1 Thursday, 23 May 2024 2 (9.44 am) 3 PAULA ANNE VENNELLS (continued) 4 Questioned by MR BEER (continued) 5 SIR WYN WILLIAMS: Yes, Mr Beer? 6 MR BEER: Thank you, sir. Good morning, Ms Vennells. 7 A. Good morning, Mr Beer. 8 Q. Yesterday, aside from the seven general topics that 9 I dealt with in the morning, we addressed two issues of 10 substance: one was the complaints made by subpostmasters 11 and others about bugs, errors and defects; and then, 12 secondly, we looked at remote access in the afternoon. 13 A. Mm-hm. 14 Q. Can I turn to my third topic of substance then, which is 15 the Second Sight investigation and the Complaint and 16 Mediation Scheme. 17 A. Okay. 18 Q. I'd like first to look at the process by which Second 19 Sight were chosen, and Deloitte were not, to conduct 20 an investigation. Can we look, please, at POL00180209. 21 It will come up on the screen for you. If we look at 22 the foot of the page there's an email of Simon Baker -- 23 you're not on this chain -- to Susan Crichton and Lesley 24 Sewell of 6 June 2012, and he says: 25 "Susan, Lesley 1 1 "Attached is Ron's proposal. 2 "My view is we make it clear to Alice/Paula the 3 distinction between the work Ron is proposing 4 (an independent review of past cases) and the Horizon 5 Forensic Audit (the Deloitte proposal) and put it on the 6 agenda to discuss tomorrow", which would be 7 June. 7 At this stage, were you aware that there were two 8 contenders for the undertaking of some form of 9 investigation, review, or audit? 10 A. From the documentation I can see that's the case. 11 I couldn't recall it at the time and I think I say in my 12 statement that the Deloitte work, which was named 13 Project Spire, was not something I remembered but I can 14 see there were those two alternatives being discussed. 15 Q. Can you remember the distinction between them, ie what 16 was proposed to be done by Second Sight and what was to 17 be done by Deloitte? 18 A. No, I can't recall the distinction but I can see it from 19 what was being said here, and I don't know, to be 20 honest, how much I remembered that -- how much 21 I understood that distinction at the time. Looking at 22 the documents, they're clearly very different, the 23 Project Spire document is a forensic investigation of 24 the Horizon system -- 25 Q. Sorry to interrupt, by forensic investigation of the 2 1 Horizon system, is that captured by these words here, 2 "forensic audit"? 3 A. Yes, and I've just read that, and I've used "forensic" 4 because I've just seen it on there. I would have said 5 a detailed investigation of the Horizon system. 6 My concern at the time, my priority at the time, was 7 to choose an organisation whom I felt would relate best 8 with the subpostmasters who had been raising their 9 claims. 10 Q. As it's described here, the work that Second Sight were 11 proposing, by contrast, was a review of past cases? 12 A. Yes. 13 Q. Okay. Can we see what happened then, please. 14 POL00233736. Now, this is a timeline that has been 15 prepared after the event of the events which led to, and 16 happened in, the course of the Mediation Scheme. But 17 it's the best and only record, I think, we've got of 18 what happened on 7 June, the day following the email 19 that I've just read to you. 20 A. Right. 21 Q. Can we look, please, at page 3. Do you see, in the box 22 that's at the bottom of the screen there, it's recorded 23 that, on 7 June 2012, a meeting is held between you, 24 Alice Perkins, Susan Crichton, Alwen Lyons and Simon 25 Baker where the Deloitte and Second Sight proposals are 3 1 discussed -- 2 A. Yes. 3 Q. -- and Second Sight was chosen as the preferred 4 supplier? 5 A. Yeah. 6 Q. Why was Second Sight proposal preferred to that of 7 Deloitte? 8 A. I think, because of what I've just said earlier, from my 9 own -- my own recollection is that I felt very strongly 10 that we needed an organisation who would be able to work 11 well with subpostmasters. I was concerned that any one 12 of the Big Four, Deloitte being one of them, may have 13 come across too corporate and wouldn't necessarily have 14 had the understanding of running a Post Office and small 15 retail businesses. 16 I don't recall, which is why -- sorry, let me finish 17 what I was saying. I don't recall looking at the 18 proposals in detail at the meeting. 19 Q. That's what I was going to ask. 20 A. Right. 21 Q. Rather than which might be preferred by 22 subpostmasters -- 23 A. Yes. 24 Q. -- how it might look, going to one of the Big Four; was 25 the substance of what each organisation was going to do 4 1 a relevant consideration? 2 A. I don't recall that. I don't -- and the reason I feel 3 sure about that recollection is that when, in preparing 4 for today, I looked at what was called the Project Spire 5 document, I was quite surprised about the detail in it, 6 and one of my reflections now is that, actually, that 7 would have been a very good piece of work to have done 8 because it may have brought more data to the fore than 9 we knew. 10 Q. That's a question that I'm going to turn to in a moment. 11 A. Sorry. 12 Q. Is the short point that the Second Sight review was much 13 narrower in scope, in that it was proposed that the 14 system should be reviewed by looking at a sample of past 15 cases -- 16 A. Yes, I believe that's the case. 17 Q. -- rather than auditing the Horizon system as a whole? 18 A. Absolutely the case, in terms of my view today. I don't 19 believe we went through that particular angle of 20 discussion in the meeting. 21 Q. Is that right? What would you say to the suggestion 22 that a deliberate choice was made to pick a proposal 23 that was much narrower in scope, that only looked at 24 a sample of past cases, rather than auditing the Horizon 25 system as a whole? 5 1 A. Oh, well, from a personal point of view, I'd say that 2 was absolutely not the case. I have no recollection of 3 that at all. 4 Q. You agree, I think, cutting to the chase, that it would 5 have been preferable, looking back now, had Deloitte 6 been chosen, because their proposal may or even would 7 have brought to the surface, if carried through to its 8 conclusion, many of the issues that were subsequently 9 discovered? 10 A. I think the operative word is "may". I have reflected 11 on that, whether Deloitte would in fact have surfaced 12 some of the other important areas that Second Sight did, 13 I don't know, because I think one of the other outcomes 14 of this has been the right decision -- was looking at 15 the contract, and that may not have surfaced through the 16 Deloitte work, which was particularly focused on the 17 system itself. 18 Q. Can we look, please, at the terms of reference or at 19 least an early copy of the terms of reference that were 20 settled for Second Sight, POL00096576. If we just blow 21 that up, please, you'll see that this is a Second Sight 22 document and it is a: 23 "Proposal to carry out an Independent Review of past 24 fraud and theft cases in order to determine whether the 25 facts support the business's findings and the charges 6 1 bought against individuals." 2 Then if we go to the detail on page 5, please. Can 3 you see that the proposal is for a case review and "This 4 case review will include the following tasks", said 5 Second Sight: 6 "[Selecting] a representative sample of cases that 7 have led to prosecutions/court appointed restitution. 8 The sample needs to cover cases: 9 "Where defendants claim they didn't take any cash; 10 "Where assertions have been made that 'The system' 11 (ie Horizon) caused the shortage (include old and new 12 versions of Horizon if possible) [and] 13 "Which have been taken up by MPs." 14 If you look at the second to last bullet point: 15 "Study and selectively test the 'Horizon' system in 16 order to find any 'Black Hole', Program Bug, etc, that 17 might have caused mysterious shortages." 18 What's described there, selecting a representative 19 sample of cases that led to prosecutions or 20 court-appointed restitutions and then study and 21 selectively test the Horizon system in order to find 22 bugs, for shorthand, that may have caused mysterious 23 shortages, was exactly what was needed, wasn't it? 24 A. Yes. 25 Q. It didn't happen though, did it? 7 1 A. The work that Second Sight -- well, the Post Office and 2 Second Sight -- did over this quite a long period of 3 time didn't come to a final conclusion, no. 4 Q. It didn't, and we're not talking about the Mediation 5 Scheme yet -- 6 A. Right. 7 Q. -- because that was a second piece of work, essentially; 8 we're talking about the events that led to the Interim 9 Report in July 2013, that's what this proposal is about. 10 A representative sample of cases that led to 11 prosecutions was not selected, was it? 12 A. I don't recall the cases that were selected. Looking at 13 this today, I don't recall the narrow focus on 14 prosecution and court-appointed restitution. My 15 recollection is that we were looking at a broad sample 16 of cases, of which some were cases with criminal 17 convictions. I thought it was broader than that. 18 I don't recall it as being that narrow. 19 Q. We'll see how things got changed by the Post Office -- 20 A. Right, okay. 21 Q. -- in the events which happened, ie over time. Would 22 you agree that, if what is described here, in those two 23 bullet points that I have identified, had, in fact, been 24 undertaken, again, there is -- to use the "may" word -- 25 a possibility that the decade that followed, until 8 1 faults in Horizon and the miscarriages of justice 2 identified by the Court of Appeal, may have been 3 discovered earlier? 4 A. I think that is a possibility. I saw, in the Inquiry 5 documentation, that there is a piece of advice that 6 Susan Crichton sought from Richard Morgan QC, where he 7 said that he thought -- that the advice was that the 8 Post Office really shouldn't get into this at all 9 because it would be a no-win situation. 10 Q. It would open the floodgates? 11 A. It would open the -- well, I think he made two 12 conclusions, from memory. That was one and I can't 13 remember what the other one was but my reflection, as 14 I read this recently, was that, first of all, I didn't 15 know that she had taken that advice and it came up 16 later, a year later, when she and I had a conversation 17 about her wanting to leave the business, and I suspect 18 we may come on to that. But when I look at that advice 19 now, I think it is a great pity that we didn't know 20 about that because we may have approached this 21 differently. 22 Q. Can you explain why, ie had you -- and I think you mean 23 the Executive and the Board -- 24 A. Yes, yes. 25 Q. -- known about Richard Morgan's advice, you may have 9 1 approached things differently in what way? 2 A. In that we may well have focused completely separate -- 3 understanding the advice he gave that we may have 4 focused very differently on the -- what we called in 5 shorthand the "criminal cases" because that needed -- 6 they needed to be reviewed differently to others that 7 were not criminal cases, and what we ended up with was 8 a scheme that tried to respond to a variety of different 9 cases and themes. 10 Q. Let's look at what the Post Office did in relation, in 11 particular, to criminal cases. That document can come 12 down, please. 13 Turn to a couple of days after the meeting of 14 7 June, to 9 June, POL00096606. 15 If you forgive me one moment. 16 If we look at the foot of the page, please. There 17 is an email from Alice Perkins of 9 June, at 9.36, to 18 you, and she says: 19 "Following a conversation with Alwen yesterday, and 20 given that I am away now for a few days, I thought 21 I should let you know before I went where I stand on 22 which cases should be in or out of this review. 23 "I have given this more thought since yesterday. 24 "I am clear that we should include ALL the MPs' 25 cases, irrespective of whether they have been decided in 10 1 court. If we try to draw a distinction here we will be 2 accused of picking cases to suit ourselves and being 3 vulnerable on the ones we omit. We'll have a row about 4 that instead of moving the issue on. 5 "On reflection, I don't buy the argument that we 6 would somehow undermine the court process by doing this. 7 There are plenty of ways in which people can go over 8 ground which has been settled in court, and if there 9 weren't, no one would ever be able to get a conviction 10 overturned. And if (which we don't believe) there were 11 new evidence in a case which had been decided, we would 12 want to do, and be seen to do, the right thing by that." 13 Then, if we scroll up the page we see you replying 14 in the bottom part of the page, which I think is about 15 admin, essentially, and then -- 16 A. I think it says I wasn't part of the discussion, doesn't 17 it? 18 Q. Yes. 19 A. Yes. 20 Q. Then if we go a little bit further up, Alwen replies to 21 you, and I think to you alone: 22 "Paula in case Susan doesn't pick this up as she is 23 in Berlin and before you speak to Alice. The issue that 24 came to light with the list of MP cases was that they 25 included the Mishra ..." 11 1 I think that's Seema Misra. 2 A. Yes. 3 Q. "... you will remember the case and the publicity she 4 went to prison and had her baby whilst in there. The 5 husband got publicity through radio and press. Susan's 6 anxiety and she raised this at the meeting with Alice 7 before you joined was whether now contacting her to tell 8 her we review the case would be a red rag to a bull. 9 "Alice feels this is the business pushing back 10 unnecessarily and she feels this has happened throughout 11 the process and she is having to keep pushing us! 12 "Susan is getting external advice on the effect 13 [that] this would have on cases which have been 14 [brought] through the courts." 15 There's quite a lot in there. Did you agree with 16 Alice Perkins that all cases should be included in the 17 independent review, even if they involved criminal 18 convictions? 19 A. Yes, I wasn't making any distinction. 20 Q. Did you agree with Alice Perkins that the business was 21 pushing back unnecessarily against that? 22 A. I don't think I knew that and so I -- the bit of admin 23 that we skipped over is I say that I'll call Alice, 24 which I did, and I think she explained to me the 25 conversation that she had had and, from what I've seen 12 1 in documentation, clearly, there was an awful lot of 2 consideration going on about what should and shouldn't 3 happen, which I was not in the loop on. 4 Q. Who would be the business that was pushing back 5 unnecessarily against the Chair? 6 A. Well, the only thing that I can think is relating back 7 to this piece of advice that Susan sought from Richard 8 Morgan, which was very clear advice to her and one 9 assumes that she would have -- she was in a -- she 10 discussed it in a meeting and one assumes that that must 11 have alerted to her to maybe needing to take different 12 approaches with cases like Mrs Misra's, for instance, 13 but I wasn't involved in those conversations. 14 And I'm not sure -- there is a further pushback -- 15 I can't remember if it is before this or after -- where 16 the terms of reference which are prepared by, again, 17 I think Susan, refer to defence documents and Alice 18 comes back and says "No, it should be all of the 19 documentation". 20 Q. So the business here "pushing back unnecessarily", you 21 take to mean shorthand for Susan Crichton? 22 A. For the Legal Team, yes, I think it was Susan Crichton 23 and Hugh Flemington who were at the meeting. 24 Q. It says that this has happened, or it is Alice's view 25 that this has happened, throughout the process. Was 13 1 that a view that you were aware of: that the business 2 was pushing back unnecessarily against a review 3 throughout the process? 4 A. Not until I spoke to Alice, which I did, I think, on the 5 Saturday morning. I was concerned and so, you know, if 6 a Chairman raises issues like this, I wanted to know 7 what had arisen. 8 Q. Did you think that Mrs Misra's case should be included 9 in an independent review? 10 A. I wasn't even involved in the conversation about that. 11 My view was that all the cases that had come forward 12 through Lord Arbuthnot and then -- and thereafter from 13 other MPs, we were going to review all of the cases. 14 Q. Did you share Ms Crichton's concerns recorded here that 15 even contacting Ms Misra -- 16 A. No. 17 Q. -- would be a red bag to a bull? 18 A. No. 19 Q. Did you know that Post Office was getting external 20 advice on the effect that bringing such cases within the 21 review would have? 22 A. Well, clearly I did, in sense that Alwen mentions it in 23 the final line on this email. I don't, at that stage, 24 think I would have asked more about it, because the 25 situation was resolved, in that all of the cases were 14 1 going to come in. If Susan was seeking advice on 2 something of a legal nature, (a) I would expect her to 3 do that and then I would listen to whatever that advice 4 was. 5 Q. Do you know what external advice the Post Office did 6 take regarding the effect of including cases like Seema 7 Misra's in the independent review? 8 A. I don't think so. I certainly didn't see the Richard 9 Morgan advice. 10 Q. I don't think there was a written advice; there was 11 a meeting with him. 12 A. There was a meeting note, right. I don't think I did, 13 no. 14 SIR WYN WILLIAMS: Have you got a date readily to hand to 15 remind me of when that was, Mr Beer? 16 MR BEER: Given a moment I probably could. 17 SIR WYN WILLIAMS: I'm sure we'll find it between us, don't 18 take yourself out of your stride. 19 MR BEER: Thank you. 20 Did you know the substance of the advice, the 21 external advice that was given? 22 A. No, no, not until I read it in preparation for the 23 Inquiry. 24 Q. Did you, and therefore the Board, take the -- not take 25 the advice given, as you now know, by Richard Morgan KC, 15 1 into account, in deciding the scope of Second Sight's 2 review? 3 A. No, I don't believe -- you would have to ask Alice 4 Perkins but I don't believe that Alice Perkins or the 5 Board knew of that advice. But Susan had had 6 a conversation with Alice that I was not involved in, so 7 it's possible it was shared in that meeting, but I -- my 8 understanding is not. 9 Q. Thank you. 10 Can we move on into 2013, please, and look at 11 POL00100200. This is a minute, I think, from, as we can 12 see, David Oliver to you, copied to others, of 13 5 February 2013. Can you explain who David Oliver was, 14 please? 15 A. David Oliver I believe was on a short-term contract -- 16 maybe a year or two -- he was either a consultant with 17 PA Consulting or had left them and came to the Post 18 Office and was working on the Project Sparrow work. In 19 fact, looking at the list -- what date is this, please? 20 Q. 5 February 2013? 21 A. 2013. No, I -- no, he was a -- working on the Sparrow 22 project. 23 Q. He sends this minute to you and others, regarding, 24 essentially, options that the Post Office could take to 25 deliver the scheme in a timely fashion. You can see 16 1 that there -- 2 A. Yes. 3 Q. -- under "Summary": 4 "We identified three broad courses of action that 5 might be taken to improve the ability of Post Office to 6 successfully deliver the Mediation Scheme in a timely 7 fashion ..." 8 Can we look at page 2, please, and scroll down to 9 what was the third option, "Plan C": 10 "Contingency plan to replace Second Sight if they 11 refuse to work on the Scheme under Terms which Post 12 Office find acceptable. 13 "Engagement of a professional accountancy firm such 14 as Grant Thornton to replace Second Sight entirely. It 15 is possible that Second Sight will refuse to work under 16 the proposed terms of engagement from Post Office and 17 that they may attempt to insist terms that neither you 18 or the Board can accept. In this scenario, they may 19 either walk away from the Scheme or Post Office may have 20 to end their engagement." 21 Was it the case that, despite their appointment in 22 mid-2012, no terms of reference or terms of engagement 23 had been settled by February 2013 for Second Sight? 24 A. I don't know about terms of engagement. I do know that 25 terms of reference were drawn up. Engagement, I don't 17 1 know. That wouldn't have been something that I had been 2 involved -- I would have been involved in. 3 Q. By this time, was it anticipated that Second Sight would 4 refuse to work under the terms of engagement that the 5 Post Office required? 6 A. It seems to say so here. I don't recall being aware of 7 that, presumably, until this was presented to me and I'm 8 not entirely sure what that refers to. 9 Q. Do you know which of these options was chosen? Do you 10 want to look back at option A and B, please -- 11 A. Yes, yes. 12 Q. -- on page 1, please. A was clarification of Second 13 Sight's engagement. 14 A. Yes. I think A and B, actually. My recollection at 15 this stage is that there were concerns from the team 16 that very few cases had been reviewed. We were -- the 17 time was being extended and, therefore, the cost 18 extended and I think that was the main concern: is that 19 the work, for whatever reason, wasn't being completed 20 and I was given a number of options. I'm sorry, I don't 21 remember the discussion, but my sense is that it was -- 22 we wanted Second Sight to see this work through. It 23 would have been difficult to stand somebody else up, 24 I think, and, anyway, they had the commitment of Lord 25 Arbuthnot and the MPs. 18 1 But I do think we brought in or changed the way they 2 worked in some way to help them but I may be confusing 3 that with the Mediation Scheme because this issue of 4 time and cost overrun was a fairly frequent topic of 5 conversation. 6 Q. Can we move forward to later in 2013, still before their 7 Interim Report was produced, by looking at POL00098437 8 and looking at page 2, please. If we just look at the 9 foot of page 1, we'll see an email from Mr Bates to you 10 of 21 May 2013, and he says: 11 "Hello Paula. 12 "It has been a while since we met at James 13 Arbuthnot's office, but at that time you did say that if 14 I had any concerns I should contact you directly, hence 15 the reason for this email. 16 "Would it be possible for Kay Linnell and I to meet 17 you? You will recall that Kay is an independent 18 forensic accountant who, on behalf of JFSA, has been 19 monitoring the work that Second Sight has been 20 undertaking. 21 "The main purpose of the meeting is to ensure that 22 you have been receiving the full details of what has 23 been occurring with the Second Sight investigation. 24 Bearing in mind what has been discovered so far, I for 25 one am surprised that we haven't yet met to discuss the 19 1 implications. Whilst I appreciate that the majority of 2 the issues began under previous regimes and you have 3 expressed a genuine willingness to address the concerns 4 that JFSA has been raising, these issues are still 5 continuing. I have little doubt it is now feasible to 6 show that many of the prosecutions that [the Post 7 Office] has pressed home should never have taken place, 8 I believe this is a view shared by Kay." 9 At this point in time, did you understand why 10 Mr Bates was saying that it was feasible that many 11 prosecutions that the Post Office had undertaken should 12 never have taken place? 13 A. I don't believe I did because we were still -- the work 14 was still very much a work in progress. 15 Q. Had any of the 'in progress' work been fed back to you, 16 ie provisional views, what it was showing, early themes, 17 emerging issues? 18 A. Not that I can recall with any clarity, because 19 I remember being surprised about -- I think, slightly -- 20 what is the date of this, please? 21 Q. 21 May. 22 A. May. Maybe not too long after this but, as we were 23 approaching the production of the Interim Report, 24 I remember being surprised about some of the conclusions 25 that were being reached because the criticisms from Post 20 1 Office were that their work hadn't been taken into 2 account. So I think, at this stage, possibly not, other 3 than feedback that the work was going too slowly and 4 Post Office's input either hadn't taken place or Second 5 Sight -- there were concerns being raised, perhaps, that 6 Second Sight were not taking account of it. 7 Q. Would you have been very concerned, reading an email 8 like this, that the person representing a key 9 stakeholder, JFSA, was saying that the prosecutions, and 10 many of them that the Post Office had brought, ought 11 never to have taken place? 12 A. I was concerned to get the email from Alan, certainly. 13 The point he's making about the prosecutions was the 14 point that the JFSA had made for, I now know, for 15 a number of years but that wasn't new news to me at this 16 stage. 17 Q. Is that how you would have thought of it: that this is 18 just Mr Bates saying something that he's always said? 19 A. No, not at all. I think that I went back to my team and 20 said -- because I had said to Mr Bates that, you know, 21 if he needed to, he should get in touch. So I don't 22 know if there's documentation on this but I'm pretty 23 sure I went back to the team and said, "What should we 24 do about this? You know, I've offered to meet Mr Bates, 25 what is your view?" 21 1 Q. Had you been given any inkling that anything had emerged 2 that might undermine the safety of convictions? 3 A. No. 4 Q. If we go to page 1, please, we'll see your reply. If we 5 scroll up, you say, second paragraph: 6 "I am happy to meet ... but cannot make [the] 7 suggested date ..." 8 Then the third paragraph: 9 "My understanding is we are too early in the 10 investigation to suggest that things have been 11 discovered which call into question the integrity of the 12 system or the validity of [the] prosecutions, and to 13 suggest that at this stage would be wrong." 14 In order to say that, you must have been told, would 15 this be right, the stage at which the investigation had 16 reached and whether it was possible to say that the 17 integrity of the system or the validity of prosecutions 18 had, even at that stage, been called into question? 19 A. Yes. 20 Q. Who were you getting that feedback from? 21 A. At this stage, I would have talked to whoever was 22 leading the work on this, so Susan Crichton, Alwen 23 Lyons -- I can't remember who else -- Simon Baker, 24 presumably David Oliver, whose name we've seen. 25 Q. So were you then getting feedback on the state of the 22 1 investigation by Second Sight, in order to be able to 2 say, essentially, "Mr Bates, you're jumping the gun"? 3 A. I'm almost certain that when I got Alan's note that 4 I went to the team and said, "I've had this note, what's 5 the current status?", and, as I say here, "I would like 6 to meet with Mr Bates". So I suspect that's where I got 7 that information from. 8 Q. You say in the last paragraph: 9 "I have been advised that Second Sight have now 10 agreed that the focus over the next few weeks will be on 11 three specific cases ... and the meeting [might be 12 a] more productive [one] once that work has been 13 completed ..." 14 Do you know how it came about that what started as 15 a debate between the choice of Deloitte conducting 16 a full forensic audit of Horizon, Second Sight 17 conducting a review of past cases that would be 18 a representative sample, but include some testing of the 19 integrity of the Horizon system, ended up with focusing 20 on three cases? 