Fujitsu may have to repay ‘fortune’ spent on Post Office scandal, Chalk says

Fujitsu should repay the “fortune” spent on the Post Office scandal if it is found culpable, the justice secretary has suggested, as pressure increases on the firm behind the faulty Horizon software.

If the statutory inquiry into the saga, which resumes on Thursday, finds the “scale of the incompetence is as we might imagine”, ministers would want to “secure proper recompense on behalf of the taxpayer”, Alex Chalk said.

Hundreds of Post Office branch managers were convicted of swindling money on the basis of evidence from the technology giant’s flawed Horizon accounting system.

Rishi Sunak announced on Wednesday that hundreds of post office operators in England and Wales could have their names cleared by the end of the year under blanket legislation to be introduced within weeks.

Those whose convictions are quashed are eligible for a £600,000 compensation payment, or potentially more if they go through a process of having their claim individually assessed.

While the proposals were widely welcomed, the prime minister faces increasing calls to go further and bar Fujitsu from securing government contracts and pursue the firm for payments.

Chalk said the government would wait for the conclusions of the inquiry chaired by the retired judge Sir Wyn Williams before it decides what action to take against the company.

“But bluntly, if the scale of the incompetence is as we might imagine, then I simply would want to secure proper recompense on behalf of the taxpayer,” the cabinet minister told ITV’s Peston.

“It’s absolutely right that there should be justice across the piece, yes for the sub-postmasters, which we’re talking about today, but frankly also for the taxpayer. This has cost and will cost a fortune.”

If Fujitsu is found to be at fault, it should face the consequences, Chalk added, in a sign ministers could launch legal action against the Japanese company.

The firm has been awarded government contracts worth billions in recent years and its continued involvement in important IT schemes has raised concerns at Westminster.

Ministers tried to prevent Fujitsu getting more official work but this proved “impossible” despite its “woeful” performance, a Tory peer revealed on Wednesday.

Lord Maude of Horsham, who served as Cabinet Office minister under David Cameron, said procurement rules thwarted ministers’ efforts. He said if Fujitsu had “any sense of honour” it would swiftly make a significant payment towards the compensation of wrongly convicted post office operators.

The long-running battle for justice accelerated dramatically after ITV broadcast the drama Mr Bates Vs The Post Office this month, which highlighted the scandal.

The public inquiry, whose first hearing of the year on Thursday will feature the Post Office investigator Stephen Bradshaw, is likely to keep the scandal in the headlines.

Bradshaw has been described as having a “heavy footprint” in the scandal after being involved in the criminal investigation of nine post office operators.

MPs were told on Wednesday that previous evidence from the inquiry had pointed to “not only incompetence but malevolence” in the way the Post Office acted against them.

Alan Bates, the campaigning former post office operator on whom the ITV series centred, said it was “about time” for the move to exonerate Post Office staff.

But asked if he would be celebrating the victory, the 69-year-old told the Times “you must be joking” as he and many others are yet to receive final compensation.

Bates told the Mirror: “The overturning of convictions is very good news but the priority remains full financial redress to everyone impacted. £75,000 is an alternative to having your case independently assessed, so for the smaller cases, it will probably suffice. But for many cases, it is not enough.”

The scale of the scandal has prompted the government to adopt the unconventional approach of introducing new legislation.

Ministers acknowledged the plan could result in some post office operators who did commit crimes being wrongly cleared, but said the process was the most effective way of dealing with the vast majority who were victims of a miscarriage of justice.

Chalk has been discussing the situation with senior judges because of the constitutional concern about parliament being seen to interfere with the legal system.

Sunak announced a £75,000 offer for post office operators involved in a group legal action against the company – with ministers setting aside up to £1bn for compensation.

The Horizon software started to be rolled out in Post Office branches across the UK in 1999 and, over the subsequent years, a series of workers were prosecuted over missing funds.

In 2019, the high court ruled that Horizon contained a number of “bugs, errors and defects” and there was a “material risk” that shortfalls in Post Office branch accounts were caused by the system.