Horizon (IT system)

Horizon is the name for a computer system used by part of the United Kingdom's postal service, Post Office Ltd. In 2013 the system was being used by at least 11,500 branches, and was processing some six million transactions every day.[1] It has come under criticism since at least 2000 for errors in the system which, according to press reports, may have caused the loss of dozens of jobs, unwarranted prison sentences, bankruptcies, and one documented suicide.[2]

Purpose and design

The system cost £1 billion and was designed by ICL/Fujitsu Services.[3][4] According to Post Office Ltd, the name Horizon encompasses:

  • the software, both bespoke and software packages[5]
  • the computer hardware and communications equipment installed in branch and the central data centres[5]
  • the software used to control and monitor the systems[5]
  • the testing and training systems[5]

The system was originally introduced in 1995 on a pilot basis in a small number of Post Offices, alongside a joint work programme between the Department of Social Security's Benefits Agency and Post Office Counters Ltd. The objective of this programme (known as the BA/POCL Programme) was to provide an automated system for making benefits payments through Post Offices and thereby reduce fraud.

At the Conservative Party conference in October 1995, the social security minister Peter Lilley brandished a smartcard as the intended replacement for the benefit book, declaring that, with the Benefits Agency and ICL, Post Office Counters Ltd would install smartcard reading terminals at every branch, through a private finance initiative (PFI) to be delivered under a commercial contract. At the time smartcards were under consideration as part of the full system, but a final choice of technologies had not been made.

After a lengthy competitive procurement exercise which began in late 1994, the contract for further development and full implementation in all Post Offices was awarded in May 1996 to ICL's Pathway division, which had been created for the purpose.[6] ICL later became part of Fujitsu.

In 1999, four years and £700m of taxpayers' money after the pilot scheme began, the Government, by now Labour, stopped the scheme in its tracks. The Department of Social Security withdrew from the deal, leaving ICL/Fujitsu to run the system. ICL has since criticised the PFI payment criterion: it would have been paid partly on how many customers Post Offices attracted. "Looking back, I think it was over-ambitious," said Stuart Sweetman in 2001, as the then group managing director of customer and banking services for Consignia, the name used at the time for Post Office Counters Ltd. "You can't export all the risk to a supplier."

Problems

Problems with the system were first reported by Alan Bates, the sub-postmaster at Craig-y-Don, in around 2000,[7] he reported his concerns to Computer Weekly in 2004, who finally gathered sufficient evidence to publish them in 2009.[8] A campaign group on the issue, Justice for Sub-postmasters Alliance (JFSA) was formed by Bates and others in September 2009.[9][10]

Initial Post Office Ltd investigation

An initial investigation failed, at first, to find the cause of the problems. As a result, an independent investigative firm Second Sight were brought in to conduct a separate, independent inquiry, in 2012.[1][9] At around this time, Paula Vennells became CEO of the Post Office.[9]

Second Sight report

In July 2013, Post Office Ltd admitted (after an interim review by Second Sight) that software defects with Horizon had indeed occurred, but that the system was effective.[1] The review discovered problems in 2011 and 2012, when Post Office Ltd discovered defects which had caused a shortfall of up to £9,000 at 76 Post Office branches.[1] However, more than 150 sub-postmasters continued to raise issues with the system, which they claimed had, by error, put them in debt by tens of thousands of pounds, and that in some cases they lost their contracts or went to prison.[1][11]

The report – which was treated as confidential – described the Horizon system as, in some cases, "not fit for purpose".[11][12] The lead investigator for Second Sight claimed that there were about 12,000 communication failures every year, with software defects at 76 branches and old and unreliable hardware.[3] The system had, according to the report, not been tracking money from lottery terminals, tax disc sales or cash machines – and the initial Post Office Ltd investigation had not looked for the cause of the errors, instead accusing the sub-postmasters of theft[11] The report was dismissed by the Post Office.[13] However, it was leaked to the BBC in September 2014. The BBC's article on the report also said that training on the system was not good enough, that "equipment was outdated", and that "power cuts and communication problems made things worse".[11]

