Do you know where we’re going to?


Whatever the outcome of the Group Litigation Order between Mr and Mrs Bates and Post Office Ltd, there is another outcome that goes without saying.   That’s not grammatically correct as I am going to say it anyway – the situation must never arise in the future where a similar trial is needed to ensure Post Office Ltd correct their obvious shortcomings and therefore one of the outcomes I refer to will be the corrective processes POL put in place to prevent a repeat of this litigation.

I believe that we are starting to see the signs of change within the organisation.   A week or so ago they issued a Message to all branches informing them of a system error that could affect any branch at any time.  That is a completely new approach and one that should and could have been taken when similar errors in the past appeared such as Dalmellington – a key error noted in the trial.  Helping subpostmasters identify shortages and surpluses in their accounts starts with telling them about problems they should be on the lookout for.  In Seema Misra’s case and stunningly in this last Horizon trial,  POL maintained that a system error should be obvious to a SPMR.   Revelations in the trial show that not even POL were aware of some of the errors in the system – hardly surprising then that not all SPMRs noticed some of them either.

A new wave of branch support visits has been instigated – these have happened in the past – but this time generally they seem to be genuinely interested in helping the SPMR get more out of his business not just by up selling but putting in place better operating procedures and standards.   I hate to be critical of this initiative at this early stage but it is clear that the folk sent out to perform these branch visits are not all singing from the same hymn sheet.   I’ll put that down to the generic problem that will take longer to fix, the ‘them and us’ culture prevalent throughout POL.

But what else needs to be done?  The biggest problem POL face with regard to mending their ways at the moment is the ongoing litigation.   Putting in place the procedures and equipment necessary to make these changes could be construed as an admission of guilt.  It is a shame if that reason delays implementation because after the trial is over they will have to do it anyway.

The most obvious and absolutely necessary change is the supply and installation of CCTV to all branches.  Why this was never done I don’t know.  Try and find a bank branch without any!  The decision of the first trial, whether it is appealed or not, makes this a compulsory action.  POL are required to prove without any doubt an error on their side did not result in a discrepancy in the branch accounts.  Without CCTV linked to terminal inputs that will be impossible.

There is a huge problem with the Help Desks which needs to be sorted out.   Personally I would abandon the Philippines as a first action and I would be looking to overhaul the current UK setup drastically.  It is clear social media has a place to play in any replacement as well as the vast knowledge base of SPMRs out there in the network ready and willing to help their colleagues.

I have already noted the culture change that needs to be put in place but there is another part of that that should be pointed out.   My gut feeling now that the Horizon trial is over and the evidence displayed in court is that there was nobody in POL willing and able to question Fujitsu as to their ability to support and develop Horizon.   There was also a huge unwillingness to incur additional costs in utilising Fujitsu support to look at possible errors.  I am pretty sure that the judge will have something to say about that in his forthcoming decision.   POL need to adopt a culture of questioning the status quo to see if it is reliable, resilient and robust and I am not just talking about Horizon here.   That can only be done with fresh faces on board.  Habits of a lifetime are not going to change as rapidly as is required.

There is more to be done but the initial changes I see are promising.   The business really has a long term future in the High St and the rural communities they support.  It is good to see POL starting to win back contracts as well as increase their banking business.   These commercial gains are purely co-incidental with the departure of Paula Vennells but there is no doubt she could not have been left in charge to put in place the necessary changes stated above that she so arrogantly ignored for so long.

As a footnote could I just add that I am desperately sorry to hear that Bal Gill, one of the claimants, is in need of help.   I am sure all of you reading this will have read his story on  and if not I would urge you to read it.  Bal – I wish you all the best mate and hope to meet you one day when we can enjoy the outcome of the litigation.


Dear Gareth

You don’t know me and I am certain you don’t want to know me either.  However at this moment in time you are at the centre of my thoughts and probably at the centre of the thoughts of several hundred claimants in the horizon trial.

To me you are something of a conundrum.  You see we have a mutual acquaintance who has met you and has described you to ms as a man of great integrity.   Now I can safely say the same of our mutual acquaintance and I can add that he is a person I have the greatest of respect for.  I cannot question his assessment of your character.

The conundrum for me sir is this.  You are a man of great integrity yet you have remained silent during this trial and indeed before this when you appeared as an expert witness in the Seema Misra trial.

