Explained | What is the Horizon IT scandal that might cost ex-UK post office chief her royal honour?

The United Kingdom Prime Minister Rishi Sunak, on Sunday (Jan 7) said that his government is considering a move which would exonerate hundreds of employees of the state-owned Post Office who were wrongfully convicted in the Horizon scandal.

The UK PMwould back a probe into whether to revokeformer Post Office boss Paula Vennells’ CBE in the wake of the Horizon scandal, said his spokesperson.

The decades-long scandal, often described as the most widespread miscarriage of justice in UK history, involving thousands of branch owner-operators and hundreds of wrongful convictions is making the headlines once again.

This time after an ITV drama which has reportedly led to 50 more potential victims coming forward. Here’s what you need to know.

Horizon IT scandal

Between 1999 and 2015, the Post Office prosecuted hundreds of sub-postmasters and sub-postmistresses based on the information from a recently installed IT system for alleged theft, fraud and false accounting.

The UK Post Office, in the late 1990s, installed the Horizon IT system.Developed by a Japanese company namedFujitsu, the software was used for tasks such as transactions, accounting and stocktaking.

Around 3,500 branch owner-operators were wrongly accused of stealing money from their businesses and 736 of them were given criminal convictions based on faulty accounting software.

As a result, hundreds of sub-post office operators who maintained their innocence all these years and said that they had complained about bugs in the system after it reported shortfalls amounting to thousands of pounds, ended up with a criminal record.

The UK Post Office employees also claimed that their concerns were often dismissed by their employers who said that the issues were the fault of the individual branch managers and not the system.

Even those who did not end up going to court had to gather money to cover nonexistent shortfalls. Notably, this was happening even before the convictions.

It was reported that some sub-postmasters would try to bridge the gap with their own money since their contracts stated they were responsible for any shortfalls, going as far as to remortgage their homes to correct the error, without any success.

The impact

The criminal convictions led to punishments ranging from community service to wearing electronic tags to being jailed. While others were left struggling financially or even went bankrupt and some were reportedly shunned by their communities.

The victims and their families over the years witnessed severe stress, including many illnesses, addiction and even premature deaths. The scandal is also linked to at least four suicides.

It was not until two decades later that the campaigners managed to get their cases reconsidered based on the claims that the computer system was flawed.

However, these convictions had done lasting damage. Recently, the courts heard how over the years the scandal has led the victims’ marriages to break down, while some families believe the stress led to long-term health conditions.

Notably, the UK Post Officehas the power to investigate and prosecute without the need for police involvement.

What proved the victims’ innocence?

The turning point in the decades-long case can be traced back to December 2019, towards the end of a series of civil cases where a group of post office operators won a High Court case in which their convictions were found to be wrongful and Horizon IT system was ruled to be at fault.

The ruling came three years after sub-postmasters initiated civil proceedings against the Post Office which over time saw the participation of more than 500 employees.

The judge said that the IT system had “bugs, errors and defects” and was not “remotely robust” in the first 10 years after it was installed. The Post Office agreed to settle with 555 claimants after accepting it made mistakes while dealing with a number of postmasters.

The Post Office agreed to pay 58 million pounds ($73.8 million) in damages, while the claimants received a share of 12 million pounds ($15.3 million) after their legal fees were paid.

In 2021, the ruling was upheld on appeal and led to the quashing of convictions of some workers who were wrongly accused and paved the way for compensation.

The High Court ruling also led to more cases being brought forward to the Criminal Cases Review Commission (CCRC), an independent body which investigates suspected miscarriages of justice.

Criminal convictions and compensation

As of last month, 142 appeal case reviews have been completed out of 900 people convicted during the scandal, reported The Guardian. To date, 93 convictions have been overturned while 54 upheld, withdrawn or refused permission to appeal, said the Post Office.

So far, a total of 24 million pounds ($30.5 million) have been given in relation to overturned convictions. However, the Post Office has recently come under fire for delaying payments and blunders, including victims being taxed on the compensation received.

Several victims have reportedly died before they could receive their compensation due to the delays by the Post Office. Notably, the overturned convictions process is one of three different compensation schemes which has been established concerning the scandal.

As the British government has previously said every branch owner-operator who has had wrongful convictions for theft and false accounting overturned is to be offered 600,000 pounds ($764,010) each in compensation.

More than 130 million pounds ($165.6 million) have been paid out to about 2,500 Post Office workers across the three schemes, reported The Guardian.

So far, neither the Post Office nor Fujitsu has been held accountable, however, the High Court judge had said that the Japanese company would be referred to the Director of Public Prosecutions for possible further action.

Why is the scandal making headlines now?

It is worth noting that it was after a TV series titled Mr Bates vs the Post Office aired on British television last week that the scandal was once again brought to the forefront of the public’s mind. The show and the attention it garnered have also reportedly led to new potential victims coming forward.

The story follows a former sub-postmaster named Alan Bates played by Toby Jones, who led the campaign for justice at the High Court. Post Office Chief Executive Nick Read said that he hoped the TV show “encourages anyone affected who has not yet come forward to seek the redress and compensation they deserve.”

‘Appalling’

In an interview, on Sunday, UK PM said that his government was considering a move to exonerate hundreds of employees who have been wrongfully convicted.

Sunak was asked if Justice Minister Alex Chalk was exploring ways to exonerate them or remove the Post Office’s ability to investigate and prosecute, the UK PM responded by saying that the case was “an appalling miscarriage of justice”.

“The Justice Secretary is looking at the things that you described,” he told BBC’s Sunday with Laura Kuenssberg programme.

“It’s right that we find every which way we can do to try and make this right for the people who were so wrongfully treated at the time.” Sunak said, adding there was some “legal complexity in all of those things.”

The UK PMwould “strongly support”the forfeiture committee “if they were to choose to investigate” and revoke Vennells’ CBE in the wake of theHorizon scandal.

"The prime minister shares the public's feeling of outrage on this issue. He would strongly support the Forfeiture Committee if it chose to review the case," said Sunak's spokesperson, adding that the decision is "for the committee, rather than the government".

Commander of the Most Excellent Order of the British EmpireorCBE is among the highest ranking Order of the British Empire level awardand is bestowed upon anindividual forhaving a prominent role at the national level, or a leading role at the regional level in the UK.

Thepetitionaddressed to Sir Chris Wormald, the chair of the forfeiture committee calling for revokingVennells'CBE over the scandal has garnered more than one millionsignatures.

(With inputs from agencies)