Amendment 135

Victims and Prisoners Bill - Committee (6th Day) – in the House of Lords at 5:00 pm on 26 February 2024.

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Baroness Brinton:

Moved by Baroness Brinton

135: After Clause 40, insert the following new Clause—“Victims of the Horizon system: timetable for compensation payments(1) Within seven days of the day on which this Act is passed, the Secretary of State must publish a timetable for making payments in respect of schemes or other arrangements to—(a) compensate persons affected by the Horizon system;(b) compensate persons in respect of other matters identified in High Court judgments given in proceedings relating to the Horizon system.(2) In considering a timetable under subsection (1) the Secretary of State must have regard to the importance of speed and fairness to victims of the Horizon system.(3) In this section “the Horizon system” means previous versions of the computer system known as Horizon (and sometimes referred to as Legacy Horizon, Horizon Online or HNG-X) used by Post Office Limited.” Member’s explanatory statementThis amendment requires the Secretary of State to publish a timetable for the payment of compensation to victims of the Post Office Horizon scandal.

Photo of Baroness Brinton Baroness Brinton Liberal Democrat

My Lords, I tabled Amendment 135 some weeks ago, after there seemed to be some difference in timing for the compensation scheme for those sub-postmasters who were accused of stealing, prosecuted and convicted, lost their jobs and their homes, were made bankrupt, lost future employment and, worse, lost their relationships; some were so distressed that they took their own lives. This House has debated this issue a lot, and I will not go through the detail, even of the compensation schemes, because I believe that they are familiar to many people in your Lordships’ Committee, unlike the previous group.

On Saturday the Times reported that more than 250 of the affected sub-postmasters have already died. Like the infected blood compensation scheme that we discussed in the debate on the last group, time really is of the essence. The amendment says that within seven days of this Bill passing,

“the Secretary of State must publish a timetable for making payments in respect of schemes or other arrangements”, both for those affected by the Horizon scheme and in relation to

“other matters identified in High Court judgments” about the Horizon scheme. It emphasises that speed and fairness must be priorities, echoing the points the Prime Minister made last month. The amendment also refers to the scope of the Horizon scheme, including its predecessors and successors.

It is important to state that the High Court was absolutely clear that any prosecution that relied on Horizon is unsound. It was worrying that on 9 January this year the chief executive of Post Office Ltd—or POL—wrote an email that was published last week, stating that POL believed that around 360 sub-postmasters were probably guilty; that is, in POL’s view, the prosecution was not totally reliant on Horizon. I am afraid that this letter shows that the culture inside POL has not changed, and that is truly shocking.

The evidence to the public inquiry demonstrated that POL’s approach to investigation and prosecution was unfair and inappropriate, because POL was the victim, the investigator and the prosecutor. It often denied postmasters access to information that they needed for their defence, which is against our court rules.

Last week the press reported that POL has now instigated an “independent investigation” by retired police officers into the behaviour and actions of POL investigators. Can the Minister assure your Lordships that it will be a truly accountable and independent investigation whose results will be fully published, unlike POL’s behaviour with Second Sight, which it commissioned to investigate the sub-postmasters and Horizon? It was then gagged and sacked when it uncovered the truth. While it is good that these prosecution powers will not be used again, can the Minister confirm that this group of victims—the 360 who the chief executive of POL says are probably guilty—will still be fully eligible for compensation in line with others?

On the compensation schemes, yesterday’s Sunday Times reported that some former postmasters are still waiting to hear from POL about their claim. There is a simplified form now, 14 pages long, with 100 supplementary questions that remain—as on the previous form—absolutely impenetrable. They make clear that POL fails to believe certain claims about hardship, personal injury, harassment and mental health. Some are being asked for specific documents going back over two decades. I am not sure that I could put my hands on my P60 from two decades ago.

The guidance clearly states that POL is supposed to accept some claims, even when it does not have the exact detail. I quote from the guidance:

“Where the postmaster is unable to satisfy the burden of proof in relation to their claim, their claim may nonetheless be accepted in whole or in part if the Scheme considers it to be fair in all the circumstances”.

But POL is not telling the postmasters what is fair. Once again, it is using its powers to hobble these victims.

I will not go into the detail of the three schemes. We understand why they are different and we debated them in some depth when, on 16 January, the Post Office (Horizon System) Compensation Bill went through all stages for quick enactment. My concern is that, despite promises from the Dispatch Box in both Houses that the scheme would be simpler and accept a wider range of damages, including the elements I just outlined, unfortunately, in the hands of POL once again, the exact opposite seems to be happening.

I do not seek to open personal cases in Committee, but there are enough postmasters now saying that POL is offering them only a very small fraction of the actual losses suffered by them as compensation. Some, including Alan Bates, have said that they have been offered a sixth of their claim. This is outrageous. Can the Minister say whether the Government have oversight of these issues and how they can be resolved?