The evidence now produced in this trial regarding your attendance of a meeting that discussed the impact of disclosing a known horizon error on ongoing criminal trials at the very time you were appearing at Seema’s trial is deeply disturbing.   It is also a matter for the CCRC to consider when reviewing her case and that leads Sir to the very likely possibility that the police will be interested it talking to you with regard to your possible involvement in a conspiracy to pervert the course of justice.

If our mutual acquaintance’s assessment of your character is justified then surely Sir your silence at this time betrays his confidence in you.

For the sake of all the claimants but in particular Seema whose trial transcript has been published, and your involvement bin it therefore documented, I urge you to come forward and reveal the truth of what happened during your time at Fujitsu.

I wish you no harm sir nor do I hope that you face prosecution for your actions.  All I seek is your cooperation in resolving this matter at the earliest opportunity.  Your actions and silence have led to much suffering.  Please help them now.

With the greatest respect

Tim McCormack




Expert Witnesses – Who Needs Them?


During the week the News at Six on BBC starts at 6pm and finishes at 6.30pm.  Half an hour every night regardless of what stories are to be told, there will be news to report and it will last 30 minutes.   In much the same way the format of trials such as the present one is laid out in advance.  There will be one expert witness allowed from each side who will investigate the matter put before them, write a report and be cross examined on the contents of that report in the witness stand.  In the current trial each expert has spent the best part of a week each in court defending their assumptions.

Personally speaking from reading the transcripts and witness statements I think we have learned next to nothing from their appearances.  I do however think that Dr Worden’s statistical approach needed to be delivered in order for that approach to be ruled out in its entirety as totally inappropriate for the purposes of determining what transpired to cause the claimants in this case to have such discrepancies in their branch accounts.   Statistics are of no use when examining the cause and effect of what must be abnormal occurrences in a system that everybody agrees works as it should most of the time.

I am sure most will be aware that a normal distribution curve of events is bell shaped and that mean, median and standard deviation can be calculated from that graph.  However the norm will always be skewed when unlikely events take place towards the ends of the bell shaped graph.   Probability plays no part in determining whether or not a particular branch will suffer from communication problems or not and how frequently these will occur.  Nor will it play a part in determining whether or not an intermittent hardware failure will occur.  The reason being is that while you may use historical analysis to determine the number of events that are likely to occur it would be impossible to use the same analysis to quantify the extremes of the amounts involved.  You may arrive at an average but, as we have already seen, the financial amounts involved differ hugely from pennies to millions.

Dr Worden has produced a computer based model of his assertions and challenged the court to use this and adapt the input to what the court considers reasonable in order to provide an outcome based on those factors.  Perhaps they might, perhaps not but there is another way that can be considered.

Monte Carlo simulation allows a computer to generate thousands if not millions of different results by re-iterating the formula using a randomly selected set of inputs limited by their range.   The results are then analysed using standard statistical techniques and again a bell graph of results can be charted.  In financial risk this, or a similar method, is used to determine the likelihood of an event happening.  However risk analysts are not overly concerned about the most likely event they are more interested in any incidents outside the norm that have skewed the shape of the results graph one way or another.

If for instance there is a 10,000 to one chance of an extreme event occurring and you use 10,000 iterations in your Monte Carlo simulation then the likelihood is that that one extreme event will be used in the risk calculation.  Risk analysts will then look at the graph of results, and from my personal experience of this very example, discount the 10,000 to one chance from their interpretation.   Use a million iterations and then that same event will likely occur 100 times and the analysts will leave the effect of that event occurring in their risk estimate.   There is one huge problem though with all of this risk analysis using statistics and that is the determination of the probability factor if you have not enough historical information to determine it.   The 10,000 to one chance in my example was from my experience working in credit risk and it was the ‘probability’ that a AAA rated corporation would fail.  At that time in the 90s from my recollection there were only 7 AAA rated corporations in the world and none of them had ever failed.  So 10,000 was just a guess.  Move forward a few years and hundreds if not thousands of AAA rated entities has been created by the banks to hold debt and as we know the collapse of many of these AAA debt bins led to the financial crisis.  I don’t know what the current probability is now of these failing but it will certainly be less than 10,000 to one.

