 17,000 12 shortfall. Have I got that right? 13 A. Yes. 14 SIR WYN WILLIAMS: Right, fine. So the two are not 15 consistent, obviously, and I just wanted to be -- 16 A. Very, very little was consistent. 17 SIR WYN WILLIAMS: Right, fine. Okay. Thanks. Sorry, 18 Ms Hodge. 19 MS HODGE: Not at all. 20 We were talking about the audit of your branch in 21 the summer of 2009. 22 A. Yes. 23 Q. At that stage the shortfall was still showing on your 24 accounts -- 25 A. It was, yes. 36 1 Q. Were you present at the branch when the audit was 2 carried out? 3 A. I was present when they started it. They were there 4 prior to my arrival. I had to go in -- they wanted 5 entry to the building, even before me, and I thought: 6 Well, I have to go and switch off the alarms; you'll 7 just have to wait there for a minute. So I let them 8 in. They put a "closed" sign up on the front door, I 9 wasn't allowed to open the doors, which obviously 10 wasn't good for local business anyway. Once the audit 11 had been conducted, I was told that I was suspended, I 12 was no longer allowed to come behind the post office 13 counter, and I had to hand my keys back in to my 14 staff, who were still allowed to. 15 Q. Were you shown any of the records on which the 16 auditors relied in carrying out their audit? 17 A. I don't remember seeing any record. I actually don't 18 even remember signing anything. I knew that the 19 shortfall was there, and I just basically had to say, 20 "Right, yes, I knew there was a shortfall." 21 Q. At the time of your suspension, what did you 22 understand the Post Office's intentions to be in terms 23 of getting to the bottom of this figure of £17,000? 24 A. I understood -- I mean, you've got a core belief that 25 something that size, and an organisation that size, 37 1 are going to conduct a full audit. I mean, because it 2 was a computer system, there was no paper trail. So 3 I mean I'd tried looking for it to see if there had 4 been another input error or if it was related to the 5 original or whatever. At no time did I think that 6 anybody had taken the money. They had all worked for 7 post office counters for years. I thought they would 8 conduct a full inquiry, an investigation, and an 9 audit, and that the money would be found. 10 Q. Is that what happened? 11 A. No, no, no. I was told that fraud officers from 12 Post Office Limited would be coming to my house, which 13 they duly did, and basically just accused me of taking 14 it. 15 Q. When you were told that you were going to be 16 interviewed, did you try and obtain any advice or 17 legal representations? 18 A. Yes, I phoned up the Federation of SubPostmasters, who 19 were little or no help at all. Basically their advice 20 was "just admit it and pay it and you'll be able to 21 trade again." They -- I'd got the real impression 22 that because they were all postmasters themselves, or 23 worked for the Post Office, I got the impression that 24 they actually feared for their own jobs if they gave 25 you other advice. They were just puppets. So, yes, 38 1 I mean the advice was no good to me at all. 2 Q. You were interviewed under caution; is that right? 3 A. I was, yes. 4 Q. Where did the interview take place? 5 A. In my own house, which, again, I found very strange, 6 and very intimidating. Very scary, to be perfectly 7 honest. 8 Q. Do you recall when the interview took place? 9 A. I don't remember the date. What I do remember is the 10 doorbell going to -- I'm not going to refer to them as 11 gentlemen, because they just were two big burly -- 12 I mean, they could have been wrestlers, by the size of 13 them, black suits, black tie, came into the door, told 14 me who they were from, that I was going to be 15 interviewed under caution. I had been advised that I 16 was going to be interviewed under caution and I had 17 asked, "Okay, right, can I have a lawyer present?" 18 "No. You can have somebody who works for the 19 Post Office", so I could have had the local mailman 20 with me, but I wasn't allowed a solicitor. I said to 21 them at the time, I was like, "Well, will I receive 22 a copy of this interview?" "Oh, yes, you'll receive 23 a copy." I was like, "And then I can take that to 24 a solicitor." "That's up to you." The two men came 25 into my house. I mean, they wanted to go through -- 39 1 they went through my bank accounts, business and 2 personal, joint. They were looking in cupboards -- 3 I mean, they basically -- the first words that came 4 out of their mouth when they sat down was, "So where's 5 the money?" 6 SIR WYN WILLIAMS: Before we get to that, because it's 7 dawned on me that there may be differences in the 8 Scottish criminal law to the English and Welsh 9 criminal law. So when you say that you were 10 interviewed under caution -- 11 A. Mm-hmm. 12 SIR WYN WILLIAMS: -- am I right in understanding that the 13 first thing that would have happened is that you were 14 told words along the lines of, "You don't have to say 15 anything" -- 16 A. No, no, no. 17 SIR WYN WILLIAMS: I see. 18 A. No, I wasn't told that at all. 19 SIR WYN WILLIAMS: So what did you understand they meant 20 by the phrase "interview under caution"? 21 A. My understanding of "interview under caution" is 22 a record will be taken and passed on to police, 23 Procurator Fiscal, CPS, whomever, for an investigation 24 to take out. The fact that I was denied a lawyer, I 25 pleaded right from the get-go. 40 1 SIR WYN WILLIAMS: Carry on, Ms Hodge. No, no, I'm sorry, 2 but it struck me belatedly yesterday, in a discussion 3 with my colleagues, that I need to know what the 4 phrase "interview under caution" might mean to both 5 Scottish and (audio distorted). 6 MS HODGE: (audio distorted) it would be -- 7 A. It was, yes. A tape-recording device was set up on my 8 living room table. The two of them sat at one side of 9 the table, I sat at the other; the tape recorder in 10 the middle. It was a twin cassette. They did open up 11 two packages in front of me and place blank cassettes 12 in, just wee mini cassettes, and from there it was -- 13 it wasn't an interview. I mean, my understanding 14 would be that an interview under caution -- an 15 investigation, whatever you want to call it -- is that 16 they have to look for evidence. They basically just 17 came in and went, "Where's the money?" There was no 18 presumption of innocence; it was an automatic 19 presumption of guilt. It was horrifying. I mean, the 20 minute they started I felt as though my back was on 21 the wall, and there were two of them. Like I said, 22 they were large men, and it was just horrible. It was 23 repeated, repeated, repeated, "So what did you do with 24 money? Where is the money? Have you hidden the 25 money? Have you given the money to somebody else? 41 1 Where is the money?" and this just went on. I mean, 2 there was no questions, it was just baiting and 3 badgering for the entire time. And after a period of 4 time, I think possibly about half an hour, I turned 5 around and I just said, "Right, wait a minute here", 6 I said, "I had £998,000 in my safe that day." I said, 7 "Do you think I would have been messing about with 8 17,500?" I said, "If I was going to steal, I would 9 surely have taken the lot and I wouldn't be sitting 10 here answering questions; I'd be in the Caribbean", to 11 which their reply came, "All right, so you've thought 12 about it. Where is the £17,500?" So I gave up, I was 13 going nowhere with it. 14 Q. So if I have understood you right, it was clear to you 15 that by this point you were being treated as having -- 16 you were under suspicion for having stolen the money? 17 A. I don't even think I was under suspicion; I was 18 assumed guilty. 19 Q. What were you advised to do? 20 A. (Zoom screen frozen). 21 Q. ... happened, what were you told to do in relation to 22 the shortfall? 23 A. I was told basically it was my responsibility; it was 24 in my contract. I had to pay it. 25 Q. Did you agree to pay the sum? 42 1 A. No. I said to them -- I said, "I know that there is 2 a computer error." I said, "I've heard about other 3 computer errors." Then they insisted, "No, this is 4 just your office, you're short of money, you're 5 responsible, this isn't happening anywhere, there is 6 no computer problem." And I knew that I'd read about 7 it, but it was basically, "You'll be hearing from us 8 soon." And every time I phoned, because I was phoning 9 initially daily and then weekly, just sort of saying, 10 "How is the investigation going? How is the 11 investigation?" -- because I was suspended, but I was 12 still having to pay the rent and the rates and the 13 wages. They'd brought in some postmaster from further 14 up north who was reaping the rewards, and getting paid 15 from the Post Office in some of the busiest months, a 16 very good wage, whereas I was receiving nothing except 17 from my shop income. 18 I was allowed to still enter my shop, but I wasn't 19 allowed to enter the post office. Now, in a town the 20 size of Pitlochry, 3,500 people, the rumour mill had 21 started the minute that the "closed" sign went up. So 22 I had to stand there in the front of my shop with 23 people looking at me, whispering, asking me outright, 24 some of them, "How come you're not behind the 25 post office?" It was just -- it was just a horrible 43 1 situation. 2 Q. For how long were you suspended from your role as 3 a subpostmaster? 4 A. Before I eventually resigned, six, maybe seven months. 5 I couldn't carry on financially. I mean, I had -- for 6 the first few months, even though I was receiving no 7 income from the Post Office, I was still expected to 8 pay that £33,000 a year rent, £12,000 a year rent, to 9 pay the electric bill. Eventually I argued the point, 10 and the Post Office themselves, rather than charging 11 the other postmaster that they'd installed, he paid 12 the wages, but the Post Office, I believe, paid the 13 rent and rates. So whoever that gentleman was made 14 a tidy sum out of it, because he wasn't liable for the 15 things that I was liable for, but because I'd had to 16 pay them for the first few months, I mean my savings 17 were gone, and eventually -- I think it was in the 18 January -- just said, "Enough is enough", and emptied 19 the shop, and had to seek advice on bankruptcy. 20 Q. Were you made bankrupt? 21 A. Yes. I was made insolvent; I think it was around the 22 end of March, April. 23 Q. And that was shortly after you'd resigned in January 24 -- 25 A. Yes. 44 1 Q. -- 2010? 2 A. Yes. I mean, just prior to me resigning, and I think 3 it was the final nail in the coffin for me, I again 4 phoned up and asked, "Look, how's the investigation 5 going?" The reply I got was, "We know it wasn't you, 6 but you still have to pay it, it's in your contract." 7 I said," Well, it wasn't me, and you're saying it's 8 not the computer, it must have been somebody. Are you 9 investigating anybody else?" "No." And that was 10 basically the end of the conversation. That, to me, 11 was just: Right, so they want me to pay this money, 12 even though I never took it; they know I never took 13 it, they've admitted I never took it, but they want me 14 to pay it. I'm not doing it. 15 Q. Do you recall who you spoke to at that time? 16 A. It was just some faceless person on the end of the 17 phone. I mean, the helpline -- it's the biggest 18 oxymoron ever, helpline. 19 Q. Did you attempt to sell the business after you 20 resigned? 21 A. I did try and sell, but obviously because my 22 bankruptcy was looming I wasn't able to sell it, so 23 I mean they then sold the building. I mean, all the 24 fixtures and fittings that I had paid for, along with 25 the goodwill, the bulletproof glass, the counters, 45 1 et cetera, et cetera, all of that got sold off as 2 well. The building -- the bulletproof glass, I've got 3 no idea how much the initial cost of it was because it 4 was put in prior to me taking over, but I know it 5 certainly wasn't cheap. I mean, that was basically 6 just ripped out and slung in a skip. But at the end 7 of the day it was still mine. 8 Q. What did you hope to achieve from your business before 9 you felt forced to resign? 