At the Post Office (Horizon System) Compensation Bill Second Reading, I mentioned a scheme that Dan Neidle, who runs Tax Policy Associates, thought would be most fair. He is an expert in compensation and taxation, and he made two or three points that have not been picked up in the compensation schemes as they are currently being run.

First, all applicants should receive a grant for legal advice. This is particularly vital when complex forms have to be completed and official data needs to be found. He also thought that there should be a large fixed amount when it is confirmed that they are a victim of the scheme, whether convicted or not. That would remove the current shameful divide between different types of cases for those convicted and those imprisoned. He thought that figure should be considerably higher than £100,000, but that is entirely up to the compensation scheme and the Government to agree.

There should also be—this is part of the fog from POL—an amount that reflects their loss of earnings from the day they could no longer work, the loss of the home and any subsequent loss accruing from that, their pensions and any amounts relating to specific damage above and beyond that outlined in previous areas. I mention this because it is exactly the sort of detail that sub-postmasters need to see laid out in a very clear form, which they are still struggling to find.

Last week, I asked a question of another Minister following either a Statement, an Oral Question or a PNQ. I note that, on page 93 of the Green Book for the 2023Autumn Statement—and in the chart on page 84—it says:

“Post Office Compensation Schemes, Corporate Entities … The government will legislate in the Autumn Finance Bill 2023 to exempt from Corporation Tax compensation payments made under the Historical Shortfall Scheme, Group Litigation Order schemes, Suspension Remuneration Review or Post Office Process Review Scheme. The legislation will align the taxation of onward payments of compensation to that of individual recipients”.

It is interesting that we have had, just before Christmas, regulations relating to taxation for both the Horizon scheme and the infected blood scheme in one set, so the Government can put the two together if they so choose to do. However, I cannot find anywhere in the Green Book the £1 billion that the Government say they have set to one side to pay for the compensation. It is not visible in the Treasury elements or BIS bits. Can the Minister show me where it is? I am not expecting him to do so this afternoon, but this is the second time I have asked about this and had no answer. I want to know where in the government books it is being held and whether the whole £1 billion is being held.

Over the past two weeks, the Independent has been gathering reports on one of the two predecessor programmes to Horizon, known as Capture. In 2003, June Tooby discovered that she was being sued by POL for £50,000 in a case that dated back to 1994 and bears many similarities to the Horizon scheme. She was not alone; other sub-postmasters from that era were also sued and bankrupted by POL. Sadly, June has now died. Can the Minister say whether sub-postmasters prosecuted as a result of the Capture scheme will also be covered by the Horizon scheme? It is a predecessor, after all, and we know that sub-postmasters were asking Ministers as early as 1997 about problems with the IT systems that were the predecessors to Horizon.

Finally, can the Minister please resolve the issue around the timings of the completion of the compensation scheme, as currently outlined? On 10 January, the Prime Minister said in Prime Minister’s Questions that the sub-postmasters will be cleared and compensated swiftly. On the same day, Kevin Hollinrake MP said at the Dispatch Box that all compensation should be paid by August, barring those where a few details are not completed. However, on 28 January, the Secretary of State, Kemi Badenoch, said on the BBC that the deadline of August was not a priority and that getting governance sorted out at the Post Office was more important. I do not want to get into the arguments that she and Henry Staunton have been having over the past few days but this urge to get the compensation sorted remains an absolute priority for the victims. Can the Minister say who is right? Equally importantly, will the Government unblock the logjam inside the Post Office over what is a fair claim, which was the other key element of the announcements made at the beginning of the year?

I beg to move.

Photo of Baroness Thornton Baroness Thornton Shadow Spokesperson (Equalities and Women's Issues), Shadow Spokesperson (Culture, Media and Sport)

My Lords, I was pleased to put my name and that of my noble friend to this amendment. The noble Baroness, Lady Brinton, has given us a comprehensive introduction to this issue. Given that this is an issue of current discussion across the country, there is not much point in me going into detail on the rights and wrongs, as well as the injustices, that we all know the Horizon scandal involved. It is shocking; it is a scandal that we should all be aware of and seek to remedy as quickly as we can.

This amendment and the one before show that this Bill is important because of its inclusiveness—I look to the commissioner—and it is not the first time I have said that in this discussion. It is very important that, in the course of the Bill, we recognise the different sorts of victims that there are in terms of the way the state has behaved, the major catastrophes that people suffer, and the issues of the courts and our justice system. That is all to the good because we will, I hope, end up with an Act that will really serve victims in all of those areas well.

The important point about this amendment is this: it is clear that cover-ups and bad behaviour have been rife throughout the Horizon scandal. Dealing with those must not stop the compensation and the justice that the victims need. We must be able to go forward from this point to make sure that those victims get the compensation they need as quickly as possible. Although this may not be quite the right amendment—they are often not—I encourage the Minister to tell us, as he did in the previous discussion, how the Government intend to take this forward in a positive fashion.