Going back to Horizon, there is no probability table that can be used.  Up until now there has never been an investigation in to how often the system fails the user and there is one absolutely certain statistic that has been ignored and unless things change within the Post Office will never be found out and that is the number of times that a subpostmaster has had to make good losses in their branches over the years and the amounts that they have lost.   Dr Worden attempted a probability table on this very statistic and it was laughable I am afraid because he has no historical data to support it – no one has.

I am afraid Dr Worden’s efforts were in vain, yet as I said it is good that now exposed to the court they can be discounted as it leaves the uncertainty factor, the balance of probability that what the claimants alleged happen did happen, intact.

The Lowest Common Denominator?

Having now read the ‘expert’s’ reports into matters relating to Horizon errors as well as the preceding testimony and evidence in this and the previous trials, it appears to me that there is a key ingredient missing from the mix of information required to assess not just the outcome of this litigation but also the future of the network and how to fix it as it is clearly broken.

All subpostmasters are not born equal.  They differ in all the ways nature intended but the most important difference between them that has not yet been incorporated into any of the arguments put forward in this trial is the great disparity in levels of intelligence.   Subpostmasters are, like politicians, not required to have any educational qualifications nor do they sit any form of aptitude test in order to be approved to run their branch.

That said there are some mightily impressive figures out there who are clearly highly intelligent and who may have chosen to become a subpostmaster purely for lifestyle reasons rather than a career in high finance or academia.   The very clear and outstanding example of this is Alan Bates, the leader of the claimants, who perhaps could have followed a different career path into litigation and one in which I am sure he would have been most successful – not to say he is not about to be so in any event.

The expert witnesses have agreed upon a list of countermeasures that would and should play a part in preventing Horizon errors creating permanent discrepancies in a branch’s accounts.  One of them is referred to as UEC User Error Correction where the reliance is on the subpostmaster to detect the error whether human or computer and correct it by themselves.  For instance in the Dalmellington error it is accepted that 80 or so branches detected the error and entered a separate transaction to correct the discrepancy that occurred as a result of a computer error (the fact that the transaction that they entered was illegal and a criminal act that other subpostmasters have been imprisoned for is another story).

Seema Misra was imprisoned partly on the assessment of the judge in her trial based on the evidence put before the court that she would have spotted any computer error that may have caused a discrepancy in her accounts.   That is simply not the case and whether a subpostmaster can detect an error in such a sophisticated computer system must certainly be a factor of the intelligence level and capability of the individual concerned.

So that leads me to this true story in which I played a part and which certainly helps form my opinion on the stories I read and hear about subpostmasters unable to run their branch properly and who as a result suffer huge losses.  It is not their fault – it is the fault of Post Office Ltd for allowing them anywhere near a Post Office branch.

Five years or so ago I assisted a potential applicant with his business plan submission to become a subpostmaster in a nearby town.  This gentleman seemed reasonably astute and ran a small convenience store close to my post office.  He was successful in his application and he and his brother expanded his empire by buying and running the new convenience store and PO in a nearby town.

Some three months after he had opened and had been a subpostmaster for that time, I was behind the counter in my post office when one of his assistants came in a with a letter to post, wanting it signed for.   I took the envelope and read the address on the front, it stated (not exact address of course):

ABC Company Ltd

82 High St

That was it.  No town and no postcode.

I explained to the assistant that I could not process the letter as it had not sufficient information in the address.  The assistant took the letter and went back to his boss who appeared quickly hilding the letter and asking me what on earth was wrong with it.  I am usually quite cool and collected in explaining matters like these to customers but the conversation became somewhat heated as he insisted that this was all that was on the letter as a reply address.  I believe that the recipient was a solicitor and my erstwhile friend was insistent that a solicitor would know how to address a letter correctly!