10 A. Having looked into the Post Office, and I mean going 11 by advice, I mean, it's a big institution, it's been 12 around for hundreds of years, and I had seen the model 13 that some other people had used, take on one 14 post office and then, after a year or so, take on 15 another one. And I knew that some of the other local 16 postmasters were either getting to retirement age or 17 getting to an age where they just wanted to say, 18 "Right, enough is enough." So the long-term plan was 19 to take over the post offices in the neighbouring 20 villages, et cetera. Obviously, that never happened. 21 Q. Have you made any attempt to estimate what you think 22 you would have earned, had you been able to carry on 23 as you had planned? 24 A. Well, during the first court case with Freeths, one of 25 the initial conversations had been the fact that I was 46 1 36 years old when this happened to me; the current 2 retirement age being 67, so that was 31 years of lost 3 income. I'm basing that on the Post Office wage from 4 2009, 2010, and the shop profits from the same period. 5 Not including inflation or interest, and it was -- 6 they estimated that I had lost 2.97 million. 7 Q. What did you in fact recover from the settlement of 8 the Group Litigation? 9 A. Sorry? 10 Q. What did you in fact recover from the settlement of 11 the Group Litigation? 12 A. I mean, negligible. I mean, the first case again was 13 just how it was dealt with, how the settlement was 14 dealt with, the fact that the Post Office didn't have 15 to pay the legal fees, that it was all swallowed up in 16 legal fees and the 555 received virtually nothing. I 17 received absolutely no satisfaction from that 18 whatsoever. 19 Q. Did you receive some compensation? 20 A. A very, very small amount. 21 Q. How did the loss of your Post Office salary affect 22 your personal finances? 23 A. Well, like I said, I had already been paying the rent 24 and rates for a couple of months without having the 25 Post Office salary. So that left me in a state that, 47 1 as I mentioned, I had to declare myself bankrupt. 2 I could no longer afford to pay my mortgage. 3 Q. You lost your home? 4 A. My home was repossessed, yes. 5 Q. What about your other possessions, your car? 6 A. Yes, I couldn't afford to pay the car, and then after 7 a few months, I mean I don't believe for a second that 8 any marriage could have coped with that. I mean the 9 stress, I mean I was a complete mess, withdrew into 10 myself, I was very paranoid that people were talking 11 about me. So the marriage collapsed as well and I 12 ended up moving out. The bank allowed -- because of 13 our kids, the bank allowed my ex-wife to stay in the 14 house for a wee while until she was rehomed, but the 15 house was eventually repossessed. 16 Q. What did you do for a living after the termination of 17 your contract as a subpostmaster? 18 A. Well, for the first year, because of the terms of my 19 bankruptcy, I wasn't able to work at all. I then 20 ended up taking jobs, washing dishes. I mean, at the 21 end of the day I was still living in Pitlochry; a lot 22 of people had an assumption of guilt because would 23 they believe me or would they believe a 300-year-old 24 organisation? So getting a job, especially a job 25 working with money -- hotel management, retail, which 48 1 had been my background -- that wasn't happening, so I 2 ended up washing dishes. I worked as a kitchen 3 porter. One of the other local businessmen that was a 4 good friend and had every faith in me did give me 5 a chance, he trusted me, so I was working front of 6 house in his restaurant, in Drummonds Restaurant, in 7 Pitlochry. 8 Q. What do you do now for a living? 9 A. I'm self-employed as a care-at-home provider, 10 providing care for the elderly and infirm in the 11 community and in their own homes. 12 Q. You've mentioned already you and your wife have two 13 children. 14 A. We've got two daughters. 15 Q. How was your relationship with your daughters affected 16 whilst you experienced this financial hardship? 17 A. The girls have never, ever complained. They've never 18 made any -- but I personally feel horrible as 19 a father, because I couldn't properly provide. 20 SIR WYN WILLIAMS: Don't worry, Mr Dawson, we've got 21 plenty of time. You just take it easy. 22 A. Sorry. 23 (Pause) 24 A. A father should be able to provide for his kids, and 25 for a long period I couldn't. Like I said, they never 49 1 complained, even at Christmas and birthdays, when what 2 we were able to give them was (unclear) from out of 3 a charity bin. It just made you feel like a failure. 4 MS HODGE: How was your mental health affected at the time 5 by these difficulties? 6 A. Yes, it was very bad. I was very badly depressed. I 7 didn't realise at the time. Others around me were 8 saying, "You need to go to a doctor, you're obviously 9 depressed." I didn't think there was anything wrong 10 with me. Looking back now, I mean I was just a 11 disaster. I felt paranoid. I felt people were 12 speaking about me. I had a fear of leaving the house. 13 When I did leave the house, it would be at night-time 14 in the dark. I didn't feel like I was myself; I was a 15 shadow of myself. 16 Q. You had previously aspired to go into local politics; 17 is that right? 18 A. I had been approached about standing for council, but 19 it was the councillor that had approached me had 20 unfortunately passed away -- untimely. I was 21 approached, "Would you be interested in standing?" but 22 I mean I had literally just taken on a big post office 23 and I had already taken on the Rannoch post office at 24 that point, so I declined at that time. I said, "It 25 might be something I'm interested in in the future, 50 1 maybe once I've established the businesses and could 2 step away from the day-to-day." It would have been 3 something that I would have really enjoyed. I would 4 have really liked to put something back into the 5 community. 6 Q. What were the prospects of you entering local politics 7 after what had happened with the shop? 8 A. Who is going to trust or vote for somebody who has 9 been accused of stealing? Although I was never, ever 10 charged, the doubt was always there. I wouldn't have 11 voted for me. There was no chance. 12 Q. How would you describe your current circumstances, 13 Mr Dawson? 14 A. Yes, I mean, like I said, I'm self-employed. Myself 15 and my partner, my fiancee, we've got a relatively 16 good income. It's a job we both enjoy. We go to the 17 same clients every day, at the same time every day, 18 which, unlike a lot of care organisations, it's more 19 hectic. We like to run it so that people with 20 dementia, people with Alzheimer's and what have you, 21 they need continuity, so we meet with them and their 22 families prior to them coming on board with us, and we 23 say, "Okay, we will be here at X time every single 24 day", and give or take five minutes allowing for 25 traffic, but that's explained to them, that's exactly 51 1 what we do. 2 Q. And how is the current state of your mental health? 3 A. Better. I still think about it every day. I mean, 4 there is not a day goes past that you don't go past 5 a postie, you don't go past a Royal Mail van, you 6 don't pass a red pillar box, and it's almost just 7 a reminder. 8 Q. Looking back on your experience with the Post Office, 9 how do you now feel about the way you were treated? 10 A. Excuse me, just a second. Looking back on it now and 11 knowing what I know now about the fact that they knew 12 all along, knowing that from the very beginning 13 Fujitsu was identified as having issues on the Horizon 14 System, finding out that of the 11 tenders to put in 15 an IT system that they came sixth, finding out that 16 even though they knew that it was the Horizon System, 17 they then went on to spend £300 million of taxpayers' 18 money to try and tell us, "No, it wasn't us, it was 19 you all along." I'm disgusted. 20 (Pause) 21 A. Sorry. 22 Q. You don't need to apologise. 23 I have no further questions that I want to ask 24 you. Is there anything you'd like to say that we 25 haven't covered in your questions today? 52 1 A. Oh, in the questions, no, not really. I mean, there's 2 just a few comments that I would like to direct, if 3 that was okay. 4 SIR WYN WILLIAMS: Of course, yes. 5 A. Sorry, I never brought my reading glasses. 6 First of all, I'd like to thank you, Sir Wyn, for 7 inviting me along today. I do have a few questions 8 that I would like to ask. Given the length of time 9 that has passed and the lives and reputations that 10 have been ruined since it became apparent that the 11 Horizon System was not fit for purpose, why did 12 Post Office Limited continue to pursue innocent 13 postmasters and mistresses; who sanctioned the 14 300 million in legal costs for the Post Office to 15 fight us to a standstill on the civil claim, to stop 16 us from getting further -- the full truth? I don't 17 for a minute believe that this was just a pen-pusher 18 or a bureaucrat; I don't even think it's within the 19 remit of the head of Post Office Limited. I think 20 this has to reach the Government level, be it the 21 Business Secretary, the Chancellor, maybe even as high 22 as Number 10. For that amount of public money to have 23 been used to protect an asset whose sole shareholder 24 is the Westminster Government, somebody within that 25 Government knew. 53 1 You and the people in this room may think that 2 everyone knows about the problems with Horizon, but 3 they don't. Two weeks ago, I was in at the local 4 post office and I mentioned the current problems with 5 the Horizon System and was she following it. She had 6 absolutely no idea what I was talking about. She 7 didn't know that there was a problem with Horizon. 8 She didn't know there was an investigation. So why 9 have Post Office Limited not contacted every single 10 subpostmaster and mistress, both current and retired, 11 to inform them of the problems with the Horizon System 12 and invited them to submit requests for reimbursement 13 for any and all shortfalls since the introduction of 14 Horizon? 15 Why, when the truth is known by all parties, is 16 compensation being withheld? Why has the scope of the 17 compensation not been broadened to include those like 18 myself who refused to admit to something they hadn't 19 done; people like me who pleaded their innocence; 20 those who were not formally charged or jailed, that 21 were threatened with it, threatened with prosecution, 22 who have lived in fear of a knock at the door for 23 years? How many more innocent people have to continue 24 to suffer? How many more need to die before they are 25 properly vindicated and compensated? 54 1 I feel that the national news coverage of the 2 Horizon case has, at best, been woeful. A perfect 3 example, Panorama, a few weeks ago the past Monday, 4 a fantastic piece of journalism; the next day in the 5 newspapers, not a follow-up. It's as if people either 6 -- and why was it shown at 10.40? Panorama is always 7 shown at 9 o'clock. It's almost as if they don't want 8 people to know about it. 9 I want to see a formal and full apology from all 10 those involved in this scandal, published in all the 11 local newspapers and magazines in the areas of the 12 subpostmasters and mistresses involved, not just in 13 a broadsheet buried at the back of a page for only a 14 minority to read. I mean, in my case that affected me 15 and Pitlochry and the surrounding areas, so I want to 16 see that apology in the Pitlochry News; I don't want 17 to see it in the Financial Times. The apology needs 18 to be seen and heard by the communities that it 19 affected. 