Photo of Earl Howe Earl Howe Deputy Leader of the House of Lords 5:15, 26 February 2024

My Lords, I am grateful to the noble Baroness, Lady Brinton, for her amendment, which, as she explained, would require the Government to publish a timeline for the payment of interim payments for victims of the Horizon scandal. As she knows, the amendment takes us back to a subject that the House has discussed several times in recent weeks. In all parts of your Lordships’ House, there is a strong desire to see justice for the victims of the Horizon scandal—in particular, to see them receive prompt financial redress. The Government share that desire.

The effects of the scandal on some postmasters have been, to put it at its mildest, truly awful. Some of them have lost their livelihoods, their homes or their health—or even all three. Others have faced serious financial impacts. The noble Baroness’s question is therefore extremely pertinent.

For reasons of history, there are three separate compensation arrangements in place; I hope that the Committee will allow me to put them on the record. One is for people who have had convictions for criminal offences overturned. A second, which is delivered by the Department for Business and Trade rather than the Post Office, is to top up the compensation settlement for unconvicted postmasters made at the end of the original so-called GLO High Court case, which exposed the scandal. The third—the Horizon Shortfall Scheme or HSS—is for postmasters who were neither in the GLO group nor convicted.

In two of the streams, we have recently announced fixed offers of settlement: £600,000 for those with overturned convictions and £75,000 for the GLO group. These fixed offers allow postmasters to receive substantial compensation without delay or hassle. Of course, those with larger claims will not generally want to accept these sums. They will instead, quite rightly, have their compensation individually assessed. For both groups, substantial interim payments are made promptly. Further payments are available to those facing hardship while their full claims are being assessed. We have undertaken to make first offers within 40 working days of receiving a completed application for the GLO scheme.

The HSS is already well advanced. All 2,417 of the people who applied by the original scheme deadline have had initial offers. More than 2,000 of them have accepted settlements and been paid. Late claims are still coming in—some stimulated by the ITV drama, in fact—and are being dealt with promptly.

However, two crucial drivers of the pace of compensation are not controlled by either government or the Post Office. First, the overturning of convictions has, of course, been in the hands of the courts, and it has been frustratingly slow. We believe that more than 900 people may have been wrongly convicted in this scandal, but, to date, only 97 of them have had their conviction overturned. The process has been not only slow but uncertain. In too many cases, the evidence has been lost or destroyed over time, and many postmasters have understandably lost all faith in authority and cannot face the prospect of yet another court case to clear their name.

That is why, on 10 January, the Government announced that they will be introducing legislation to overturn all the convictions resulting from this scandal. We recognise that this is an unprecedented step, but it is necessary if justice is to be done. I can tell noble Lords that, this afternoon, my honourable friend in another place has made a Statement about that legislation. We hope to introduce this legislation within a few weeks. I am sure that it will be widely supported across the House and in the other place, and that it will therefore be able to progress quickly. We hope to see it become law before the summer, with prompt compensation to follow.

That takes me to the second area where we do not have control of the timescale: postmasters and their lawyers need time to formulate claims and gather evidence, with some needing specialist reports from medical or forensic accounting experts. Setting arbitrary deadlines for the submission of claims would, I suggest, be deeply unfair to postmasters, and we therefore should not do it.

That is why the House recently and enthusiastically passed the Post Office (Horizon System) Compensation Bill, which implemented the Williams inquiry’s recommendation to remove the arbitrary deadline of 7 August 2024 to complete the GLO compensation scheme. It remains the Government’s goal to complete that scheme by August, but if postmasters need longer, that is fine.

The Government are determined to see financial redress delivered as quickly as possible for all postmasters, including those whose convictions will be overturned by the forthcoming Bill. However, setting a fixed timetable would entail rushing postmasters into major decisions about their claims and the offers they receive. I hope that, on reflection, the noble Baroness agrees that we should not do that, and will therefore feel able to withdraw her amendment.

The noble Baroness asked me a number of detailed questions. If she will allow me, I will write to her as fully as possible in response to her particular questions about legal advice, the Green Book, the logjam of claims and a number of others.

Photo of Baroness Brinton Baroness Brinton Liberal Democrat

I am grateful to the Minister for his response. As ever, it was thoughtful and very helpful.

I laid the amendment principally because it seemed to me that there were two issues. The first was about everything being done, where possible, by August, which seemed encouraging but clearly is not going to be hit in many cases. The detail that I gave to the Committee in the speech is what worries me more: there seems to be a chasm between Post Office Ltd and the postmasters about what is eligible in damage. I do not think it is just about whether people can get access to information, because of this proviso. I will be grateful for any letter, but would the Minister be prepared to meet between Committee and Report to discuss the detail? The most urgent thing, from their perspective, would be a grant for legal advice, given the complexity of applying. If that can be speeded up in any way, shape or form, that would be enormously helpful.

I suspect I will bring something back on Report, though probably not the same thing at all. In the meantime, I beg leave to withdraw the amendment.

Amendment 135 withdrawn.