I asked to see the letter which he went away to get and sure enough the letter looked something like this:

Dear Sir

kajshkad k;jsdfk kkjsdf kjh sdkjjhsdfk kkjsdhfkjkkksdf kkkksdfjh

kajshkad k;jsdfk kkjsdf kjh sdkjjhsdfk kkjsdhfkjkkksdf kkkksdfjh

kajshkad k;jsdfk kkjsdf kjh sdkjjhsdfk kkjsdhfkjkkksdf kkkksdfjh

kajshkad k;jsdfk kkjsdf kjh sdkjjhsdfk kkjsdhfkjkkksdf kkkksdfjh

kajshkad k;jsdfk kkjsdf kjh sdkjjhsdfk kkjsdhfkjkkksdf kkkksdfjh

kajshkad k;jsdfk kkjsdf kjh sdkjjhsdfk kkjsdhfkjkkksdf kkkksdfjh

kajshkad k;jsdfk kkjsdf kjh sdkjjhsdfk kkjsdhfkjkkksdf kkkksdfjh

Please reply to :

ABC Company Ltd

82 High St



He pointed to the last lines and said “There you are.  See what I mean?”

At that point I turned the page of the letter over and the text of it continued




TD14 3GH



This is NOT a simple mistake.  This is .. well I don’t quite know how to describe it .. certainly NOT the actions of a subpostmaster capable of detecting any sort of error in his branch accounts whether computer or otherwise.   This person should not even be allowed to accept mail from a customer.  Perhaps I wouldn’t even blame the trainer for allowing this person to continue in his role because there are no tests before or after to determine what an individual has taken on board and therefore their level of competence.   I do blame POL though – entirely – for letting this happen.

It is vitally important that this factor – the level of competence of individual subpostmasters – be taken into account when attempting to assess the issues put before the court.   Dr Worden’s attempt at categorising actions subpostmasters would take on detection of a loss in their branch by defining the probability of each action on the amount of the loss is totally absurd and extremely annoying particularly when he confesses in yesterday’s transcript that he had made no contact (perhaps he was not permitted by POL to do so) with any subpostmaster.

My example above is just one of many.  Perhaps the worst, perhaps not.  Any subpostmaster who is or has been a member of various social media forums will know and understand that this rather low level of ability is common within the network although I have no idea of how prevalent it is.

It is of POL’s own doing that this has been allowed to happen – I would suggest the situation has developed more so since the inception of NT and the rush to get offices converted which is now being replaced by the necessity to find enough idiots to take on a post office and maintain the network size at its legislated level for the convenience of the Goovernment.

To fix it POL will have to start with the Lowest Common Denominator and work upwards although they might want to examine the ability and intelligence levels of their own staff first who got them in this mess.





What are POL’s chances?


Looking Ahead

We are reaching the conclusion of the Horizon trial and recently I have found it interesting to review the opening statements of both the Claimants (Cs) and the Defendants (POL)

The next trial will be looking at Breaches of Contract and Causation (whether or not Horizon or other areas could have caused the losses the Cs are looking to recover).

An interesting extract then from POL’s opening statement in the Horizon trial:

4.The robustness issues are so important because of their impact on the “breach” trials that will be held in this Group Litigation. When the Court comes to decide the claims made by individual Cs, it will do so with the benefit of the generic judgments it will have given in the Common Issues and the Horizon Issues trials:

24.1The Common Issues judgment will have determined the contractual rights and obligations between Post Office and the relevant Cs and certain other incidents of their legal relationships.

24.2The Horizon Issues judgment will have determined, in effect, the extent to which Post Office can generally rely on the contents of the relevant Cs’ Horizon-generated branch accounts as evidence of the true accounting position. In each case, Post Office will rely on the relevant branch accounts as evidence of a deficiency (or shortfall) for which the relevant C is liable. For that purpose, PostOffice will wish to say that Horizon is generally reliable to a high degree and so, absent special circumstances, the accounts generated from Horizon can be taken as accurate. Against that, the relevant C will wish to say that Horizon is not anything like so reliable and that, accordingly, the branch accounts generated by Horizon cannot be given anything like as much weight as Post Office contends.

So far so good then for the Claimants particularly those who claimed for losses under the old SPMR contract (pre Network Transformation) as practically all of the issues under this contract were settled in the claimants favour.

Any decisions in favour of the claimant’s issues in the Horizon trial will therefore put them in a strong position for the third trial.

Without commenting on the current trial or the next one, other than to note there are errors in Horizon from time to time which has been admitted by POL, I would take issue with the above statement from POL with regard to the present day activities of subpostmasters.