20 Lastly, I want to see Paula Vennells, amongst 21 other senior officials, feel the full weight of the 22 law, in a similar manner that was so eagerly dealt out 23 as judge, jury and executioner whilst in full 24 knowledge that those who they were prosecuting were 25 innocent. 55 1 SIR WYN WILLIAMS: Well, thank you, Mr Dawson. Clearly, 2 you've spoken about very personal and difficult 3 matters in a public forum, and that's very difficult. 4 So I appreciate you taking the time and the trouble, 5 and making the effort, to come and give this evidence. 6 A. Thank you. 7 SIR WYN WILLIAMS: Okay. 8 MS HODGE: Thank you very much, sir. 9 SIR WYN WILLIAMS: Right. Well, I think we can have 10 a mid-morning break, and in that mid-morning break, 11 Mr Enright, can I invite you to discuss with your 12 clients, remaining clients, how they would like to 13 proceed. I don't want them waiting around for hours 14 if they would prefer to get on with it, so to speak. 15 So let's have a 15-minute break and then take stock of 16 where we are. 17 (11.17 am) 18 (A short break) 19 (11.35 am) 20 SIR WYN WILLIAMS: Whenever you're ready, Mr Beer. 21 MR BEER: Thank you, sir. I think Mr Enright has 22 indicated that his clients are very content to 23 continue now. 24 SIR WYN WILLIAMS: Excellent. 25 MR BEER: So can I ask for Donald McLean to be sworn, 56 1 please. 2 DONALD ROGER MCLEAN (sworn) 3 Questioned by MR BEER, QC 4 MR BEER: Good morning, Mr McLean. Do take a seat. 5 A. Good morning. 6 Q. My name is Jason Beer and I ask questions on behalf of 7 the Inquiry. Can you give us your full name, please? 8 A. Donald Roger McLean. 9 Q. In front of you is a copy of your witness statement -- 10 A. Yes. 11 Q. -- if you turn to the last page, you should see it's 12 dated 20 January 2022. 13 A. Right. 14 Q. And is there a signature there that's yours? 15 A. Yes. 16 Q. And are the contents of that witness statement true to 17 the best of your knowledge and belief? 18 A. Yes. 19 Q. Can you tell us a little bit about you, please. How 20 old are you? 21 A. I'm now 70. 22 Q. Okay. 23 A. I've been a subpostmaster for nearly 25 years. I 24 actually retire tomorrow, I hand the keys over to the 25 office I've been running temporarily tomorrow. Before 57 1 that, I originally went to sea as a radio electronics 2 officer -- 3 Q. We're going to come to your background in a minute. 4 Are you a married man? 5 A. Yes. My wife is ... 6 Q. Mrs McLean is there? 7 A. Yes. 8 Q. And I don't think you've got children; is that right? 9 A. Correct. 10 Q. Now, no need to tell us at which post office you're 11 currently a temporary subpostmaster, but until 12 tomorrow you are a temporary subpostmaster? 13 A. Yes. 14 Q. And before you became a subpostmaster, I think you 15 were about to tell me what you did. I read you had an 16 interesting and varied career. 17 A. Yes. 18 Q. Tell us about it, please. 19 SIR WYN WILLIAMS: And don't forget the Cardiff bit. 20 A. Yes, okay. I went to -- I trained to be 21 a radio/electronics officer and went to sea, and I 22 spent probably six years there. I was brought up by 23 a great aunt and uncle that were in ill health, so I 24 came ashore and I went to university in Cardiff. And 25 I was there, and during that period my great aunt and 58 1 uncle died, and I got a job, and I went working for 2 British Aerospace on the maintenance and operation of 3 Rapier defence missiles, on the basis of working out 4 in Oman to maintain the systems. But before I was 5 just about to go out, I got headhunted by a big cruise 6 company now, Carnival Cruise Line, but then they were 7 a very small company, and I went to work for them on a 8 brand-new ship that was coming out of Denmark. From 9 there, after the time I came ashore, I became 10 a technician at South Glamorgan Institute of Higher 11 Education in Cardiff -- 12 Q. Yes. 13 A. -- and then I went into teaching and I moved up to 14 South Tyneside College, which was one of the major 15 providers of marine education in the country, and I 16 worked in the electrical and electronic department and 17 computing -- at that stage, computers were then 18 quite -- well, in their early days, and I spent nearly 19 10 years there. And I got -- from there I decided -- 20 I had a load of friends from university that were down 21 in Devon, so I was looking for other opportunities and 22 I was getting fed up with the system of the 23 examinations. There was people that, in the first 24 years, failed, would have flown through the exams when 25 I was leaving, so the system was going down. So in 59 1 the end I decided that I'd sell up, and go down and 2 after shopping around I ended up moving to my first 3 post office, which was in Okehampton in Devon, which 4 was a modified sub-post office, which is ie an 5 ex-Crown office. The person before had been the 6 manageress, and she had it, I think, for about a year, 7 and it was still not completely out of -- into 8 a proper retail environment, which I thought there was 9 a possibility in, and I also had fully trained Crown 10 staff. And at that time we were still moving paper. 11 I have never used the paper system. We had -- there 12 was an in-built PC-based system called Capture that 13 was run by the Post Office, and I used that to balance 14 the post office. 15 MR BEER: Just to put some dates on that -- 16 A. That's '97. 17 Q. So I think 7 June '97, is that right -- 18 A. Yes. 19 Q. -- you took up your role as SPM? 20 A. Yes. 21 Q. At the Okehampton branch. Okehampton is in Devon -- 22 A. Yes. 23 Q. -- west of Exeter? 24 A. That's right, yes. 25 Q. What kind of branch was the Okehampton branch? 60 1 A. Well, it's what they called the modified sub-post 2 office, but it was actually an ex-Crown office. 3 Q. So how many counters were there in there? 4 A. Four. That was it, four and -- 5 Q. What type of community did -- it's a -- what type of 6 place is Okehampton? 7 A. Actually, it's on the northern edge of Dartmoor. It's 8 a very rural area. It's not that touristy -- you see 9 a few tourists, as I said, but it's basically -- you 10 were the main office in quite a rural area with quite 11 a lot of outlying post offices around. During the 12 period there, they started moving into having 13 satellite post offices. During that time I ran three 14 satellite post offices from Okehampton, where we would 15 go out twice a week to each of them. We went to 16 Exbourne, Belstone and Sticklepath. These are just 17 villages that were, you know, about probably six or 18 seven miles from there. 19 Q. Okay. And so just to get the complete picture, 20 I think you spent about nine years at Okehampton -- 21 A. Yes. 22 Q. -- until 26 April 2006. 23 A. That was when I took over the next branch. 24 Q. Okay. And then you moved to Scotland? 25 A. Yes. 61 1 Q. And you were the subpostmaster of a branch in 2 Aviemore, is that right? 3 A. That's right, yes. 4 Q. And that was from the beginning of 2006 until 5 June 2017, is that right -- 6 A. That's right, yes. 7 Q. -- when it was closed, under the Network 8 Transformation Programme -- 9 A. Yes. 10 Q. -- and you moved to your current branch? 11 A. No, we'd been running the current branch for nine and 12 a half years. 13 Q. Oh, I see. So winding back then to the beginning, 14 before you took up your role as SPM at the Okehampton 15 branch, were you trained on the use of Horizon? 16 A. Horizon wasn't around when I was trained. I had 17 two weeks. I think I ended up with three weeks with 18 a trainer in-branch, but I was quite lucky, I had two 19 mail clerks that had been fully trained by the 20 Post Office. 21 Q. When was that? Which year was that? 22 A. That was 1997, when I took over. They were there all 23 the way through my time there. 24 Q. I meant when was the training; that's my fault? 25 A. The training was on the job -- 62 1 Q. Okay. 2 A. -- from the day we took over. It was two weeks from 3 there. So basically it was learn as you went along. 4 Q. In your statement you say: 5 "I had initial training on the introduction of 6 Horizon. This was in 1999 and consisted of two days 7 of offsite training at a hotel in Dartmoor." 8 A. Yes, that's right. 9 Q. Do you remember that? 10 A. Yes. 11 Q. What did the training cover? 12 A. It covered mainly transactions, basic operations such 13 as putting rolls in printers, paper. They did a few 14 transactions and they did do a little balance, but it 15 was no way what you would need for a busy office. 16 Q. Why was it in no way what you'd need for a busy 17 office? 18 A. Well, it's quite easy to see, if you've done five 19 transactions and you've made a mistake in five 20 transactions, but if you've got four people doing 21 transactions, multiple transactions all day, you'll 22 suddenly see that your total amount of work, if 23 something goes wrong, what you've got to check is 24 considerable. So it's a lot harder to find a mistake 25 where there are more people using the system and 63 1 multiple transactions. 2 Q. Was, therefore, the training in your view inadequate? 3 A. For Horizon, yes. 4 Q. Did it address what to do in the event of a shortfall 5 or a discrepancy or, more broadly, troubleshooting? 6 A. No. In no way on that. As I say, at that time I felt 7 the Post Office had suddenly become -- one day they 8 were a paper-based system, there was a computer 9 system, but there was nobody that -- of the people 10 that used the paper system knew everything about the 11 computer system. I think you can term it like 12 British Airways when they decided to move to 13 terminal 5, if you move them all across from that 14 terminal to that one, it will just work thinking it; 15 of course it didn't. 16 Q. You say in your statement: 17 "When Horizon was introduced, I got the impression 18 that Post Office was completely unprepared and lacked 19 the practical knowledge to deal with a computerised 20 accounting [system]." 21 A. Yes. 22 Q. Is that right? 23 A. That's -- I think that's true. 24 Q. And of course you at this stage had been a senior 25 lecturer in, amongst other things, computing -- 64 1 A. Yes. 2 Q. -- for a decade. 3 A. Yes. 4 Q. And you say elsewhere in your statement that you built 5 computers for a hobby. 6 A. I did, yes. 7 Q. And so by this stage did you think you had a good 8 understanding of the operation of computing systems? 9 A. Yes, yes. 10 Q. What were the problems that you saw then at this 11 initial stage? 12 A. Technically, as I said, it was how Horizon -- firstly, 13 a person that was from the IERE came and made 14 a beautiful plan of where sockets should go, telephone 15 sockets should go there, your modem should go there, 16 the computing unit should go in different places, but 17 when they actually came to do it, it was thrown in. 18 It was people that were working to a quick timescale 19 and it was what parts they had at the time, and it got 20 thrown in. I think all the sockets should have had 21 switches on them; they didn't. One of the big 22 failures, I think, on the installation was that none 23 of the sockets were filtered. So if you had any 24 spikes, electrical spikes, it would immediately affect 25 your computer, which caused lots of problems if you 65 1 had thunderstorms and lightning. 2 Q. You are there speaking about the current configuration 3 of the hardware largely -- 4 A. Yes, yes. 5 Q. -- did you ever get to see anything about system 6 design or anything like that, or was that all behind 7 the curtain for you? 8 A. That is behind the curtain to everybody, as I said. 9 Q. So did you begin to use Horizon in 1999 then? 10 A. Yes. As I say, up till 1999 we had never had any 11 serious counter losses, as I call them, on that, but 12 during the period for the operation of the early 13 version of Horizon, over the years I lost about 14 £11,000 during that period. Nothing anything big, 15 because I was always of the opinion that if it was an 16 amount more than, you know, a certain amount, it would 17 be a case of sitting down there and having a really 18 good search for the figure. 