Source · Select Committees · Public Accounts Committee
Recommendation 20
20
The Department currently estimates that the scheme is likely to cost £153 million, of which...
Conclusion
The Department currently estimates that the scheme is likely to cost £153 million, of which £89 million is from the Post Office and £65 million is from the Department.65 The Department noted that its contribution was its current best estimate, and did not represent a hard and fast limit: should the estimate prove to be too low, then it will be increased.66 In addition to the scheme, the government has committed to covering the costs of compensation to those former Post Office employees wrongly convicted of criminal offenses. The Department currently estimates this may cost the taxpayer up to £780 million.67 62 Q 79 63 Qq 79, 80 64 Correspondence from the Department for Business, Energy & Industrial Strategy to the Board of Directors, Post Office Ltd., 14 December 2020 65 Q 78 66 Q 79 67 Qq 78–80 Department for Business, Energy & Industrial Strategy Annual Report and Accounts 2020–21 15
Government Response
Not Addressed
HM Government
Not Addressed
6.1 The government agrees with the Committee’s recommendation. Recommendation implemented 6.2 Over the past decade, the government has provided over £2.5 billion in funding to support the Post Office network. The government is providing a further £335 million for the Post Office over the next three years. The government is confident that with this funding, Post Office remains a viable company and can continue to meet the core requirements for the network, including maintaining a network of at least 11,500 branches and ensuring that 99% of the UK population lives within three miles of their nearest branch. 6.3 Post Office Ltd published its annual report and accounts for 2020–21 in May 2022, which, while highlighting a number of risks and uncertainties, was prepared on a going concern basis. Post Office’s independent auditors concluded that the directors’ use of the going concern basis of accounting in the preparation of the financial statements was appropriate. 6.4 The Horizon scandal has had a devastating impact on postmasters and their families. It is right that affected postmasters are properly compensated and, without government funding, the compensation would have been unaffordable to Post Office. To form part of the going concern assessment for Post Office’s financial statements, BEIS issued letters of comfort to assist the Post Office Board in maintaining its view that the company continues to be able to meet its liabilities. The government will share letters with the Committee from BEIS to Post Office, providing assurances for the Historical Shortfall Scheme, interim and full payments for those with overturned criminal convictions. Further letters will be shared with the Committee at the earliest opportunity.