A subpostmaster who today discovers a shortfall in his accounts of say £1,000 has the following options:

  1. They can look at the transaction logs for common user errors. The transaction log being a print out on 4” wide receipt paper roll that may be several metres long and contain unknown acronyms and product codes.  This data is available to the post office however in electronic form and can be rapidly searched and sorted.  It is way beyond my comprehension why subpostmasters are not provided with that facility.
  2. They can look at their CCTV footage to see if anything unusual has happened. CCTV though is not a pre-requisite and a lot of offices don’t have any let alone cameras that cover every counter from both sides.  A very important point is that POL have NO access to this information even if cameras are present (excluding some branches that have recently been installed with anti-crime surveillance equipment)
  3. They can call the Hell Line for assistance and/or advice. Good luck with that one.


A subpostmaster faced with a unexplainable discrepancy DOES NOT have the option to query whether or not a problem with Horizon was to blame, but it is and always has been a possibility.    The oxymoron of course is that POL/Fujitsu only find out and investigate these errors in Horizon when a subpostmaster informs them of something strange happening that causes a discrepancy that he cannot explain.   Even worse, POL for whatever inexplicable reason, decide not to inform their subpostmasters when an error does exist in their system that can cause these  losses.  They rely it seems totally on back office procedures to pick up and automatically correct shortages caused by known errors which does not help the poor subpostmaster locate his problem.


As an aside, not only does that way of dealing with errors cause the subpostmaster lots of wasted time and effort in trying to locate the source of the error plus sleepless nights, in most cases it will result in the subpostmaster having to put his own money into the safe to balance the books until such time as this confidential error have been rectified.  It truly is an absurd way of doing things.


Of course there are several other ways a discrepancy can occur in a subpostmasters account that would be inexplicable such as theft or counter fraud.   There is however a reason for EVERY discrepancy and to find that reason it may be down to excluding all other logical possibilities.  In Seema Misra’s case POL decided that theft by her could be the only explanation and the attempted in court to prove that was the case by EXCLUDING all other possibilities.


How could they do that with no CCTV recordings as evidence?   How could they do that without revealing to the court all known Horizon errors and specifically excluding ALL of them as the possible source of the discrepancies?  How could they do that without investigating whether or not there was an unknown, yet to be discovered error in Horizon, that could have caused the shortages?


The last sentence is intriguing.   Errors in computer systems exist until they are found.   It has been suggested and agreed by both experts in the current trial that some of the errors that have so far been found existed in the system for years before they were located and fixed.  So how can you possibly bring a prosecution against a subpostmaster until you are sure you have excluded ALL the possibilities?  How long do you have to wait before the possibility of an UNKNOWN Horizon error can be discounted?


So POL have the almighty problem of justifying their actions or lack of them in this regard.  For me the overwhelming evidence that cannot be counted on in court is the fact that so many claimants are vociferous and persistent in their belief – no their knowledge – that they stole not one penny.   Where the losses went is not for the claimants to find out because they do not have and never had the tools and wherewithal to do that, it is for POL to do that and in the absence of CCTV footage and no knowledge of what errors currently exist in the system and for how long they have existed then they have no chance.

Remember we need continued coverage of the trial from Nick Wallis and that has to be paid for so drop a tip or two in his tip jar at

Thanks too to Tony Collins for his excellent articles on the background to this trial.



Post Office Ltd – The End is Nigh

With all the attention that is being focused on Post Office Ltd (POL) at the moment with the on-going trial ( you would think POL would be displaying a modicum of common sense when it comes to even more unwanted publicity that would tend to put off anyone considering buying a post office.

There are many key components to a sustainable Post Office Network but none is as important as a steady stream of individuals keen enough to borrow and invest in purchasing a Post Office from an incumbent subpostmaster.   You see all subpostmasters need to retire eventually and to do that they have only two options, sell the business on or close it completely.  As the NFSP are very helpfully pointing out today in the press, more and more subpostmasters are finding the latter the only option they have and while I don’t blame the NFSP for making this point it is just adding fuel to the fire and will only serve to put more individuals off buying a post office.

In an absurd attempt to maintain the Network size, Post Office Ltd are offering interested parties the opportunity to open a brand new post office more often than not in close proximity to an existing one.  There is absolutely no commercial sense in this for anyone involved.   This won’t increase overall sales of Post Office products, it will make existing Post Offices harder to sell therefore increasing the chances of them closing altogether and it will increase the costs associated with supporting a Post Office for POL.  It is complete and utter madness.