Post Office Ltd then went into mediation with the affected sub-postmasters.[11] By December, however, MPs had criticised Post Office Ltd for how it handled the sub-postmasters' claims, and 140 of those affected had withdrawn their support for the Post Office-run mediation scheme.[14] 144 MPs had been contacted by sub-postmasters about the issue, and James Arbuthnot, the MP leading on the matter, accused the organisation of rejecting 90% of applications for mediation.[14] Post Office Ltd said that the claims by Arbuthnot were "regrettable and surprising".[14] Arbuthnot further claimed that Post Office Ltd had been "duplicitous", and said that:[4]

I do not want to build up hopes that the other methods are going to be more successful than the current ones, so I will not be specific – but it will involve legal and political campaigns.

In February 2015, ComputerWorld UK, a UK trade magazine for IT managers, reported that Post Office Ltd were obstructing the investigation by refusing to hand over key files to Second Sight.[3] Post Office Ltd claimed in the Business, Energy and Industrial Strategy Committee hearing of 3 February 2015[15] that they "have been working with Second Sight over the last few weeks on what we agreed at the outset. We have been providing the information.", but the lead investigator for Second Sight, when asked by Adrian Bailey if that were the case, said "No, it is not.", as he had not been given access to prosecution files, which he needed to back up his suspicions that Post Office Ltd had brought cases against sub-postmasters with "inadequate investigation and inadequate evidence".[3] He said that these files were still outstanding eighteen months after they had been requested.[4]

Investigation cancelled

In March 2015, Private Eye and other sources reported the news that Post Office Ltd had ordered Second Sight to end their investigation just one day before the report was due to be published, and to destroy all the paperwork which they had not handed over.[2][4] Post Office Ltd then scrapped the independent committee set up to oversee the investigation, as well as the mediation scheme for sub-postmasters, and published a report which cleared themselves of any wrongdoing.[2]

Of the 136 cases, 56 had been closed, and Post Office Ltd would put the rest forward for "mediation" unless a court ruling prevented them from doing so.[4] After ending the inquiry, Post Office Ltd said that there were no widescale problems, and that:[4][16]

This has been an exhaustive and informative process which has confirmed that there are no system-wide problems with our computer system and associated processes. We will now look to resolve the final outstanding cases as quickly as possible.

Civil action

In 2019, class action civil litigation, Bates & Ors v Post Office Ltd,[17] brought by 550 sub-postmasters was settled by the Post Office.[18][19] Significant fees for counsel, repayment of legal financing, and payment of the legal financing "success fee" will be deducted from the £58 million settlement.[20]

Mr Justice Fraser, the judge overseeing the civil action noted that the approach of the Post Office to the case:

amounted, in reality, to bare assertions and denials that ignore what has actually occurred, at least so far as the witnesses called before me in the Horizon Issues trial are concerned. It amounts to the 21st century equivalent of maintaining that the earth is flat.

Vennells subsequently apologised to workers affected by the scandal, saying:[9]

I am truly sorry we were unable to find both a solution and a resolution outside of litigation and for the distress this caused.

In March 2020 the Criminal Cases Review Commission has so far decided to refer for appeal the convictions of 39 Post Office applicants. The Commission will be referring all those cases, which involve convictions for theft, fraud and false accounting, on the basis of the argument that each prosecution amounted to an abuse of process.[21] In May 2020 the Criminal Cases Review Commission has decided to refer a further eight Post Office workers’ convictions for appeal – this brings to 47 the number of cases to be sent for appeal so far on grounds related to the Horizon computer system.[22]

Possibility of criminal action

In December 2019, The Register reported that Mr Justice Fraser would be passing a file on to the Director of Public Prosecutions.[23][24] A number of cases are under review by the Criminal Cases Review Commission raising the possibility of actions for malicious prosecution.[25][26]

Arbuthnot, by now sitting in the House of Lords as Baron Arbuthnot of Edrom, said in November 2019:[27]

My own suggestion is that the government should clear out the entirety of the board and senior management of the Post Office and start again, perhaps with the assistance of consultancy services from Second Sight, who know where the bodies are buried.