19 Q. How soon after the beginning of the use of Horizon by 20 you in that branch in 1999 did problems with 21 shortfalls and balancing begin? 22 A. Quite soon. I can't remember just when. I think it 23 was in the January of -- actually, I had all the 24 counters changed because we were having so much 25 problems with it, and Fujitsu took the four counters 66 1 and I actually went back to paper-based operation for 2 -- I think it was about four weeks -- and then we -- 3 as I say, we moved back over on to -- back to Horizon. 4 Q. Just taking this in stages. When problems with 5 balances began to emerge and shortfalls were shown on 6 the system, what did you do? 7 A. Well, you contact the helpline, and sometimes you 8 didn't get any help from them. 9 Q. What did they say? 10 A. You know, they say, "Well, it's the -- the system, you 11 must have put something in the system wrong", or 12 something like this. 13 Q. So what were you told to do? 14 A. Well, the case of -- as you are well aware by now, 15 that on a Wednesday on your balance, to start trading 16 the next day you've got to turn over, and you've got 17 to declare your losses or your gains and accept them. 18 They were basically saying, "Oh, it will probably come 19 back next week", which in some cases it did. You 20 might be £200 down on a Wednesday night, but when you 21 did a quick cash variance on the Thursday, that money 22 would be back in the -- in your system. So it was one 23 of those things. Again, you ring up -- the thing is 24 if you've altered anything on Horizon, because of how 25 it was based that physically the system was live in 67 1 your office compared to the new system, you had -- 2 they had mirrored desks at other parts of the country, 3 which you did it on your computer, then it went on to 4 another system; so, in other words, they got the 5 duplicate of the system, which, of course, led to 6 timing faults. One of the things that -- when my 7 computer was being done that four times, I actually 8 managed to sign on two of our units with the same 9 pass, and it just let me, which I was amazed at, why 10 it let me actually sign on to the system with the same 11 username and password, and there I had two units, you 12 know, I could use, but with the same -- that would of 13 course lead to problems as well. 14 Q. So you told us overall that you paid in about 15 £11,000 in total. 16 A. Yes. 17 Q. When did you start doing that? 18 A. It was from the start. There was -- 19 Q. Why did you start doing that? 20 A. Well, you've got to -- basically to fulfil your 21 contract, you've got to cover any losses, and 22 physically I'd been old-school that even though 23 they've changed, so you only balanced once a month, 24 I've always balanced everything every week, because if 25 you've got a busy office, trying to find out what you 68 1 did three weeks ago, when you've got this loss, it's 2 a lot of material you've got to go through to find it. 3 So I have always tried to limit the amount of 4 searching I would have to do by doing it weekly. 5 Q. You said that as part of your contract you have to 6 repay -- 7 A. Yes. 8 Q. -- any losses or pay any losses. 9 A. Yes. 10 Q. Did anyone advise you on the helpline that that's what 11 you needed to do -- 12 A. Oh yes. 13 Q. -- if the system was shown as a loss? 14 A. Yes, there was always -- the Post Office always told 15 you, the helpline always told you that you should 16 always pay -- you know, cover your losses, you have to 17 put the money into the till, whatever, because the 18 fact is, if you don't, you're then, you're "false 19 accounting", that's it. So it was always to my mind 20 you always had to put the money in to make sure that 21 you couldn't be prosecuted for false accounting. 22 Q. You told us a moment ago about an occasion when the 23 terminals were -- the hardware was taken out of the 24 branch. 25 A. Yes. 69 1 Q. You went to a paper-based system -- 2 A. Yes. 3 Q. -- for four weeks or so and then recommenced -- 4 A. Yes. 5 Q. -- with new hardware. 6 A. Yes. 7 Q. How did that come about? 8 A. Yes, I complained to my BDM, business development 9 manager. I said -- and I -- she can actually see some 10 of the problems, and I was saying, "Well, this should 11 not be happening", so with agreement she took it 12 a level higher, they agreed to have an investigation. 13 But I never was privy to what they actually found. 14 Q. You say that you were experiencing problems with the 15 Horizon System not being able to balance, and someone 16 was sent to your branch to try to rectify the problem. 17 A. Yes, I had -- 18 Q. What was the problem with Horizon? How did you know 19 it was a problem with Horizon? 20 A. Because we suddenly -- we're doing the same 21 transactions as we were doing for the previous two to 22 three years, we were getting -- we basically had no 23 losses. The staff were the same, and they were, as 24 I say, quite long in the tooth, they'd been doing 25 these things for years. I couldn't see why it should 70 1 suddenly change -- they should suddenly change when 2 the computer system changed. So I argued that, you 3 know, there should be something with the system. 4 Q. So somebody came to the branch to try and rectify the 5 problem? 6 A. Yes. 7 Q. Who was that somebody; not necessarily by name, but by 8 job description or title? 9 A. Two, I think probably Crown office managers. 10 Q. What did they do in the branch? 11 A. They sat and looked at different transactions. They 12 didn't actually do very much. They never told me -- 13 I didn't get a report on what they actually -- what 14 conclusions they came to. 15 Q. You told us that the hardware was taken out. Why was 16 the hardware taken out? 17 A. Because I think that there was a -- that probably the 18 thinking was that there was something not 19 communicating to each other, or somewhere there was a 20 problem, and that's why. That's what I would, you 21 know, presume that was the thing, because that is the 22 active part, is the -- are the base units. 23 Q. And when you went to the paper-based system for 24 a month, was there any problem in balancing the books? 25 A. No. 71 1 Q. When you went back to Horizon after the month, did the 2 shortfall problem continue? 3 A. Yes. On and off, but nothing -- no gigantic amounts. 4 I would never -- if I've seen errors of more than 5 probably a couple of hundred pounds I would have 6 stopped the whole thing and said, "There's something 7 wrong here, I'm not going to work any further with the 8 system", because it escalates. I've seen quite a few 9 things -- the amount can just keep going up, and it 10 shouldn't do that, so I would have stopped there and 11 said, "Let's really go -- let's really find out what's 12 going on." 13 Q. You speak in another part of your statement about 14 Fujitsu having remote access. 15 A. Yes. 16 Q. Was that at this branch in Okehampton or was this 17 after you moved to Aviemore? 18 A. Yes. No, it was in Okehampton. 19 Q. Tell us the circumstances in which that came about? 20 A. We were having some problem there I had actually seen 21 on the screen in front of me, and I was talking to the 22 helpline and I explained that, and next minute they 23 connected me to a person in Fujitsu -- 24 Q. So they connected you on the telephone? 25 A. Yes, to Fujitsu. And he actually altered the figures 72 1 that I was actually looking at while I was watching 2 the screen. 3 Q. So how do you know that he had remote access? 4 A. You could actually see what was happening. The 5 screen, as I say -- say there was a figure there of 6 5,000, that suddenly changed to, say, 7,000, so you 7 could actually see that -- the number change -- well, 8 you know, while we were just watching the screen. 9 Q. And was he talking you through this when he was doing 10 this? 11 A. No, he just did this. When I tried to contact the 12 gentleman again, I seemingly got in trouble for doing 13 this and I wasn't allowed to talk to him again. 14 Q. Who did you get in trouble with? 15 A. No; he got in trouble -- 16 Q. He got in trouble? 17 A. Yes. 18 Q. How do you know he got in trouble? 19 A. Because they wouldn't let me talk to him ever again. 20 Q. Can you remember roughly when this was when Fujitsu 21 had remote access to -- 22 A. It would be 2001, 2002, something like that. 23 Q. And so they effectively altered an error? 24 A. Well, yes. Well, I don't know if it was an error or 25 -- but I saw them alter figures. 73 1 Q. Was the problem that was fixed a shortfall problem, 2 and what they did was to solve the shortfall problem? 3 A. Yes. 4 Q. Can you remember what the error was? 5 A. No, I can't. Too long ago, I'm afraid. 6 Q. Okay. Was that the only time therefore that you had 7 access directly to a Fujitsu employee? 8 A. Other than when they came to change printers or 9 something like that, yes. 10 Q. You say in your statement: 11 "I knew from other subpostmasters that they were 12 having similar problems with balancing on the Horizon 13 system ..." 14 How did you know that? 15 A. Well, I was -- well, I had been in the 16 Federation of SubPostmasters -- again, they're just 17 subpostmasters, but we had meetings, talking to one 18 another and things like that. I've been to 19 conferences, and talking to other people, it gets -- 20 it comes up in conversation all the time, it did. 21 Q. You also say that: 22 "... the Helpline told me that I was the only one 23 and that the system was faultless." 24 A. Yes. I got told by various Post Office management 25 when I was querying things that, "You're the only one. 74 1 There is no problems with the system, it's all good to 2 go." 3 Q. You said there that "various Post Office management". 4 Was that on the helpline, or was that more -- 5 A. No, it might be -- 6 Q. -- in branch? 7 A. In branch. You used to get a visit from a BDM every 8 month and things like that. 9 Q. Tell the chairman who the BDM is? 10 A. I can't remember her name. 11 Q. No, what a BDM is? 12 A. A business development manager. 13 Q. And in conversations with -- was it a "him"? 14 A. At that time it was a "her". 15 Q. It was a her. In conversations with her -- 16 A. Yes. 17 Q. -- she said that you were the only one experiencing 18 faults? 19 A. Yes. 20 Q. And that the Horizon System was problem-free or 21 faultless? 22 A. Yes. 23 Q. Was there ever any discussion amongst you as 24 subpostmasters that with you all experiencing issues 25 with Horizon showing shortfalls, that something needed 75 1 to be done? 2 A. Well, I think it's -- the fact is that everybody -- 3 they say 300 years they've trusted the Post Office, 4 that the Post Office would be telling you the truth 5 and that it was you and not their system. That's one 6 of the things I think they've always tried to provide, 7 that it can't be them, it's got to be the 8 subpostmaster. 9 Q. I think you were on the National Federation committee 10 when you were in Okehampton; is that right? 11 A. Yes, I was on the committee of the North Devon and 12 Barnstaple branch. 13 Q. Was there any discussion ever had as to whether this 14 issue ought to be raised at a higher level within the 15 Post Office? 16 A. I think we've tried to -- we -- I think in the 17 Federation we tried to push it hard -- push it up 18 there, right, up to the management, but I think the 19 management of the Federation of SubPostmasters 20 believed quite -- probably not correctly -- that the 21 system was as the Post Office described it, but 22 I think it was due to their lack of knowledge of 23 telecommunication systems and computing that led them 24 to just follow that because they had nowhere else to 25 get information to, you know -- whether to question it 76 1 or not. 2 Q. You told us earlier that you estimate that in your 3 branch you paid in some £11,000. 4 A. Yes. 5 Q. Was that ever deducted from your remuneration, or was 6 it always cheque payments or cash payments in? 7 A. Yes, it's always cheque or cash. 8 Q. So there were no deductions ever made? 9 A. I never got -- as I say, I never got to those amounts, 10 thankfully. 