I was going to write more about this but it seems I already have as my evidence statement to the BEIS select committee has just been published and it re-iterates much of the above.  I wrote that in April so POL decided in their wisdom to provide me with a clear cut example of the very problem I am referring to above as well as one quite local to me.

In the same newspaper last week two reports – side by side – tell of one subpostmaster clearly infuriated with POL and desparate to sell only to find one of these White Space offices opening up right next door to him in a small town with a more than ample supply of Post Offices.

POL are completely out of control and led by idiots.   If the management are not replaced then there is no hope for the network.   A very sad state of affairs for all of those who still have their own money invested in their post offices and those lucky enough to sell on have been replaced by people who clearly have no business acumen and who didn’t do their research properly and are now regretting their decision.


POL and the Money Tree

With £3 million already spent at the 31st March 2018 on defending the current Group Litigation Order trial brought by the Justice for Subpostmaster Alliance (JFSA), Post Office Ltd (POL) are looking at significant legal costs as they attempt to delay the trial in one way or another.   The absurd recusal application alone cost them £500k.   Now they say they are definitely going to appeal the decision of the court in the first trial which is a ‘double down’ on what they have already spent on that to date.

I am not entirely sure of the sequence of events as far as legal costs go but the recusal hearing gave some insight into the process when the JFSA QC claimed costs, the POL QC objected to the amount they were claiming and that will result in a case management hearing to determine how much POL pay JFSA.   In much the same way, the costs for the first trial in the series will be settled except in this case POL actually won a few points so some of the costs will be to the account of JFSA.   Of course then there will be an appeal and I would assume at that time the JFSA may concede the points POL won from the start so ALL the costs will fall to POL for that one when they lose again.

It is pretty much clear cut that POL will lose the Horizon trial as well and there is no doubt that they will appeal that one, they have to otherwise the consequences of losing must take place immediately and again the costs become payable fairly soon after the decision is published.  A much longer trial and considerable background detective work went into this one by the JFSA so the costs will be far higher.   By the end of the year the whole process will have repeated itself in the Breach and Causation trial and I am as confident as I can be that POL will lose that one completely.

The end of POL’s financial year is 31st March so costs to date will be reported on when they publish their accounts in September and they will then certainly have to advise a contingent amount for the appeal process.   In fact they may even have to start considering the possible total liability they face should they complete the quadruple and lose all four trials, something I would definitely not bet against.

So stab in the dark time, how much is this all going to cost in total?   I sat in the trial for a couple of days and there were 20 or so highly paid legal professionals attending, plus the back office staff plus the court costs.   I am going for £100 million by the time it is all over and let’s say £80m of that is to POL’s account.    If that is the case then that means POL lost and the JFSA claimants have won so it won’t just be the legal fees they are paying it will be the quantum of those claims as decided by the Judge.    These will be huge and include compensation for wrongful imprisonment which if it had been carried out by the Crown Prosecution Service would have been limited to £500k.  As Post Office Ltd carried out the prosecution as a private company then there is no maximum amount of compensation.   (that is my opinion and not necessarily a legal fact!)

My guess is that the total claim will be in excess of £500m plus the legal costs of £80m – let’s just round it up to £600m

The big problem for POL is that they have no access to that sort of cash.   A bigger problem for POL and the Government is that from a political perspective POL cannot go bust so they need to raise that money in some way and in fact at some point in the near future they (the Government and POL) are going to have to comment on where they expect to raise the capital required should the very likely happen and they lose the cases.   It is not just POL, POL’s auditor’s will have to express a view  on the viability of the business as a going concern if a source of funds is not available to meet the company’s legal penalties.