21 A. My recollection is that the team -- what I can recall is 22 frustration from the team that the work Second Sight was 23 doing had moved away from focusing on individual cases 24 to development of themes and what they were trying to do 25 at this stage -- and Second Sight, as well, to be 23 1 fair -- was to try and corral this back into a piece of 2 work, which could have a report which could be fed back 3 to the MPs, before we got to recess, in just number 4 of -- small number of weeks after this. That was my 5 recollection and that was a -- to misuse a word in this 6 context -- that was a theme that ran through, which was 7 that Second Sight were focusing on themes, rather than 8 on individual cases and, at some stage, we will come on 9 to how that then developed into spot reviews, which 10 I think came after this. 11 Q. So was it the Post Office, in your view, or Second Sight 12 that narrowed focus down to a very small number of 13 cases? 14 A. My view is it was both because both Second Sight and the 15 Post Office had a commitment to Lord Arbuthnot and the 16 MPs to get some work out for people to look at, and we 17 were now very -- not quite a year but sort of ten months 18 into this. That's my recollection. 19 Q. Were you aware of a view amongst the lawyers and, in 20 particular, Susan Crichton, that "if we review a large 21 number of cases, that might open the floodgates to 22 damages claims by subpostmasters" -- 23 A. No. 24 Q. -- and that a less risky approach would be to just pick 25 the cases in which the MPs happen to be interested in? 24 1 A. No, I don't remember that at all. 2 Q. Can we go to the -- this slightly out of order but it's 3 in order to answer the Chairman's question from 4 earlier -- Richard Morgan KC advice. It's POL00006484. 5 The date says 12 June 2012. I think this is the 6 advice -- we'll see in a moment that it's recorded as 7 a note of an in-person conference -- of which you 8 weren't aware -- 9 A. That's right, yes. 10 Q. -- and, to the best of your knowledge, the Board was not 11 aware? 12 A. No, I don't believe so. The only possible -- the only 13 person who could possibly be aware might have been Alice 14 Perkins in that conversation Susan had had. But, 15 actually, looking at the date of this, I think this 16 comes afterwards, doesn't it? 17 Q. Yes. If we look at the second bullet point: 18 "The proposal to instruct an independent expert to 19 prepare a report on the ... system is the highest risk 20 response to the issue." 21 Was that view communicated to you? 22 A. No. 23 Q. In fact, a decision had been made, it seems, already, at 24 the meeting of 7 June 2012, not to instruct an expert to 25 prepare a report, a forensic audit of the Horizon 25 1 system, hadn't it? 2 A. The decision had been made to go -- in my head, to go 3 with Second Sight, for the right reasons. 4 Q. The note records "What will it achieve?", and I'm not 5 going to attribute any of these words to anyone because, 6 when he gave evidence, Mr Morgan took the point that 7 it's not clear that it's him speaking -- 8 A. Right. 9 Q. -- here and it doesn't necessarily represent his advice; 10 it could be anyone speaking: 11 "What will it achieve? It will not be able to 12 address any of the civil/criminal cases dealt with under 13 'Old Horizon'." 14 Was that advice communicated back to you, that 15 an independent report couldn't look at civil or criminal 16 cases dealt with under old Horizon? 17 A. No. 18 Q. "Will it seek to review particular cases? If so, which 19 ones?" 20 Then what might be said to be the important 21 paragraph is the third one: 22 "Whatever the findings of the expert report it will 23 not resolve the problem. [The Post Office] will be 24 'damned if they do and damned if they don't'. If the 25 findings are that there are no issues with Horizon 26 1 people will see that as a 'whitewash' ..." 2 Then this: 3 "... whereas if the findings are negative that will 4 open the floodgates to damages claims by 5 [subpostmasters] who were imprisoned for false 6 accounting and Access Legal [that's part of Shoosmiths] 7 will part to pursue ... the civil cases they are 8 currently sitting on." 9 Was that view communicated back to you as relevant 10 to decision making, "If we commission an independent 11 report, which comes back with negative conclusions, 12 people who have been imprisoned might bring claims 13 against us" -- 14 A. No, absolutely not. 15 Q. -- "and that that would be a reason not to commission 16 an independent report, because it might find out things 17 that entitle people to question their convictions or 18 bring damages claims against us"? 19 A. No, I didn't know about this. 20 Q. Did that ever form part of your decision making, "We 21 best not ask for the Deloitte report because, if it 22 discovers too much, we may face damages claims"? 23 A. No. 24 Q. To your knowledge, did that ever form part of any 25 discussion or decision making at Board level? 27 1 A. No, and, as I say, in the meeting where we took the 2 decision to go with Second Sight, I don't remember 3 looking at two separate sets of documents and comparing 4 and contrasting. 5 Q. The foot of the screen that's being displayed: 6 "A less risky approach is to agree to take the 7 relevant MPs privately through particular cases in which 8 they are interested." 9 Was that ever communicated back to you? 10 A. No. 11 Q. Thank you. Can we return to where we were in the 12 chronology, which was the following year, June 2013, by 13 looking at POL00098789. If we scroll down and look at 14 the message from Alwen Lyons, it's dated 28 June 2013. 15 We are getting quite close here to the date of the 16 production of the Second Sight Interim Report, aren't 17 we -- 18 A. Yes. 19 Q. -- which we know was published on 8 July 2013? 20 A. Yeah. 21 Q. It's quite difficult because of the way the text has 22 been printed on this email but, if you look at the 23 fourth bullet point, Ms Lyons says to you that she is 24 going to spend time with Janet; is that Janet Walker? 25 A. Yes. 28 1 Q. Remind us who Janet Walker was? 2 A. Janet Walker was the Executive Assistant for Lord 3 Arbuthnot. 4 Q. "... she says she can give me as long as it takes. My 5 approach will be to try to get to understand the status 6 of the review and the risk to [Lord Arbuthnot] and us of 7 an incomplete Interim Report. I will share the fact 8 that [Second Sight] are not using all the evidence they 9 are being given and our concern is that [their] approach 10 to try and keep everyone happy is not how we would 11 expect a forensic accountant to behave. I do think this 12 is the right place to share the 'bugs' we have found and 13 how we dealt with them, which is why the report from 14 Rod/Lesley checked by Legal and Mark is important. My 15 objective is to get Janet to a place where she also 16 wants the meeting to be cancelled." 17 Then, if we scroll up, please, we'll see your reply, 18 sending on to Alice Perkins, second paragraph: 19 "You will see below Alwen's proposed next steps. It 20 covers all the ground ... 21 "Alwen and I are staying close ... and I'm expecting 22 an update later this [afternoon]. So no need to bother 23 you today." 24 On what basis did you understand the Post Office had 25 determined that Second Sight were not using all of the 29 1 evidence that the Post Office had given them? 2 A. From conversations with the team involved in the work. 3 Q. Second Sight were getting it wrong, they were -- 4 A. No, I don't think -- 5 Q. -- not looking at the evidence? 6 A. I beg your pardon. No, I'm sorry, I didn't mean to cut 7 across you. No, I don't think that is what I was told. 8 What I was told is that they hadn't -- because this had 9 run on too long, they hadn't yet had time to take 10 account of the Post Office's view in the investigations 11 they were doing. That's my recollection of what I was 12 told, not because they were getting it wrong or -- 13 Q. Was there any -- 14 A. -- sorry, I beg your pardon, they may have been getting 15 it wrong because they hadn't yet taken account of the 16 input from the Post Office. 17 Q. Was there a suggestion in what you were told that Second 18 Sight were biased in their approach? 19 A. No, certainly not at this stage. My very clear 20 recollection is that this was simply, to describe it 21 more colloquially, the team felt it was unfair because 22 Post Office hadn't had the opportunity to contribute yet 23 into -- whether that was true or not, I didn't check 24 that with Second Sight but what I was told is that the 25 work was so far behind that Second Sight had yet to take 30 1 account of the Post Office's input. 2 Q. Was the sense of unfairness conveyed to you? 3 A. Frustration, I think. 4 Q. By who? 5 A. Alwen, certainly, was one of the main people I spoke to; 6 Susan; and, I think, David Oliver, but that's only -- 7 I'm only remember, by having seen his name today. 8 Q. What evidence were you told that the Post Office had 9 provided to Second Sight that they were not using or 10 taking account of? 11 A. I can't remember today, I'm sorry. They were looking at 12 number of cases, is my understanding, and these cases 13 raised different issues. So it would have been whatever 14 data the Post Office needed to present about the issue 15 that was being investigated. 16 Q. Were you told that Second Sight were trying to, in the 17 words of the email, keep everyone happy? 18 A. I was told that -- and I knew, I think, because we had 19 agreed to fund Kay Linnell to support the JFSA -- I was 20 told that they -- I think, if I've remembered the timing 21 correctly -- that they had been asked by Lord Arbuthnot 22 to keep the JFSA happy and I don't think we had any 23 problem with that, until the team began to raise these 24 questions that, perhaps, because of that, Second Sight 25 were not looking at the Post Office work. But I'm 31 1 probably now speculating too much, to be fair. 2 Q. Did you tell Second Sight that they were being unfair on 3 the Post Office by not taking account of the evidence 4 that the Post Office was giving to them? 5 A. I didn't have regular conversations with Second Sight. 6 I was running the organisation. I wasn't closely 7 involved in the detail of this work. I'm sure, if I -- 8 I'm not sure if I spoke to them at this time but I would 9 have had no problem sharing that piece of information. 10 Q. Did you tell Second Sight about the Post Office's 11 concerns about its approach or alleged approach of 12 keeping the JFSA happy? 13 A. I don't believe I spoke to Second Sight. 14 Q. Did anyone, to your knowledge, say, "You're not treating 15 us fairly, you're trying to keep the subpostmasters 16 happy and you're not looking at our evidence"? 17 A. I would hope that the Post Office team -- sorry, first 18 of all, I don't think the Post Office team would have 19 said, "You're trying to keep the subpostmasters happy", 20 I may be wrong on that, because that feels too strong 21 a view in one direction. This whole point was to look 22 at the subpostmasters' cases. But I think the team 23 would undoubtedly have said to Second Sight, "There is 24 more information here to be taken account of". 25 Q. Can we look a little more deeply at the move to select 32 1 a small number of cases by looking at POL00144687. This 2 is the previous month. If we look at page 2, please, 3 and scroll down, an email between Simon Baker and Second 4 Sight, with Alwen Lyons copied in, not you at this 5 stage, but it's about a meeting, and I think this is the 6 meeting that we've just seen Post Office was going to 7 try and get cancelled. 8 A. Right. 9 Q. "Ron 10 "Just to ensure that we're on the same page, Paula 11 would like to say we have agreed the following with 12 Second Sight, can you confirm you agree: 13 "The investigation reports on 2-3 MPs' cases by 14 Summer Recess (or more). 15 "By using the 2-3 cases you will answer the 16 question: have systemic defects in the Horizon system 17 resulted in the wrongful conviction or suspension of 18 subpostmasters." 19 By this stage, had the proposal that we saw, first 20 thing this morning, to examine a representative sample 21 of cases been abandoned? 22 A. Not on my understanding. 23 Q. How did it come about that, by late May, the Post Office 24 was proposing that, by looking at two to three cases, 25 Second Sight could answer the very big question: have 33 1 systemic defects in Horizon resulted in the wrongful 2 conviction or suspension of subpostmasters? 3 A. I'm not sure but, when the report was produced, as the 4 Inquiry knows, one of the conclusions was that, so far, 5 no systemic defects had been found. So whether, as 6 a result of the broader work -- so Second Sight had been 7 working -- 8 Q. Sorry, could you repeat that answer, please? 9 A. Yes. When the Second Sight Interim Report was 10 published, one of its initial conclusions was that, so 11 far, no systemic issues had been found with the Horizon 12 system. 13 Q. Just stopping there, that's two months after this. 14 A. Yes. But I'm getting to answer your question, if I may, 15 because, to have reached that conclusion, which, in 16 a sense, is what point 4 refers to here, referring back 17 to point 2, you couldn't reach that conclusion on two to 18 three cases, so how could you do it on two to three 19 cases? Because of the other work they had done. They 20 were working through different themes, as I understood 21 it, so potentially through that work. 22 Second Sight had been working on this for ten months 23 now, they hadn't just done two to three -- well, they 24 hadn't even done two to three cases in that period of 25 time. 34 1 Q. Why was the proposal to limit the report to determining 2 whether systemic defects in Horizon had resulted in 3 wrongful convictions on the basis of two or three cases? 4 A. I don't know. I wasn't involved in the conversation. 5 I believe, from other documentation I've seen, that the 6 recommendation was to choose two of the three -- I don't 7 think this was the word but "hardest" cases, so not 8 cases that would have present the Post Office in the 9 best light but cases which could have been used to 10 challenge the Horizon system, and then do that 11 work-through. There is some documentation on this 12 somewhere else. 13 Q. How could two or three cases possibly answer the 14 question: have systemic defects in Horizon generally 15 resulted in the wrongful conviction or suspension -- 16 A. They couldn't. They could not possibly do that, and 17 I wasn't involved in this conversation but, by this 18 stage, there was an urgency to have a report produced 19 that showed that some work was at least in progress, and 20 I -- 21 Q. You say you weren't involved in this conversation. This 22 email says you want to say this: 23 "... Paula would like to say the following ..." 24 A. Yes. 25 Q. Did you want to say that, "By looking at two or three 35 1 cases, we can answer the entire question of whether 2 systemic defects had resulted in the wrongful conviction 3 of subpostmasters"? 4 A. I was absolutely not, to be completely clear, trying to 5 drive a conclusion from Second Sight that they would not 6 have given -- I don't -- 7 Q. That's an answer to a different question. 8 A. No, I realise that but I don't recall the background -- 9 so I didn't write this email. I wasn't copied in this 10 email. I don't recall a conversation where 11 I consciously possible, because it wouldn't be 12 consciously possible, to come to a conclusion on 13 systemic defects as a result of two to three cases. 14 Q. Isn't that exactly what happened, Ms Vennells, that the 15 Second Sight Report addressed a very small number of 16 cases, it contained the sentence about "no systemic 17 defects" and then, forever after, the Post Office 18 paraded that conclusion? 19 A. It did come to that conclusion in its Interim Report. 20 There is no way that the Post Office -- first of all, 21 there is no way that I would have want to persuade 22 Second Sight on something they were not prepared to say 23 and I don't believe Second Sight would ever have agreed 24 to that. If they came to that conclusion in their 25 Interim Report, that was their conclusion. 36 1 Q. Isn't that what the Post Office wanted to drive them to, 2 and isn't this the evidence of such driving? 3 A. The Post Office most certainly wanted the reassurance 4 that the Horizon system could be relied upon. That has 5 been the objective all the way through this. At no 6 stage, did I get the sense that anybody in the Post 7 Office was going to be able to influence Second Sight 8 over what conclusions they came to. I would be very 9 surprised if that was the case here. 10 Q. Did you receive, or the Board receive, any advice as to 11 the appropriate scope of an investigation by Second 12 Sight, as to the nature and extent of any investigation 13 that would be required in order to determine whether 14 there were systemic defects in Horizon? 15 A. The only information I and the Board had was contained 16 in the terms of reference of the work that Second Sight 17 were doing, which is what we looked at earlier. 18 Q. Ie "We, the Post Office, need to engage somebody to 19 produce a report whose conclusions are respectable and 20 truly provide us with the answer as to whether or not 21 there are systemic defects in Horizon"? 22 A. Yes. 23 Q. You think that's the report they produced? 24 A. Second Sight's didn't produce the report that Project 25 Spire, under Deloitte, could have produced. Second 37 1 Sight responded to the terms of reference, which were 2 greet with them. This work was approached from the 3 point of view of trying to resolve postmaster cases. 4 That was the genesis of it, that was the initial 5 conversation with Lord Arbuthnot and Alice Perkins. 6 Q. Can we move forwards, please -- 7 SIR WYN WILLIAMS: Before we do, Mr Beer, can I just be 8 clear about what you are saying about this email, 9 Ms Vennells. 10 As I read it, it is a request by Mr Baker to 11 Mr Warmington that four matters are agreed, and it reads 12 as if he is making that request on your behalf, all 13 right? 14 A. Yes. 15 SIR WYN WILLIAMS: That's how it reads. 16 A. It does read that way. 17 SIR WYN WILLIAMS: So what is your evidence to me about 18 whether Mr Baker was accurately representing what you 19 had told him in this email? 20 A. Firstly, Sir Wyn, I don't recall the conversation with 21 Simon Baker -- 22 SIR WYN WILLIAMS: Right. 23 A. -- at all. I rarely met with Simon and, if I did, it 24 was usually with Susan or Alwen. But it sounds as 25 though, at some stage, a conversation was had and I may 38 1 have accepted that -- you could -- this email could have 2 been produced one of two ways, couldn't it, or multiple 3 ways. I could have said, "This is what I want", or he 4 could have said to me, "This is where we're at, we think 5 that actually we will get two to three MP cases done", 6 and I may well have said, "Will that help us answer the 7 question about are there systemic defects in the Horizon 8 system?" 9 I wouldn't have known, personally, from any of -- 10 because I wasn't involved in the work or conversations 11 with Second Sight, point 4 about whether they could have 12 said no or not, at this stage. So I can only assume 13 that has come from a conversation with Simon Baker 14 and/or somebody else. 15 SIR WYN WILLIAMS: Thank you. 16 MR BEER: Can we move forward couple of days to POL00098317. 17 This a briefing for you for the meeting that was 18 proposed to be held between you and James Arbuthnot on 19 23 May; can you see that? 20 A. Yes, yes. 21 Q. It says, under "Key Message": 22 "We are concerned that the investigation is 23 overrunning, that the findings will not be definitive 24 and there will be no satisfactory outcome to the 25 'Horizon question' -- for MPs or the Post Office. 39 1 "We would like to discuss ways to more clearly 2 define the scope so we get a definitive outcome within 3 reasonable timescales." 4 Then under the heading "Background": 5 "2.1. When the Post Office commissioned Second 6 Sight the expectation was that the investigation would 7 review a small number of MPs' cases (6 to 12 cases)." 8 Firstly, does that represent your recollection of 9 the Post Office's expectation when Second Sight were 10 being instructed? 11 A. I don't remember today but we were talking to Lord 12 Arbuthnot and, I think, two or three other MPs, so 13 that's entirely possible. 14 Q. Do you know why it was the Post Office's expectation 15 that a smallish number of cases, 6 to 12, would be the 16 limit of Second Sight's review? 17 A. Presumably because that was the number that was being 18 discussed at the time. 19 Q. Discussed by who? 20 A. With James Arbuthnot and the team working on it. 21 I don't recollect 6 to 12 cases, as a particular number, 22 because what I remember is that the number increased as 23 more MPs raised cases. 24 Q. You remember the Second Sight proposal that we looked 25 at. Its suggested scope of work was to review -- 40 1 A. Yes. 2 Q. -- a representative sample of cases in order to answer 3 the question of whether there had been wrongful 4 convictions. 5 A. Yes. 6 Q. Was that the Post Office's understanding, when it was 7 commissioning Second Sight, that that's the work it 8 would be undertaking? 9 A. If that is what was in the final terms of reference, 10 yes. 11 Q. The speaking note or briefing carries on: 12 "MPs have now submitted 29 cases and JFSA have 13 submitted about 20 cases. 14 "It is unlikely that the investigation, no matter 15 how London it runs, will conclude anything definitive; 16 as the remit has become blurred, different stakeholders 17 have different expectations, and the evidence is open to 18 interpretation." 19 Was that a view that you held at the time? 20 A. I didn't have a view on the work because I wasn't 21 closely associated with it. So I would take the view 22 that I was given by the experts who were doing the work 23 at the time. 24 Q. So you would subscribe to or be willing to repeat that 25 view expressed in 2.3? 41 1 A. Not necessarily. I mean, if I was given information 2 I would usually ask questions about it. I don't know 3 what I did with this brief at the time. 4 Q. The suggestion that any investigation would conclude 5 anything definitive, was that your understanding at all? 6 A. No, I don't think it was my understanding at all -- at 7 any time throughout this, and the Inquiry will see there 8 is further documentation where I have -- I'm exhorting 9 the Post Office and Second Sight to move through the 10 cases because I wanted the cases looked at. There was 11 at this time, actually, a potentially helpful issue, 12 a number of cases had come through, I think, from MPs 13 and there was some debate about whether there was 14 sufficient information and quality of information to be 15 able to do any work on them at all, and that was Second 16 Sight's view, they went back to those cases and in some 17 cases they couldn't produce information. So whether 18 that was part of this point, I don't know. 19 Q. Did the Post Office subsequently present Second Sight's 20 Interim Report as a definitive view that there were no 21 systemic errors or failures in Horizon? 22 A. The Post Office presented it sometimes definitively and 23 sometimes less so, yes. There are -- 24 Q. Do you know how that came about, given what is 25 recognised by this note at this stage? 42 1 A. No, I think what happened is that, when the Interim 2 Report was published, and it said it was an Interim 3 Report and so far it had found no systemic issues with 4 Horizon, that was reported sometimes in communications 5 saying "So far they had found none", and there is 6 documentation where I am asked about, or maybe I offered 7 the view that, actually, the qualification was "so far", 8 and there are other communications, which may simply be 9 inconsistency of communication, I don't know, which 10 simply says that they had found nothing systemic. 11 Q. Just above the heading "Proposal", 2.6: 12 "The investigation has been running for a year and 13 to date no evidence of systemic failures has been found. 14 "Proposal 15 "James Arbuthnot to request Second Sight to complete 16 the investigations on two to three MP cases -- selecting 17 the ones they feel best indicate systemic problems." 18 A. That was the point I was trying to make earlier. Thank 19 you. 20 Q. How would an individual case indicate systemic problems? 21 A. I don't know that I can answer that question. It 22 couldn't, could it? 23 Q. It's a bit tricky, isn't it? 24 A. It's very tricky, yes. 25 Q. This was a briefing to you of what you should say and 43 1 seek to achieve in a meeting with James Arbuthnot, yes? 2 A. Yes. 3 Q. Had you signed up to this idea, by this time at least, 4 then, that James Arbuthnot should be asked to persuade 5 Second Sight to wind their investigation up on two to 6 three cases and those two to three cases would answer 7 the question, "Have systemic defects resulted in the 8 wrongful conviction of subpostmasters?" 9 A. Could you ask the question again, please. I'm sorry. 10 Q. Yes. Had, by this stage, in readiness for the meeting 11 with James Arbuthnot on 23 May 2013, you signed up to 12 the idea that he would be asked to persuade Second Sight 13 or request Second Sight to wind their investigation up 14 on the basis of two to three MP cases, answering the 15 question "Have systemic defects in Horizon resulted in 16 the wrongful conviction of subpostmasters"? 17 A. I don't believe so because we had committed to a larger 18 number of cases. There were significantly more cases 19 now in -- I was going to say the scheme but we're not 20 yet into the scheme, but now in the project. This was 21 an Interim Report and I don't think there is any 22 evidence that I thought that was the case. My 23 understanding was that this -- we had made a commitment 24 to the MPs and, all of the way through this, I wanted 25 all of the cases looked at. 44 1 Q. We've seen now an email that attributes to you 2 a suggestion that you wanted to agree this with James 3 Arbuthnot, and a speaking note or a briefing note saying 4 the same thing. 5 A. It doesn't say that I -- I'm trying to wind the scheme 6 up, which I think was your question. 7 Q. Okay. They should focus on answering the question, 8 "Have systemic defects in Horizon result in the wrongful 9 conviction of subpostmasters by reference to two to 10 three cases?" 11 A. Yes, so -- 12 Q. Was that your view as to what should happen? 13 A. No. At no stage did I make the link that you have just 14 led me to make between these two to three cases and 15 being able to reach a view on the system, and being able 16 to complete the whole piece of work. This is what I was 17 very aware of, is that this was an interim review coming 18 up and that there were more cases to go through the 19 scheme. 20 Q. The link is made right here in this document, isn't it, 21 in paragraphs 3.1 and 3.2? 22 A. It is and, as I mentioned earlier, before the document 23 came up, my understanding was that, from the work Second 24 Sight had done, presumably around the thematic work, 25 where they had been looking at a number of cases, and 45 1 they're now being asked to take two or three cases, 2 which may or may not show whether subpostmasters had 3 been wrongfully convicted. 4 Q. Can we move forwards -- sorry. 5 A. I was not trying to close anything down. It's really 6 important that I say that. 7 Q. Can we move forwards, please, to closer to the 8 introduction of the Interim Report, POL00099003, 9 an email from Martin Edwards. Can you explain who 10 Mr Edwards was at this time, July '13? 11 A. Martin Edwards was my Chief of Staff. 12 Q. He emails you on 4 July with a draft for the Board. He 13 says: 14 "[Hopefully it is] not too long, but it's difficult 15 not to open some of these issues without providing 16 a reasonably full explanation." 