11 Q. And so how would you put those amounts in? Would you 12 simply physically place cash in the safe? 13 A. Yes. It depends on the amount; it could be cash or 14 cheque. We had a retail part of the business and I'd 15 maybe move money on a Wednesday across from that to 16 cover the loss, or I would put in a cheque. I mean, 17 sometimes when my cash flow is thing, I put in credit 18 card cheques to cover the shortfall. 19 Q. And was this all in the Okehampton branch or did the 20 same problem continue when you moved to Aviemore? 21 A. In Aviemore, the problem wasn't the same; it wasn't as 22 large or anything like that. We had no gigantic 23 losses; they were all quite small, small losses. 24 But -- 25 Q. Do you know why that was? Well, to start with, was 77 1 the volume of money going through the branches 2 different? 3 A. Yes, vastly different. 4 Q. Was Aviemore a four-counter branch? 5 A. Yes, yes, and that was when most -- all the pensions 6 were paid in cash. So, I mean, you know, you're going 7 through so much cash. I mean, I think I had about 8 130 -- in Okehampton, I think I had about 140 9 pensioners who were all being paid in, and children's 10 benefits, all being paid in cash. So the amount of 11 money that was actually coming through the branch was 12 considerable, whereas now, when we moved up to 13 Aviemore, it was still a busy branch, it had all sorts 14 of things, because it was touristy, plus all the 15 locals and banking, that the money I'd brought in 16 was -- that I paid out near enough covered itself. 17 So, in other words, I was cash-rich, I was sending 18 money back, whereas in Okehampton I was being fed cash 19 three times a week to pay for all the benefits. 20 Q. When you moved to Aviemore in 2006, did you or your 21 wife undergo any further or different training? 22 A. It was decided at the interview that, when I was 23 accepted for the branch, that I had nine years running 24 a busy branch, I didn't need training, and my wife got 25 sent to Dartford, and she did a two-week training 78 1 course at Dartford. 2 Q. What was the training course about? 3 A. Basically transactions and sales. 4 Q. Was it about the whole business of the post office, or 5 was it only about the use of Horizon? 6 A. Oh, the sales was part of all different products, but 7 it was basically, what we can do is -- from what -- 8 she didn't have much information about balancing or 9 what you do if things go wrong. 10 Q. In the course of your time in Okehampton, were you 11 audited? 12 A. On a number of occasions. 13 Q. You say four or five audits -- 14 A. Yes. 15 Q. -- in your statement. Does that sound about right? 16 A. Yes. 17 Q. And were these notified to you in advance, or were 18 they a surprise? 19 A. No, they were a surprise. They would arrive on your 20 doorstep at about 8 o'clock on a -- usually a Friday 21 morning. 22 Q. And out of those four or five audits, did auditors 23 ever find a shortfall? 24 A. Only one major. I think there was only one major 25 shortfall on one occasion. The others were sort of 79 1 quite; maybe £100 or a couple of hundred pounds either 2 way. 3 Q. What happened on the occasion of the major shortfall? 4 A. Well, there was two auditors and I think one was all 5 for getting me suspended and -- in other words, 6 sacking me. But I said -- the auditor, they also 7 talked to my business development manager, and she 8 supported sort of thing, and it was agreed to carry 9 on, from a view that on most of these, if they found 10 an error -- usually when I balanced on the following 11 Wednesday, say they did it on a Friday, without 12 putting any money in, it would -- the office would 13 come to a near enough balance as you can. 14 Q. So one of the auditors wanted you suspended -- 15 A. Yes. 16 Q. -- the other one was suggesting, what, that you pay 17 the money? 18 A. Yes, yes. 19 Q. And what did you do? 20 A. I think it came to the conclusion that it would be -- 21 it would be left -- if I remember rightly, it would be 22 left, and then they would come back and do an audit 23 a week later, or something like that. 24 Q. And what happened when they came back? 25 A. It was all -- it happily balanced. 80 1 SIR WYN WILLIAMS: And you hadn't done anything to make it 2 balance, so to speak? 3 A. No, no. 4 MR BEER: And so other than that, the audit showed up no 5 substantial problems. 6 A. No. There was no problems in that case. They just 7 come in and go through everything. 8 Q. But did you have audits when you moved to Aviemore? 9 A. Yes. I can't remember; you always get one after 10 you've been in a new office after six months, but -- 11 Q. Were there any problems showing up to your knowledge 12 in the audits that were conducted in Aviemore? 13 A. Not that I can remember. 14 Q. You say in your statement, on one occasion you were 15 told that you were "getting close to the threshold 16 where I might be suspended due to the shortfalls that 17 were arising." 18 Was that back at Okehampton? 19 A. Yes, that was back at Okehampton, yes. 20 Q. How did that make you feel that you were being told 21 that you might be suspended? 22 A. Well, it's a shock to your system. It means it's the 23 end of your work on this life as you know it because 24 you can be put down as presumed guilty. Your local -- 25 and the community are going to presume, you know, 81 1 you've been thieving, so in other words it's going to 2 stain your character in that community. 3 Q. That, in the event, didn't happen to you? 4 A. No, thankfully. 5 Q. And so essentially you paid in £11,000 -- 6 A. Yes. 7 Q. -- to balance the books, through what you believe is 8 a flaw in the Horizon System? 9 A. Correct. 10 Q. Have you sought to recover that money? 11 A. No. No. 12 Q. Have you heard of something called the Historical 13 Shortfall Scheme? 14 A. I have heard of it. I don't -- when I read the 15 conditions of it, I don't think I was able to. 16 Q. Why was that? 17 A. I can't remember now. Maybe I should go back to it 18 and have a look at it, but I ... 19 Q. You didn't participate in the Group Litigation? 20 A. I did. 21 Q. Oh, you did? 22 A. Yes. 23 SIR WYN WILLIAMS: That would be the reason. 24 MR BEER: That would be the reason. 25 A. Yes. 82 1 Q. What happened in the Group Litigation, insofar as 2 you're concerned, by way of outcome? 3 A. I think it was great that it was proved that the 4 Horizon System was faulty. I just -- I think it was 5 despicable that Post Office did everything to win. 6 But I say -- I think I received £600, or something 7 like that, of compensation, but that's far from what 8 it should have been. I mean, physically all the money 9 from the settlement basically went to funding legal 10 fees and the people that supported us in actually 11 taking the case to the court. But I was just pleased 12 that it was shown that there was something wrong with 13 the system, which everybody up to then had always 14 denied, in Post Office Limited. 15 Q. And so the outcome for the Group Litigation, so far as 16 you're concerned, never mind what it established, was 17 that you got £600? 18 A. Yes. 19 Q. And when you looked at the HSS, you realised you were 20 excluded from it? 21 A. Yes. 22 Q. Are you taking any active steps now to recover the 23 money that the Post Office has taken from you? 24 A. No. 25 Q. How does this saga make you feel? 83 1 A. Very sad. As I say, it really upsets me on how some 2 of my fellow postmasters have been treated. It's very 3 upsetting. 4 Q. They're the only questions that I would like to ask 5 you. Is there anything else that you would like to 6 say? 7 A. Yes. 8 Sir Wyn, thank you for inviting me to give 9 evidence. From my personal experience as 10 a subpostmaster and from my experience as a computer 11 science lecturer, I would like your Inquiry to find 12 out who led the cover-up of the failures in the 13 Horizon System and who thought and advised them that 14 they could get away with it? 15 Horizon was a secondhand system from Irish Post, 16 the Irish Post Office. What testing was done by 17 IBM/Fujitsu before Horizon was implemented in the UK? 18 There have been numerous updates to both operating 19 systems: what testing was done prior to downloading 20 them to Post Office branches? Who set up and 21 controlled the Post Office audit teams who repeatedly 22 made statements like "It's only happening to you"? 23 Who signed off on the branch installations, as it 24 appears that some installations were just thrown in? 25 I am ashamed of the treatment of my fellow 84 1 subpostmasters by Post Office Limited. The staff 2 appeared to think that they were above the law and 3 pursued individuals relentlessly, assuming SPMs -- 4 subpostmasters -- were guilty, although no real 5 evidence was provided. I remember my first audit when 6 I was told by one of the Post Office auditors that 7 I could not ask -- not question their procedures. 8 I think all persons involved with the Horizon 9 failures hidden by Post Office Limited should be 10 compensated now, and not sometime in the future when 11 there will be less of us around. The Post Office have 12 wrecked the Post Office brand, which has affected all 13 our investments. I have been an agent for the 14 Post Office for nearly 25 years, and retire tomorrow. 15 I have managed to make a living, despite Post Office 16 Limited and its policies and actions that have caused 17 me a lot of anxiety and pain. Thank you. 18 Q. Thank you very much. 19 SIR WYN WILLIAMS: Thank you very much for coming -- 20 A. Thank you. 21 SIR WYN WILLIAMS: -- and for giving evidence to me in 22 person, and thank you for bringing your wife, so I can 23 meet you both. 24 A. Thank you. 25 MR BEER: Sir, can we take a short break just before 85 1 Nancy Chant is able to give evidence? 2 SIR WYN WILLIAMS: Yes, certainly. Shall we depart? 3 MR BEER: It's probably not that kind of break. 4 SIR WYN WILLIAMS: Okay, then. We'll just quietly sit 5 here. 6 MR BEER: Thank you very much. 7 (12.16 pm) 8 (A short break) 9 (12.19 pm) 10 NANCY CHANT (sworn) 11 Questioned by MS HODGE 12 MS HODGE: Good afternoon, Mrs Chant. As you know, my 13 name is Catriona Hodge, and I ask questions on behalf 14 of the Inquiry. Please could you state your full 15 name. 16 A. It's Mrs Nancy Chant. 17 Q. You made a statement on 6 February this year; is that 18 right? 19 A. That's correct. 20 Q. Do you have a copy of your statement in front of you? 21 A. I do, yes. 22 Q. Can I ask you, please, to turn to the last page of 23 your statement. 24 A. I'm too nervous to turn the page. 25 SIR WYN WILLIAMS: I was having the same difficulty 86 1 yesterday afternoon, so don't worry about it, it can 2 happen to all of us. 3 MS HODGE: Can you see your signature there? 4 A. Yes. 5 Q. Have you had a chance to read your statement again 6 since it was first made? 7 A. Yes. 8 Q. Are there any corrections you'd like to make to your 9 statement? 10 A. A slight change. At the end, point 59, although what 11 it says is the truth, it comes over -- 12 Q. Which sentence are you talking about? 13 A. "My husband blamed me" -- it sounds like he blamed me, 14 but what he was, he was angry that I was paying for 15 something that he believed had nothing to do with me. 16 But it comes over there as if he thought I was guilty, 17 just the way -- maybe it's the way I'm re-reading it. 18 But it never occurred to him that something went wrong 19 somewhere else, something catastrophically went wrong 20 in that office I was in charge of, and he was angry 21 that I paid for it. He said he felt that I should 22 stand up and fight it, not pay it. 23 Q. Thank you. Apart from that correction, is the content 24 of your statement otherwise true to the best of your 25 knowledge and belief? 87 1 A. Yes. 2 Q. I'd like to begin by asking you some questions about 3 your long career in the Post Office. You first came 4 to work in a post office branch upon leaving school; 5 is that right? 