Post Office executives considered charging wrongfully accused sub-postmasters 'entry fees' to apply to a compensation scheme, Horizon IT inquiry hears

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Post Office executives mooted charging wrongfully-accused sub-postmasters 'entry fees' to apply to a compensation scheme, the inquiry into the Horizon IT scandal heard yesterday.

Edward Henry KC, who represents several sub-postmasters, said one Mark Underwood sent an email to bosses which discussed the idea of asking victims to pay to be able to apply to the Horizon Shortfall Scheme — previously known as the Historical Shortfall Scheme.

It is one of three compensation streams for victims and is for those who experienced Horizon-related losses, but were not convicted of a crime.

In the email to executives, Mr Underwood — who served as a Post Office lawyer and compliance director — wrote: 'My strong view is that you cannot seek payment from applicants, however small and regardless of the rationale behind it.

'Optically, this would be extremely challenging, and would be a position that I believe the business would struggle to maintain under political and media pressure.'

But he advised: 'I think you can achieve the same desired outcome through having a very tight and clearly communicated set of eligibility criteria and requirements in terms of the documentation applicants have to provide in order to be accepted onto the scheme.'

Questioning embattled Post Office chief executive Nick Read about the email, Mr Henry said: 'That's an atrocious line of thinking, is it not, that at one point, the Post Office would seem to have been discussing charging fees to be paid by the wronged victims of the Post Office before they would be allowed to enter into the scheme?'

Mr Read replied: 'It does seem bizarre.'

Mr Henry added: 'I suggest, as is clear from what Mr Underwood was saying, was that the same desired effect, the same outcome, would be strict, very tight eligibility criteria... and of course, the documentation sub-postmasters would have to provide before being accepted into the scheme.

'I suggest that was to restrict access to the scheme and to deter applicants.

'It's a more subtle and insidious method of doing it, but it makes it difficult for sub-postmasters to apply, to reduce the Post Office's disclosure.'

Pressing Mr Read further, Mr Henry cited the complex forms sub-postmasters have to fill out without funded legal help when applying for compensation, adding: 'In the forms, they talk about the provision of contemporaneous documents.

'How are you going to get contemporaneous documents where many years have passed and where the Post Office had seized them, and as in (former sub-postmaster) Mr Lee Castleton's case, never returned them.

'It's a hurdle, isn't it? Not a low hurdle, but it's actually a high bar.

'That was the design, wasn't it?'

Former sub-postmasters have long complained about the protracted delays in obtaining full and fair compensation and have criticised Mr Read for the slow progress during his tenure as chief executive.

As he prepares to leave the business in March, less than £1 in every £3 of the expected compensation bill has been paid out and 2,900 sub-postmasters are still waiting for final compensation, The Sunday Times reported.

The government previously announced all eligible claimants to the HSS scheme would be entitled to a fixed sum award of £75,000.

And those who have had their wrongful convictions for theft and false accounting quashed will be offered £600,000 each in compensation in return for them settling their claims.

The scandal saw more than 900 sub-postmasters prosecuted after flawed data from the Horizon IT system used in Post Office branches made it look like they were thieving from their tills.

The inquiry continues.