There is a further conundrum in the fact that POL’s hands are very much tied by their articles of association.   While these articles allow them to spend up to £50m without approval from the Secretary of State (SoS) which would allow them to pay the legal fees, they also prevent POL from borrowing any amount in excess of £75m without the SoS permission whether that amount is to be borrowed from the Government or not.  So the SoS has the power to prevent POL paying the claimants their dues.  Perhaps it is time for the SoS to make it clear that when the JFSA win the SoS will not use their power to stop POL raising the funds necessary to pay off the claimants.   In any event it would be an extraordinary act of political suicide to cast POL into the insolvency courts because the government withdraws support not only from POL but from the claimants whose suffering the government were as guilty of as POL. (just re-read the above and to make it perfectly clear – when the JFSA win it is the Secretary of State who will make the decision directly or indirectly whether or not to pay the claimants .  Secretary of States come and go as do parties forming governments so I am not sure they should remain in denial of the problem and put all questions to them asked in the house about the matter back to POL or refused due to sub judice)

POL as we know remain unaccountable to nearly everyone, except now the JFSA who are truly holding them to account so I imagine they think they can get away with misusing the funds they have at their disposal in order to settle this.  I did say they didn’t have any and legally they don’t but that has not stopped them in the past from making use of government funding they are not entitled to.  In this trial alone they have already had to repay the government funds they misused.

POL remain bound by EU State Aid rules, at least for 2 years after Brexit if it ever happens.  They are prevented from using the Working Capital Loan provided by BEIS for anything other than financing the level of cash they require to keep in the network.  I have caught them out before with misusing this and if they try it again I will see it.

They could try and tell us that the source of funds was the working capital in the business less the BEIS loan but they can’t utilise that either because the conditions of the BEIS loan state clearly that BEIS retain a lien over the working capital as security against the loan.   It all gets a bit incestuous I know but rules are rules and conditions must be met.

Any business can always try and leverage their cash flow in a way to free up cash to pay off liabilities.  By extending the time they take to pay creditors and reducing the time they allow debtors to pay them could solve their problems if they hadn’t already gone down that road.  I am pretty sure the government is keen to see small businesses being paid quickly by their departments so it is something of a surprise to see that in the last financial report from POL in 2018 their creditors were owed twice as much as their debtors.  There is no more meat on that particular bone of capital to pick from.

POL aren’t going to continue to make a profit for very much longer.  They only recently did for the first time in years but what they seem to forget is that they need subpostmasters to carry on making that profit for them and who in their right minds will be buying a post office in the light of the extraordinary disclosures that have already been made, are waiting to be made and are going to be repeated in the appeal court.   So raising debt to pay off the claimants will be problematic as again they are restricted by state aid rules and it remains to be seen whether or not Brexit happens if those state aid rules will continue to be enforced.

And then ….

When the court case is over and the claims settled there is more expenditure needed.   A fairly significant amount to put in place what I will call the replacement therapy.  Political expediency demands a post office network and a phoenix rising from the ashes of this burnt out mismanaged enterprise will be required.   Replacing the staff (OK some of them won’t get redundancy payments because they will be jailed) will be expensive and putting in place the systems and technology that should have been in place from the start will add to the cost.  However that is a reasonable expenditure for the Government to provide grant funding for under state aid rules but the government will also have to wake up to the realisation that subpostmasters will not work for less than the minimum wage and as a result a network of 11,500 offices will always require financial support.

And Oh! … how the government would wish that that was the end of it all.  But no there is more.  The CWU are bringing POL before an employment tribunal with the awarding of worker’s rights to subpostmasters almost certain.   Holiday pay, sick pay, maternity leave, workplace pensions all going to have to be paid for.

And just like those ads you see on TV .. but wait there is more .. this trial is only the first round .. there are far more claimants being added every day.  When I attended the trial in London I was surprised to meet several ex subpostmasters who had come along to find out what it was all about and who had never heard of the JFSA.  The publicity hasn’t really started and most shamefully the position of POL has not changed one bit and they haven’t even informed the network of the errors that were in the system let alone the ones they know are current.   Kimberley diamond mine is not the biggest hole in the world….

Need I say all this could have been avoided?  If they had done it properly from the start?  If they had listened to the people like Alan Bates there would have been no claimants to bring a court case in the first place.   Does the government really want to entrust the very people who are continuing to deny there is a problem even after two highly respected judges have found against them so far, to sort this mess out?

When we add it all up it is beginning  to look a lot like a billion (there’s a song in there but I’ll leave that til Xmas) So will somebody please tell me and the rest of the world how on earth POL intend to pay for it all?  I think this question must be the last remaining concern for the JFSA team as they stride towards total victory in the courts.

As ever, grateful thanks to Nick Wallis ( for his coverage as well as Karl Flinders at Computer Weekly and Tony Collins at whose latest blog post looks at this very question of where is the money going to come from.