6 A. That's correct. 7 Q. In which year was that? 8 A. It would have been 1973; '72, '73. 9 Q. Where was the branch located? 10 A. In Lyoncross Road in Pollok, Glasgow. 11 Q. What was the nature of your role in the branch at that 12 time? 13 A. Saturday girl. No, I was just helping the back work, 14 like I was very good -- one thing I could do was 15 count, so I was given all the paperwork, all the 16 little giro cheques that were written and handwritten, 17 and then added up. And the dockets from all the 18 pension books, piles of them, that was my job; not so 19 much serving the customers at that time, but -- 20 because I could count, that was what I was doing. 21 Q. Did you enjoy your work? 22 A. I loved it. 23 Q. You were later appointed as the subpostmistress of 24 Crookfur post office. 25 A. That's right. 88 1 Q. Have I pronounced that correctly? 2 A. Yes. 3 Q. And that is located in Glasgow? 4 A. Yes. 5 Q. When did your appointment as a subpostmistress 6 commence? 7 A. In June 1986. 8 Q. Do you remain in that role today? 9 A. I do. 10 Q. If my maths is correct, you worked as 11 a subpostmistress for more than 10 years before the 12 Horizon System was introduced? 13 A. Yes. 14 Q. (unclear). Did you ever experience problems balancing 15 your accounts, before Horizon was brought in? 16 A. There was one, right at the very beginning; a 17 discrepancy which I couldn't understand. It happened 18 when I was on holiday for the week. There was an 19 investigation; I assumed there was an error that had 20 come back. I was investigated. I had a woman that 21 worked for me to give me holiday relief because I was 22 a single, one-man band. We were both interviewed. We 23 were asked if they could look through our bank 24 accounts, which I let them, she wouldn't, and there 25 was a -- a time went by when -- I mean, I was 89 1 interviewed in George Square, but I never gave it much 2 thought, I just thought it was an error and it will 3 turn up. Then somebody came out to me at the branch 4 and said to me that was his job to interrogate people 5 for any errors, and in his opinion I was telling the 6 truth, or I was the best liar in Britain. He looked 7 me in the face and he said, "You're the only one that 8 actually knows that you didn't take it, but it could 9 only have been the person that worked for you. You 10 need to do something about that", and I did. And then 11 I was single-handed for years without holidays, 12 because she really just gave me holiday leave, but 13 never -- that was the only time. 14 Q. Apart from that one incident, was your honesty and 15 integrity ever called into question by the 16 Post Office? 17 A. No, no. 18 Q. What had attracted you to the role of 19 a subpostmistress? 20 A. My father was a postmaster at Lyoncross Road and I 21 just loved the work. I loved meeting people; I liked 22 the variety of work. Just -- I think I liked being 23 with people, talking to people, et cetera. 24 Q. What experience have you had of working with computers 25 before Horizon was installed? 90 1 A. Nothing. Absolutely nothing. 2 Q. How did you feel about the introduction of this 3 computer system? 4 A. Terrified. I actually considered packing it in. I 5 considered leaving the Post Office, it just terrified 6 me. 7 Q. What training did you receive from the Post Office? 8 A. Two days in a hotel in Glasgow. 9 Q. What did that training cover? 10 A. The workings of the Horizon, the keyboard, the 11 touching the icons on the computer and -- 12 Q. Were you taught how to balance on the system? 13 A. Yes, yes. 14 Q. Did you feel the training was sufficient to prepare 15 you for using this new system? 16 A. I felt it probably should have been, but not for me. 17 By that time I had a young girl that came in to give 18 me holiday relief and I paid her to go in and do the 19 two days' training because I thought if she's going to 20 cover for my holidays, she needs to know what she's 21 doing. She was young, with it, and thought it was 22 easy. And she just went to it like a fish to water, 23 great, and she helped me. 24 Q. What were you told to do if you did experience 25 problems balancing on the Horizon System? 91 1 A. Just to report to it helpline. 2 Q. Did you experience problems balancing after the system 3 went live? 4 A. No, no. 5 Q. So you -- 6 A. Not immediately, not immediately, not immediately. 7 Q. When did you first start having -- 8 A. 2007. 2007. 9 Q. Had anything changed around that time and was there -- 10 A. I never thought about it until I was sitting in here 11 just now, but I had just renovated the office, so 12 everything was cleared out, totally emptied. All my 13 cash was REM-ed back into the head office and the 14 workmen came in. I refitted the entire post office, 15 and then the engineers came and refitted two 16 computers, because I only had one before, and it was 17 just -- it's the same computer that I had that had 18 been stored and put back in place. But I never gave 19 that a thought, everything was fine, until I had the 20 shortage. 21 Q. You've mentioned in your statement you had quite 22 a significant shortfall in May of 2007. 23 A. Yes. 24 Q. Is that right? Do you recall how much that was? 25 A. It was about 8,000, I can't get it exactly; it was 92 1 around the 8,000 figure. 2 Q. What inquiries did you make at the time to try and 3 work out what had caused that shortfall? 4 A. I phoned the helpline that night to explain that I had 5 a shortfall and they said, "That's okay. Just you 6 know you have to declare it?" I said yes. That night 7 I printed out from the computer every single 8 transaction that had taken place in the day. I 9 checked the bins. I just looked everywhere, but what 10 didn't add up for me, rechecked the transactions and 11 in a simple way that I can explain it, if I locked up 12 on the Wednesday night with £1,000, it was a different 13 account, a different amount, but in theory £1,000, and 14 I could see the transactions that there was £1,000 of 15 deposits, and withdrawals, £1,000 of withdrawals, you 16 can see all that, so I ended up with £1,000 cash, but 17 the system said I should have 10,000. It just didn't 18 add up. I don't know why that was, but the figures -- 19 I was searching for it. If I could lose £8,000 in 20 a day, because that happened in a day, then there must 21 be a transaction saying I deposited -- somebody 22 deposited 8,000 and I threw it in the bin, or 23 something, but there was no deposits. Nothing 24 corresponded to this shortage. There was no amount of 25 cash coming in, so I just didn't see what could have 93 1 happened. 2 Q. When you reported the shortfall to the helpline, which 3 you were required to do, did they assist you to get to 4 the bottom of what had caused -- 5 A. They said they were making inquiries. 6 Q. Do you know whether they made any inquiries? 7 A. No idea. 8 Q. In your statement you say that you contacted your area 9 manager about this shortfall; is that right? 10 A. She contacted me. She contacted me to say that 11 Chesterfield had been in touch with her and asked her 12 had -- in her opinion, could I have taken money, and 13 she was telling me that she'd told them that I would 14 not have done that, which was quite a relief, really, 15 because all I could think was, "Oh, I've just 16 renovated the shop. I've taken out a loan to do all 17 this and now money has disappeared." It just looked 18 awful. It looked awful. So to hear somebody in the 19 Post Office saying that they believed that there was 20 an error somewhere was comforting. 21 Q. So as far as you know, the only inquiry the 22 Post Office had made was to ask your area manager 23 whether she thought you had taken the money? 24 A. Yes. 25 Q. Did the Post Office accept what your area manager told 94 1 them, that you hadn't taken the money? 2 A. Yes, yes. Yes. The only thing I ever heard was that 3 I was responsible for the cash and that I needed to 4 repay it back, and I came to an agreement of paying it 5 back over several years. 6 Q. So although you hadn't been shown anything to say that 7 you'd taken it, you were still required to repay the 8 money? 9 A. Yes. 10 Q. How was that communicated to you? 11 A. I think I got it in -- when there is a shortage and 12 it's been held in suspense, it's held in a head office 13 and they write to you to say you have an account that 14 you owe so much money, or whatever, and they asked me 15 to pay it and I contacted them and said, "Can I have 16 time to pay it?" and we came to -- the longest time 17 that they were willing to let me take, I can't 18 remember how long it was, it was years, but the 19 longest time they were willing to give me to pay it 20 back, that's -- they then deducted from my 21 remuneration each month. 22 Q. So over the course of that time, they gradually 23 deducted the amount of 7 or £8,000 from your salary as 24 a subpostmistress? 25 A. Yes. 95 1 Q. And you let them do that because? 2 A. It was in my contract. 3 Q. You experienced another shortfall in June 2010; is 4 that right? 5 A. Yes. 6 Q. On this occasion I think you again made some inquiries 7 yourself to get to the bottom of it? 8 A. Yes. 9 Q. Can you describe those, please? 10 A. Again, I checked the transactions for the day. There 11 were several small deposits; there was nothing of any 12 large amount. And there was nothing that I could see 13 printing it out, looking at it, I couldn't see 14 anything, but I still had faith that errors happen and 15 errors come back, because that did happen in the old 16 days. Before computers, there were human error, 17 additions were wrong and the errors would come back, 18 and I still believed that could happen. 19 Q. On this occasion the shortfall was £3,000; is that 20 right? 21 A. Yes. 22 Q. Did you contact the helpline to report that shortfall? 23 A. Yes. 24 Q. What did they tell you to do? 25 A. Just make sure that I declared the shortage when I 96 1 balanced. 2 Q. How was that shortfall resolved with the Post Office? 3 A. Again, I had a letter from the head office saying that 4 there was a discrepancy in my office, I was 5 responsible for it, and could I pay it. I phoned them 6 up, and again arranged a year or two to pay it back. 7 Q. When you were experiencing these shortfalls at the 8 time, what did you believe was causing them? 9 A. I had no idea. I had no idea. At that time I had 10 a gentleman who had worked for the Post Office and he 11 was giving me holiday relief. Again, I was still 12 working single-handed, and he would come in and give 13 me holiday relief. And he'd popped by one day and I 14 told him about the shortage. He says, "Ah, that's not 15 right. That's a computer error." I said, "Do you 16 think so?" and he goes, "Yes, it will turn up", and I 17 kind of believed that, too. So I always believed it 18 would come back; I always believed it would come back. 19 I used to open up mail in the mornings and that would 20 be headed "Confidential" and from the Post Office, and 21 I'd go "Yes", but it wasn't. 22 Q. How much money do you think you paid in total to the 23 Post Office -- 24 A. About 11,000. 25 Q. What effect did it have upon your business to be 97 1 paying back these substantial sums of -- when I say 2 "paid back", to be paying in these substantial sums? 3 A. The business carried on, but I was the one that was 4 working for very little money. Because the 5 remuneration was paying the rent, the rates, the water 6 rates, electricity, running costs, and what was left 7 was for me, but it was going to the Post Office to pay 8 back the shortage. 9 Q. By way of deduction -- 10 A. Yes, yes. 11 Q. -- from your salary? How did this affect your 12 personal finances at the time? 13 A. Well, I just didn't have any spare money. I survived; 14 I survived. I survived, and that's it. 15 Q. Did the financial pressures you were under affect your 16 relationship with your husband? 