Other enquiries

Evidence about the case was also heard by Parliament's 'Business, Energy and Industrial Strategy Committee' on 10 March 2020.[28][29]

In February 2020, Prime Minister Boris Johnson committed to an independent inquiry.[30]

On 19 March 2020, in a debate in the House of Commons, Kevan Jones MP criticized former Post Office CEO, Paula Vennells, for her role in the scandal.[31]

In a written ministerial statement on 10 June 2020 Paul Scully (Minister for Small Business, Consumers and Labour Markets) announced the scope of the Independent Review into the Post Office Horizon IT System and Trials.[32]

Individual cases
  • Jo Hamilton, from South Warnborough in Hampshire, claims she first noticed problems with the Horizon system in 2005[33] and lost £36,000; she pleaded guilty to false accounting after trying to hide the resulting incorrect deficit.[1] She was originally charged with theft, but was told that if she repaid the money and pleaded guilty to 14 counts of false accounting, she would be less likely to go to prison.[14] At the time, she was told that she was the only person who had had these problems.[14] She pleaded guilty, and, under the terms of her contract, she paid her wages for the next ten months to Post Office Ltd, and had to remortgage her house to pay the money.[14][34] James Arbuthnot was her MP.[27]
  • According to Ms Hamilton, a man who had worked for the Royal Mail for 40 years spent his 60th birthday in prison as a result of the errors.[1][11]
  • Sarah Burgess Boyd, from Newcastle upon Tyne, said she lost her life savings in repaying an incorrect shortfall.[11]
  • Rubina Nami was jailed for 12 months in 2010 for false accounting of £43,000.[35] She and her husband fell behind on mortgage payments and in February 2013 bailiffs seized their home and changed the locks.[33][35] They slept in their van for six weeks before being given a one-bed housing association flat by the local council.[35]
  • According to Private Eye, there has been one documented suicide.[2]
gollark: What game is this‽
gollark: Er, oxygen, not hydrogen.
gollark: The electrolytic separators providing hydrogen for the TNT production part were misplaced, so I had to reshuffle that entire component.
gollark: Well, yes, I had to partly tear it down and rebuild it too.
gollark: It's not *needed*, but it's *cool*.

