Government receives report on second controversial Post Office IT system

The government has received a report into a Post Office software application - used by subpostmasters before the controversial Horizon software was introduced - which has also been blamed for causing unexplained accounting shortfalls, ruining businesses and lives. 

As long as 30 years ago, postmasters suffered shortfalls which they believe were caused by errors in PC-based software known as Capture, which was in use before the widespread computerisation of branches that began in 1999. Potential problems with the software package came to light following the ITV drama about the Post Office scandal, Mr Bates vs the Post Office, which was broadcast in January.

The Department for Business and Trade (DBT) commissioned an investigation from forensic specialist Kroll following claims by affected subpostmasters. Now, an email sent to a former subpostmaster has revealed that the final report from Kroll has been completed and the government is working to publish it on the Gov.uk website.

Computer Weekly asked Neil Hudgell, solicitor at Hudgell Solicitors which has about 40 former Capture users as clients, for an update. While he would not comment on the status of the report, he said: "We are pleased to see Kroll has proceeded quickly to place a draft report before DBT."

He said he is confident that the content of the report will be supportive of his clients’ claims. Former subpostmasters who had problems using Capture suffered losses and some were convicted of crimes - years before other subpostmasters were prosecuted for losses wrongly caused by Horizon.

Hudgell added: “Our focus now is on pushing for early disclosure of the report and an indication of next steps. Those next steps need to scope out any avenue to exoneration and compensation that does not involve long drawn-out processes.”

In some instances subpostmasters were convicted of financial crimes almost 30 years ago.

The Capture system was a PC-based application developed by the Post Office and uploaded onto a personal computer by subpostmasters to carry out their accounts. The software – referred to by some users as a “glorified spreadsheet” – was a standalone system, unlike Horizon which is a complex, networked system connected to centralised services.

Computer Weekly reported in January that former users of the software had come forward claiming they were prosecuted because of unexplained shortfalls. Former MP Kevan Jones, who now sits in the House of Lords, was involved in the campaign for justice for Horizon victims and has spearheaded a campaign for subpostmasters who believe they suffered losses and criminal prosecution as a result of Capture errors.

Potential victims of the Capture software have so far been excluded from the government’s response to the Horizon scandal, which saw the introduction of legislation to quash the convictions of  900 wrongly prosecuted subpostmasters which was passed by Parliament in May.

Thousands of subpostmasters could have used Capture. A Post Office Branch Focus newsletter – which gave weekly updates for subpostmasters – revealed in September 1995 that subpostmasters were experiencing problems with the application. The newsletter read: “We were aware that, as new software, there would inevitably be faults in the program.”

Steve Marston was prosecuted in 1996 for theft and false accounting following an unexplained shortfall of nearly £80,000 in his branch in Bury, Lancashire. He said he had never had any problems using the paper-based accounting system. This changed when his branch, which he ran from 1973, began using Capture.

Marston said he felt pressured into using the system at a time when many branches were being closed by the Post Office. He’d had no problems for two decades using manual accounting processes, but within two years of using Capture he ran up a debt of £79,000.

He covered the losses with his own money, but it kept getting worse. After an audit revealed a loss he couldn’t fully cover out of his own pocket, he was advised to plead guilty to theft and fraud to avoid jail. The judge took into account two bravery awards Marston had received for standing up to armed robbers, saving him a jail sentence. He was given a 12-month suspended sentence, lost his home and business, and went bankrupt.

Marston said he hopes to get justice.

The Post Office scandal was first exposed by Computer Weekly in 2009, revealing the stories of seven subpostmasters and the problems they suffered due to Horizon accounting software, which led to the most widespread miscarriage of justice in British history (see below timeline of Computer Weekly articles about the scandal since 2009).

• Also read: What you need to know about the Horizon scandal •

• Also watch: ITV’s documentary – Mr Bates vs The Post Office: The real story •

• Also read: Post Office and Fujitsu malevolence and incompetence means huge taxpayers’ bill •