17 A. Yes. Yes, he didn't like the fact that I was paying 18 back something that I didn't have. He had worked for 19 British Rail, and he just thought they were such 20 a great company to work for and they looked after 21 their staff, and he just couldn't believe the way that 22 I was being treated by a big organisation, you know. 23 So we gave up arguing over it. I thought, "No, it's 24 money, yes, but we're living. Get on with it." 25 Q. How was your wellbeing affected by the financial 98 1 pressures that created for you? 2 A. Not so much the financial pressures. It was lack of 3 my self, my own abilities. Every night, because I 4 cashed up every night because I liked to see I'm okay 5 tonight. But as the computer churned over the -- my 6 stomach would be in knots, my knees would start 7 shaking. That still happens; it still happens. 8 Q. In your statement you say: 9 "I lost confidence in my abilities and began to 10 question myself." 11 A. Yes. I started double-checking everything I was 12 doing, because there is a mistake here somewhere. I 13 don't know what happened, but everything I was doing I 14 was double-checking. 15 Q. Why did you decide to remain working for the 16 Post Office when you had experienced these significant 17 problems using Horizon? 18 A. I didn't consider walking away. I loved working in 19 the post office. In my mind there was a couple of 20 errors taken place -- horrible errors, terrible errors 21 -- but working where I was was my life. I just -- 22 I know I was working -- people won't believe how 23 little I was earning, but I loved the work and I had 24 a husband that supported me, so. That's it. 25 Q. How would you describe your current experience of 99 1 using the Horizon System? 2 A. It's fine, but the weirdest thing is that I find that 3 I know what I'm doing. I've even learned how to go 4 online and check what they're paying me. I couldn't 5 do that for years. Everything -- if I can understand 6 how it was going, I can work it. I have forgotten 7 what I was going to say there. 8 Q. Have you experienced any significant shortfalls in 9 recent years? 10 A. No, no. No. 11 Q. Do you continue to experience small ones or? 12 A. No, no. 13 Q. It's balancing fine? 14 A. Yes, yes everything -- yes. 15 SIR WYN WILLIAMS: So I think you were part of the 16 Group Litigation. 17 A. I was, yes. 18 SIR WYN WILLIAMS: And Mr Justice Fraser found that the 19 current version of Horizon, as and when he was looking 20 at it, was, to use the word that was bandied in that 21 litigation, robust. Has that been your experience 22 over the last few years of it? 23 A. Yes. Yes. 24 SIR WYN WILLIAMS: Okay. 25 MS HODGE: You've just mentioned that you participated in 100 1 the Group Litigation. 2 A. Yes. 3 Q. Before that, you'd made a claim through at the 4 mediation scheme; is that right? 5 A. No. 6 Q. You haven't? 7 A. No. 8 Q. As a result of the Group Litigation, did you receive 9 any compensation? 10 A. I received about £2,000. 11 Q. Do you feel that the Post Office has learnt from the 12 failings that came to light in the course of the 13 Group Litigation, from your experience as a current 14 subpostmistress? 15 A. I don't know. It's not something we really discussed 16 with the Post Office. It's really not something I 17 have discussed with them. 18 Q. In terms of your day-to-day interactions though with 19 those that -- your managers, the helpline, do you feel 20 that those experiences have improved? 21 A. There is an improvement in that I now have an area 22 manager. When I first took over the post office you 23 had an area manager, you felt you were on 24 a one-to-one, you felt you could phone her up to see 25 whatever was going on. There was one occasion where I 101 1 had balanced and it was bad. I think it was maybe at 2 least £1,000, and I phoned her up. She goes, "Oh, it 3 will be there, it will be there", and it was crazy, 4 because the next day at the very back of safe it was 5 sitting at the back of the safe. I had missed it when 6 I had been doing my reconciliations that night; it was 7 just a bag at the back. But you had that personal 8 touch. Once the computer came in then you had 9 a helpline, and the helpline were impersonal. It was 10 just totally different. And over the last four, 11 five years they've reintroduced an area manager, and 12 it's back to being a bit more personal. It's nicer. 13 Q. I have no further questions that I'd like to ask you. 14 Is there anything that you'd like to say to the Chair? 15 A. Yes. Thank you. If I can hold the paper without 16 shaking. 17 Sir Wyn, I find it difficult to describe to you 18 what impact this shortfall has had on me and my 19 family, but thank you for giving me the opportunity to 20 give evidence to you. I always knew that I was 21 responsible for any shortfalls in my office, and as 22 such accepted responsibility. I was devastated when 23 it 2007 I had a large shortfall of about 8,000. Pure 24 fear and panic flooded through me. I contacted the 25 helpline to report the loss, and spent days poring 102 1 over transactions for that day. Nothing made sense. 2 My son spent the day studying the CCTV footage in my 3 shop and he couldn't see anything that gave him any 4 clue. 5 I lost a lot of confidence and became very nervous 6 when cashing up. A few years later another shortfall 7 had me doubting myself. Now that I've learned that 8 the Post Office, while asking me to pay for these 9 shortfalls, knew that the system was unreliable. I 10 feel betrayed and very angry. Deductions were made 11 from my remuneration for a few years, leaving me 12 working 50 hours a week with very little to show for 13 it while I paid rent and bills for the property, which 14 took the rest of the cash. It was very difficult with 15 my husband at that time, as he could not understand 16 why I had to pay for something that I had not taken. 17 He wanted me to refuse to pay it and fight. He wanted 18 me to go to court and fight it. I tried to explain to 19 him that there is nothing I could do, it was in my 20 contract to pay shortfalls. He was raging. 21 The job I had loved was now causing me great 22 anxiety at work and stress at home. In the beginning 23 I convinced myself an error had taken place and it 24 would be found and the losses would be rectified. To 25 this day I'm still nervous when cashing up at night, 103 1 and my stomach flips. 2 I would like to see everyone get their money back 3 that they had to pay back to the Post Office. I know 4 what I lived through was scary, but my heart goes out 5 to those who were prosecuted. I would like to see 6 them receive compensation, although no amount of money 7 will ever compensate probably what these people had to 8 live through. Thanks. 9 SIR WYN WILLIAMS: Well, thank you very much, Mrs Chant, 10 for your description of the past, but also your 11 description of the present. And if I may, I'm going 12 to use the bits of evidence that you gave about the 13 present as a vehicle to say that I have heard 14 comparatively few people talk about the present so 15 far. In due course I would like subpostmasters to 16 come forward and tell me about the present, because 17 part of my role is not just to look at the past, but 18 to look at the present and the future. So thank you 19 for sharing that part of your evidence with me, and 20 thank you generally. Thank you. 21 A. Thank you. 22 MS HODGE: Thank you, sir. That concludes our oral 23 evidence. 24 SIR WYN WILLIAMS: It does, and I'll give Mr Enright 25 a minute or two to talk to his client, and then we'll 104 1 have him in the hot seat to read a few summaries and 2 then conclude the proceedings. 3 MS HODGE: Thank you. 4 (Pause) 5 MR ENRIGHT: Sir, you've asked me to begin with the final 6 Scottish -- 7 SIR WYN WILLIAMS: If you would, please, yes. 8 MR ENRIGHT: And to read four others, so hopefully you 9 have them in order. 10 SIR WYN WILLIAMS: Well, I deliberately annoyed my team, 11 Mr Enright, by refusing to have them in order because 12 I like moving my papers around every now and then. 13 That's just to introduce a little light heartedness 14 into what is obviously a very serious occasion. 15 MR ENRIGHT: The order I was hoping to address is 16 Mr Brian Macaulay, Ms Joanne George, Ms Pauline Coyle. 17 SIR WYN WILLIAMS: Yes. 18 MR ENRIGHT: Anonymised Witness 0301. 19 SIR WYN WILLIAMS: 0301? Yes. 20 MR ENRIGHT: And Mr Peter Holloway. 21 SIR WYN WILLIAMS: Thank you very much. 22 MR ENRIGHT: Thank you, sir. With your permission. 23 SIR WYN WILLIAMS: Yes. 24 25 105 1 Mr Brian Macaulay, statement summarised 2 MR ENRIGHT: Sir, you and your panel, of course, have read 3 with care the full witness statements of the 4 individuals whose summaries I will be reading to you 5 now. 6 I'd like to begin with Mr Brian Macaulay, who is 7 a subpostmaster of two Post Office branches in 8 Scotland. He operated his main branch, the Kilmaurs 9 post office, from around September 2014 to 10 December 2016 with his sons, and he operated an 11 outreach branch in Kilmarnock from around 2015 to 12 December 2016. 13 Brian attended a couple of days' training on the 14 Horizon System before starting work at the branch. 15 The training was run at the Post Office Training 16 Centre here in Glasgow. Brian says a trainer also 17 attended the branch on the first day he opened, to 18 show him how to complete the daily and monthly 19 balances. Brian described this as a shambles. During 20 the balance there was a shortfall, and the trainer did 21 not stay to help him work out where the balance had 22 gone wrong. Brian says the training was completely 23 inadequate; he did not feel as though it prepared him 24 to run a post office. 25 Brian says he paid in excess of £20,000 to the 106 1 Post Office in relation to shortfalls. He would often 2 telephone the helpline when shortfalls arose, and 3 trace back through transactions to see if he could 4 find any obvious mistakes. When he could not find any 5 errors, he would opt to settle the shortfall by cash 6 on the Horizon System. 7 In 2016 Brian experienced two large shortfalls. 8 The first amounted to some £39,765.05, which Brian did 9 not repay. He then experienced another shortfall 10 later on in 2016 that amounted to £107,618.89. Brian 11 received a letter from the Post Office demanding 12 repayment of this sum, but was unaware of how or where 13 this alleged shortfall came from, and whether it 14 related to the previous £39,765 shortfall. 15 Following an audit Brian was contacted by his 16 contracts manager, who confirmed that they had found 17 an alleged shortfall, and that his appointment was 18 suspended. As a result, Brian could no longer work in 19 the branch until the Post Office had concluded their 20 investigations. Brian says: 21 "I was absolutely shattered by my suspension 22 because I had no idea what the problems were and how 23 these shortfalls kept occurring." 24 Brian's appointment was eventually terminated in 25 December 2016. 107 1 After losing the post office he tried to keep his 2 retail business running, but due to a huge drop in 3 footfall and rumours that were circulating about him, 4 Brian's retail business was no longer sustainable. He 5 had no option but to close. 6 Brian says he was under a huge amount of pressure 7 as a result of the actions of the Post Office, and his 8 mental health was seriously impacted, as well as his 9 relationships. Brian says: 10 "The consequences of being held responsible for 11 the shortfalls were that I lost my business, my home, 12 my family, I was out of a job, and my kids were also 13 out of a job ... My entire life was falling apart as 14 a result of the actions of the Post Office ... I 15 considered ending it all by taking my own life; I had 16 nothing to live for anymore. The Post Office are the 17 most evil people I know." 18 Mrs Joanne George, statement summarised 19 MR ENRIGHT: Sir, Mrs Joanne George was the 20 subpostmistress of the Baschurch post office in 21 Newtown from March 2013 to October 2016. Mrs George 22 and her husband ran a hardware store, and expanded the 23 business to include a Post Office branch. Joanne 24 attended an eight-day Horizon training course prior to 25 the branch opening. She found the training rushed. 