17 So what follows, is this right, is a draft email 18 that you were to send to your Board? 19 A. Yes. 20 Q. Is that right? 21 A. Yes. 22 Q. Then beneath the dotted line, we see the draft email: 23 "I wanted to send you a brief email to update you on 24 where we are with the Second Sight investigation. 25 "We have been engaging closely with [Second Sight] 46 1 throughout the week to understand the position they 2 intend to take in the Interim Report and emphasise our 3 concern that their findings must be even handed and 4 grounded in the facts. In line with our discussion on 5 Monday's Board call, we understand they have not found 6 any evidence yet of systemic issues with the Horizon 7 system (and it should be noted that this is based on 8 a detailed review of their four 'best' cases in terms of 9 compelling evidence)." 10 So, by this time, I think you had drawn a link 11 between a review of a small number of cases, it's got up 12 to four, and whether there were systemic issues with 13 Horizon. 14 A. Yes, but I hadn't drawn that link. I think -- the way 15 I read this is that is what the team had understood from 16 Second Sight. 17 Q. What, Second Sight were prepared to say that there were 18 no systemic issues with Horizon, generally, on the basis 19 of looking at -- 20 A. Well -- 21 Q. -- four cases? 22 A. -- that appears to be the case but, as I've said, they 23 also were doing wider work by this stage. 24 Q. What was your understanding at this point of what 25 "systemic issues" meant? 47 1 A. I'm not sure, as I say in my statement, that I was able 2 to make an informed decision on that. Second Sight 3 themselves, I think, refer to it as something that might 4 have a broad impact across the post offices or across 5 the system, I can't remember, but you will have 6 a reference, and so -- 7 Q. Was there -- sorry. 8 A. -- sorry -- and so my assumption, if they felt they 9 could reach this conclusion from a small number of 10 cases, was that perhaps -- but this is my reflection 11 today, I don't think I had the reflection at the time -- 12 was that perhaps they had seen something in those cases 13 that could have occurred elsewhere but I'm really -- I'm 14 speculating to try and help answer the question that 15 I didn't ask at the time. 16 Q. Was there a shared understanding between you and the 17 Post Office Board as to what "systemic issues" meant? 18 A. I don't think the conversation ever happened. 19 Q. Was there a shared understanding between you and the 20 Post Office team that were leading on the work with 21 Second Sight -- 22 A. No. 23 Q. -- as to what "systemic issues" meant? 24 A. No. 25 Q. Was there any discussion over what "systemic issues" 48 1 meant? 2 A. I don't recall one, no. 3 MR BEER: Thank you. 4 Sir, it's 11.00. May we take a morning break until 5 11.15. 6 SIR WYN WILLIAMS: Yes. 7 MR BEER: Thank you. 8 (11.00 am) 9 (A short break) 10 (11.16 am) 11 MR BEER: Ms Vennells, can we turn, please, to some 12 documents that may provide some insight into your 13 approach and decision making in relation to the Post 14 Office's decision not to review all past convictions, in 15 the light of what was emerging from Second Sight. Can 16 we look, please, at POL00099056. 17 If we look at the bottom of page 1, please. If we 18 just look at the top of the page, I think we'll see who 19 this is sent to: Lesley Sewell, Martin Edwards, Mark 20 Davies, Alwen Lyons, Susan Crichton. 21 A. Mm-hm. 22 Q. Go back to the bottom of page 1, please: 23 "[Thanks] for your inputs today. Susan I need your 24 thoughts on the note below especially 1) and 2) please 25 and the questions at the end of the mail. 49 1 "I think we have the following which is a variant: 2 "1) a working party over the next three/four months. 3 This comprises [the Post Office] working collaboratively 4 with the JFSA and does three things ..." 5 Just stopping where we are at the moment, I think 6 you knew, is this right, of the likely content and 7 conclusions of the Interim Report, this is two days 8 before it was published, and you're now working out the 9 next steps? 10 A. I think that's right, yes. 11 Q. The working party: 12 "Firstly explores the [Second Sight's] (8) themes 13 for improvement (can we get less than 8?) and agrees how 14 they can be implemented. 15 "Secondly, looks at the remaining past cases with 16 the JFSA (and MPs if they wish) to see if either further 17 themes or new evidence emerge." 18 Then this: 19 "Thirdly, our external lawyers review all 20 prosecutions in the past 12/18 months since [the Post 21 Office] has been independent of [Royal Mail] in the 22 light of the [Second Sight] findings. The JFSA/[Post 23 Office] Working Group reviews the findings. (Why would 24 they not review all cases of false accounting, eg over 25 the last 5-10 years, especially where amounts have been 50 1 'small'? I assume 'large' amounts would be less likely 2 to get away with saying they were muddle-headed and not 3 helped? But could we review all? It's the false 4 accounting charge [James Arbuthnot] was most concerned 5 about.)" 6 Then if we scroll on, please, over the page. I'm 7 going to skip over 2 and 3 for the moment and look at 4: 8 "[Issuing] a statement that although the system has 9 been proved to have no systemic issues, and our 10 training, support processes and helplines have worked 11 for most of the 50,000-60,000 colleagues over the past 12 decade, we are nonetheless genuinely sorry that some of 13 our [subpostmasters] who were struggling did not feel we 14 offered them sufficient help and support when they 15 needed it. And that we are grateful to [the] JFSA and 16 [James Arbuthnot] for highlighting the issues. Many are 17 historic and already improved but we are always open to 18 new ways to improve how we do business to ensure the 19 [Post Office] stays as trusted and effective in its 20 communities as it ever was." 21 You say: 22 "... can we draft this into something I can send to 23 Alan Bates ..." 24 Yes? 25 A. Yes, yes. 51 1 Q. Last paragraph: 2 "Susan, would we ever ask the lawyers to consider 3 reviewing past prosecutions? Is that what we are 4 talking about in 1) above but simply not using the 5 terms? If not, why would it be different? Of our 500 6 prosecutions, how many are false accounting? (For 7 clarity these are open questions -- just want to know 8 the answers, not an indication that I want us to do 9 so.)" 10 Just going back to the first page, please, at the 11 foot, the point 3: 12 "... our external lawyers review all prosecutions in 13 the past 12/18 months ..." 14 Then you asked the question: 15 "Why would [the external lawyers] not review all 16 cases of false accounting over the last 5-10 years ..." 17 Why was the proposed review to be limited to 18 prosecutions in the last 12 to 18 months? 19 A. I don't remember and, if I might just add, in case 20 there's any confusion, the description "muddle-headed" 21 was one that Mr Bates had used. That wasn't a word -- 22 and I had picked that up. But, in terms of answering 23 your question specifically, I can't recall why 12 to 18 24 months. There was a question raised by the Board at 25 some stage as to -- 52 1 Q. These are your proposals, though? 2 A. No, I think this is -- I believe this is me pulling 3 together a number of suggestions that had come in over 4 a period of time from different colleagues. 5 Q. You have drawn them together -- 6 A. I have tried -- 7 Q. -- and said "We've got the following, which is the 8 variant", and you've said, "Can this be drawn up into 9 a document that can be sent to Alan Bates"? 10 A. Yes, and what I'm doing here, I think, is showing with 11 colleagues, have I -- the way I worked and they worked 12 in an iterative process, is have I understood what -- 13 you know, does this seem a sensible way forwards? 14 Q. So you were going to propose that the lawyers review all 15 prosecutions in the past 12 to 18 months? 16 A. No, I wasn't proposing that. I had been given that 17 information, I think, by somebody else. 18 Q. Okay, who had given you the information? 19 A. It could only have been Susan. 20 Q. Why were they proposing the past 12 to 18 months? 21 A. That I'm not sure, and what I was just trying to say is 22 that the Board had asked at some stage, but I'm not sure 23 if it is at this point, whether the company -- and this 24 also in Alice Perkins' statement -- had conducted any 25 prosecutions which had relied solely on Horizon because 53 1 there was a concern, clearly, because of the issues that 2 were being raised by Lord Arbuthnot, that the Board 3 didn't want to be taking prosecutions until the various 4 investigations had been seen through. 5 But I don't know whether that was anything to do 6 with this particular point. The person -- 7 Q. What -- 8 A. If I have collated this from -- information from 9 colleagues, that could only have come from Susan, 10 I think. 11 Q. You drew this up as a collection of what had been said 12 to you -- 13 A. Yes. 14 Q. -- or passed to you, and you were happy to put it 15 forward as a proposal, subject to the questions that you 16 asked. 17 A. Yes, I think we were trying to find a way through, 18 post-the Interim -- the Interim Report was about to be 19 published and we still had numbers of cases that needed 20 to be reviewed and we were trying to find -- and what 21 actually happens is this is moved on a couple more 22 stages -- was a solution that would get us through the 23 other cases that would work for the JFSA. 24 Q. So what was the logic of the proposal to review 25 prosecutions in the past 12 to 18 months? 54 1 A. I'm afraid I can't remember, and I can see that I'm 2 asking, in a sense -- I don't put it that clearly -- but 3 I'm saying "Why would they not review all the cases"? 4 Q. It says "review all prosecutions in the past 12 to 18 5 months since [the Post Office] has been independent of 6 [Royal Mail]". Was that seen, in your discussions with 7 the people involved, as the important point of 8 distinction: we'll only go back to the point of 9 separation, ie April 2012? 10 A. No, I think that is my point about the question that was 11 raised in the Board, because the Board had only been in 12 place post -- since the Post Office had been independent 13 of Royal Mail. 14 Q. You ask in brackets, "Why would they [the external 15 lawyers] not review all cases ... eg over the last 16 5-10 years?" Why were you asking that? 17 A. I assume because that seemed a fairly sensible question, 18 which is why would we be restricting ourselves to 19 a particular time period. 20 Q. That's logical, isn't it? 21 A. If we were trying to do this properly, why wouldn't we 22 do all of them, yes. 23 Q. If we are doing this properly and fairly, why wouldn't 24 we look back at all cases of false accounting? 25 A. Yes. 55 1 Q. Was that done? 2 A. No, in terms of what we know today, clearly not. The 3 scheme was opened to 150 cases that came forwards and 4 the Post Office advertised across the Network for any 5 postmasters who wanted to come into the scheme and have 6 their cases reviewed. So my understanding at the time 7 is that we were open to however many postmasters came 8 forwards but, in terms of specifically the Post Office 9 Legal Team and its lawyers, going back and looking at 10 all the cases, that wasn't the work that was in place, 11 and I wouldn't -- 12 Q. Why wasn't it put in place? Here you're suggesting that 13 the Post Office itself, through external lawyers, 14 proactively review all cases of false accounting going 15 back up to a decade -- 16 A. Yes. 17 Q. -- and you've, I think, accepted that that would be the 18 fair and proper thing to do; why didn't the proper and 19 fair thing to do get done? 20 A. I can't remember whether you have any further 21 documentation that would see what answer I got to that. 22 Q. We'll come to the answers -- 23 A. Yes -- 24 Q. -- the narrow answers and, essentially, we're going to 25 find out that Mark Davies, the PR guy, said it's very 56 1 dangerous. 2 A. I don't remember that. I was asking the question to do 3 this work the right way and my understanding and 4 acceptance of what was proposed, which was accepted by 5 the MPs and everybody else involved, was that the 6 Mediation Scheme was the right way through. I think we 7 see other documentation that sees cases go to the CCRC, 8 there is documentation that says cases can't be resolved 9 through mediation and the scheme, and they would need to 10 go through the Court of Appeal. The fact I can recall 11 those, I suspect there was a wider discussion around 12 this at some stage. 13 Q. Do you agree that your nascent idea here of a review of 14 all prosecutions of false accounting, if it had been 15 carried into effect, may have avoided a lost decade 16 until miscarriages of justice were discovered? 17 A. It may well have done. It may well have done. 18 Q. Do you think the failure to carry into effect the idea 19 that you posit here was a missed opportunity? 20 A. At the time, I and the Board, and everybody else 21 involved in what succeeded after this particular 22 point -- sorry, wrong word -- what took place after this 23 particular point, felt that that was completely the 24 right way to do this. We were concentrating on 25 individual cases. 57 1 Q. You say that such a review, especially where cases have 2 been small, because "'large' amounts would be less 3 likely to get away with saying they were muddle-headed"; 4 what do you mean by that? 5 A. I'm not entirely sure now. You can see from the way 6 these questions are asked that I am operating in an area 7 of business, ie the legal sphere, that I, at the time 8 especially, was very naive about and didn't understand. 9 So I am asking questions because one of the roles of 10 a chief executive is to not sit on questions -- is to 11 not stay quiet on things you don't understand. 12 Sometimes you ask questions and they sound stupid but 13 it's the right thing to do because you need to ask those 14 questions and I am not entirely sure here whether I was 15 assuming that large amounts of false accounting might 16 point more to crime than not. I don't know. 17 Q. Can you help us as to why you would come up with that 18 idea: a person accused of false accounting in relation 19 to a small amount of money may be more likely to deserve 20 or need a review of their conviction versus a person 21 accused of false accounting a large amount of money? 22 A. I don't think that's what I'm saying. I think what I'm 23 saying is that if -- so, first of all, I'm asking 24 questions and I don't understand this. I think what 25 I was asking is that, if somebody had committed false 58 1 accounting over a long period of time and had, 2 therefore, reached a large sum -- and I realise today, 3 and I regret what I've said, that -- and I understand 4 very much today why subpostmasters were driven to do 5 this but, at the time, my naive assumption was that, if 6 somebody was false accounting on a regular basis over 7 a long period of time and accumulated a large amount 8 false accounted, that might give an intention of 9 something that was perhaps more planned than where 10 an amount might have been an occasional example. 11 Q. Okay, can we look at Mr Davies's reply, POL00099055, 12 foot of the page. 13 "Hi Paula 14 "Could we have a word at some point today to discuss 15 this and specifically how far we go in terms of the 16 wording below? I'm sending this just to you at this 17 stage. 18 "I am very concerned that we may get to a position 19 where we go so far in our commitments that we actually 20 fuel the story and turn it into something bigger than it 21 is. I am not at all complacent about the issues, but 22 there is real danger in going too far in commitments 23 about past cases. 24 "[This is] for two reasons: 25 "First the substance of the report doesn't justify 59 1 this response. Indeed the response is at such a level 2 that our current media strategy would mean there would 3 be some coverage, but not very much ... If we say 4 publicly that we will look at past cases ... whether 5 from recent history or going further back, we will open 6 this up very significantly, into front page news. In 7 media terms it becomes mainstream, very high profile. 8 It would also give [James Arbuthnot] a very strong case 9 for asking for a Parliamentary statement from BIS. 10 "My second concern is the impact that this would 11 have more broadly. It would have the 'ballistic' impact 12 which AB fears. It [would] lead to a very public 13 narrative about the very nature of the business, raising 14 questions about Horizon (the reality of what [Second 15 Sight] has found would be misunderstood) and having 16 an impact on public views about the [Post Office] and 17 really widening the issue to the whole network." 18 Do you agree Mr Davies is here giving you personal 19 advice on the extent to which past convictions are 20 reviewed on the basis of the extent of the media 21 coverage that each decision might generate? 22 A. My understanding at the time was that he and, I think, 23 the Post Office generally -- and we've seen similar 24 comments from the Chairman as well -- believed we were 25 dealing with a small number of cases, and the numbers 60 1 that were coming forward seemed to, at that stage -- 2 clearly more came later -- seemed to indicate that that 3 was the case. And the Inquiry heard from Mark Davies 4 last week, I think, where he explained -- and that was 5 my understanding at the time, that what he was trying to 6 do was to minimise misinterpretation. 7 It was wrong because, clearly, if past -- if all 8 past cases needed investigating, they needed 9 investigating but, at the time, that wasn't what the 10 Post Office thought and I think what he was trying to do 11 here was, as I say, to minimise misinterpretation and 12 exaggeration in the media. 13 Q. Do you agree his first point says you should make 14 a decision about the extent to which you review possible 15 past miscarriages of justice by reference to the extent 16 of media coverage that it will generate? 17 A. It does say -- it could be read that way. That wasn't 18 my -- 19 Q. Is there another way of reading it -- 20 A. I wouldn't have -- 21 Q. -- and, if there is, please explain which words help to 22 read it in a different way. He's saying, "Don't go back 23 10 years or say that you'll go back 10 years, our 24 current approach would mean there's going to be some 25 coverage but not very much, the usual suspects. If we 61 1 say we'll look back at past cases, we'll be on the front 2 page". Isn't he directly saying -- 3 A. Yes, I can see that that's what he is saying but my 4 mindset at the time when I received this is that we were 5 working on specific cases that were coming forwards and 6 we opened up -- 7 Q. No, no, no, hold on, Ms Vennells. The email that you 8 had sent, to which this is a response, posits "Shall we 9 look back 12 to 18 months since separation" -- 10 A. Yes, yes. 11 Q. -- "or should we go back further?" 12 A. Further, yes. 13 Q. "Why aren't we going back further, 5 to 10 years?" 14 A. Yes. 15 Q. This says, "You can't do that, you'll be on the front 16 page". That's a grossly improper perspective, isn't it? 17 A. Yes, it is. Yes, it is. 18 Q. Do you know why he cut everyone else out of the chain 19 and replied directly to you? 20 A. No, I don't. 21 Q. Was he a very trusted adviser? 22 A. He was trusted by all of the team -- I mean, as I said 23 yesterday, I trusted all of the team; none of them more 24 than the others. 25 Q. Did you remain in contact with Mr Davies after you left 62 1 the Post Office? 2 A. I did -- 3 Q. Did you exchange messages with him about media 4 statements that you might make and the media lines that 5 you might take in the announcement of this Inquiry, for 6 example? 7 A. I believe the Inquiry has texts that show that. I -- 8 Q. Even though you'd moved on, he was still advising you 9 into 2020 as the lines to take in your media statements? 10 A. I had kept in touch with Mr Davies for reasons that were 11 very personal to him and I think he offered that advice 12 at the time. 13 Q. To what extent did what Mr Davies advises here affect 14 your decision making? 15 A. I would never -- it was simply not the way I worked -- 16 have taken a decision based on the advice of one 17 colleague -- never. My way of working was to take as 18 many different views as I possibly could and to involve 19 those individuals in the decision making as much as 20 I possibly could. 21 Q. Can we look at the top of page 1, please, and your 22 reply: 23 "Mark, thanks for this, and I don't think we are too 24 far apart -- I didn't say this would be our media 25 statement but they would need to be aligned. 63 1 "You are right to call this out. And I will take 2 your steer ..." 3 You did take the advice of the PR guy, didn't you? 4 A. I really don't remember it relating to the decision -- 5 SIR WYN WILLIAMS: (To audience) Hang on now, please. Thank 6 you. 7 A. As I tried to say before, my -- what we were working to 8 at this stage was numbers of cases going through 9 a scheme and a scheme that was going to be opened up to 10 anybody who wanted to come forwards. 11 I understand how this reads but I don't recall 12 making any conscious decision not to go back and put in 13 place a review of all past criminal cases. My 14 conviction, as we were going forwards in this, was that 15 this scheme would enable any case that that want -- any 16 postmaster that wanted their case to be reviewed, that 17 this scheme would allow for that. 18 MR BEER: You continue: 19 "There are two objectives, the most urgent being to 20 manage the media. The second is to make sure we do 21 address the concerns of [James Arbuthnot] and Alan 22 Bates, mainly looking forwards (but we should be aware 23 [Alan Bates'] driver is really justice for the past); 24 otherwise they will call for reopening cases." 25 A. Yes. 64 1 Q. "It may be that we get to manage [Alan Bates/James 2 Arbuthnot] by playing on the 'go ballistic' view: 3 ie I will meet him privately to hear his views about 4 these cases but that we cannot refer to anything in 5 relation to past convictions. Any challenge must go via 6 normal legal routes." 7 Is that the way your mind worked at this time: the 8 priority was to manage the media and then deal with the 9 actual substance of issues? 10 A. The media issue related to, I believe -- because we were 11 right on the day or the day before the release of the 12 Second Sight Interim Report, and that's my recollection, 13 that that is the media conversation that we were having. 14 Q. But what we're talking about here is how far back 15 a review of possible miscarriages of justice should go? 16 A. Yes, and I'm not closing that down -- 17 Q. You say -- 18 A. -- at all. 19 Q. You say there are two objectives, the most urgent being 20 to manage the media. 21 A. I'm pretty sure that that was in relation to the Interim 22 Report, which was due out any time, which, as the 23 Inquiry has seen and heard from other people, there were 24 issues in that report which the Post Office disagreed 25 with and the team felt Second Sight hadn't taken account 65 1 of. That, I think, was the issue that we were 2 talking -- so this was a really urgent 'Today or 3 tomorrow' issue and then there were the concerns looking 4 forwards -- 5 Q. No, no, what you're saying here is, "You're right, Mark, 6 we will put the past behind us. We won't look at past 7 cases. We'll focus on the future". 8 A. That isn't what happened. That simply isn't the case 9 because the scheme was open to past cases. There was no 10 time limit or -- 11 Q. The burden was put on the subpostmaster to prove their 12 case, wasn't it? 13 A. The scheme was open to any postmaster who wanted to 14 bring their case forwards. It was advertised in various 15 ways to encourage people to come forward. There were 16 other conversations going on at the same time as this 17 exchange, with colleagues, and it was very clear that 18 any cases that included criminal convictions would need 19 to go through the Court of Appeal and the normal legal 20 routes. 21 I don't think I understood any more about the legal 22 side of things to have got involved in anything more 23 complex than that. I believed very sincerely that the 24 scheme we were putting in place would help. 25 Q. Do you accept that this exchange of emails shows that, 66 1 in making decisions as the substance as to what the Post 2 Office should do, ie whether it, itself, should seek to 3 review whether there had been past miscarriages of 4 justice, you took into account the views of your media 5 adviser, as to the extent to which your decision would 6 meet with front page news? 7 A. I do not recall that being -- I see what is written 8 here. There were other conversations going on at the 9 same time. The highlighted paragraph isn't as clear as 10 what you're saying. I do not think -- and I would not 11 have taken, personally, any decision on review of 12 historic cases. That was not my role. I wasn't 13 qualified or competent to do that. I did not take that 14 decision. 15 What I was trying to do, at this stage, was to find 16 a way forwards through the cases that had come into the 17 Post Office and to encourage more to come forwards, 18 which would have enabled any case to go through normal 19 legal routes if the Post Office couldn't help it. 20 Q. What did you -- 21 A. So no, I absolutely don't accept that I took a decision 22 to not review past criminal cases based on a media 23 outcome. I didn't take any decision on that. 24 I wouldn't have been able to do so and it was -- would 25 have been such an important decision that would have had 67 1 to have gone to the Board. 2 SIR WYN WILLIAMS: Can I just ask -- and this may be 3 entirely my fault, so I preface it by that -- but I'm 4 not clear that, as of 6 July or 7 July, or this period 5 of time, this discussion of how to approach the issue of 6 past cases is taking place in the context of Second 7 Sight continuing its investigative work beyond the 8 Interim Report or in the context of the idea of 9 a mediation scheme. Do you understand the distinction 10 I'm trying to draw? 11 A. Not entirely. Would you -- 12 SIR WYN WILLIAMS: Well, as I see it, in simple terms, 13 Second Sight began by investigating in the context of 14 a number of cases -- 15 A. Yes. 16 SIR WYN WILLIAMS: -- and, after their Interim Report, 17 somehow a transition took place so that what I will call 18 a mediation scheme emerged. I'm not sure, as of this 19 date, ie at or about the time when Second Sight was to 20 produce its Interim Report, whether the discussions of 21 how to deal with past cases was in the context simply of 22 Second Sight moving forward with their investigations 23 or, by that stage, in the Post Office's mind, that was 24 at an end and something new was emerging? 25 A. No, I think -- that's a helpful question. I think there 68 1 was a process of evolution. So -- 2 SIR WYN WILLIAMS: Sure, but I wanted to try and pinpoint -- 3 A. Yes, I'm trying to think through what -- Second Sight 4 had done the work it had done up to the publication of 5 the Interim Report. There was still a number of cases 6 that hadn't been looked at, which needed to be 7 continued. I had been disappointed about the way the 8 Post Office team hadn't worked as well or been able to 9 contribute to the work Second Sight had done and I say 10 that I would like us to work collaboratively with the 11 JFSA, who still had a very serious vested interest in 12 that. 13 And a proposal was made to form a working party -- 14 I think was the word that was used -- and that was, 15 I recollect, an attempt to work together to go through 16 the remaining cases. At some stage -- and, as we were 17 going through this, because it was an iterative process, 18 people were contributing ideas as to how this might play 19 out, I had a conversation with Susan -- and this 20 I remember very clearly because I can remember where it 21 was -- I'd arrived home at this -- and I was standing on 22 the station and she called me and Susan suggested that 23 a way of bringing -- the trouble is I now know what 24 didn't happen -- but some of these cases or these cases 25 to a conclusion would be to introduce mediation. 