Chancellor reveals payment programme aims to support those who received ‘small fraction’ of £58m settlement

Credit: Cameraman/CC BY-SA 2.0

A new government-backed scheme aims to provide compensation to victims who fought to expose the Horizon IT scandal but ended up receiving only “a small fraction” of a £58m settlement with the Post Office. 

A long-running High Court battle ended in late 2019 when the Post Office agreed to pay a total of £57.75m to 555 postmasters that supported a collective lawsuit seeking damages. However, the majority of this amount – £46m – went on paying the legal fees of Therium, a company which specialises in providing funding for litigation.

Split between all victims that backed the court case, the settlement would equate to payments of more than £100,000 each. But, according to the government, individuals received only about £20,000 a head.

According to a report published by MPs last month, “the injustice arising from this level of compensation was further compounded by the government’s decision to exclude the 555 from the Historic Shortfall Scheme (HSS), which was opened [by the Post Office] in May 2020 for sub-postmasters who had covered losses caused by Horizon with their own money, often to avoid prosecution and imprisonment”.

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Chancellor Rishi Sunak today unveiled a new funding programme that, according to HM Treasury, aims to “ensure that those who uncovered the injustice receive the same level of compensation as the postmasters who claimed through the HSS”.

The as-yet-unnamed scheme “will be set up in the coming months” and further details of the claims process and the amount of funding to be offered will be made available nearer the time.

“The Horizon IT dispute has had a devastating impact on postmasters and their families, with many losing their livelihoods or being wrongly convicted for crimes they didn’t commit,” Sunak said. “Without the efforts of these postmasters, this terrible injustice may have never been uncovered so it is only right that they are compensated fully and fairly. That is why we have set up this new compensation scheme for those who played a crucial role bringing this scandal to light, which I hope provides a measure of comfort.”

The Horizon IT system, developed by Fujitsu and implemented by the Post Office in 1999, caused accounting discrepancies that led to thousands of sub-postmasters – who run local Post Office branches as franchises – being wrongly accused of losing or stealing money. In 900 cases prosecutions were brought, with many people ordered to pay back thousands of pounds, and others sent to prison.

Prime minister Boris Johnson said: “Whilst it cannot take away the years of distress, the postmasters who have suffered terribly over the Post Office Horizon scandal deserve to be fairly compensated. That’s why we’ll be introducing a new compensation scheme for those who led and won the landmark legal case over the failings, so they can receive their fair share. We’ll continue to stand by postmasters and their families.”