Source · Select Committees · Public Accounts Committee
Recommendation 17
17
Accepted
Horizon Shortfall Scheme re-opened, offering a new £75,000 fixed sum award option
Recommendation
Under the Horizon Shortfall Scheme, between its launch on 1 May 2020 and its closure to new applicants in March 2021, the Post Office received 2,417 eligible scheme applications. In October 2022, the government announced that additional funding would be provided so that eligible claimants could receive financial redress and the scheme re–opened for applications. Then, on 13 March 2024, the Government announced that a £75,000 Fixed Sum Award would be available as a voluntary option to individuals in the scheme.
Government Response Summary
The government agreed to provide the Committee with information on the Horizon Shortfall Scheme, payment forecasts, settlement timelines, cost estimates, and ensuring quiet settlement of payments in line with court judgements by March 2025, and confirms they did so on 28 March 2025. They also outline actions to improve the redress process, including the introduction of a £75,000 fixed sum award and an appeals mechanism.
Government Response
Accepted
HM Government
Accepted
3b. PAC recommendation: The Department should write to the Committee by 31 March 2025 setting out: • its arrangements for monitoring with Post Office Limited the applications made under the Horizon Shortfall Scheme, with a view to ensuring that payment forecasts are fit for purpose; • when it expects to have the information it needs to settle every claim; • and by what date it will be able to present evidence to support the reasonableness of its cost estimates for this scheme. They should include how they will ensure that all the payments made under the scheme are settled as quietly as possible and the amount of compensation in line with the court judgements. 3.3 The government agrees with the Committee’s recommendation. Recommendation implemented: March 2025 3.4 The Department for Business and Trade has written to the Committee on 28 March 2025 to provide the requested information. 3.5 The department receives regular management information from the Post Office on scheme progress, which it uses to update cost estimates. These estimates are subject to quality assurance by analysts and financial leads. 3.6 The department commissions the Post Office each month to provide a forecast update and funding is provided monthly according to those agreed forecasts. The presentation of evidence to support the reasonableness of cost estimates for all schemes will be disclosed as part of the department’s annual report and accounts (ARA) for 2024-25. 3.7 There is considerable uncertainty over total scheme costs and when all cases will be settled as the scheme is still open to applications. However, the government is committed to progressing claims as quickly as possible and is taking steps to improve the redress process, working closely with the Post Office. This includes the introduction of the £75,000 fixed sum award, streamlined governance and greater use of automation. The department is in regular dialogue with the Post Office and legal representatives of claimants to consider what further improvements could be made. 3.8 Fully assessed cases are considered against established legal principles and case law, before awards are made. Ministers have, however, committed to introduce an appeals mechanism, which will enable those Horizon Shortfall Scheme claimants who are unhappy with the assessment of their case to challenge the offer that they have received.