69 1 What she said was that -- and, again, this is in the 2 documentation somewhere -- is that mediation -- that 3 sometimes what was needed in cases is for people to hear 4 the Post Office apologise and say it was sorry that it 5 got things wrong or for the Post Office to explain to 6 a subpostmaster that perhaps they had done something 7 wrong, and that, once the cases had been reviewed 8 through this working party process, that might then be 9 a way to reach some finality on those cases. 10 What was also talked about at the same time was 11 that, if this was a good thing to do, which clearly it 12 was, the Post Office then needed an ongoing process, 13 possibly an adjudication process and external ombudsman, 14 on a permanent basis, so that, if this type of challenge 15 arose again, there was an external appeal process, if 16 you like, for subpostmasters to go to. 17 And the thing that I'm missing, Sir Wyn, in telling 18 you all of that, is, if Susan knew -- which of course 19 she did, and I wouldn't have known so well -- that 20 criminal cases couldn't be resolved through mediation -- 21 and this is simply a question -- did she know that there 22 would need to have been a further review or was her 23 understanding at that time -- which is a fact that was 24 later described -- that any criminal cases going through 25 the Mediation Scheme would be open to all of the 70 1 investigation work that was done by Post Office and 2 Second Sight and Fujitsu, which may then give them 3 information to take forward to -- through the normal 4 legal routes through the Court of Appeal or the CCRC? 5 MR BEER: Ms Vennells, can we look at page 2 of this 6 document, and scroll down. This is your thoughts on the 7 proposal as of 6 July. 8 A. Yes. 9 Q. In direct answer to the Chairman's question, isn't it 10 the case that Second Sight were to play no part going 11 forwards? 12 A. There were conversations about whether Second Sight 13 should or shouldn't because there were concerns about 14 the fact that this had run on too long and was way over 15 budget, and there -- and this, again, is in many 16 documents -- there were concerns that they -- their work 17 was not, at this stage, sufficiently evidence based. 18 Q. Your proposal didn't involve any role for Second Sight, 19 did it? 20 A. I'm not sure that's true -- 21 Q. Look at the email on the screen. 22 A. It was a consideration -- sorry? 23 Q. Look at the email on the screen. Your written proposal 24 did not contain any role for Second Sight, did it? 25 A. It doesn't at this stage, because we're in this process 71 1 of evolution, say that Second Sight -- 2 Q. In this process of evolution, it doesn't involve any 3 role for Second Sight? 4 A. I'm not sure because I'm not -- it doesn't say that they 5 would or wouldn't. What it says is that it would 6 explore their themes for improvement and I'm being frank 7 with you that there were conversations about whether -- 8 there was criticism of the work that Second Sight had 9 done, but there was equal understanding that they had 10 the support of MPs, notably James Arbuthnot, and that we 11 had committed to do that work. That is a -- 12 Q. Back to page 1, please. You say: 13 "You are right to call this out. And I will take 14 your steer. No issue." 15 Do you agree this email chain reads as if the PR man 16 has influenced you conclusively as to a decision as to 17 whether or not the Post Office would itself review 18 whether and to what extent there had been past 19 miscarriages of justice? 20 A. I wouldn't take that steer on a legal matter from Mark 21 Davies. He clearly -- he was talking about -- and, 22 again, in the timescales we're talking about, we're 23 talking about publicity within the next couple of days 24 as a report coming out, but I wouldn't have taken 25 a decision on anything at all to do with legal matters 72 1 from Mark Davies and -- 2 Q. Okay, let's see what the -- I'm so sorry, I spoke over 3 you. 4 A. Sorry. It's fine. 5 Q. Let's see what the IT person was telling you on what to 6 do about looking at possible miscarriages of justice. 7 POL00099056. This is a separate chain, remembering that 8 Mark Davies had just replied to you. This is Lesley 9 Sewell's reply to your email setting out your proposals. 10 She does include everyone on the chain and doesn't cut 11 people out. 12 A. Mm-hm. 13 Q. "Paula 14 "Just a couple of thoughts. 15 "If we state that we will review the cases since 16 Separation, that implies that there are material 17 findings in the [Second Sight] review and leaves us open 18 to challenge against all cases. It may be better to 19 offer in the spirit of the review and how we have 20 listened to those who have been affected, and how we 21 want to change our business. 22 "This is the delicate line we are balancing and from 23 memory Susan quoted more [than] 500 cases in the last 24 10 years. It may be an option to allow [subpostmasters] 25 to come forward and request a review. 73 1 "I agree on the points around the working group and 2 user group", et cetera. 3 Did you bring into account in your decision making 4 the views that the Head of IT was giving you on the 5 extent to which the Post Office should itself ask 6 independent lawyers to review past convictions? 7 A. I would have read Lesley Sewell's email sent to me. 8 I wouldn't take any decision on legal matters, 9 personally, without the advice of the General Counsel 10 and on something this significant as the Board. 11 Q. We can see that you've had what the PR expert has been 12 telling you to do about past convictions, and here the 13 Head of IT telling you. I think your position is that 14 you did not see Simon Clarke's Advices, which address 15 looking at past convictions, until after the Court of 16 Appeal Criminal Division disclosures in late 2020/early 17 2021; is that right? 18 A. Yes. 19 Q. So you didn't know that there were lawyers advising on 20 the very issues that you were considering at this time 21 bringing into account the PR man and the IT lady's 22 views? 23 A. I had no sight of the Simon Clarke Advices, no. 24 Q. You tell us in your witness statement -- that can come 25 down, thank you -- it's paragraph 562 -- no need to turn 74 1 it up -- that you recall that you were told by Susan 2 Crichton that, due to advice from external lawyers, 3 there was a need for a review to ensure that proper 4 disclosure had been given in previous criminal cases. 5 A. Yes. 6 Q. You say that you had a conversation with Lesley Sewell 7 in which she told you that the Post Office had been 8 advised that the expert witness that the Post Office had 9 used in criminal cases to give evidence about Horizon 10 had failed to mention there were bugs in Horizon, 11 including in the Seema Misra case. You tell us that in 12 your witness statement. 13 A. Yes, I -- yes, that's right. 14 Q. Can we please try to pin down the date on which you had 15 knowledge of a problem with the Post Office's expert 16 evidence? 17 A. It's difficult to find the date exactly. I remember 18 that I -- so I learned of it, first, from Lesley Sewell, 19 not from Susan Crichton. What had happened is I passed 20 Lesley in the corridor. She was looking particularly 21 concerned or grumpy about something, and I asked her 22 what was the matter, and she said that she had just 23 heard that -- so I don't know that she said this but I'm 24 assuming from Susan -- that the Post Office expert from 25 Fujitsu, whom we had used in past cases, now had to be 75 1 stood down because he had not revealed -- and, as I said 2 yesterday, I think -- one or two bugs that he knew about 3 in a case, and -- that's right, I think it was 4 Mrs Misra's -- and the reason that Lesley explained he 5 hadn't revealed those bugs in that case is that they 6 hadn't been -- Mrs Misra's was a Horizon Online case and 7 the -- sorry, the other way round. Mrs Misra's case was 8 on Legacy Horizon and these bugs hadn't come into effect 9 until Horizon Online. 10 Q. Ms Vennells, the way you've described it there is that 11 Ms Sewell was telling you that the expert had failed to 12 mention bugs in one case, and that was Seema Misra. 13 A. I think so. 14 Q. In your witness statement, you say that she told you 15 that he had failed to give disclosure in criminal cases, 16 including Seema Misra. 17 A. Right. That's probably right then. I don't think -- 18 Q. Again, can you help us as to the time of this, please? 19 A. Well, I then spoke to Susan, I think, within a day or so 20 of that conversation. Susan explained more about it, so 21 if you can date when Susan found out, it would have been 22 just before that, because Lesley could only have found 23 out from Susan. 24 Q. By this time, and I'll call it mid-2013, you had been 25 engaged on the issues of Horizon integrity for some 76 1 time, hadn't you? 2 A. From when -- yes, yes. 3 Q. You knew that there had been prosecutions and that those 4 prosecutions had been founded on evidence from Horizon? 5 A. Yes. 6 Q. When told by Lesley Sewell and then Susan Crichton that 7 there was an issue with the Post Office's expert 8 evidence that had been relied on to convict 9 subpostmasters, including Mrs Misra, were you concerned? 10 A. Yes, and I think Susan had -- and I think the 11 documentation says this -- Susan had -- at the time 12 I spoke to Susan about it, she said, I think, that she 13 had already put in chain a review by the external 14 lawyers. And I think the documentation shows that she 15 had done that before the written advice from Simon 16 Clarke came in on the 15th. 17 Q. Did you, at the time, join the dots between the debates 18 that we've seen you have in emails here with Mr Davies 19 and Ms Sewell, about the extent to which the Post Office 20 should announce that it was going to review past 21 convictions, and the information that you were being 22 given, quite separately, that the Post Office's expert 23 witness had failed to mention bugs of which he had 24 knowledge in criminal cases? 25 A. No, I didn't make that link. 77 1 Q. Why not? 2 A. I think because my -- that the emails from Mark Davies 3 and Lesley Sewell are part of an iterative process as to 4 how we took this important, ongoing piece of work 5 forwards. The conversation with Susan Crichton about 6 the work that became known as the Cartwright King Sift 7 Review was -- I think I took as a piece of reassurance 8 that the lawyers were doing what they needed to do in 9 terms of -- and I think this is at the stage where 10 I learnt about disclosure -- of what they needed to do 11 in respect of disclosure. 12 What I didn't know at this stage, to be very clear, 13 was that, by dint of what had happened with Gareth 14 Jenkins, the Post Office had breached its duties as 15 a prosecutor. I don't think that was mentioned to me at 16 the time. 17 Q. Did you never, at any time, connect the long running 18 criticism of Horizon's integrity, that had been forced 19 upon the Post Office by subpostmasters, for years and 20 years, with being informed that there was a problem with 21 the expert evidence on which the Post Office had relied 22 about bugs? 23 A. I don't think I made that connection because it was very 24 specific. The information I was told was very specific, 25 which was that these two bugs were related to Horizon 78 1 Online. There were two of them which affected -- and, 2 by this stage, I knew about them -- which affected 14 3 and 62 post offices, I think, all of whom had been 4 informed or, in the case of the 14, were in the process 5 of being informed, and that the bugs had been fixed and 6 the postmasters had not lost any money as a result of 7 that. 8 So this was Lesley's frustration, which was that 9 these were two isolated incidents -- I accept now that 10 is incorrect, but that was what I was told -- they had 11 been fixed. There is even documentation which refers to 12 them as a "red herring", and the fact that Susan was 13 going through this Sift Review, to me seemed to be 14 reassuring, rather than concerning. 15 Q. Did you ask who this witness was? 16 A. I don't believe I knew Mr Jenkins' name because there 17 is -- 18 Q. I'm asking: did you ask who was this witness? 19 A. I think I was told that it was a Fujitsu -- someone who 20 worked for Fujitsu, who was very competent on the 21 system. 22 Q. Did you ask how many cases he had given evidence in? 23 A. No. 24 Q. Did you ask what was being done in relation to the 25 evidence that the Post Office was concerned about? 79 1 A. I'm sorry, ask the question again. 2 Q. Yes. Did you ask what the Post Office was doing as 3 a result of its concern that he had failed to mention, 4 in cases, knowledge of bugs? 5 A. I was told that we were gong back looking -- or that 6 Cartwright King were going back looking at cases. So 7 I -- 8 Q. Why were they doing that, if it was a red herring? 9 A. I understood that that was the obligation that one had 10 to do: was that any case that he had given evidence in 11 needed to be given this evidence around these two bugs, 12 even if it didn't affect those cases. 13 Q. Were you told that he was an unsafe witness? 14 A. No. 15 Q. Can we jump forwards, please, to October of this year, 16 October 2013, and look at POL00382001, at the foot of 17 page 1, please. An email from you to Alice Perkins, 18 signing out: 19 "Hi Alice, don't worry about the lateness of this 20 note -- I am clearing the tray before signing out ... 21 "Couple of updates: 22 "Sir Anthony Hooper/Sparrow: very positive phone 23 call on Friday pm. No issue at all re Hillsborough; he 24 is going to send a file note." 25 Then: 80 1 "My concern re Sparrow currently is our obligations 2 of disclosure, re an unsafe witness (the representative 3 from Fujitsu made statements about no bugs, which later 4 could be seen to have been undermined by the [Second 5 Sight] report). We do not think it is material but it 6 could be high profile." 7 Is the "unsafe witness" that you're referring to 8 there the same person that Lesley Sewell and Susan 9 Crichton had referred to -- 10 A. Yes. 11 Q. -- earlier? 12 A. Yes, yeah. 13 Q. Had they described him as an "unsafe witness"? 14 A. I don't know where -- I only saw this disclosure 15 recently, so I haven't had a chance to go back and see 16 whether -- an unsafe witness is not a term that I would 17 have used. So -- and the other thing that -- 18 Q. You did use it. 19 A. Yes, sorry, the word that -- the adjective "unsafe" is 20 not something that -- in relation to the word "witness" 21 is quite a specific description, and I'm not sure that 22 that's something that I would have just used 23 coincidentally. And when I looked at this email, this 24 is some considerable time, so this is three months after 25 I found out about Mr Jenkins being stood down. So 81 1 I don't know whether, at this stage, I had been given 2 more information about him or not. I mean, it says -- 3 Q. Sorry, it's six days after Mr Altman did his general 4 review? 5 A. Right. 6 Q. A document which I think you say you weren't told 7 about -- 8 A. No. 9 Q. -- or didn't see? 10 A. No. Does he use the term? 11 Q. Not precisely. But, in any event, you understood that 12 there was an issue by the date of this email -- 13 A. Yes. 14 Q. -- concerning disclosure that related to an unsafe 15 witness, correct? 16 A. Yes. 17 Q. That related to him making statements about there not 18 being bugs in Horizon? 19 A. That was my understanding. 20 Q. So you understood by this time that there was an issue 21 about the reliability of the Fujitsu expert evidence 22 about there being bugs, ie the absence of them -- 23 A. Yes. 24 Q. -- and not merely about the presence of bugs that had 25 been revealed by the Second Sight Report? 82 1 A. That's what it says here, yes, yes. 2 Q. Yes. You say: 3 "We do not think it material but it could be high 4 profile." 5 If the issue of the expert evidence in criminal 6 cases was not material, why would it be high profile? 7 A. I suspect this is the media aspect again, which is the 8 worry that something could be taken out of context. I'm 9 not entirely sure because I don't -- whether I was given 10 this information very quickly, because I'm clearly going 11 somewhere, and Martin Edwards is briefed to give Alice 12 more detail, I don't -- I'm really -- I just have no 13 recall of this at all. 14 Q. Who is the "we" in that sentence? 15 A. I can only imagine that this has come from -- well, 16 it -- yes, possibly Susan Crichton, the Legal team. 17 Q. Where is it recorded that what it was alleged that 18 Mr Jenkins had failed to do, or had done, was not 19 material? 20 A. I don't know. I would not have personally been able to 21 make that statement without getting it from someone who 22 knew. I didn't understand about, as I now do, about the 23 nature of an expert witness. 24 Q. There existed at this time the Simon Clarke Advice -- 25 A. Yes. 83 1 Q. -- of 15 July 2013, which addressed, page upon page, 2 this very issue, the materiality -- 3 A. Oh, I'm sorry. I think I've just remembered. I'm 4 sorry, I didn't mean to cut across you. 5 Q. You go ahead. 6 A. The -- I think Cartwright King had said that -- because 7 they had obviously, by this stage, done a number of 8 checks across subpostmaster cases, and I think they had 9 said that the disclosures were a fairly small number, 10 and that that may be what this is relating to. 11 Q. So "material" means "not many"? 12 A. It could be that, yes. 13 Q. As I was saying, there existed at this time, the Simon 14 Clarke review of 15 July 2013, on this very issue, the 15 materiality of what Gareth Jenkins had said in witness 16 statements and to a court in oral evidence, but you 17 hadn't been given it -- 18 A. No. 19 Q. -- the Advice? 20 A. No. 21 Q. Did you even know that external lawyers had been 22 instructed to advise on the very issue that you're 23 debating? 24 A. I -- do you mean in the sense of the Cartwright King 25 review? 84 1 Q. No. The materiality of what Mr Jenkins had said or had 2 failed to say? 3 A. I don't think so. 4 Q. Do you know where you got the idea that we do not think 5 it -- ie the expert witness making statements about 6 there being no bugs in Horizon -- from? 7 A. I'm sure there's -- there's something in the 8 documentation about numbers of cases. I was not 9 personally involved in any of this at all. I mean, 10 I wasn't working with the external lawyers doing the 11 review, so I couldn't have known what they did or didn't 12 think and, therefore, it can only have come through the 13 Legal team, or possibly Martin. I mean, it is possible 14 that Martin was briefed by -- but, again, he would have 15 had it through the Legal team. 16 Q. Isn't the "material" comment here another reference back 17 to the supposed red herring, rather than about numbers? 18 A. I don't think so. 19 Q. Why not? 20 A. Well, only in the context that -- no, I don't -- that 21 isn't what I understood, and there is certainly 22 something in documentation somewhere that makes the 23 statement that the lawyers, Cartwright King, did not 24 think that there would be a large number of cases where 25 the disclosure needed to be made. 85 1 MR BEER: Can we go back, then, to mid-July 2013, but 2 probably after the break. 3 Sir, can we say 12.30, please? 4 SIR WYN WILLIAMS: Yes, certainly. 5 (12.17 pm) 6 (A short break) 7 (12.30 pm) 8 MR BEER: Thank you, Ms Vennells. 9 Can we pick up in mid-July 2013, please, by looking 10 at POL00100702. This is a letter from the CCRC, 11 directly to you, of 12 July 2013. If we just look at 12 it: 13 "Horizon computer system: 14 "The [CCRC] is an independent body ... Our purpose 15 is to review possible miscarriages of justice in the 16 criminal courts of England, Wales and Northern Ireland 17 and refer appropriate cases to the appeal courts. 18 "For obvious reasons, we have read the recent media 19 coverage concerning the Post Office Horizon computer 20 system with interest. Clearly, it would be very useful 21 for us to have more information directly from the Post 22 Office, especially accurate information as to number of 23 criminal convictions that might be impacted by the issue 24 and what action is proposed, or being taken, in that 25 respect. 86 1 "We see that the [AG] was called upon on Tuesday to 2 set up an enquiry and we are in contact with his office 3 about that. 4 "In essence, the Commission's role in this is likely 5 to relate to anyone who is convicted of a criminal 6 offence (in England, Wales or Northern Ireland), where 7 evidence from the Horizon computer system is relevant, 8 where (i) they have already tried to appeal against that 9 conviction or (ii) they were convicted at a Magistrates' 10 Courts following a guilty plea. 11 "I look forward to receiving your reply." 12 This must have been a very unwelcome development. 13 A. I remember receiving the letter from the CCRC. I don't 14 remember personally regarding it as unwelcome. 15 Q. It arrived at a time at which you would have been told, 16 is this right, by Susan Crichton, about the need to 17 review past convictions? 18 A. I would think so, yes. 19 Q. It would have arrived at a time when you'd been told by 20 Susan Crichton and Lesley Sewell about the concern about 21 the Fujitsu expert witness's evidence to the courts, 22 including in the Seema Misra case? 23 A. Yes. 24 Q. A letter like this does not land on the doorstep of the 25 CEO every day of the week, does it? 87 1 A. No. 2 Q. Would you agree that the right and honest thing to do 3 would have been to let the CCRC know about the Post 4 Office's concerns over Gareth Jenkins? 5 A. What I did with this letter was to ask Susan to reply as 6 the legal expert in the organisation. 7 I don't believe I would have given her direction as 8 to how we should reply to it and, for clarity, 9 I wouldn't have either instructed her to leave things 10 out. 11 Q. The right and honest thing for the Post Office to have 12 done would be to let the CCRC know and know promptly 13 over its concerns about the truthfulness and reliability 14 of the evidence that Gareth Jenkins had given to court, 15 wouldn't it? 16 A. Yes, it would. 17 Q. That didn't happen for years and years, did it? 18 A. I understand that to be the case now, yes. 19 Q. Given what was on your mind, what you'd said to Alice 20 Perkins a couple of days before this, in the email that 21 we saw, did you think, "We need to say to the CCRC what 22 we know about Gareth Jenkins"? 23 A. I don't think we're looking at the same timescale. The 24 email that I sent to Alice Perkins was in October. This 25 is July. 88 1 Q. I'm talking about the -- I'm sorry, the exchange with 2 Lesley Sewell and Mark Davies, my mistake. 3 A. I'm sorry, so what was the question? 4 Q. Yes. In the light of the exchanges you had with Mark 5 Davies and Lesley Sewell about the extent to which we 6 have to go back and look at previous convictions, up to 7 500 of them, for false accounting, and the conversations 8 you'd had with Lesley Sewell and Susan Crichton about 9 the person you now know to be Gareth Jenkins, do you 10 think the right thing to have said in response to the 11 CCRC was, "We have got concerns about a key witness in 12 a number of our cases"? 13 A. Yes -- assume -- yes, I sound slightly hesitant because 14 I wouldn't have known what we -- my -- let me step back. 15 My understanding and expectation is that, when the 16 Post Office received something like this from the CCRC, 17 that it should respond in the fullest way possible, to 18 be transparent about whatever it was that needed to be 19 shared with the CCRC. 20 Q. Can we turn forwards, please -- in fact it's a couple of 21 days before this -- to POL00407582. This is 22 an attendance note of 10 July. You're not present. It 23 seems to be between Susan Crichton, Hugh Flemington and 24 Simon Richardson. Can you recall who Simon Richardson 25 was? 89 1 A. Yes, he was the -- one of the partners from Bond 2 Dickinson who had worked on Post Office work for quite 3 some time. 4 Q. If we scroll down, please, to 6. Thank you. I should 5 just read the introduction to this: 6 "There was then something of a general discussion 7 around how they were going to manage the additional 8 complaints and resourcing. Essentially where we got to 9 ... was quite a lengthy brainstorming session ..." 10 Then 6: 11 "The real worry was around the Fujitsu expert who 12 appeared to have known of some of the problems but not 13 referred to them in his report or statement even though 14 they could be dismissed. There are non-disclosure 15 issues here. They are looking at replacing that expert 16 with somebody else." 17 Then 7: 18 "There was generally an overall defensive air and 19 the Board are also feeling bruised." 20 Stopping there. By this time, was it the case that 21 the Board was feeling bruised? This is 10 July. 22 A. These are Simon's words, I certainly don't -- well, he's 23 reflecting a conversation he's had with two colleagues 24 at the Post Office. 25 Q. Yes. 90 1 A. I -- it's not an adjective I'd have used in respect of 2 the Board. The Board were feeling very frustrated, 3 I don't know about bruised -- 4 Q. Frustrated about what? 5 A. That the Second Sight Interim Report had not -- 6 according to colleagues, had not taken account of the 7 Post Office's factual evidence against issues that were 8 raised and criticisms made of the Post Office and, 9 secondly, that it had taken too long and was continuing 10 to run up budgets that -- to levels that had not been 11 expected. 12 Q. Do you think that's what this might be a reference to, 13 their feeling bruised? 14 A. I can't think what else it would be a reference to the 15 Board were very frustrated by the criticisms in the 16 Second Sight Interim Report, which, at that stage, they 17 were told, were, at least in some cases, according to 18 the team, unfounded because Second Sight hadn't had 19 sufficient time in preparing it to take on board the 20 Post Office's evidence. 21 Q. The note continues, seemingly on the basis of what your 22 two colleagues, Susan Crichton and Hugh Flemington, 23 said: 24 "There are tensions between people and that includes 25 Alice Perkins (the Chair), Paula Vennells and [Susan 91 1 Crichton]." 2 At this time were there tensions between Alice 3 Perkins, you and Susan Crichton? 4 A. There had been some difficult conversations. I can't 5 remember exactly. Alice -- well, we were all frustrated 6 by the report. Alice felt frustrated by it. She could 7 not understand -- and, again, there's documentation on 8 this -- as to why we had ended up in -- why the 9 business, as she put it, that ended up in the position 10 that it had with a report that hadn't taken account of 11 Post Office's input and conclusions seemingly reached or 12 suggested -- to be fair to Second Sight, they'd said it 13 was an Interim Report. 