Post Office’s full and final settlement with Horizon scandal victims in plain English

Whenever the government is asked whether it will give fair compensation to the subpostmasters who defeated the Post Office in court in the Horizon scandal trial, it reels off the same line: “The settlement reached in late 2019 was full and final, and the government cannot accept any further request for payment.”

But what does it mean?

There are a lot of contrasting views about the £57.75m settlement, and there is a lot of nonsense inferred around the “full and final settlement” wording in the settlement deed with the Post Office. It is either through ignorance or deliberate obfuscation by senior people who should know better, so I will try to explain, by way of example, where the wording “full and final settlement” comes in.

In the simplest of terms, the court agreed that the case would be broken down into a number of trials and each trial would cover one main issue or a group of issues, as it would be unmanageable to address everything in just one trial. While at the outset, for example, 10 issues were identified to go before the court, which it was thought could be addressed in four or five trials, the outcome of those first four or five trials may well have raised a further number of issues, requiring even more trials.

But we’ll stick with the example of 10 issues, which included the two bigger issues – the matter of the subpostmaster contract and the flaws in the Horizon computer system. Each of those issues took a whole trial, with the Post Office doing everything it could to run us out of funds. This included serving an application to recuse the judge, appealing Judgment Number 3 (Common Issues) to the Court of Appeal and holding endless costs and disclosure hearings, so that by the end of the second trial (Horizon), the group had run up a bill of £46m.

However, at this point in the legal action, conducted under civil procedure rules, we were encouraged to take part in mediation discussions to settle before we got to trial three, which was due to start in March 2020. The Post Office was keen to pursue this avenue with us, and we thought it wouldn’t hurt to listen to what it had to say.

Cutting a long story short, and one which is a matter of history, we entered into a compromise settlement agreement by consent with the Post Office because, put simply, we did not have the funds to carry on with the case – and pulling out was not a viable option.

“We entered into a compromise settlement agreement with the Post Office because we simply did not have the funds to carry on with the case – and pulling out was not a viable option”

Yet in trying to agree a settlement figure, the only issues that could be used to calculate a financial figure were based on those legal points we had won as part of the judgments in the two trials that had been held. In reality, there were many other considerations included in the calculation, but trying to keep it simple, everything extended from just the legal points won in court from the first two trials. 

So when you see the Post Office, the Department for Business, Energy and Industrial Strategy (BEIS) and the Her Majesty’s Government bandying around the phrase “full and final settlement”, in actuality they are only referring to the issues that formed part of the first two trials, although they would have you think everything had been addressed. Some people might think they were deliberately trying to mislead everyone.

Returning to the two of the 10 issues that had been dealt with, in reality this meant the other eight issues, which would have been the subject of further trials, were never addressed. And as we already owed £46m in costs, it meant the group of 555 subpostmasters could not afford to pursue the Post Office further as it had unlimited funds available from its sole shareholder, the government. 

So the 555 have never received a penny for these other eight – and possibly significantly more – issues, yet the Post Office Historical Shortfall Scheme, with 2,400 applicants, will compensate those people for all the 10 issues. The Post Office, BEIS and the government will not allow the 555 to take part in the scheme, no doubt as further punishment for daring to take the Post Office to court and exposing the failures of them all.

Hopefully, my example will explain the weaselly way the Post Office, BEIS and the government use “full and final settlement” to hide the way they continue to abuse and mistreat the 555 victims of the Post Office, and which is why we will never give up pursuing the financial redress they seem determined not to give us.

Alan Bates is a former subpostmaster who lost his business and savings in the Horizon IT scandal and went on to lead subpostmasters to victory against the Post Office in the High Court.