References
  1. Prodger, Matt (8 July 2013). "Bug found in Post Office row computer system". BBC News. Retrieved 29 March 2015.
  2. "How to suppress a scandal, Pt 94," Private Eye, issue 1388 - Archived page Original
  3. Jee, Charlotte (3 February 2015). "Post Office obstructing Horizon probe, investigator claims". Computerworld UK. Computerworld UK. Retrieved 29 March 2015.
  4. Flinders, Karl (11 March 2015). "Post Office ends working group for IT system investigation day before potentially damaging report". Computer Weekly. Retrieved 29 March 2015.
  5. "Post Office Limited Horizon System". WhatDoTheyKnow. 31 May 2011. Retrieved 29 March 2015.
  6. "Pathway and the Post Office: the lessons learned". Computer Weekly. Retrieved 29 March 2015.
  7. Glick, Bryan (11 December 2019). "Vilified then vindicated - victory for subpostmasters in Post Office trial shows risk of tech hubris - Computer Weekly Editor's Blog". Computer Weekly. Retrieved 9 February 2020.
  8. Thomson, Rebecca (11 May 2009). "Bankruptcy, prosecution and disrupted livelihoods - Postmasters tell their story". Computer Weekly. Retrieved 9 February 2020.
  9. Glass, Katie. "Victims of the Post Office's sub-postmaster scandal on their decade of hell". Archived from the original on 9 February 2020. Retrieved 9 February 2020.
  10. Thomson, Rebecca (28 September 2009). "Post-masters form action group after accounts shortfall". Computer Weekly. Retrieved 9 February 2020.
  11. "Post Office IT system criticised in report". BBC News. 9 September 2014. Retrieved 29 March 2015.
  12. Nguyen, Anh (10 September 2014). "Some Post Office Horizon IT was 'unfit for purpose', investigators say". Computerworld UK. Computerworld UK. Retrieved 29 March 2015.
  13. Flinders, Karl (26 November 2019). "Peer calls for clear-out of Post Office board after Court of Appeal confirms major court defeat". Computer Weekly. Retrieved 9 February 2020.
  14. Prodger, Matt (9 December 2014). "MPs attack Post Office sub-postmaster mediation scheme". BBC News. Retrieved 29 September 2015.
  15. "Post Office Mediation scheme and the Horizon IT system". UK parliament. 3 February 2015. Retrieved 8 June 2020.
  16. "IT system working, says Post Office". Express & Star. 10 March 2015. Retrieved 29 March 2015.
  17. Case No: HQ16X01238, HQ17X02637 and HQ17X04248
  18. Sawer, P. (11 December 2019). "Post Office agrees to pay subpostmasters £58m compensation over false accusations of theft". The Telegraph. Retrieved 12 December 2019.
  19. "Judgment (No.6) "Horizon Issues" (Bates & Ors v Post Office Ltd)" (PDF). Judiciary.uk. 16 December 2019.
  20. Gompertz, S (11 December 2019). "Victory against Post Office one of the best days of my life: Analysis". BBC News. Retrieved 12 December 2019.
  21. "CCRC to refer 39 Post Office cases on abuse of process argument". 26 March 2020. Retrieved 7 June 2020.
  22. "The CCRC refers eight more Post Office cases for appeal – bringing total to 47 so far". 3 June 2020. Retrieved 7 June 2020.
  23. Corfield, Gareth (18 December 2019). "Post Office faces potential criminal probe over Fujitsu IT system's accounting failures". The Register. Retrieved 19 December 2019.
  24. Slingo, Jemma (16 December 2019). "Post Office IT contractor faces prosecution after judge's 'grave concerns' about evidence". Law Gazette. Retrieved 19 December 2019.
  25. Slingo, Jemma (16 December 2019). "Post Office 'attacked and disparaged' sub postmasters, judge finds". Law Gazette. Retrieved 19 December 2019.
  26. "Post Office workers win High Court ruling over faulty IT system that left them bankrupt and in prison". The Independent. 16 December 2019. Retrieved 19 December 2019.
  27. Flinders, Karl (26 November 2019). "Peer calls for clear-out of Post Office board after Court of Appeal confirms major court defeat". Computer Weekly. Retrieved 9 February 2020.
  28. "Business, Energy and Industrial Strategy Committee - 10 March 2020". Parliament Live. 10 March 2020. Retrieved 15 March 2020.
  29. Corfield, Gareth (10 March 2020). "Post Office burned £100m in UK taxpayer cash on Horizon IT scandal legal fees, MPs told". www.theregister.co.uk. Retrieved 15 March 2020.
  30. Flinders, Karl. "Boris Johnson commits to 'getting to the bottom of' Post Office Horizon IT scandal". Computer Weekly. Retrieved 20 March 2020.
  31. "Horizon Settlement: Future Governance of Post Office Ltd - Hansard". hansard.parliament.uk. Retrieved 8 April 2020.
  32. "Business Update :Written statement - HCWS280". UK parliament. 10 June 2020. Retrieved 13 June 2020.
  33. Hodge, Neil (7 March 2017). "U.K. Post Office faces group litigation order over IT flaw". Compliance Week. Retrieved 9 February 2020.
  34. "The scandal that rocked a village Post Office". BBC Radio 4. 25 May 2020.
  35. Plimmer, Gill; Bounds, Andrew (12 December 2015). "Dream turns to nightmare for post office couple in fraud ordeal". Financial Times. Retrieved 29 March 2015.
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