14 I had been challenged over that and there was going 15 to be more challenge to come a couple of days after this 16 in a Board meeting, and I don't know what -- at this 17 stage, I don't know what conversations had taken place 18 between Alice and Susan. Certainly, Susan and I had 19 discussed about how we were going to -- we'd had 20 conversations about the first draft of a Second Sight 21 Report, which I think she went back to talk to them 22 about, and some changes were made but nothing 23 substantive. And it was a difficult time. 24 Q. Were there tensions between you and Alice Perkins? 25 A. I don't recall that -- she had been critical. I mean, 92 1 Alice was a very straightforward Chair and I generally 2 took feedback pretty well and, again -- forgive me for 3 repeating the phrase -- but there is documentation on 4 that as well. I'm sure she gave me some fairly 5 straightforward feedback about why this had taken so 6 long, why it was over budget, why the report contained 7 things that the Post Office felt were inaccurate. 8 Q. The minute continues: 9 "I said [that's Simon Richardson] that I thought the 10 Minister had dealt with the questions extremely well and 11 looked in control of the brief. Evidently she had [the 12 Post Office] in to tear them off a strip for not putting 13 someone up earlier in the day for interviews on radio 14 and TV. I said my view was it was a good thing no one 15 was there. It was a no win given the nature of the 16 complaints and some are subpostmasters who were 17 generally reporting rather wild stories of what had gone 18 on. However, I understood the political imperative of 19 somebody being put up. [Susan Crichton] said she would 20 pass my comments [on] to the Comms Director. 21 "However, I told them that my view was they need to 22 be much more on the offensive about this, this was a new 23 management team who that put in place a new independent 24 report and were dealing with the problems. The Chair 25 [Alice Perkins] seems to have been taken by surprise by 93 1 the reaction and the noise generated. [Paula Vennells] 2 may be sensitive around some of these issues happening 3 on her watch as the Network Director. I said that 4 I still thought there were positive messages to deliver 5 and people just need to get into a different mindset. 6 She said that [Paula Vennells] had asked about what 7 I knew and she might pass on my comments to her. I said 8 I was happy to talk to [Paula Vennells] since we knew 9 each other from another difficult project in the days 10 when they were a subsidiary of [Royal Mail Group]", 11 et cetera. 12 In your approach to the reaction to the Second Sight 13 Report, were you sensitive that some of the issues it 14 addressed happened on your watch as Network Director? 15 A. No, I wasn't. 16 Q. The note says that the real issue here, the real worry, 17 was around the Fujitsu expert, who appeared to have 18 known some of the problems and not referred to them in 19 his report or statement. There are non-disclosure 20 issues here. Was the result of this meeting fed back to 21 you? 22 A. I don't believe so. 23 Q. Would you be surprised that members of your team were 24 having this in-depth and frank conversation about Gareth 25 Jenkins being the real worry that was facing the Post 94 1 Office -- 2 A. Yes. 3 Q. -- after the Interim Report, and yet this information 4 not being fed back to you nor indeed to the Board? 5 A. Yes, I would be surprised at that. 6 Q. How has it come about that they're having this very 7 frank conversation with somebody with whom you have 8 a history, as is referred to here, Simon Richardson, and 9 you never get to know about it? 10 A. Oh, my history with Simon Richardson was one case that 11 we sat on at Royal Mail Group where we were on an appeal 12 panel and working with him a long time ago on Post 13 Office closures, but I hardly met with Simon. 14 Q. It's recorded here that, "She said that Paula Vennells 15 had asked about what I [Simon Richardson] knew". 16 Do you know what that's a reference to? 17 A. I don't. If you'd like to take me back up the email in 18 case there's something there that prompts it -- 19 Q. It's an attendance note but, yes, let's go back up. 20 A. It may simply be that I was asking for what Simon's view 21 was on the work that was underway because he was the 22 partner for the Post Office or had been a partner for 23 the Post Office. 24 Q. Again, asking the general question: how is it that two 25 relatively senior members of your team, Susan Crichton, 95 1 the General Counsel no less, were having this frank 2 conversation with a solicitor and the outcome of it 3 never reached you or the Board, if your evidence is 4 correct? 5 A. To be honest, I don't know. Whether Susan -- as you've 6 heard previously, it was not a process in the Post 7 Office -- which was wrong -- for advices -- if this is 8 considered advice, which in a sense, it is -- to be fed 9 back, and the reason I was looking down the list of 10 numbered points was in case any of it was fed back and 11 some wasn't. 12 Q. Is it every day of the week, though, in the Post Office 13 that it is told that the safety of its convictions, its 14 criminal convictions, may be called into question by 15 unreliable evidence given by an expert witness? 16 A. No, Mr Beer. I agree. It should have been shared. 17 Q. You were explaining perhaps why it wasn't shared because 18 of a convention of not giving counsel's advice or 19 solicitor's advice documents to the Board -- 20 A. Yes, yes, it should -- 21 Q. -- but it doesn't prevent any of the substance being 22 conveyed, does it? 23 A. No. Yes, I agree. Yes. No, no. 24 Q. So what's at work here, in your view, why is this 25 information not coming up to you? We've got Cartwright 96 1 King through Simon King (sic) advising, on the one hand, 2 you've got Bond Dickinson advising here that the real 3 worry is Gareth Jenkins, on the other. 4 A. My hesitation on this is that I now know much more than 5 I did at the time, so I'm now aware that Mr Jenkins had 6 never been briefed as an expert witness. I don't know 7 whether this is suggesting that that was part of the 8 real worry or whether the worry that is expressed at 9 point 6 is what the organisation knew already, which was 10 non-disclosure issues, because the Cartwright King 11 review had started by this stage. But I'm afraid 12 I can't help you why more of that wasn't shared. 13 Q. Thank you. If we move on, the Second Sight Interim 14 Report was, in fact, published on 8 July. The 15 reference, we needn't show it at the moment, is 16 POL00029744, and it referred to three bugs in Horizon: 17 the receipts and payments mismatch bug; the suspense 18 account bug; and, although it didn't name it, the 19 Callendar Square or Falkirk bug. 20 A. Yes. 21 Q. If we just look at your witness statement, please, it's 22 paragraph 253(f) on page 111. If we scroll down to (f), 23 please, you say: 24 "... I was not made aware between joining [the Post 25 Office] in 2007 and early 2012 that any [bugs, errors or 97 1 defects] had been identified in Legacy Horizon or 2 Horizon Online." 3 Then you say: 4 "The first that I knew that any [bugs, errors or 5 defects] had been discovered was in mid-2013, when I was 6 made aware for the first time of the [bug] known as the 7 Callendar Square problem in Legacy Horizon, and two 8 [bugs] in Horizon Online ... Receipts and Payments 9 Mismatch [and] Local Suspense Account problem." 10 Can I ask for your assistance on what your evidence 11 means here. You state in the first sentence that you 12 were not aware until early 2012 that any bugs had been 13 identified in either system and then, in the second 14 sentence, you say: 15 "The first that I knew that any [bugs] had been 16 discovered was in mid-2013 ..." 17 A. I'm sorry -- 18 Q. They appear contradictory. 19 A. Yes, they do. I'm so sorry. 20 Q. So what's the correct answer -- 21 A. The correct answer -- 22 Q. -- to the question when did you first know of any bugs, 23 error or defects? 24 A. -- yes, 2013. 25 Q. So why did you say here that it was early 2012 that you 98 1 were made aware that bugs, errors and defects had been 2 identified in Horizon? 3 A. I don't know because the only thing I can think as 4 an explanation is that the local suspense bug was, 5 I think, drawn to the Post Office's attention in 2012 6 but nobody knew about that because it had been referred 7 to the NBSC and I suspect this is just a mistake. 8 Q. So the corrects evidence is that that represented in the 9 second sentence -- 10 A. Yes. 11 Q. -- is that right -- 12 A. Yes. 13 Q. -- and the first is just a mistake? 14 A. Yes. 15 Q. Can we turn to what was said in the run-up to the Second 16 Sight Report to the Post Office's position on the three 17 bugs. 18 A. Mm-hm. 19 Q. Can we look, please, at POL00105632. Can you see this 20 is an email to you and others from Alwen Lyons re the 21 "James brief", and she says: 22 "Paula the only thing that is not in the brief for 23 James is our move away from 'there are no bugs in 24 Horizon' to 'there are known bugs in every computer 25 system this size but they are found and put right and no 99 1 subpostmaster is disadvantaged by them' it would be good 2 to be able to go on and say 'or has been wrongfully 3 suspended or prosecuted'." 4 Did this represent a move, a shift in position, 5 pre-emptively before the Second Sight Report, from 6 "There are no bugs in Horizon" to the then altered 7 position that's set out by Alwen Lyons? 8 A. It was -- firstly, I don't recall -- and I think Alwen 9 said this on Tuesday as well -- that there had been 10 a line, as it were, that there were no bugs in Horizon. 11 I don't remember, and I haven't seen it anywhere, as 12 being used. But it would be completely right for the 13 Post Office, if that was a line that it had used, to 14 correct it. 15 Q. I mean, if that's right -- 16 A. But it wouldn't have been done pre-emptively because of 17 the Second Sight Report; it would have just been done 18 because it was the right thing to do. 19 Q. If that's right that there hadn't been a position 20 adopted by the Post Office of "There are no bugs in 21 Horizon", this email makes no sense? 22 A. No, I agree and they're written as "lines" in inverted 23 commas. I can only assume that this came from Mark 24 Davies and the Communications Team. I don't recall 25 having a conversation about that. 100 1 Q. You tell us in your witness statement -- it's 2 paragraph 389 on page 183, no need to turn it up -- that 3 after the receipts and payments mismatch bug and the 4 local suspense account bug came to light, as you put it, 5 in May '23 (sic), we no longer lived in a world where no 6 bugs had been found in the system. 7 A. Yes. 8 Q. That was your position and the Post Office's position up 9 until at least May 2013, that no bugs had been found in 10 the system, wasn't it? 11 A. I think that's right. What I'm trying to say here is 12 that I don't remember seeing it as a line in 13 communications but, as soon as the -- we had discovered 14 these bugs, if we had been saying publicly that there 15 were no bugs, clearly that needed to be corrected. 16 Q. In any event, in May 2013, you no longer lived in 17 a world where no bugs had been found in the system? 18 A. Yes, yes. 19 Q. In your position as Chief Executive, was that not very 20 significant information, "We've got three bugs or had 21 three bugs in the system"? 22 A. It is significant. At that stage -- it doesn't make any 23 difference -- but there were only two that I knew of and 24 what was very important to me -- and the Inquiry can see 25 this from emails that I sent and work that I did -- was 101 1 that -- and I can remember saying to Alwen Lyons, 2 actually, that I wanted to demonstrate leadership in 3 this case, this was around the local suspense bug, that 4 it was -- that I wanted reassurance that Fujitsu had 5 done as it said, which is that all affected post offices 6 had been identified, that we had looked at whatever the 7 shortfalls were, that post offices had not been held 8 accountable for any of those or that they were held 9 accountable for any losses, that they were all written 10 to, which they were, and so my priority was to make sure 11 that it was dealt with. 12 In terms of the second bug, the receipts and 13 payments mismatch bug, that, I was told, had been dealt 14 with and -- again, it is in documentation -- that the 15 post offices affected by that had been written to as 16 well. 17 Q. Ms Vennells, you tell us time and time again in your 18 witness statement that, up until May 2013, you had been 19 told time and time again that there were no bugs in 20 Horizon? 21 A. Yes. 22 Q. You had been reassured; it was the basis on which you 23 operated. Isn't this world changing information for 24 you? 25 A. Yes. 102 1 Q. "In fact, there were bugs; the previous assurances that 2 I've been given were false"? 3 A. Yes, it was information that changed. The way that 4 I was told about those two bugs was that they were -- 5 and I'm not referring to previous exchanges elsewhere, 6 but they were incidents that had been dealt with, they 7 were bugs that had been resolved and that they were red 8 herrings to the work that -- and they didn't affect any 9 of the branches that Second Sight were looking at and 10 the branches that had been affected had been properly 11 supported by the Post Office and the cases had been 12 dealt with. 13 Q. Was the answer to my direct question that you had been 14 told repeatedly for six years since you joined -- 15 A. Yes. 16 Q. -- Post Office that there were no bugs in Horizon? That 17 mantra is key to what you say in your witness statement 18 as to what you did as Managing Director and, previously, 19 as Network Director; it was the consistent message from 20 the business. 21 Then you're told "No, in fact, there are bugs in the 22 system", and you're telling us, "but they don't matter, 23 they are just red herring bugs". Did you explore why 24 you had been given false information in the past? 25 A. I think, to be really clear on this, because it's 103 1 important, I was told that -- what I was told was about 2 Horizon -- and I'm not splitting hairs on this. I was 3 told that Horizon -- that where cases had gone to court, 4 the courts had found in favour of Horizon, that where 5 issues had been raised, I knew, and I say in my 6 statement, that there were always glitches and issues 7 with the system. I knew that from having visited 8 branches, whether it was the egg timer issue or the blue 9 screens or network failures or whatever, so -- 10 Q. Let's go back to page 111 of your witness statement, (f) 11 you say: 12 "... I was not made aware between joining [the Post 13 Office] in 2007 and ..." 14 You've told us this should read "mid-2013". 15 A. Yes. 16 Q. "... that any [bugs] had been identified in Legacy 17 Horizon or Horizon Online. The first I knew that any 18 [bugs] had been discovered was mid-2013 ..." 19 A. Yes. 20 Q. So wasn't it world changing information that, in fact -- 21 A. I'm sorry. Yes, I'm not -- what I'm not getting across 22 clearly enough is that this was important but I was 23 reassured at the same time that these bugs had been 24 dealt with. 25 Q. Is that reassurance anywhere in writing or is it one of 104 1 these corridor conversations? 2 A. I think it is in writing. In the Second Sight Interim 3 Report, both of them are detailed and it explains, 4 I think, pretty much what I said in more detail but the 5 Post Office -- that -- this I now know was wrong: that 6 the system had identified the issues, that they had been 7 fixed, the Post Office has been informed and nobody had 8 been held accountable for any losses and, where 9 surpluses -- and surpluses were left in the hands of the 10 postmasters. 11 Q. Given that you'd not been told before mid-2013 about any 12 bugs in the system and you were operating on the basis 13 that there were none, on being told that, in fact, the 14 system did have bugs, would you not have wanted 15 a watertight assurance from Fujitsu that there were no 16 more bugs? 17 A. I should have asked for that. 18 Q. Do I take the answer that you've just given to mean, 19 "Yes, I would have wanted assurance but I didn't ask"? 20 A. I had -- at roughly about the same time or maybe a month 21 before, I'd had a conversation with the Chief Executive 22 of Fujitsu, which -- 23 Q. Is this the Fort Knox conversation? 24 A. -- yes -- which had been based around the allegations 25 that Mr Rudkin had raised -- 105 1 Q. That's a separate issue. 2 A. It is a separate issue but I'm not a technical expert 3 and I'm dealing with challenges to the Horizon system 4 and I'm working within a context where I'm taking 5 numbers and inputs. I took these seriously and 6 I accepted the explanations that I had been given and 7 I knew that those explanations had been based on -- but, 8 again now, this sounds very hollow, in hindsight -- on 9 work that had been done by Fujitsu. 10 Q. Can we look, please, at POL00090219. This is the press 11 statement that the Post Office put out on the 12 publication of the Interim Report. If we scroll out 13 a little bit, please, you'll see, in the third paragraph 14 and following, it says "Chief Executive [you] said", as 15 follows, yes? 16 A. Yes. 17 Q. Did you approve this statement? 18 A. I would generally. There were occasions when I may not 19 have been able to but, generally, I would -- I wouldn't 20 usually put my name to something that I hadn't read. 21 Q. In particular, where direct quotes are attributed to you 22 in direct quotation marks? 23 A. Yes. 24 Q. We know that the Post Office had been informed of the 25 receipts and payments mismatch bug in September or 106 1 October 2010; we know that the suspense account bug had 2 been drawn to the Post Office's attention as 3 an operative problem by at least February 2013; and we 4 know that the Callendar Square or Falkirk bug had been 5 drawn to the Post Office's attention in 2006. 6 Do you know why this press statement did not 7 acknowledge that the Post Office had known about each of 8 the three bugs referred to in the Second Sight Report 9 for many years? 10 A. I don't remember having any conversation about that, no. 11 Q. You'll see that it, instead, concentrates upon the 12 number of people under the system, the number of 13 branches, the number of transactions? 14 A. Yes. 15 Q. Was that the mantra that the Post Office had used for 16 many years to defend allegations against Horizon? 17 A. It was a truth and it was an explanation that was 18 overused, and I fully accept that now. 19 MR BEER: Thank you. That's a convenient moment before we 20 move to our next topic, sir. 21 Could I say, I think it's 1.05 now, could I say 22 1.50, please? 23 SIR WYN WILLIAMS: 1.50. 24 MR BEER: Thank you. 25 (1.07 pm) 107 1 (The Short Adjournment) 2 (1.50 pm) 3 SIR WYN WILLIAMS: Yes, Mr Beer. 4 MR BEER: Good afternoon. 5 Good afternoon, Ms Vennells. 6 We're about to turn to the 16 July Board meeting, 7 16 July 2013. Before I do so, can I ask you about 8 a couple of issues, essentially turning on this use of 9 the phrase "systemic" or "systemic issues" -- 10 A. Mm-hm. 11 Q. -- and your understanding of it, Post Office's 12 understanding of it and what it meant and how it was 13 deployed by the Post Office. 14 Can we start please by looking at INQ00002021. 15 Thank you. This a transcript of a covert recording of a 16 conversation including Susan Crichton, Alwen Lyons and 17 Ian Henderson about a briefing of you, yes? 18 A. Yes. 19 Q. You're not on this call. 20 A. Right. 21 Q. The next call we're going to look at, you are. 22 It seems to pick up partway through the conversation 23 and I should say this is 22 May 2013. Susan Crichton 24 says that she, I think: 25 "... had a chat with Paula earlier on and we had 108 1 a couple of chats this morning, Ron and Ian, and then 2 separately I've had chats with Alwen so I just thought 3 we should probably come back together and try and see if 4 we can move this forward. So Paula agrees that the 5 original scope of the investigation did not go as far as 6 looking at whether -- it was the miscarriage of justice 7 point, Ron and Ian. So that's -- that's not what she's 8 looking for. She's just -- she's looking for the 9 systematic -- or systemic, rather, not systematic -- 10 systemic weakness in the Horizon system, but not -- as 11 I said, didn't go on to that next point around whether 12 or not it's caused a miscarriage of justice or 13 a suspension of a subpostmaster, because I think 14 that's -- once you have found it, then it's up [to] us 15 to look for and see what impact it might be if that 16 happens." 17 I appreciate you weren't a party to this 18 conversation. 19 A. Mmm. 20 Q. But it's expressing a view about your approach to what 21 should be and what shouldn't be in the Second Sight 22 report. 23 Firstly, was it your view that the focus of the 24 Second Sight Report should be on whether there are 25 systemic weaknesses in the Horizon system? 109 1 A. I can't remember, first of all, the conversation that 2 Susan and I had. So I don't know whether I had raised 3 the issue with her or her with me. I don't remember, 4 personally, ever sort of feeling that I had instigated 5 the use of the word "systemic" in some way. That was -- 6 the work I understood Second Sight to be doing was part 7 of the terms of reference which had originally been 8 established. 9 I imagine the miscarriage of justice point was 10 a conversation with Susan because I wouldn't have 11 expected forensic accountants to be working on issues of 12 justice and law but I can't remember the conversation 13 with Susan to -- and I'm not sure that this necessarily 14 points in a particular direction that reminds me. 15 Q. We saw the Second Sight proposal earlier this morning. 16 A. Yes. 17 Q. Wasn't the purpose of their work to seek to establish 18 whether there had been miscarriages of justice? 19 A. You're right. I think that was -- I don't know if those 20 words were mentioned in the terms of reference but, if 21 you're telling me they were, I'm happy to accept that, 22 but they were to look at individual cases to see whether 23 there was anything, as a result of Horizon issues, that 24 could have caused that. I don't imagine Susan would 25 ever have -- and myself even less so -- would ever have 110 1 thought that Second Sight would then go on to look into 2 whether there was a miscarriage of justice because, 3 clearly, that's a legal issue not an issue for 4 a forensic accountant or the detail of the work they 5 were doing it. 6 Q. But when Second Sight reported, you raised the issue, 7 which is essentially referred to here, "It's up to us to 8 look at the impact that their conclusions had", and we 9 saw in your exchange with Lesley Sewell and Mark Davies 10 this morning, you raising "Have we got to go back 12 to 11 18 months, have we got to 500 convictions for false 12 accounting, have we got to go back a decade?" That was 13 never done, was it? 14 A. No, what you saw me raising was questions about -- 15 whereas I said earlier today, naive questions, in 16 a sense, but important questions -- about what this work 17 could do, and what -- and why the Post Office wasn't 18 considering going back further. It wasn't that I was 19 saying we shouldn't; I was simply asking the questions 20 to understand better. 21 Q. The way this is explained to Second Sight here is, "You, 22 Second Sight, on Paula's instructions, should look at 23 whether there are systemic weaknesses in the Horizon 24 system. It's for us to work out whether there have been 25 miscarriages of justice; we will see what the impact of 111 1 your report is on our convictions"? 2 A. And I think that's what I understood because Susan was 3 the General Counsel and that would be a decision for 4 a lawyer to take forwards -- 5 Q. So why wasn't that done? Why was a mediation scheme set 6 up instead? 7 A. I don't know. It was Susan who called me to talk about 8 the Mediation Scheme. We've seen the background of 9 information that I wasn't party to, in terms of the 10 original advice from Richard Morgan or the discussion 11 that took place. As I sit here today, we would have 12 been better doing two different things: we could have 13 had a mediation scheme that worked for non-criminal 14 cases; and we could have -- but in a sense, it sort of 15 migrated to this -- we could then have done a separate 16 investigation, which Second Sight were involved in, 17 which may have thrown up information for disclosure 18 which subpostmasters could have taken through to appeal 19 through the courts. 20 As far as I understood it, Post Office itself 21 couldn't instigate that process. That process -- what 22 Post Office could do was to instigate a review that 23 potentially could lead to that. 24 Q. Here it records that you are not looking for them to 25 look at miscarriages of justice and, in the event, you 112 1 didn't look for the Post Office to look for miscarriages 2 of justice either, did you; you set up a mediation 3 scheme instead? 4 A. We set up a -- I don't think I understood at this 5 stage -- and I don't think others -- I don't think 6 I understood, when we set up the Mediation Scheme, that 7 it was going to finish in the way it did for the 8 criminal cases. The Post Office -- the very original 9 legal advice that Susan took from Richard Morgan was 10 then almost repleted two years later by Brian Altman, 11 I think -- I think it was Brian Altman -- to say that 12 you can't resolve criminal cases through a mediation 13 scheme and the advice was very strong that the Post 14 Office shouldn't put criminal cases through the 15 Mediation Scheme, and what it should do is to continue 16 to do the detailed investigation, which itself might 17 then provide subpostmasters with information to take 18 through the Court of Appeal, and some had already gone 19 into CCRC. 20 Q. You knew that James Arbuthnot's main concern was 21 miscarriages of justice, didn't you? 22 A. I did yes. 23 Q. Can we turn, please, to SSL0000128. This is 24 a transcript of a covert recording with the Post Office 25 team and you of 2 July 2013. Can we look, please -- 113 1 A. This is with Second Sight and the Post Office team, yes? 2 Q. Yes. Sorry, Ian Henderson and Ron Warmington are both 3 on the call. We will see in due course that, on the 4 Post Office side, there is included Lesley Sewell, Simon 5 Baker -- I think that's it. If we look at the foot of 6 the page, please. Simon Baker says: 7 "Just to let you know, Paula has now joined us." 8 Then top of the next page, you say: 9 "Hi, Ian", and Mr Henderson reciprocates. 10 Then if we go to page 3, please, under "Ron 11 Warmington", he says to you and the call: 12 "His [that's Mr Arbuthnot] main theme continues to 13 be the possibility, whether there exists the possibility 14 of wrongful prosecution or, for that matter, wrongful 15 civil action, but he's less concerned about that." 16 Mr Henderson: "He's certainly referring to 17 miscarriages of justice. We've obviously briefed him on 18 the defect issue, and I don't know to what extent he has 19 been previous sort of briefed on that, but he seemed 20 very concerned about that. He didn't, you know, suggest 21 that it was a cover-up but he said 'I find it quite 22 astonishing that it is only now that information is 23 coming to light, bearing in mind that these were, you 24 know, events and so on that occurred you know up to 25 three years ago'." 114 1 Simon Baker: "just for the record, before the room 2 can be clear ... written to the subpostmasters about 3 that and how many court cases we had mentioned ... if we 4 ... for information only." 5 Lesley Sewell: "... in terms of responding to that, 6 can we make it clear that that is all in the public 7 domain?" 