Source · Select Committees · Public Accounts Committee
Recommendation 24
24
Accepted
Department funding significant Post Office compensation to avoid insolvency.
Conclusion
We asked whether the Department will in effect be funding the full bail out of the estimated compensation. The Department stated that of the estimated £150 million provided for the Historical Shortfall Scheme, £63.3 million will be funded by the Department and for the Overturned Historical Convictions Scheme, the Department has agreed to stand behind the whole cost of £502 million. While the Department would be keen to see the Post Office fund a greater share of these costs, this would have imposed a significant financial burden on the Post Office that would likely have resulted in it no longer being a going concern.49 46 BEIS, ARA 2021–22, page 257 47 Q 167 48 Qq 168–169 49 Qq 170–173 16 Department for Business, Energy & Industrial Strategy Annual Report and Accounts 2021–22
Government Response Summary
The government agrees with the committee's conclusion and states the recommendation is implemented. It provides an update on the progress of compensation payments under both the Historical Shortfall Scheme and the Overturned Historical Convictions Scheme, detailing the number of offers and payments made, and notes further funding is being prepared for a tax treatment issue.
Government Response
Accepted
HM Government
Accepted
7.1 The government agrees with the Committee’s recommendation. Recommendation implemented 7.2 The government is working hard to ensure fair compensation is delivered to the postmasters affected by the Horizon scandal as quickly as possible. 7.3 Under the Historical Shortfall Scheme (HSS), as of 30 May 2023, 2,401 offers (over 99%) have now been issued to the original cohort of claimants, totalling £98.7million(net), with 16 offers outstanding. The Post Office expects to issue offers in the remaining cases by the end of July, but this is dependent on information from third parties. 1,965 payments have been made totalling £67.7million (net), meaning over 81% have received payments. This includes £8.7million in interim payments. Total payments will not be known until all cases have been settled. The Post Office has also issued 60 offers to late applicants to the HSS and made 22 payments totalling £320,000; it continues to receive and process late claims. In addition, DBT is preparing to provide further funding to correct an issue relating to tax treatment for some HSS payments. 7.4 For overturned convictions, as of 30 May 2023, the Post Office has made 80 initial interim payments totalling over £8.1million, out of 86 convictions overturned so far. It has settled 55 non-pecuniary claims, including one subject to a pending probate arrangement, and made offers for a further 13 non-pecuniary claims. The Post Office has settled 4 pecuniary claims, meaning it has reached full and final settlements with 4 postmasters. The total compensation paid out by Post Office to those with overturned convictions is over £18.8 million. Post Office encourages postmasters to continue to submit their claims, and once received will review these as quickly as possible.