Conservative leader and former Kemi Badenoch has told the Post Office inquiry that the bureaucracy of the “government machine” slowed down compensation claims for wrongly convicted sub-postmasters.
Badenoch claimed that after being appointed Business Secretary in February 2023 she “wanted to get the money out there” but was “always given a reason why we couldn’t” by government officials.
In her witness statement to the inquiry, she said the Post Office would have “disappeared in its current form long ago” if it was a private organisation, adding that it is a “20th century organisation that is struggling to evolve in a 21st century world”.
Here are the key points of what we learned from Monday’ at the inquiry’s evidence:
Badenoch told the inquiry that when she became Business Secretary she was vaguely aware of the Horizon scandal but was unfamiliar with “the full detail”.
The Conservative leader claimed she quickly became frustrated by the slow pace at which compensation claims for sub-postmasters who had been wrongly convicted were being processed.
More than 900 subpostmasters were prosecuted between 1999 and 2015 after faulty Horizon accounting software made it look as though money was missing from their accounts.
Hundreds are still awaiting compensation despite the previous government announcing that those who have had convictions quashed are eligible for £600,000 payouts.
She said: “I feel that there is often too much bureaucracy in the way of getting things done, because people are worried about process.”
A letter shown to the Post Office inquiry shows that Badenoch wrote to then-chancellor Jeremy Hunt in August 2023 calling for the process of financial redress for sub-postmasters caught up in the Horizon scandal to be sped up.
Badenoch says that then-Post Office minister Kevin Hollinrake “had come to me on a number of occasions saying that he was having trouble getting through to the Treasury” on the issue.
She says she wanted to “cut through the bureaucracy” he was facing and described being slowed down by the “government machine”.
Explaining why she felt bureaucracy was getting in the way, Mrs Badenoch said: “They [government officials] are worried about: if things go wrong, they’ll be on the hook for that. So they carry out lots of checks and balances well beyond what I think is required in order to deliver the right outcome.”
Asked if she thinks she should have raised her concerns with the Treasury earlier than six months after she was first appointed, she added: “I would not have known enough. This letter is happening after a period of frustration that things aren’t happening.”
Badenoch told the inquiry she was “extremely disappointed” that it took ITV’s drama Mr Bates vs The Post Office, which was first aired in January 2024, to speed up payouts for wrongfully convicted sub-postmasters.
She told Jason Beer KC, counsel for the inquiry, that the drama “changed the priority of the [Horizon] issue, which was behind the NHS and security and so on, to something we needed to solve now. It raised the prioritisation.”
Mr Beer said it was “disappointing” to hear that it took a TV drama to get the government to change its priorities.
“It is extremely disappointing,” said Badenoch. “I think if you look at it in the context of what is happening in government, there are a thousand things money is being requested for. After a while decision-makers become very dispassionate. It becomes another line in the ledger.
“It is not irrational but it has to change, it is not helpful either. There is an absence of common sense in a lot of Whitehall. They don’t trust their judgment. People want legal cover.”
The inquiry was told Badenoch told the Treasury she wanted to give £100,000 “flat offers” to all sub-postmasters entitled to compensation to speed up the process.
Asked if this could be seen as “posturing”, she replied: “It was signalling the direction I wanted the department to take to make it very clear.”
The Conservative leader said she believed speed should triumph over accuracy, even if it might not have represented value for money for the taxpayer.
Badenoch told the inquiry she had felt it was important for her to be “seen to do the right thing” on the Horizon scandal, following previous delays in securing compensation and the overturning of convictions.
She said: “Being seen to do the right thing, in my view, is just as important as doing the right thing.
“Making explanations and excuses for why things take so long shouldn’t go on beyond a few weeks or months.”
Challenged that surely doing the right thing is more important than being seen to do it, she said: “Both of them are important. Doing the right thing when no one knows that you’re doing it often creates problems elsewhere.
“As a politician, it is not enough to do the right thing; it’s also important to be seen to be doing the right thing too.
“Perception matters too, otherwise there is a loss of trust.”
Before Badenoch’s evidence, her successor as Business Secretary Jonathan Reynolds told the inquiry he believes the speed at which compensation claims are being processed has increased since the Labour government was elected in July.
Reynolds told the inquiry there had been a “significant increase in the pace at which compensation has been paid” since the general election, and told the probe he did not believe it had been “at the cost of fair or accurate compensation being made.”
He said: “The first thing I would say is, I understand there has been, quite rightly, a lot of analysis in this inquiry about whether there is a tension between fair redress and the speed at which it is delivered, and I understand why that is of such importance to the work that is going on here.
“Since the general election, there has been a significant increase in the pace at which compensation has been paid.
“The overall quantum of compensation is up in the last four months by roughly a third, and the number of claims to which there has been an initial offer being made in response to that claim has roughly doubled in the last four months to what it has been in the four months preceding the general election.”
The Business Secretary said the Post Office’s corporate culture is key to the Horizon scandal, but insisted the organisation is still “an incredibly important institution in national life”.
Commenting on the culture within the Post Office in his witness statement to the inquiry, he said: “It is clear that the Post Office’s corporate culture is at the root of this scandal, and I want to make sure the system works for subpostmasters.
“I am supportive of a reform agenda which seeks to turn this ambition into reality.”
2024-11-11T18:01:17Z