8 At this point, did you understand that to mean the 9 information that Second Sight had uncovered about the 10 existence of bugs, Simon Baker and Lesley Sewell were 11 saying was already in the public domain? 12 A. I think Lesley here is saying something that I remember 13 her being irritated over, which was that she had said -- 14 and I think she said in her evidence last week -- that 15 she had told Second Sight, and I think it was being said 16 that Gareth Jenkins had told Second Sight, and I think 17 what she's referring to here is that it was Post Office 18 who told Second Sight, there was no cover-up about that, 19 and this was about the two bugs. I don't know what 20 happened about Callendar Square/Falkirk. 21 Q. Was she saying there that all of the bugs were in the 22 public domain? 23 A. She is saying that there but whether she was -- my 24 recollection was that her emotion, as it were, was 25 around the fact that it had been said somewhere that it 115 1 was Gareth Jenkins who had told Second Sight when 2 Lesley -- I understood it was clear that it was Post 3 Office that had told them. 4 Q. So "certainly no cover-up" but it's absolutely "in the 5 public domain". Was the existence of the receipts and 6 payments mismatch bug absolutely in the public domain as 7 at July 2013? 8 A. I think she's referring here to what was in the Second 9 Sight Interim Report or the -- 10 Q. This is before the Second Sight Interim Report? 11 A. What date is this, please? 12 Q. 2 July. 13 A. Well, it wouldn't have been in the public domain by 14 then, no. 15 Q. But she's saying it is. She's saying it is absolutely 16 in the public domain? 17 A. I think -- well, I can't comment exactly on what Lesley 18 is saying here but I'm trying to help by saying that my 19 recollection was that her response -- it was the word 20 "cover-up" because I think she was responding to the 21 fact that somebody had said that Post Office hadn't 22 disclosed these bugs and her view was that the Post 23 Office had disclosed the bugs to Second Sight -- oh, and 24 of course, in terms of them being in the public domain, 25 the postmasters had been written to. So you'd have to 116 1 go back to Lesley to get -- 2 Q. That was putting it in the public domain, was it? 3 A. Sorry? 4 Q. That's what you understood "putting it in the public 5 domain" to be? 6 A. That was my understanding of what Lesley was meaning by 7 this comment, at this distance from the conversation. 8 Q. Yeah, that they've been through court cases. Was she 9 saying that these bugs have been disclosed in court 10 cases, to your understanding? 11 A. I mean, that would be -- 12 Q. Was that something she said to you, "Look, we've 13 disclosed these bugs before, receipts and payments 14 mismatch bug and local suspense account bug, in court 15 cases, no cover-up here". 16 A. No, I don't think so, Mr Beer. My only recollection on 17 this is what I've just said, which is she wanted to 18 reassurance me that it was Post Office that had told 19 Second Sight, not Mr Jenkins, and I can't comment on the 20 line about other court cases but there is a possibility 21 that that's the link through, because the reason Gareth 22 Jenkins was stood down is that he hadn't mentioned -- 23 I'm not entirely clear, I'm sorry. 24 Q. Okay. Mr Henderson: 25 "... I think his point was, you know, until the last 117 1 sort of few days, he was certainly unaware of that, and 2 I think there was a feeling, you know, bearing in mind 3 that this investigation was set up 12 months ago, there 4 was a lengthy and protracted build-up to that, you know, 5 why is it only now that he is hearing about this? Now, 6 you know that may be a valid point." 7 Mr Warmington: "Yes, he said something like, 'They 8 haven't told me about it', or, 'They hadn't told me 9 about it'." 10 Simon Baker: "I think we ought to register that 11 point. I think us discussing it is probably not going 12 to -- okay, can we just keep going then. What else 13 transpired at the meeting?" 14 There's then some discussion about what transpired 15 at the meeting between Second Sight and Mr Arbuthnot. 16 Then, at the foot of the page, Lesley Sewell, four lines 17 from the end: 18 "... the other point around the system itself in 19 terms of the cases, there's nothing material been found 20 in terms of Horizon. Was that made clear to James? 21 Ian Henderson: "Well, no, because like us he is 22 using this broader definition of Horizon, and I think 23 like us -- I know, Simon, you said yesterday we've just 24 got to agree to differ. I think, if you look at that 25 wider definition of Horizon, if you look at the totality 118 1 of the user experience, you know, what you, I think 2 collectively sort of identified as sort of, you know, 3 process changes, opportunities, and so on, he is putting 4 more into the category of ... using that definition, 5 sort defects in Horizon ..." 6 Lesley: "Sorry to jump in but that's not what we 7 talked about yesterday. We were absolutely clear 8 yesterday in terms of how we carve up each element of 9 the process so ... the system so that we are absolutely 10 clear where we've got the issues which we do need to 11 address." 12 Ron Warmington: "Lesley, we are crystal clear on 13 that. However, I don't think you'll find that he cares. 14 From his viewpoint, it doesn't matter whether it's 15 software code or the procedures." 16 Then there's an example of a spot review involving 17 scratchcards. 18 If we go over the page, please, four paragraphs in, 19 Ian Henderson: 20 "Simon, the message is: don't rely on this narrow 21 definition of Horizon. I think, frankly, any references 22 to software and so on are not going to help your case. 23 James is operating well beyond that. He ... like us, is 24 looking at the totality of the user experience when he's 25 talking about Horizon." 119 1 Over the page, please, to page 7, four paragraphs 2 in: 3 "Simon, I don't think we can be categoric like that. 4 Trying to compartmentalise frankly is going to backfire 5 on you. That's the message we're picking up from James' 6 office. He has got no time whatsoever for these 7 semantic definitions and distinctions ... he wants all 8 of us to stand back and actually, you know, think about 9 the bigger picture and the totality of the user 10 experience." 11 Then foot of the page, you say: 12 "I think we need -- I mean, I understand the message 13 you're giving us. I've [something] semantics. I think 14 there are very different things here between -- you 15 know, a systemic problem with Horizon system that brings 16 into question all of the transactions, and the fact that 17 it's not a user-friendly experience for user 18 subpostmasters and we need to ... you know, and I said 19 this yesterday, the number of transactions we do, the 20 number of branches that run and the number of complaints 21 that we've had, even though we've been out and 22 advertised and been very open about them." 23 As a result of this conversation that you were 24 a party to, what did you understand Second Sight to be 25 saying as to their approach to the phrase or definition 120 1 of "systemic issues"? 2 A. They were -- and there was a line in here that we've 3 looked at -- they could understand the difference 4 that -- what was, I think, going on here, and then there 5 is further documentation about it, is that as the 6 Interim Report was published, it was important to the 7 Post Office to make the distinction between the findings 8 of the report about the system so -- which were, at that 9 stage, they had so far found nothing -- no systemic 10 issues to the Horizon system, and the wider system 11 issues around training and support -- 12 Q. Stopping there -- 13 A. -- and -- 14 Q. What do you understand "no systemic issues with the 15 Horizon system" to mean? 16 A. At that time, my understanding -- because we were trying 17 to make the clarification, so there could be no 18 misunderstanding -- was that they had found no systemic 19 issues with the technology but they had -- 20 Q. What does "systemic issue" mean? 21 A. -- found -- so something that was wide-ranging across 22 the system -- they make the point in there the 23 scratchcard issue -- which, by this stage, had been 24 fixed -- had generated, I think -- was it 700,000 25 transaction corrections? It was a systemic issue. It 121 1 was something that could have affected a single post 2 office and affected a number of them, but what they were 3 also saying was that they had come across other issues 4 around processes and support and training. 5 And what Post Office was trying to do at this stage 6 was to accept both, accept what they were saying, in 7 a sense -- although on the training and support issues 8 I think there were some challenges -- to make sure that 9 when any reporting on this happened in the media, there 10 wasn't a headline that said, "bug's been found in" -- 11 or -- in the Post Office system. So I think that was 12 the nature of this conversation at this stage. 13 And I think Second Sight understood that, as did 14 Mr Arbuthnot, because we had that conversation later, 15 and there is a minute on that somewhere. 16 Q. Did you understand "systemic issues" to mean an issue 17 which affects the entirety of, ie all, of the system? 18 A. Do you mean including the training and support and 19 process issues? 20 Q. No, just on the technology front. 21 A. I think at this stage we had understood it to mean the 22 technology front. 23 Q. Yes -- 24 A. Yes. 25 Q. -- ie a systemic issue relating to the technology -- 122 1 A. Yes. 2 Q. -- in order to be a systemic issue, had to affect the 3 entirety of the estate on that issue? 4 A. Yes, or a scale of branches, yes. 5 Q. Or a scale of branches? 6 A. Yes, so -- 7 Q. What was the scale of branches that it had to affect to 8 be a systemic issue? 9 A. The -- I'm simply thinking about the -- I think it was 10 the scratchcard issue that was given as an example. 11 That affected numbers of branches but I don't think all 12 of the branches. So it wasn't -- it was a system issue 13 in terms of interfaces and some branches -- actually, 14 that was probably -- 15 Q. What about an issue that affected the balancing of 500 16 branches; was that a systemic issue? 17 A. I think I had taken -- I had accepted the definition of 18 "systemic" that Second Sight themselves had said. 19 Q. Which was? 20 A. I wouldn't have said -- I can't remember. It wasn't the 21 point we were talking about here, it was earlier. They 22 had talked about an issue that would -- I think it 23 was -- they talked about system-wide, or something like 24 that. 25 Q. Can I understand your evidence correctly: you, at the 123 1 time, understood Second Sight's reference to "systemic 2 issues" as meaning an issue that affected, on the 3 technology front, all of the estate in relation to that 4 issue or a very large part of the estate on that issue? 5 A. Yes, I think so. 6 Q. Would it cover an issue which affected the balancing of 7 500 branches? 8 A. That would be a serious issue. I don't know that I went 9 into any numbers of branches. I didn't think about 10 numbers of branches. I simply accepted the definition 11 that they, as experts, had given, and I think their 12 wording was -- it wasn't every branch but it gave you 13 an indication that it covered a large number or it may 14 have been system wide, I can't remember. 15 Q. You know that the Post Office went on to use this 16 phrase -- 17 A. Yes. 18 Q. -- year in, year out afterwards -- 19 A. (The witness nodded) 20 Q. -- in order to defend its system? 21 A. Yes. 22 Q. Did not occur to you that there was a category of case 23 involving a large number of branches, which may have 24 experienced a problem with Horizon's systems but which 25 didn't affect every branch? 124 1 A. I don't imagine that I ruled that out at all because the 2 ambition behind the scheme that was put in place was to 3 look at all of the branches that came forward, and all 4 of the issues that came forwards. 5 Q. Can we turn, please, to the Board meeting of 16 July, by 6 looking at POL00099218. This is a report prepared by 7 Susan Crichton for that Board meeting, entitled "Post 8 Office Board, update following the publication of the 9 Interim Report on Horizon". It's dated 12 July 2013. 10 So I'm going to call it the 12 July Board report. 11 You tell us in your witness statement, it's 12 paragraph 519, that this was made available to you at 13 the time, before the 16 July Board meeting, correct? 14 A. Yes, yes. 15 Q. The purpose of the paper is recorded to be to: 16 "Update the Board on the latest events; and 17 "Seek input as to how the business moves forward 18 with the three new initiatives outlined in the ... press 19 release of 8 July and explored further in this paper." 20 If we scroll down -- and there's some background. 21 Then if we look at "Current activity under way", and 22 then go over the page, 3.7 records one of the pieces of 23 activity under way is: 24 "On the advice of our external criminal lawyers we 25 have immediately begun a review of our criminal cases 125 1 conducted since Separation on 1 April 2012. More detail 2 [on] this is set out in Annex 1." 3 That date there, the separation date of 1 April 4 2012, as being the date of the review, I think, must be 5 an error. That was the date of separation but it wasn't 6 the date that the review went back to -- 7 A. No. 8 Q. -- as we'll see when we look at annex 1 itself. They 9 went back to January 2010. 10 A. Yeah. 11 Q. If we scroll down, "Proposed Way Forward": 12 "4.1. The Working Party ... 13 "Overview: We will establish a working party (to 14 include the JFSA) to complete the review process and 15 look at the thematic issues which have emerged ... 16 "Continued involvement of [Second Sight]: Following 17 the meeting with [James Arbuthnot] and the MPs and the 18 comments made in the House it is clear that [Second 19 Sight] will have to continue to be involved in this 20 matter. We are currently considering how best to manage 21 this and to use the work already completed by them, 22 mindful of the need for their report to remain 23 independent, [and] a need for a cap on their costs. In 24 addition followed the statement in the House we will 25 need an independent chair for this group." 126 1 Can you help us, was it the original plan, as per 2 your email to Lesley Sewell and Mark Davies, to part 3 company from Second Sight? 4 A. My email didn't say that as an action. My email didn't 5 refer to Second Sight and, as I've said this morning, we 6 were considering whether or not we could bring in 7 additional resource to support Second Sight, whether 8 their involvement should end. There was, I remember -- 9 or there were, I remember, questions from the Board 10 about whether Second Sight should continue and it became 11 very clear that they should, because they had the ear 12 and the confidence of the MPs and the Minister and that 13 was important, and so they did. 14 And so what the -- and, again, this isn't my paper, 15 this is Susan's paper, but I think, from memory, what 16 the Board then asked us to do was to think about how we 17 could support Second Sight so that the work could be 18 progressed at more pace and closer to the budgets which 19 they had originally agreed, or they were about to sign 20 off. 21 Q. You make the point this is Susan's paper and not your 22 own. You went on to present this paper and -- 23 A. I can explain why, if that's helpful. 24 Q. We'll get to that but the short point is she was made to 25 sit outside on a chair? 127 1 A. Yes, yes. 2 Q. If we go to page 3, please. Under the heading "Next 3 steps" if we go down, 4.6: 4 "A proactive approach -- there are a number of areas 5 where the Post Office wishes to take a proactive 6 approach, for instance looking at processes for managing 7 our relationship with our subpostmasters. Further 8 details will be shared ... 9 "A reactive approach -- in respect of the criminal 10 cases the Post Office should wait for those to be 11 overturned via the Court of Appeal and for claims for 12 compensation to be made. We [will] then decide whether 13 to settle or fight ..." 14 Why was a proactive approach being taken to the 15 management of relations with subpostmasters, but 16 a sitting back, a reactive approach, being taken to 17 miscarriages of justice? 18 A. I can't really comment on the criminal legal side of 19 things. I am not a lawyer and I know you discussed 20 this -- or Mr Blake, I think, discussed this -- when 21 Mrs Crichton came in last week, and I can't remember 22 what she said in her evidence but this was her 23 recommend, and my recollection at the time was that, as 24 I said earlier today, that criminal cases had to go 25 through the Court of Appeal for any resolution to be 128 1 reached. 2 Q. That's a truism, but it doesn't tell you anything about 3 what the organisation responsible for the prosecutions 4 in the first place should itself do, to uncover 5 material, to review material, to be an honest broker, to 6 allow the Court of Appeal to fulfil that function, does 7 it? 8 A. Yes, I agree and I said this morning, it would have been 9 better if we had done a separate -- completely separate 10 investigation into this. At the time, I and the Board 11 took the advice from the Legal team and the lawyers that 12 they were working with that this was the way to do it. 13 It was clearly completely wrong to put criminal cases 14 into a mediation scheme that couldn't have resolved it 15 but, in the Mediation Scheme documentation, it allows 16 for that, and there were questions -- 17 Q. Was that a deliberate strategy to do that? 18 A. No. 19 Q. To lump these things into -- 20 A. I'm sorry, I -- 21 Q. -- into a process that you well knew had no facility to 22 deal with them? 23 A. No, not a deliberate strategy on my part -- at all. 24 Q. Can we go over to page 4, please. This is the annex 25 that was referred to and is Ms Crichton's note on the 129 1 "Details of the Criminal Cases Review". It records: 2 "Post Office have been advised by our external 3 criminal lawyers to undertake a review of all cases 4 going back to the time of the migration from old Horizon 5 to Horizon Online ... -- [ie] 1 January 2010 -- and this 6 has already begun." 7 A. Yes. 8 Q. That's the correction to the main paper -- 9 A. Yes. 10 Q. -- that I mentioned earlier. 11 "They are essentially looking at whether or not 12 anything in the [Second Sight] Interim Report should be 13 drawn to the attention of any defendants (current or 14 past) and if so they will be writing to the relevant 15 defendants providing them with a copy of the ... report. 16 We have a continuing legal duty as prosecutors to do 17 this. 18 "It is important to note that we believe ... that we 19 have undertaken [about] 55 prosecutions a year for the 20 last 10 years. [The lawyers] advised us that they 21 believe there will be around 5% where they need to 22 disclose additional evidence and it will be up to the 23 defence lawyers to consider the evidence and apply to 24 the Court of Appeal. 25 "Each individual has to seek leave", et cetera. 130 1 "We may also face civil suits for wrongful 2 conviction. The consequences of this ..." 3 I think "the courses of action are": 4 "Malicious Falsehood ... 5 "Defamation ... 6 "Wrongful termination of their contracts ... 7 "Harassment ... 8 "1.4. If we abandon prosecutions we may also face 9 claims for, eg malicious prosecution." 10 Over the page -- oh, that's the end. Thank you very 11 much. 12 A. Excuse me, if you remember this morning I mentioned that 13 I had a recollection about the external lawyers thinking 14 there were a small number of cases, I think 1.1 may be 15 a reference to that. 16 Q. Ie the 5 per cent? 17 A. The 5 per cent, yes. 18 Q. Can we look, please, at the agenda for the meeting. 19 POL00371898. We can see at item -- this the agenda for 20 the meeting on 16 July 2013. If we scroll down to 21 item 9 we can see that Susan Crichton was, after lunch, 22 to speak to the issue of group structure, yes? 23 A. Yes. 24 Q. Then earlier, before lunch, "Horizon Update", item 4, 25 Susan Crichton and Mark Davies were to speak to that 131 1 issue, yes? 2 A. Yes. 3 Q. And was that the plan so far as you were concerned as 4 you walked into the meeting? 5 A. It was the plan as far as I was concerned until very 6 shortly, either before the beginning of the meeting, or 7 the break. Now I've seen the agenda it might have been 8 before the break. I was told by Alice Perkins that 9 she -- and this was a complete surprise to me -- that 10 she was planning to stand Susan Crichton down and, 11 I assume, Mark Davies, because she wanted a full and 12 frank discussion in the Board meeting, and I think 13 I said two things, I can't recall exactly. But, first 14 of all, that seemed unfair because Susan had written the 15 paper -- and this was a very important matter -- and so 16 the second thing was how were the Board going to be 17 properly briefed on this, and her response to me was 18 "Well, you can table the paper". 19 Q. Sorry, stopping there, presumably you said, as you've 20 said to us a number of time frames, "But I'm not 21 a lawyer, I don't know anything about this"? 22 A. I did, exactly that. I said, "I can't possibly table 23 that paper" and her reply to that was "Well, you can 24 talk to" -- you know, I was familiar with some of it 25 clearly, I could talk to what I could talk to and the 132 1 questions that I couldn't answer could be picked up 2 later, and so that happened, and I felt uncomfortable 3 about it. 4 Q. Can we look at what you said in the board meeting, 5 POL00021516. These are the minutes of the meeting on 6 16 July. We see that you are recorded as being present. 7 If we go forward to page 6, please. It's recorded that 8 you provided a Horizon update, and that's correct, you 9 provided -- 10 A. Yes. 11 Q. -- the Horizon update; is that right? 12 A. Yes, that's right. 13 Q. You presented the Susan Crichton 12 July Board report to 14 the board? 15 A. Yes, I'm not sure entirely how that happen but, yes. 16 Q. It records that you explained that: 17 "... although the Second Sight Report had been 18 challenging it had highlighted some positive things as 19 well as improvement opportunities." 20 Is that really how you read the Second Sight Report? 21 A. Well, that is what is recorded, so I imagine that that 22 was what I said in the meeting, or that was what was 23 taken out of the discussion in the meeting from the 24 paper. 25 Q. Isn't that to put some -- to put it mildly -- spin on 133 1 the Second Sight Report? It highlighted positive things 2 as well as improvement opportunities? 3 A. I don't believe I was doing that. The Board had the 4 paper and they had the -- so they had this Board paper 5 and, by this stage, I think the Second Sight Report had 6 been circulated to the Board, and -- 7 Q. So they could read for themselves -- 8 A. -- it was an interim -- 9 Q. They could read for themselves whether the thing to take 10 from it was that there were positive things as well as 11 improvement opportunities? 12 A. I say, first of all, that it had been challenging, and 13 then I say -- and maybe there's a comma missing, "It had 14 highlighted some positive things as well as 15 investment -- improvement opportunities". 16 Q. You say -- 17 A. And it had been challenging. There were numbers of 18 challenges in the report, particularly around the 19 training and support issues, and those were the 20 improvement opportunities that needed to be dealt with. 21 Q. You -- 22 A. I can't remember what the positive things were. 23 Q. -- carry on to say: 24 "The business had been praised in Parliament for 25 setting up the interpreter review; the proportionality 134 1 of the tiny number of cases had been emphasised; and no 2 systemic issues had been found with the Horizon computer 3 system. However, there are cultural issues which had to 4 be addressed to improve the support we gave to 5 subpostmasters. This was now a catalyst to make changes 6 in the business." 7 A. Yes. 8 Q. Then the Board is recorded as being concerned that the 9 Second Sight review opened the business up to claims for 10 wrongful prosecution. What did it say, the Board 11 members -- 12 A. I don't recall this because, when I read this minute 13 more recently, the main recollection I have of the 14 discussion -- I mean, clearly this is discussed, but 15 I don't recall this. My main recollection was around 16 all of the criticisms that had been made that the 17 business had yet been able to respond to, and I don't -- 18 I mean, this is a minute of a Board conversation. This 19 isn't a minute of what I presented. So I've no reason 20 to doubt the minutes at all but I don't recollect the 21 board asking if Susan was implicated in any way. 22 Q. I haven't come on to that yet. 23 A. Okay, I beg your pardon. 24 Q. I'm just asking about whether the Board said to you that 25 they were concerned, it was concerned, that the Second 135 1 Sight review opened the business up to claims for 2 wrongful prosecution? 3 A. As I say, I can't recall that. 4 Q. Do you know how the Second Sight Report might open the 5 company up to claims for wrongful prosecution; I thought 6 it had found no systemic issues? 7 A. Which is what it said. I don't know whether at the time 8 I understood how the Board -- whoever in the Board had 9 arrived at that particular conclusion. Um -- 10 Q. Anyway: 11 "The Board asked if Susan Crichton ... was in any 12 way implicated in the prosecutions." 13 You said that: 14 "... up until they eighteen months ago, Royal Mail 15 Group had run the Criminal Law Team and many of the 16 cases in the review had arisen before separation. [You] 17 explained that the Business was a prosecuting authority 18 and as such brought its own prosecutions. However since 19 separation the General Counsel had proposed moving to 20 the more normal position of using the CPS for 21 prosecutions; this was being explored." 22 Is that right, as at 16 July 2013, using the CPS to 23 prosecute was being explored? 24 A. I don't know how much it was explored. The only 25 recollection I have -- and it's a fairly constant 136 1 recollection about discussions on the CPS -- was that 2 whilst that would have been -- I think, for those of us 3 who were lay people in the sense of legal expertise, 4 that would have been an option that should have been 5 considered. The constant feedback we had about the CPS 6 was that they were stretched, that there were budget 7 issues, that there were resource issues. There was 8 a further point -- and a lot more detail in an advice 9 that Brian Altman -- 10 Q. Ms Vennells, I'm just asking at the moment, did you tell 11 the Board on 16 July 2013, that -- 12 A. If the minute captures this, then yes. 13 Q. -- the use of the CPS was being explored? 14 A. Yes. 15 Q. Where did you get that from? 16 A. I can only imagine the General Counsel. 17 Q. Susan? 18 A. Yes. 19 Q. "The Board expressed strong views that the business had 20 not managed the Second Sight review well and stressed 21 the need for better management and cost control going 22 forward. 23 "The board accepted it was an independent review and 24 therefore things could happen that were beyond the 25 control of the Business. 137 1 "... the things that could be managed by the 2 business needed to be well managed with strong 3 leadership. The Board asked [you] if [you] had 4 considered changing the person leading for the 5 business." 6 That's a reference to Susan Crichton? 7 A. It is, yes. 8 Q. Did they ask you had you considered relieving her of her 9 duties? 10 A. I don't recall today but I'm sure they did, if that's 11 captured in the minutes. 