This Post Office scandal should end our fixation with big government

The management was callous and inept. The system was deaf to complaints. The cover-up went on for far too long, and it certainly should not have taken an ITV series to bring us closer to the justice that its victims deserved. Sub-postmasters were treated scandalously. Ministers and executives should be held accountable, and compensation should be paid.

However, there is a wider lesson to be learnt from this outrageous treatment of many hard-working small businesses. State control is invariably the most brutal, and unpleasant, form of ownership there is. From NHS mismanagement, to the Government’s handling of lockdown, to the fanatical pursuit of Net Zero, we see the failures of state control time and time again. Perhaps it is time Conservative politicians, and perhaps even the voters, twigged that it never works.

Mr Bates vs The Post Office has become one of the most influential TV shows in recent years. It has brilliantly dramatised the horrific way in which hundreds of the roughly 3,500 sub-postmasters – people who are often the beating heart of villages and small towns – were treated by the organisation. Rishi Sunak has already described it as “an appalling miscarriage of justice”, and £1 billion has been set aside for compensation for its victims. Quite rightly, there may well be criminal prosecutions in the months ahead.

It would be easy to portray it as an example of how wickedly big business crushes the little man. There are certainly questions to be asked over the role Fujitsu – which provided and managed the faulty software – played. On social media there are knee-jerk demands that the shareholders and “greedy executives” should be made to pay.

Here’s the catch, however. While the Royal Mail was privatised many years ago, the Post Office, which is in charge of the local offices, has always been completely controlled by the state. In reality, the scandal perfectly illustrates the defining characteristics of government ownership.

First, the senior management were inept and in some instances venal. As the evidence of the scandal started to emerge, management could have listened to the complaints of the sub-postmasters, and started to fix some of the problems. Instead, they turned on them, seemingly preferring to try and imprison their accusers rather than admit any errors. And of course, they “fell upwards”, as parastatal officials so often do. Adam Crozier who was formerly chief executive at the Post Office moved seamlessly on to running ITV, and now BT.

Next, blame was quickly shifted. For years, as the saga unfolded, the sub-postmasters themselves were held responsible for the scandal, with officials at the organisation itself refusing to admit any wrongdoing. Ministers (such as the Liberal Democrat leader Ed Davey) allegedly deflected the blame onto officials, or else on to outside regulators, in a merry-go-round that meant no one ended taking responsibility for what had gone wrong. There was no real control of contractors, though this is a familiar story: consider the tens of millions in “consulting fees” run up on HS2 or many other major government projects. Individuals were crushed relentlessly, sent to jail as if they were of no importance, with officials and executives protected by the state machine.

And finally, and perhaps most tellingly, the only efficient part of the whole operation was the cover up. The Post Office has been revealed to be a shambolic operation, hopeless at managing anything. But when it came to closing ranks, and shielding its own people it proved itself highly effective. If only it had dedicated the same kind of energy to actually running the organisation that it did to sweeping aside all the evidence of the mistakes it had made. But that is never how nationalised companies are run.

It is hardly the only example. Look at the NHS, one of the largest state run organisations in the world, and how protecting the institution has become more important than the people it treats. Lockdowns were a disastrous product of the state trying to micro-manage society on an unprecedented scale. And we have seen a fanatical pursuit of arbitrary Net Zero targets, which officials are trying to meet by picking winners, and which are imposed at huge cost to the rest of society with little regard for who pays.

There is probably nothing about the way the Post Office operated during the whole dismal saga that would have surprised anyone in Soviet Russia. That is the way state-controlled businesses operate all the time, yet we hear a constant clamour for the Government to take a bigger role in the economy. There are demands for green “investment” corporations to help us decarbonise. There are calls for state-led champions to rebuild the industrial base. And there are campaigns for the renationalisation of utilities, as if the electrical system, or the trains were perfectly run when they were controlled by functionaries employed by the government.

The Post Office scandal should remind us why privatisation was so important. Of course, unscrupulous behaviour and poor management can be seen in private businesses. But why is it only the private sector which is subject to public obloquy?

It is probably too much to expect anyone in the Labour Party to notice, or even the Lib Dems even if they are up to their necks in the scandal. But at least a few Tory MPs, and perhaps even the voters, might grasp that more state control is always the wrong answer to any question.

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