108 1 Three Post Office trainers came into her branch to 2 shadow her. Joanne says this was not helpful, as the 3 Post Office trainers chatted amongst themselves. 4 Joanne says she would contact the helpline two to 5 three times a week. She found them rude and 6 unhelpful. Their advice was always to pay the 7 shortfalls. Joanne estimates that in total she paid 8 in the region of £12,000 over the years in shortfalls. 9 Joanne was not suspended, but instead accepted closure 10 under the Network Transformation scheme. The constant 11 stress of the shortfalls and lack of support from the 12 Post Office led Joanne to feeling as though she had no 13 other option but to accept closure. 14 At the final audit before the Network 15 Transformation Scheme a £450 shortfall was discovered. 16 Mrs George disputed this, but the Post Office warned 17 her that she would not receive anything if she did not 18 pay the shortfall. Joanne felt she was being 19 blackmailed. Joanne was ordered by the Post Office to 20 hand over all her paperwork and to sign 21 a non-disclosure agreement. Joanne's contract was 22 then terminated. 23 Mrs George blames the Post Office for the loss of 24 her business. It was valued at £480,000, but Joanne 25 was told she must accept the Post Office offer of 109 1 £42,000, and was prevented from selling her business. 2 Joanne says her mental and physical health declined. 3 Joanne became suspicious of family members, and even 4 asked her son if he had stolen the money. Joanne 5 attempted suicide. 6 Mrs George and her husband now live in a mobile 7 work. She has not worked since her business closed, 8 as she finds it very hard to trust anyone. Joanne 9 says: 10 "My life has been forever changed by the actions 11 of the Post Office ... I was leading a happy family 12 life and running a successful business. I was forced 13 out and made to sell my business at a loss ... It has 14 felt as though we are on a merry-go-round with no end. 15 All I hope is that we can finally put the situation 16 behind us and have some closure." 17 Ms Pauline Coyle, statement summarised 18 MR ENRIGHT: Sir, Pauline Coyle is the current 19 subpostmistress at Bonby post office in Brigg, 20 North Lincolnshire. She and her husband consider that 21 they were thrown in at the deep end with the Horizon 22 System. She had to be trained by her husband 23 initially, who was unsure of the system. She 24 describes this as the blind leading the blind. 25 Subsequent on-site training was inadequate. It soon 110 1 became clear that there were problems with the Horizon 2 System. Ms Coyle was told by the helpline that the 3 problems were her fault, and payments were deducted 4 from her wages. Pauline requested an audit in 2014, 5 and a shortfall of over £1,600 was identified in 6 relation to stocks of stamps which she had never 7 received. Pauline says: 8 "I was very stressed, very worried, but also 9 incredibly angry. It was the injustice of having 10 someone come into my business, and tell me that I owed 11 a huge amount of money and implied that I had been 12 stealing." 13 The auditor told Ms Coyle that he knew that she 14 and her husband had not stolen anything, but that she 15 was liable anyway. Pauline escalated the matter, and 16 the Post Office agreed to write off the stamps against 17 monies which the Post Office owed to the Coyles. 18 Pauline says: 19 "My retirement is being delayed, and we are being 20 forced to live somewhere we do not want to live, and 21 being forced to do a job that we do not want to do." 22 Pauline says that the problems created distrust in 23 her marriage, and she became distressed and 24 frustrated. She's been unable to sell her post office 25 for some eight years now, and her retirement plans 111 1 have been frustrated. Pauline says: 2 "I also feel very strongly that subpostmasters 3 should be put back into the position that they should 4 have been in if the shambolic operation of the 5 Post Office had been better, and the scandal better 6 managed." 7 Anonymous Witness 0301, statement summarised 8 MR ENRIGHT: Sir, Anonymous Witness 0301 was a 9 subpostmaster from July 2000 to May 2016. The witness 10 sold his property abroad. This enabled him to buy 11 a post office and a home in the UK. The witness 12 thought he would run the post office until his 13 retirement, and he would be able to retire early. The 14 training and the trainers were inadequate. The 15 witness would be up until 1.00 am on a Wednesday to 16 get the figure on the Horizon System to balance. He 17 called the helpline every week, sometimes more than 18 five times in one day, regarding shortfalls or 19 balancing. 20 The helpline would actually make the loss double, 21 by giving the witness the wrong information. The 22 shortfall amounts varied, but continued over the 23 16 years of the witness's tenure. The Post Office 24 would not let the witness pay the shortfalls back by 25 deducting from his salary, so the witness paid for 112 1 those shortfalls with his credit card. By this time 2 the witness was behind on his gas and electricity 3 bills, and behind on his taxes. 4 The shortfalls were revealed on balance nights. 5 The witness spent hours looking at rolls of paper, 6 trying to find the cause of the shortfalls. The 7 witness would be up as late as 4.00 am looking for 8 discrepancies, but he could not find the shortfalls. 9 He felt that the system was designed so that you could 10 not find them. 11 The witness feared that his contract would be 12 terminated by the Post Office every Thursday morning. 13 He would always look through the window on a Thursday 14 to see if anyone was there, following a balance on 15 a Wednesday. The Post Office had told him that if he 16 did not pay back the shortfalls, he could be subject 17 to prosecution. The witness estimates that he could 18 well have repaid shortfalls in excess of £25,000. 19 Even today the witness has debts that he is still 20 paying off, and feels that the emotional scars on his 21 wife and family will never heal. 22 The witness and his wife's reputation was damaged 23 in the community. They were no longer asked to open 24 the church gala or organise pensioners' days. Their 25 shop window was smashed, they did not feel safe in 113 1 their own home. The witness's parents suffered, as 2 they heard people at church running them down and 3 saying there is no smoke without fire. 4 The witness was party to the Group Litigation, 5 which the witness feels turned out to be a joke. The 6 witness feels that he and his wife should have been 7 comfortably retired by now; however, they're not. As 8 the witness says: 9 "All because 20 years or so ago we decided to buy 10 a lifestyle business in a quiet village, so our 11 children would have a good future, away from the fast 12 dog-eat-dog life, and we would be with our family." 13 The witness concludes: 14 "I would like for it to be over with. I would 15 like to know where all the money went. We are bitter 16 all because of a crappy computer system, but most of 17 all by the mistreatment and lies of the unscrupulous 18 Post Office Ltd management." 19 Mr Peter Holloway, statement summarised 20 MR ENRIGHT: And then finally, sir, Mr Peter Holloway, who 21 was the subpostmaster of the Wareham post office in 22 Dorset from September 2001 until April 2009. 23 The post office had three satellite offices for 24 which he was responsible. Mr Holloway was also the 25 temporary subpostmaster of the post office on King 114 1 Street in Swanage from 2005 until 2006. 2 Mr Holloway experienced shortfalls in the Horizon 3 System of approximately £28,000 at his branches. The 4 Post Office responded to these shortfalls by claiming 5 that Mr Holloway's staff were stealing from him. Due 6 to this, Mr Holloway began to mistrust his staff, and 7 as a result he implemented measures and checks. This 8 caused bad feelings amongst his staff, and created an 9 uncomfortable working environment which resulted in 10 the departure of some of his employees. 11 Despite having acknowledged that Mr Holloway was 12 the best subpostmaster in the area, the Post Office 13 conducted an audit and threatened to prosecute 14 Mr Holloway, and then terminated his contract. 15 Mr Holloway has suffered significant financial loss as 16 a consequence of the actions of the Post Office. He 17 went from being a successful and reputable 18 businessman, to having to undertake low-paid work. 19 For example, working 66 hours per week on jobs such as 20 delivering vegetables. 21 Mr Holloway has suffered significant stigma in the 22 community. He had to resign as chair of the local 23 Chamber of Commerce. Mr Holloway says: 24 "When my wife and I walked down the street, former 25 friends and acquaintances would turn their backs on us 115 1 and cross the street to avoid us. When I got work 2 doing food deliveries one of the company's customers 3 asked them to dismiss me, as they said I was a 4 criminal. My employer refused, but the customer 5 cancelled their order and refused to let me near their 6 home." 7 Mr Holloway and his wife have now left their local 8 area to escape that stigma for which the Post Office 9 is responsible. Mr Holloway says: 10 "The Post Office's lack of support or sympathy for 11 subpostmasters was unbelievable, and their fraudulent 12 motives that have emerged are unforgivable. To behave 13 as they did to other human beings, and to destroy and 14 ruin their lives, is inhumane. Post Office Ltd and 15 their senior managers and staff do not deserve to 16 survive the scandal. The individuals should feel the 17 full force of the law for knowingly making innocent 18 people suffer." 19 Thank you, sir. 20 SIR WYN WILLIAMS: Thank you, Mr Enright. 21 And that brings us to an end of our evidence 22 gathering on human impact in Scotland. As I expected 23 it would, it has provided us with further important 24 insights into the damage caused by Horizon and 25 decisions taken in relation to it. I'm very grateful 116 1 to all of those who have participated in these 2 hearings over the last day and a half. 3 I can now announce that we're on the last lap, so 4 to speak, of our human impact hearings, but we're 5 going to Belfast next week to complete our tour around 6 the United Kingdom, and then that will see the end of 7 this phase of the Inquiry. 8 So I'm grateful to the people in Scotland who have 9 assisted me. I should give a plug to my team. They 10 have made this run smoothly, so thank you to them. 11 Although in many ways this is a sad occasion because 12 we're dealing with sad events, I have to say I have 13 been very pleased to come to Scotland. So thank you 14 all very much. 15 (1.02 pm) 16 (Adjourned until Wednesday, 18 May 2022) 17 18 19 20 21 22 23 24 25 117 1 I N D E X 2 EDWARD BROWN (sworn) .................................1 3 Questioned by MS HODGE ...........................1 4 Mrs Catrona Brown, statement ........................22 summarised 5 CHRIS DAWSON (sworn) ................................24 6 Questioned by MS HODGE ..........................24 7 DONALD ROGER MCLEAN (sworn) .........................57 8 Questioned by MR BEER, QC .......................57 9 NANCY CHANT (sworn) .................................86 10 Questioned by MS HODGE ..........................86 11 Mr Brian Macaulay, statement .......................106 12 summarised 13 Mrs Joanne George, statement .......................108 summarised 14 Ms Pauline Coyle, statement ........................110 15 summarised 16 Anonymous Witness 0301, statement ..................112 summarised 17 Mr Peter Holloway, statement .......................114 18 summarised 19 20 21 22 23 24 25 118