12 Q. What did you say? 13 A. I think my response was, which is documented, further 14 on -- 15 Q. Yes -- 16 A. -- is that I thought that Susan was the right person to 17 lead it going forwards and that what we needed to do was 18 to support and put better project management in place to 19 help her do that. 20 Q. You are recorded at (f) as saying: 21 "[You] had considered this and recognised that the 22 business did not have good governance in place around 23 Second Sight ..." 24 Why did you say the business did not have good 25 governance in place -- I'm going to say "concerning 138 1 Second Sight" rather than "around". 2 A. Yes, I don't know whether those are the words or not, 3 but I -- what the business didn't have in place, which 4 it then put in place, when we went into the Mediation 5 Scheme, was proper project and programme management 6 around making sure, as much as it could, although that 7 continued to be a challenge, that the work was 8 progressed in a reasonably efficient and in a manner 9 that was within budgets that had been approved, because 10 the Board issues were particularly timing and budget, at 11 this stage. 12 Q. You're recorded as saying that the independence of the 13 review, amongst other things, had made this complicated? 14 Why had the independence of the review made good 15 governance complicated? 16 A. The way an organisation like -- well, any large 17 organisation like Post Office would work, with 18 independent and external consultants, is that you would 19 normally agree a work plan and you would have 20 workstreams and you would have timescales related to 21 those workstreams. 22 This was -- for me, I think as well as everybody 23 else, this was a very unusual situation where Second 24 Sight came in, and they were taking -- they were 25 independent, and that was the case all of the way 139 1 through. They had an idea of how they would approach 2 things. They had been asked to keep the JFSA on board 3 or happy. They had MPs who were speaking to them as 4 well, and so this was a very complicated context in 5 which to manage a piece of work, and the Board hadn't 6 I think really understood the complexity of that. 7 The directors around the Board table, the NEDs, 8 other than the Chair, had no experience of the 9 complexities of work involving these sorts of bodies and 10 MPs, and their view was this ought to have been very 11 straightforward and why hadn't it been so? 12 Q. You're asked to conduct a post-mortem, a review -- 13 A. Yes. 14 Q. -- is that right? 15 A. Yes. In fact, I think I had suggested that to the 16 Chairman before this meeting. 17 Q. So you presented Susan Crichton's Board paper in her 18 place? 19 A. Yes, I -- 20 Q. She was made to wait outside on a chair -- 21 A. Yes, and I felt bad about that. 22 Q. -- sitting there like a naughty schoolgirl. 23 A. It must -- she must have felt terrible. 24 Q. You presented her paper, you took over the issues, 25 didn't you? 140 1 A. I imagine what I did was certainly not present her 2 paper, because I was not Susan, I was not a lawyer. 3 I suspect what happened is that I asked the Board if 4 they had questions on this paper and, where I might 5 be -- where I answered them -- where I could answer 6 them, I would and, where I couldn't, there was 7 an opportunity where the Chairman had said that people 8 could speak to Susan but, from memory, there was not 9 a formal presentation of this paper because what 10 happened is the Board had a pretty free ranging 11 conversation about how the Post Office had not managed 12 this piece of work better. 13 Q. Susan Crichton has told us in the Inquiry that she spoke 14 to you before the meeting to say that, in her view, 15 there would be many successful claims against the Post 16 Office arising from past wrongful prosecutions; did she 17 tell you that? 18 A. I have no recollection of that whatsoever. 19 Q. That would be very significant information, wouldn't it? 20 A. It would. Could you remind me? I heard Susan's 21 evidence. I don't -- 22 Q. Yes. She said that she spoke to you before this meeting 23 to say that, in her view, there would be many successful 24 claims against the Post Office arising from past 25 prosecutions? 141 1 A. I don't recall that at all. My recollection is what is 2 in her paper, which is that the lawyers had found -- 3 thought it would be about 5 per cent of the cases they'd 4 looked at. 5 Q. If she had told you that, that would be about the last 6 thing you wanted to hear, wouldn't it? 7 A. No, not at all. I approached this in -- Mr Beer, 8 I would not cover anything up in this process. That 9 would not have been -- 10 Q. That -- I'm sorry. 11 A. I'm sorry, because this is an important point, if -- 12 Q. That's why I'm asking you about it. 13 A. Yes, I'm sure it is. If Susan had explained that to me 14 very clearly, why, in her paper, did it say 5 per cent? 15 And, if she had said that to me, I never once withheld 16 information from the Board and I have to go in and brief 17 her paper. I'm very sorry but my recollection on that 18 is I don't recall it. 19 Q. Did you take over her paper and present it, or the 20 issues in it, to prevent the Board from hearing her 21 opinion? 22 A. No. I've told you exactly what happened, which is I was 23 expecting her to come in and, minutes before that should 24 have happened, the Chairman told me she had decided to 25 stand Susan down. 142 1 Q. Did you tell the Board about what you had been told, 2 concerning evidence that the Fujitsu expert had given to 3 courts which had led to prosecutions, in which he had 4 not disclosed his knowledge of bugs in Horizon? 5 A. That I can't remember because the way it was presented 6 to me was not in the way that I now understand it to 7 have been so important, and I didn't see the Simon 8 Clarke advice of 15 July. It was presented to me as 9 I've explained, as a frustration, and something that 10 seemed -- that was a logic that I couldn't follow -- 11 that Lesley Sewell had explained and I couldn't follow 12 either. 13 I can't imagine that I would have withheld that 14 level of information but what you're asking me about is 15 much more serious, and I didn't brief the Board on that 16 aspect of it because I didn't know. 17 Q. Let's try and break that down. You hadn't got a copy of 18 the Clarke Advice? 19 A. No. 20 Q. You had been told by two people, Lesley Sewell and Susan 21 Crichton -- 22 A. Yes. 23 Q. -- that there was a concern that the Fujitsu expert had 24 given evidence to courts in which he had failed to 25 reveal his knowledge of bugs, errors and defects in 143 1 Horizon? 2 A. Yes. 3 Q. There's no record of you telling the Board about that? 4 A. No, there isn't, and I don't know at what stage the 5 Board became aware of it. 6 Q. Susan Crichton -- 7 A. But if I may, the brief that was going to the Board was 8 in Susan's paper. 9 Q. Susan Crichton did know about the Clarke Advice, didn't 10 she? 11 A. I understand -- yes, obviously she knew about the Clarke 12 Advice. 13 Q. Ought this to have been the occasion on which the Board 14 was briefed about the Clarke Advice? 15 A. Yes, it should have been in her paper because she was 16 going to get the written evidence three days late -- 17 well, the day -- she received the written evidence the 18 day before the Board. 19 Q. The Post Office was in possession of expert legal advice 20 to say "The expert we've relied on in criminal 21 proceedings to secure the conviction of subpostmasters 22 is an unreliable witness and breached his duties to the 23 court". The person in possession of that information is 24 sitting outside on a chair. You're not telling the 25 Board about it. You have a summary of it on your 144 1 account. How has this state of affairs come about? 2 A. I have been put in a position in the Board meeting with 3 no notice to present the paper by Susan. As I say, 4 I don't think there was a formal presentation of it 5 because what took place was a wide-ranging conversation 6 that the Board is dissatisfied and this wasn't in 7 Susan's paper. So I had no prompt -- first of all, 8 I had no understanding about the degree of the 9 seriousness of it, and we had, by that stage, stopped 10 most of the prosecutions. So, in terms of it being an 11 meet need of no longer having an expert that wasn't -- 12 which might have been my reflection, that wasn't front 13 of mind. 14 Q. So this is a series of unfortunate events? 15 A. No, I was asked -- I was asked to take this paper in 16 that Susan had prepared, that was not in the paper, and 17 I don't suppose it would have crossed my mind to have 18 raised that because I was not aware at the time just how 19 serious an issue it was. 20 Q. What would you say to the suggestion that this is the 21 Executive Team shielding the board from the Executive 22 Team's dirty laundry? 23 A. I'd say it was completely wrong. 24 Q. That "We can manage the problem away. If the Board 25 know, they will ask the proper questions. They may 145 1 ensure that we disclose all of this stuff to 2 subpostmasters, to the CCRC, to the public and to 3 Parliament"? 4 A. I feel very strongly about that because one of the 5 elements that was so important to me was to have the 6 Board challenged, because I was very aware that I was 7 not a legal expert -- or an IT expert, for that matter, 8 but in this case a legal expert -- I relied on my Board, 9 and I think there is evidence in the Board Effectiveness 10 Review that I took feedback and challenge, and I valued 11 it. 12 Q. The minutes note a list of items for noting, which 13 include a Significant Litigation Report, which itself 14 refers to a separate standalone report for the Board. 15 Can we look at the separate standalone report to the 16 Board. POL00099218, and can we look at page 4, please. 17 If we scroll down, it's 1.1: 18 "... 55 prosecutions a year for the last 10 years." 19 So about 550 prosecutions in which there may be 20 a need to disclose in 5 per cent of cases the 21 "additional evidence". 22 What did you understand the additional evidence to 23 be? 24 A. I think this was relating to the Interim Report. I now 25 know that it also included the Helen Rose Report but 146 1 I don't believe I knew that at the time. 2 Q. So the Board knew, from at least mid-July 2013, that 3 there was a material risk that around 5 per cent of 4 prosecutions undertaken in the name of the Post Office 5 needed to have disclosure that might lead to appeals to 6 the criminal courts being made; is that right? 7 A. Yes. 8 SIR WYN WILLIAMS: Sorry, what was that date again, Mr -- 9 MR BEER: Mid-July. 10 SIR WYN WILLIAMS: Mid-July, yes. 11 MR BEER: 16 July, to be precise. 12 Were you concerned about that number of cases, or 13 did you regard it as small or trifling? 14 A. No, not at all. This was an extremely serious matter 15 and was something that I was relying very heavily on the 16 Legal team to lead and advise on. I do remember the 17 last line of paragraph 1.2, as well, that there had 18 been -- so this was a serious concern but there was 19 a small reassurance that it was no means certain that 20 each appeal would be successful -- 21 Q. What point are you making there? 22 A. In that I think the -- I think this is covered somewhere 23 else in another document, that Cartwright King had said 24 that -- let me make it very clear, first of all -- any 25 wrongful prosecution, any at all, one, would have been 147 1 unacceptable and the Post Office needed to do whatever 2 it needed to do in that instance. 3 There was a concern about the number of prosecutions 4 that the Post Office had conducted and that its external 5 lawyers were saying that it was unlikely to be 550; it 6 was likely to be potentially 5 per cent of that number, 7 and that, from their view, having reviewed this, there 8 was a view that perhaps even fewer than that would be -- 9 would have been unsafe convictions. 10 And the Board, I think, was -- and this is, again, 11 this is Susan's paper. This isn't information I've 12 presented but the Board would want to have an idea of 13 the scale of what we were going to be dealing with. 14 Q. How did it react, the Board, to that information, in 15 your presence, "we may have only wrongfully prosecuted 16 a small number of people"? 17 A. I don't recall because I don't know how much of Susan's 18 paper we actually got through. As I said, I really 19 don't think that I presented it page by page, point by 20 point. 21 Q. Did you say, "I'm not a legal expert, the person that is 22 is sitting outside on a chair"? 23 A. I'm sure I did but the Chairman, I think, positioned it 24 very clearly at the beginning that there was a reason -- 25 I think she possibly had the thought of bringing Susan 148 1 in at some stage, I'm not sure how Susan would have felt 2 about that. But the Board ran out of time and Susan 3 didn't come in. 4 Q. Can we move on to later on the same day, 16 July, and 5 look at POL00192088. We'll see at the top there's 6 a reply from you on the morning of the Board meeting at 7 7.05, in response to a Mark Davies email the previous 8 day. Let's look at the Mark Davies email first. 9 15 July at 5.51: 10 "Paula 11 "I have been reflecting on our conversation on 12 Friday around Horizon. 13 "The danger in reputational terms is that the issue 14 rumbles on without conclusion both before and after the 15 'final' Second Sight Report. This could really damage 16 the business and hamper NT." 17 That's Network Transformation? 18 A. That's right. 19 Q. How would the issue rumbling on damage or hamper Network 20 Transformation? 21 A. I believe this was Mark referring to -- if there was -- 22 I'm not entirely sure. If there was either no 23 resolution to the cases that were coming in to the 24 scheme, or -- I had a feeling this was around people 25 being worried about the impact of Horizon, and the issue 149 1 with Network Transformation is that we were closing and 2 relocating about 3,000 to 4,000 post offices, and 3 recruiting new subpostmasters, many with existing retail 4 outlets that the post offices were going to be put into 5 and I think there was a concern that it might impact 6 people's willingness to consider that. 7 Q. It wasn't to do with Government funding, that, if this 8 Second Sight issue dragged on, it may impact on the 9 extent to which the Post Office was funded for Network 10 Transformation. 11 A. No, I have seen that and I think the Chairman made 12 a point in relation to that but that was never my 13 understanding. 14 Q. Okay, I'm going to let others ask questions about the 15 relationship between the Post Office's conduct and 16 Government funding. He continues: 17 "We need somehow to take the sting out of it, in 18 advance of the report. 19 "We are taking the right steps in looking to the 20 future ..." 21 What did you understand him, Mark Davies, to mean, 22 "We need to take the sting out of the final Second Sight 23 Report in advance of it being published"? 24 A. I'm not entirely sure, actually. 25 Q. "We are taking the right steps in looking to the future 150 1 ... 2 "But none of these will go far enough to address the 3 damage which some believe they have suffered. These 4 cases will continue and the noise will be louder as the 5 [Second Sight] process concludes. 6 "There is an opportunity here to make a big 7 statement about the kind of business we are and intend 8 to be in the future. 9 "We can't though issue a blank apology because we 10 just don't know the details of each case. At present we 11 also face the risk of an 'open-ended' situation where 12 the pipeline of cases is potentially very long. 13 "So I wonder whether something like the following 14 would work: 15 "We create an independent panel to oversee cases 16 where a [subpostmaster] feels lack of training or 17 support contributed to an issue (therefore in addition 18 to the legal review). 19 "We proactively invite people to submit their cases 20 to the panel (including writing to the likes of those in 21 the telegraph piece). 22 "The panel is chaired by a QC or perhaps a former 23 MP/peer." 24 Scrolling down: 25 "It hears evidence from the [subpostmaster] and 151 1 [Post Office] on the training and support elements and 2 reaches a 'judgment'. 3 "Evidence is made public. 4 "We allocate funding to compensate in cases where 5 training and support is judged to have fallen short (but 6 the fund is limited). 7 "... this is potentially expensive and needs more 8 thought ..." 9 Then the top of the page. You say: 10 "... this is very helpful. Susan and I discussed 11 last evening with one of our experienced lawyers, and 12 came up with a similar idea of a discussion and 13 resolution Forum, which could be chaired by 14 a professional mediator. 15 "We should play into the Board discussion and 16 regroup afterwards." 17 Who were the experienced lawyers that you spoke to 18 the previous evening? 19 A. I don't recall, I'm sorry. I imagine Bond Dickinson, 20 because I had no contact with Cartwright King. I don't 21 think I met ever any of the lawyers from Cartwright 22 King. 23 Q. Was this where the idea for a mediation scheme was born 24 in this exchange of emails here? 25 A. No, I think that -- my conversation with Susan on the 152 1 station when I'd -- at the end of my journey home, was 2 only me and her. That's my very clear recollection of 3 the first time that we had a conversation about 4 a mediation scheme and, whether she had spoken to Mark 5 as well -- because I didn't remember Mark making this 6 recommendation until I saw this document in the Inquiry 7 disclosures. 8 So whether Susan and I had had a discussion and 9 I asked her to set up a call with somebody so that 10 I could understand it better, I'm not sure. 11 Q. Let's move forward to 26 July when you go back to the 12 Board. POL00006590. 13 This a document dated 26 July. It's further, in 14 paragraph 1, as it says, to the Board discussion on 15 16 July, and: 16 "... provides an update on how we're taking forward 17 the programme of work in response to the publication of 18 the Second Sight Report." 19 A. I'm sorry, could you just give me the date again? 20 Q. 26th -- 21 A. Thank you. 22 Q. -- I think, I'll just check that. Yes, if we go to 23 page 8. 24 A. That's fine, I'm happy to take your -- 25 Q. At the foot of the page, 26 July. 153 1 A. Thank you. 2 Q. So it appears that this document was prepared, is this 3 right, for the Board in response to the actions that the 4 Board had asked you to take on the previous occasion -- 5 A. Yes, I think so -- 6 Q. -- not the post-mortem? 7 A. No, this isn't the post mortem, no. This is, I think, 8 the next steps in terms of work going forwards. 9 Q. Then if we scroll down to paragraph 4. I should have 10 said to start with, did you write this? 11 A. No, I didn't write this. 12 Q. Who wrote it? 13 A. I think -- I heard Susan question who wrote it. I think 14 Martin Edwards wrote this, and -- 15 Q. Your Chief of Staff? 16 A. My Chief of Staff but there is a -- I mention that 17 I have -- somewhere I mention that I have offered to 18 Susan to be able to use Martin to help her as 19 an additional resource. Martin could only have written 20 this with input from others. 21 Q. In paragraph 4, the report to the Board says: 22 "We have ... been focusing on developing an approach 23 to respond to these expectations which balances the 24 requirements to be cost effective, time efficient and 25 credible. We have two specific concerns around Second 154 1 Sight's role ... 2 "As a two-man team they do not have the capacity to 3 deal with all these cases within an acceptable 4 timescale; and 5 "Their approach of seeking to reconcile the 6 conflicting evidence and views of the Post Office and 7 subpostmasters -- which stems from a steer from James 8 Arbuthnot that they needed to 'keep the JFSA onside' -- 9 is pushing them into an almost impossible situation, 10 which both extends the time taken to conclude each case 11 and, more worryingly, creates a tendency for them to 12 place a greater weight on the subpostmaster's version of 13 events, irrespective of the evidence we [produce]." 14 Then page 2 -- sorry, I should have looked at the 15 bottom of page 1: 16 "We propose to address these concerns: 17 "restricting Second Sight's remit to the specific 18 task of preparing an impartial [evidential] base with no 19 requirement to iron out any inconsistencies between the 20 two sides' positions. We propose that this process of 21 resolution will instead be pursued by employing 22 an independent professional mediator, who will seek to 23 facilitate a dialogue between the Post Office and the 24 subpostmaster to arrive at a sensible conclusion; and. 25 "changing the way we work with Second Sight, by 155 1 allocating additional senior level resource with a deep 2 understanding of the network to work closely alongside 3 them, in order to answer their queries and help them 4 prepare an accurate evidence base as quickly and 5 efficiently as possible." 6 Who did that person turn out to be? 7 A. I think that was Angela van den Bogerd. 8 Q. She was the chosen one for that? 9 A. She was the senior individual who had the expertise and 10 the experience across the business to do the work we 11 believed needed to be done, supported by a team who also 12 had experience. 13 Q. Paragraph 6: 14 "The mediator ... is likely to be a senior, 15 independent lawyer with specific experience and 16 expertise in mediation. [Their] role will be to help 17 the subpostmaster and Post Office find common ground and 18 hopefully some form of resolution to the subpostmaster's 19 complaint. They would not have authority to impose 20 a financial settlement or any other warm of resolution 21 on the parties." 22 Then page 3, paragraph 11: 23 "We also considered the option of supporting Second 24 Sight with additional capacity from another firm ... 25 However, this would not address the underlying issues 156 1 ... We therefore concluded that the repudiation process, 2 alongside more collaborative joint working and no 3 arbitrary time limit, would be the best way to balance 4 our various objectives." 5 This was the proposed ways forwards, wasn't it? 6 A. Yes. 7 Q. A way forwards that meant it was impossible to deal with 8 anyone who'd been convicted of a criminal offence? 9 A. I hadn't read that into this. 10 Q. You thought that this was going to be able to resolve 11 those complaints of those people who had been convicted 12 of criminal offences? 13 A. We didn't have any conversation about excluding criminal 14 cases from this and the documentation that was produced 15 to support the mediations -- the Complaint Review and 16 Mediation Scheme, clearly envisaged criminal cases going 17 into it, because there were questions and answers 18 related to if "I have a previous conviction, may 19 I submit my case?" 20 Q. What was going to happen to those that were convicted of 21 criminal offences? How was the mediator going to deal 22 with their conviction? 23 A. Mr Beer, I don't know. I wasn't involved in that -- if 24 that conversation took place at all, I wasn't involved 25 in it. 157 1 Q. What's happened to the "We need to review convictions 2 going back 12 to 18 months, we need to review 3 convictions going back up to a decade"? Has that been 4 lost now, that idea? 5 A. I don't -- I'm not entirely sure but we did have some 6 advice -- not seen -- from Brian Altman, I think, who 7 reviewed the process that Cartwright King were going 8 through. I believe found that it was when fundamentally 9 sound and there was -- he looked at the start point 10 which he decided I think was proportionate at the time 11 but that the Post Office would need to be open to that 12 going back further if that was necessary. 13 Q. Were utility all of that at the time or are you 14 repeating what you've now read? 15 A. That's -- that's good question, because -- I'm very 16 clear on that now. I think at the time, that is 17 documented somewhere. I'm fairly sure that, not in any 18 great detail, but I knew at least some of that at the 19 time. 20 MR BEER: Thank you. 21 Sir, that might be an appropriate moment. I wonder 22 whether we can break until 3.20, please. 23 SIR WYN WILLIAMS: Yes. 24 (3.07 pm) 25 (A short break) 158 1 (3.20 pm) 2 SIR WYN WILLIAMS: Mr Beer. 3 MR BEER: Ms Vennells, can we move on to late August 2013, 4 please, by looking at POL00116218, and page 2, and 5 scroll down, please. There's an email from you of 6 27 August to Alwen Lyons and Susan Crichton about the 7 draft note for the Board. In the third paragraph, you 8 address a different issue. You say: 9 "Susan, a couple of questions ... I have just read 10 the mediation pack tonight ..." 11 Just stopping there, was that a collection of 12 documents that was to be given to putative applicants to 13 the scheme? 14 A. Yes, I think so. 15 Q. "... page 10 clearly states that compensation can be 16 a possible outcome. When we discussed this, the hope of 17 mediation was to avoid or minimise compensation but as 18 far as I can see, the pack doesn't really suggest any 19 other outcome (difficult to do I know). And so this 20 will be the page that [subpostmasters] will pay 21 attention to. You explained that there were steps in 22 place to advise [subpostmasters] entering the process 23 that this was a chance to be heard and not to expect 24 compensation. How are we planning to manage those 25 expectations? And where compensation may be offered, 159 1 you mentioned small figures in the £3,000 to £5,000 2 band: can we give a range of costs?" 3 Was it your view that mediation was to avoid paying 4 compensation? 5 A. No, my view was, as I explained earlier from the 6 conversation with Susan, that it would be in those cases 7 where it was possible, a way for resolution to have 8 a conversation between -- a mediated conversation -- 9 between the Post Office and a subpostmaster, and I'm 10 playing back to her exactly the content of the 11 conversation and the way that she explained it to me. 12 So what I had then seen in documentation was something 13 that was different to what I had expected. 14 Q. You say here, when the pair of you discussed it, the 15 hope of mediation was to avoid -- ie it wouldn't happen 16 at all -- or to minimise the amount of compensation. 17 Was that your hope: that the process of mediation would 18 avoid paying any money to subpostmasters? 19 A. No, the purpose of mediation was to seek a resolution, 20 and within -- 21 Q. Why does this say that there then? 22 A. Because, within that, as I say, it had been Susan's 23 suggestion -- and it had been a conversation about 24 whether this might or might not have been a good idea 25 and, as she explained it, this was one of -- I can't 160 1 remember exactly but, clearly, we must at this stage 2 have had concerns about potentially paying out major 3 compensation if it wasn't due -- there wouldn't have 4 been concerns about that if it was due, clearly -- but 5 the suggestion of mediation had been a way of dealing 6 with what I expected to be cases that -- where the Post 7 Office thought resolution could be sought in that way. 8 And we had discussed compensation and I mention 9 there the sort of small levels of figures, and, in fact, 10 we did pay more than that in some cases. 11 Q. What you're saying here is "We've got a private hope of 12 paying out nothing. The document we're giving to 13 subpostmasters doesn't tell them that". 14 A. Well, clearly I'm saying that because it didn't. But 15 I don't think it was a private hope. I don't use that 16 word and I'm playing back to her the conversation which 17 had been her suggestion, which I thought sounded a very 18 sensible solution. 19 Q. Was it always your intention that token payments should 20 be made? 21 A. That appropriate payments, that -- 22 Q. No, I'm asking was it your intention that token payments 23 should be made? 24 A. No, and that word has been used elsewhere, I've seen 25 it -- 161 1 Q. And attributed to you? 2 A. -- and gratuitous -- yes, and -- it wasn't meant in the 3 negative sense that could be assumed. My understanding 4 of the Mediation Scheme is that it was going to be 5 a conversation around resolution of issues -- around 6 understanding and hopefully reaching resolution of 7 issues, and Susan had said to me, and I recall this 8 today very clearly still, that sometimes only an apology 9 is necessary. 10 So I had gone into this assuming that -- and with no 11 prior knowledge or professional knowledge of mediation 12 either, as to what it could lead to and, presumably, the 13 fact that I still have this expectation here when I had 14 that further conversation with Susan and a lawyer, 15 I wasn't disabused of that view in that conversation 16 either. 17 Q. Did you have a discussion, therefore, with Susan 18 Crichton in which you expressed a hope that mediation 19 was a means to avoid or minimise compensation? 20 A. I don't remember having the conversation after this. 21 I don't know what happened after this email. 22 Q. No, no, before this? 23 A. The conversation -- no, the conversation with Susan 24 Crichton was that mediation could be a very helpful way 25 of resolving the misunderstandings and issues that the 162 1 Post Office and subpostmasters were facing and that it 2 would be an independent way of doing that, that there 3 was a process of mediation and adjudication. It wasn't 4 done to avoid or minimise compensation. 5 Q. Why did you write an email -- 6 A. Because that was a factor -- 7 Q. Why did you write an email which says, "When we 8 discussed this the hope of mediation was to avoid or 9 minimise compensation"? 10 A. Because that was what we discussed. 11 Q. Right, good. 12 A. But, sorry -- 13 Q. That was easy then, wasn't it? 14 A. But not as -- not as the purpose of doing it, that one 15 of -- 16 Q. The hope -- 17 A. -- the aspects -- 18 Q. The hope? 19 A. Possibly, yes. 20 Q. A desire, a good outcome, we don't have to pay any money 21 out? 22 A. I'm sorry, you're presenting it in a way that I didn't 23 understand. 24 Q. What does the hope of mediation -- 25 A. I didn't -- 163 1 Q. -- to avoid compensation mean then? 2 A. Because my understanding was that the conversation 3 around mediation was that it would -- was that mediation 4 would be a conversation and, if it was appropriate, then 5 compensation could be paid but we were not thinking 6 about large scale compensation. That wasn't the nature 7 of what I understood the issues to be. That's what I'm 8 trying to say here. And maybe I haven't chosen the 9 words well enough to represent it but it wasn't -- what 10 I'm challenging is that I didn't want us to, I guess, 11 set expectations that the Post Office couldn't meet. 12 Q. The subpostmasters who were raising the concerns were 13 those that had lost money, hadn't they? 14 A. Yes. 15 Q. The Post Office had forced them to make good the losses, 16 hadn't they? 17 A. Yes. 18 Q. Some of them had been pursued through the courts, yes? 19 A. Mr Beer, with hindsight, this is completely wrong. 20 Q. No, at the time, you knew these facts, didn't you? 21 A. Yes. 22 Q. Their salaries had been docked or garnished hadn't they? 23 A. They had agreed to money being paid back on a monthly 24 basis, yes. 25 Q. Agreed? 164 1 A. Yes -- 2 Q. They agreed to -- 3 A. Sorry, they were obliged to, yes. 4 Q. Thank you. You never intended to pay out any 5 substantial figures in compensation for those issues at 6 all, did you? 7 A. Not in -- no, that's right. Not in terms of the 8 Mediation Scheme, because that was not what I had 9 understood it would do. 10 Q. Can we look, please, that POL00100336. This is a note 11 in 2014, of 24 February 2014 and, if we look at page 2, 12 we can see it's Chris Aujard, your Interim General 13 Counsel's note -- back to page 1 -- of a meeting between 14 you and him on the one hand, and Messrs Warmington and 15 Henderson on the other. 16 A. Yeah. 17 Q. In paragraph 2, it's recorded as follows: 18 "It was noted by [you] that the projected level of 19 claims was currently [around I think that's 20 £100 million] ..." 21 A. Yes. 22 Q. "... in response to which [Second Sight] noted that 23 their back of the envelope calculation was of the order 24 of £25 to £50 million." 25 You're recorded as observing: 165 1 "... that this was a long way from the figures that 2 were in mind when the schemes was established, which 3 were much smaller, and more of the nature of a 'token' 4 with an apology." 5 A. Yes. 6 Q. When the scheme was established, it was your intention 7 to make mere token payments, wasn't it? 8 A. That was the point in the previous email, is that we 9 were looking at smaller -- we could not possibly have 10 paid out token payments for the cases that we now know 11 about, at the time the scheme was put in place and the 12 advice I was given is that this is the way that it would 13 work and, as we got into more and more of the detail, 14 and the claims came through, we were suddenly faced with 15 a potential bill of 100 million. 16 SIR WYN WILLIAMS: Sorry, Mr Beer, is this 24 February '14 17 or '15? I missed it. 18 MR BEER: I think it's '14. 19 SIR WYN WILLIAMS: '14. Thank you. 20 MR BEER: You wanted to minimise the cost to the business, 21 didn't you? 22 A. I had a responsibility to the Board around the budgets 23 that had been agreed and this information was shared 24 with the Board. 25 Q. You wanted to give them, at most, a meagre sum and 166 1 an apology without really understanding or investigating 2 what the cause of their problems was, didn't you? 3 A. No, that isn't the case. All types of cases were 4 welcomed into the scheme but my understanding at the 5 beginning of it was very different to what it turned out 6 to be. 7 Q. Everyone was welcomed in, so long as they had a pat on 8 the head and a token payment when they left? 9 A. I agree that it sounds like that now. This was not the 10 case at all. 11 Q. You wanted everyone to get the bare minimum, to forget 12 all of this and move on, didn't you? 13 A. No. 14 Q. That can come down. Thank you. 15 Did you blame Susan Crichton for the Second Sight 16 review? 17 A. I'm sorry, did I blame Susan Crichton for -- 18 Q. Yes, the Second Sight review. The first one, the one 19 that led to the Interim Report of the 8 July 2013. 20 A. I had a difficult conversation with Susan about what -- 21 Q. I'm not asking whether you had difficult conversations 22 at the moment. I'm asking did you blame her? 23 A. Did I blame her? Susan had two responsibilities on 24 that. She had the legal oversight as a General Counsel, 25 and she was -- she herself has said somewhere -- 167 1 responsible for the delivery or the oversight of the 2 project and, if the project hadn't worked out as had 3 been originally planned, she had some accountability for 4 that part of it. 5 I didn't blame Susan, that wasn't my style and you 6 will see in documents that I tried to help her through 7 this. I challenged back to the Board when they asked 8 whether or not Susan should lead it going forwards and 9 my view was that, yes, she should. I then put in place 10 some additional help and I met with her. 11 Q. The Board appeared to have blamed Susan for the Second 12 Sight review. Was that in getting Second Sight in, in 13 the first place, through her previous relationship with 14 them, ie choosing the wrong people, or a failure to 15 manage them once they had started their work, or both? 16 A. I think it was -- and I want to be careful not to use 17 the word "manage" in the wrong way -- but I think it was 18 the latter rather than the former. I don't ever 19 recollect anybody ever saying that it was -- Susan had 20 brought Second Sight in and that was the root of what 21 the Board saw the problem to be. 22 Q. Okay, so they weren't blaming her for choosing the wrong 23 team? 24 A. I don't think so, no. 25 Q. Can we look, please, at POL00381629. This is, I think, 168 1 a file note of a number of meetings with Susan 2 Crichton -- 3 A. Yes. 4 Q. -- and then some reflections by you on those meetings. 5 A. Yes, this was -- 6 Q. The first is wrongly dated 30 September, that should be 7 30 August 2013; is that right? 8 A. That's right. 9 Q. We're familiar with this, so I'm going to take it at 10 some speed. This is in Costa -- 11 A. Yes. 12 Q. -- on Goswell Road. First paragraph: 13 "[She] had asked me earlier in the week how I felt 14 about her continuing in the business and what job I was 15 expecting her to do. I was slightly surprised she had 16 raised the issue again -- we had already had 17 a conversation where I said I wanted to help her restore 18 her reputation after the Board discussion." 19 Was her reputation such that it needed to be 20 restored? 21 A. That was what she felt, yes. I -- well, I suppose that 22 would have been a fair reflection on her part because 23 the Board had asked me whether she was the right person 24 to lead it going forwards. I think that I had reassured 25 the Board that I thought she was. 169 1 Q. Second paragraph: 2 "Susan was very, very angry. She yelled at me. She 3 thinks this has damaged her reputation. She was upset 4 that Alice had commissioned the RH [that's the Richard 5 Hatfield] review." 6 Yes. 7 A. Yes. 8 Q. That's essentially the post mortem? 9 A. Yeah. 10 Q. "She was cross that I hadn't got her the [terms of 11 reference] before I circulated it to Alice, Alisdair and 12 [Richard Hatfield]. She was convinced there was 13 a breakdown of trust. [Especially] between her and 14 Alice. But with the Board generally. Although she did 15 say that all the Board except Susannah had been in 16 touch. 17 "[You] explained [you] had not had the time to give 18 her the [terms of reference] ..." 19 Next paragraph -- 20 A. And that if she wanted to make changes to it, I was very 21 open to that. 22 Q. Thank you: 23 "It is clear [next paragraph] that the [Hatfield] 24 review has destabilised her. She shouted that she was 25 looking at other jobs. She threatened that we would 170 1 have to have her back, implying the importance of 2 references. 3 "She raised that Alice had made mistakes. [You 4 said] that we probably all had and Alice had accepted 5 that [Hatfield] needed to be even-handed. I reminded 6 [Susan] again that I had raised (with Alice) the 'issue' 7 of Alice also needing to be interviewed. And I said 8 that whilst I would be asking Alice about a couple of 9 challenges Susan raised ..." 10 Then: 11 "... (Alice believing Donald ..." 12 That's Donald Brydon. 13 A. Yes. 14 Q. "... and BIS comments about a [Post Office] cover-up?) 15 ..." 16 So you say there to Susan that you would be asking 17 Alice about a couple of challenges that she, Susan, had 18 raised, namely Alice believing Donald and BIS comments 19 about a cover-up by the Post Office. So had Susan said 20 to you that Alice believed that Donald and the 21 Department believed there was a Post Office cover-up? 22 A. I'm sorry, I don't remember, but if that's what I've 23 said -- I think that's what that implies. I don't 24 remember, and there's a question mark at the end of it 25 so it appears that I hadn't heard that before. 171 1 Q. You say: 2 "[You] wanted to be loyal to the Chairman as [you] 3 believed that she had imagined the [Hatfield] review 4 would be a way of moving on." 5 You note in the next paragraph, in brackets: 6 "(... Susan is clearly making lawyers notes on 7 everything ...)", as were you, I think. 8 A. Afterwards, yes. 9 Q. Yes. 10 A. Yes. 11 Q. "(... I would like the two of them to repair the 12 relationship. Not sure how doable the latter is, but to 13 have it break down totally at present is not in anyone's 14 interests.) 15 "I mostly listened and took the anger. Eventually, 16 she calmed down and I said I would (genuinely) like to 17 help her find a way [back through]. She began to be 18 positive again as [you] walked back to [Old Street], 19 Susan suggested I join her and her HR team for her 20 moving on supper. [You] said you would be happy to do 21 that and how sorry [you] were that it had happened so 22 quickly ... she had helped make the function much 23 stronger and [you were] grateful to her." 24 Then over the page, on 2 August in meeting room, you 25 reflected that: 172 1 "... Susan's request to been in BD ..." 2 Is that Bond Dickinson? 3 A. It is, yes. 4 Q. "... was more about her lack of confidence and decided 5 to reassure her that I was happy to take her opinions 6 ..." 7 What was that about, bringing in Bond Dickinson to 8 do or about what? 9 A. I don't recall. I think previously she'd mentioned 10 about -- I'm not sure but I think you just have to take 11 this at face value that, actually, I was -- I had 12 already said I thought Susan could lead through this. 13 I had given her -- we'd had a previous conversation, I'd 14 given her some additional support and a list to things 15 that she could do to sort of address the leadership 16 issues around this and I wanted to show that I was 17 confident in her. 18 Q. Next paragraph: 19 "Susan then told me it didn't matter because she 20 couldn't do her job any more. The [Hatfield] review was 21 not the right action for the business. We had ruined 22 her reputation and compromised her. Professionally, she 23 needed to point out that the [Hatfield] review shouldn't 24 happen as not being legally privileged, it could be 25 detrimental to the business but Alice would not believe 173 1 her and instead see her view as defensive. She could no 2 longer be effective: a General Counsel cannot operate if 3 they don't have the confidence of the Chairman/Board/ 4 CEO. I repeated she had my confidence and I cited other 5 business issues in the last several days where I had 6 sought her counsel. I am trying to repair the 7 situation. She pointed to the impossibility of her ever 8 coming before the Board. [You] disagreed -- she will 9 have spoken to all of the Board. And I reminded her 10 that Alice wanted an open and even-handed [Hatfield] 11 'lessons learnt' review. 12 "... if she is right and the [Hatfield] review is 13 not in the best interests of the business, then [you] 14 needed to understand why (she is sending through the 15 legal case). And assuming she is correct then she would 16 need to brief me on how to present the case to Alice, 17 and, we would need to explain at the same time how we 18 were going to demonstrate what lessons had been 19 learned." 20 A. Excuse me, that may have been the point about Bond 21 Dickinson. 22 Q. I see: 23 "Hatfield is due to see Susan and Angela on 24 Wednesday [morning]. If I am going to stop or pause the 25 review, I need to stand him down from those two 174 1 meetings. Seeing [her] in her current frame of mind 2 will not help the business or her. As [Hatfield] is 3 a past colleague of Alice (there are couple of lessons 4 to be learnt here too), then it will be sensible to tell 5 Alice first. 6 "[You wondered] if Susan [was] overreacting to the 7 [Hatfield] review. But she could be right. She will 8 undoubtedly make the legal case against it. 9 Emotionally, she may just throw in the towel if we 10 decided to press ahead. This may also be her way of 11 saying she can't cope with much more pressure at 12 present. 13 "If [she] leaves in the short term, that will be 14 a major setback. She has stabilised the project, she is 15 demonstrating she wants to 'right the wrong' (my 16 words -- not hers). And importantly, the external 17 stakeholders have responded positively, and she has the 18 confidence of the internal team. 19 "I need to find a way of calming this down. And 20 buying us some time to think carefully. We can do 21 a 'lessons learned' internally. And if we do it 22 ourselves, then there could also be some reconciliation. 23 How we handle this will say a great deal about the 24 values of the business." 25 Then "Reflections": 175 1 "... Susan was very emotional." 2 A. Excuse me, may I just make a comment. The line you 3 haven't read is possibly important. "Neil" was Neil 4 McCausland who was the Senior Independent Director and 5 I was obviously going to talk to him about Susan and 6 that could have been for one of three reasons: I may 7 have asked, because if there's an issue with the Chair, 8 you speak to the SID; he may have suggested it because 9 he will have been aware; or Alice herself, who was 10 generally quite straightforward, may also have suggested 11 that I speak to Neil. So I think -- 12 Q. We got some emails of you sending these notes on to 13 Neil. 14 A. Right, okay. 15 Q. "Reflections": 16 "In both meetings, Susan was very emotional. She is 17 hurt. Her ego and self-esteem have been undermined. 18 She swings between wanting to get away from it with 19 a settlement and leave immediately, to building a case 20 to fight and defend her reputation, to accepting that 21 the most satisfactory outcome would be to restore her 22 reputation by managing the Mediation Scheme through to 23 a satisfactory ongoing process. 24 "Each time, we have finished the meeting positively. 25 "Susan has said to me prior to my leave, she would 176 1 never have put a business she worked for in the 2 situation we found ourselves with the [Second Sight] 3 Interim Report, and she wished she had never allowed 4 Alice to persuade her to do the independent review. She 5 should in her view have resigned over it at the time." 6 What does that refer to? 7 A. That, I think, is what I mentioned much earlier today, 8 which I didn't -- I couldn't remember or potentially 9 didn't even understand at the time. She had 10 commissioned the -- sorry, she had had the meeting with 11 Richard Morgan and, I think, other lawyers and had come 12 away from that meeting with a view that there shouldn't 13 have been the review, possibly -- I don't know the 14 detail at all around the cases, and I can only imagine 15 that she spoke to Alice about that and I was out of that 16 loop. I think that is what that is. 17 Q. That doesn't really make sense. She wished she had 18 never allowed Alice to persuade her to do the 19 independent review. 20 A. Yes, so -- 21 Q. No female -- no woman -- is doing an independent review, 22 are they? 23 A. I think my -- my understanding of this, with hindsight, 24 is that Susan had gone to Alice because you will 25 remember that Alice talked about kickback from the 177 1 business or pushback from the business. I hadn't been 2 involved in that conversation. She was -- she had taken 3 advice from Richard Morgan, who had said very clearly 4 that this is just a no-win situation. She'd had 5 a conversation with Alice, and Alice had persuaded Susan 6 that we needed to continue with the independent -- the 7 Second Sight review. 8 Q. I see. Then you say this: 9 "My reflection on what happened with [Second Sight] 10 as I write this today (2/9/13), is that Susan was 11 possibly more loyal to her professional conduct 12 requirements and put her integrity as a lawyer above the 13 interests of the business." 14 When had Susan Crichton put her professional conduct 15 requirements and integrity above the interests of the 16 business? 17 A. I wrote this completely wrongly. What I was trying to 18 say, if I may, is that, as I said earlier, Susan had two 19 responsibilities here. She absolutely -- and 20 I respected it 100 per cent -- had the professional 21 conduct requirements of a lawyer, as the General 22 Counsel. That was her role as the lead lawyer for the 23 organisation. She also had, in parallel, a major 24 project that she was leading and had accountability for 25 delivering for the business which was this independent 178 1 review led by Second Sight, and the latter had bumped 2 into all of the issues and problems that we have 3 discovered today, and what I was trying to say here, 4 very badly, is that she had not managed to combine those 5 two responsibilities. 6 And she hadn't -- and I think this was her point 7 about she wished she -- she wouldn't have let a business 8 get into the situation it was -- she hadn't led the 9 project management side of that as well as she could 10 have done. We had that conversation and I put in 11 additional resource to support her. So I'm genuinely 12 very, very sorry that -- I did not mean this in the way 13 that it could be read. It was about that balance -- 14 Q. It's not the way that it could be read, it's the way 15 that it does read. 16 A. It's the way it reads, the way it does read, but I'm 17 very clear and I don't think there is anything else in 18 the notes of conversations that I had with Susan that 19 puts it this badly but that was the point, that she 20 hadn't balanced those two aspects of her role. But 21 I was sure -- and I think this is now the third time -- 22 that I had gone back to Susan to help her, in her words, 23 restore her reputation and give her the resource to be 24 able to lead this going forwards. 25 Q. Why did you write, why did you type something that 179 1 didn't express what you believed or felt? 2 A. It's clumsy. It's clumsy, Mr Beer. But I absolutely 3 did not mean what this reads when you read it in the 4 cold light, and I think there are plenty of other 5 documents around this that show that it was that balance 6 and it was the project management part of her role, 7 because she was a director of the business leading this 8 piece of work, as well as the lead lawyer. 9 Q. Did you think there was a choice to be made -- 10 A. No. 11 Q. -- between, on the one hand, a lawyer's professional 12 obligations and their integrity -- 13 A. No. 14 Q. -- and, on the other, the needs of the business, and 15 Susan Crichton had made the wrong choice? 16 A. No, I didn't. 17 Q. Why did you type it then? 18 A. I'm sorry, I -- it was -- I've tried to explain, because 19 she had these two areas of responsibility and I think 20 that she neglected the business side but -- and focused, 21 as she had to do all of the time in her job, on the 22 legal side, and that's what I was tying to say. 23 I wasn't at all trying to say that she either hadn't 24 done the legal side or that I thought she shouldn't. 25 Q. Can we look, please, at POL00381455. This is a note of 180 1 a meeting, slightly earlier, 31 July 2013, between Alice 2 Perkins and Susan Crichton. You're not present -- 3 A. No. 4 Q. -- but you were sent this note -- 5 A. Yes. 6 Q. -- see POL00381460. If we look at the bottom of the 7 first page, please, the bottom two paragraphs: 8 "The Board had been unsighted on the issue. They 9 had naturally been alarmed when they found out what had 10 happened and the fact that the Board paper had been so 11 bland had not helped to build their confidence in the 12 handling of the affair (there had been the possibility 13 of a discussion on a Board call the previous week but 14 because we had needed to discuss issues in relation to 15 the strategy and funding negotiations with the 16 Government which required Board decisions, these had had 17 to come first and we had run out of time for the [Second 18 Sight] issue before people had to leave the call)." 19 "In the course of what followed, the following 20 points were made: 21 "[Susan Crichton] said that she now thought it had 22 been right to have the enquiry, as it revealed the 23 imbalance of power between the [postmasters and the Post 24 Office] which needs addressing. This was a huge and 25 complex issue for the business. 181 1 "I [Alice Perkins] commented that I thought that 2 although the outcome had in some ways been good for the 3 [Post Office], the way the process had been handled had 4 been deeply flawed. I had backed [Susan Crichton's] 5 judgement on the appointment of [Second Sight] because 6 we did not want to appoint one of the Big Four, she 7 seemed very confident in them and given her strongly 8 stated opinion to having an enquiry in the first place, 9 I had wanted her to feel some ownership of the process 10 once we had decided to go down that route. We had lost 11 control of the process; I had lost confidence in Simon 12 Baker early on but had been told repeatedly that he was 13 good and capable of handling the role. I said that we 14 should never have got into a position where we did not 15 see the draft of [Second Sight's] report until days 16 before its publication (the complete version Friday 17 before Monday publication). 18 "I understood that [Second Sight]'s investigation 19 had to be independent but in the Civil Service there 20 would have had been someone marking it who was close to 21 all the key people ([Second Sight], [James Arbuthnot], 22 and JFSA) and knew what was going on. By the time 23 I found out how [Second Sight] had, in effect, changed 24 the [terms of reference] to which they were working, it 25 was too late to retrieve the situation. The 182 1 organisation and people in it should have had proper 2 time to consider [Second Sight's] findings and respond 3 to them. [Susan Crichton] questioned my understanding 4 of the endgame and said [the Post Office] had seen the 5 report days earlier; she had been contacted by the CEO 6 while unwell about this and had come back early from her 7 holiday to handle it which had not been ideal." 8 Then next paragraph: 9 "[Susan Crichton] said that as a lawyer it was 10 inappropriate for her to influence key stakeholders. 11 She would have been criticised had she become close to 12 them. I commented if she had felt unable to play that 13 role, she should have flagged that up and that someone 14 else could have been brought into perform it (privately 15 I am astonished at this view which I simply do not 16 recognise from my experience elsewhere)." 17 This is what you were referring to, isn't it, when 18 you said, of Susan Crichton, that she had put her 19 professional conduct requirements and her integrity as 20 a lawyer above the interests of the business? 21 A. I was -- no -- 22 Q. She had not marked these people properly, had she? 23 A. I'm sorry. Those are Alice's words, I've never used 24 that. What I was referring to was that she had, as 25 other directors around the Group Executive did, 183 1 responsibilities for delivering work -- and this was 2 a particular project or process, as Alice calls it 3 here -- and it hadn't delivered to time, to budget. The 4 board felt rushed in terms of seeing it. They hadn't -- 5 normally, a report like this from an independent 6 consultancy -- as we saw earlier on Deloitte, for 7 instance -- would come to the Board, there would be 8 discussions around it, there would be interim 9 discussions, drafts, et cetera. 10 Although the business had had it days earlier, it 11 was only days earlier before it came to the Board and 12 the business itself hadn't had that opportunity. So my 13 comment was not about Susan marking anybody; it was 14 simply about how she managed that balance of her legal 15 responsibilities and her responsibilities to deliver 16 a key business project. 17 Q. So the Chairman of the business is saying that, in the 18 Civil Service, there should have been somebody marking 19 the key players; the lawyer says it would be 20 inappropriate for me to influence the key stakeholders 21 because of my professional -- 22 A. Yes. 23 Q. -- obligations. 24 A. Yes, but also -- 25 Q. The Chairman is astonished at that view and then you 184 1 wrote a note which said the lawyer put her professional 2 obligations above the interests of the business but that 3 didn't refer to this; is that what we're to believe? 4 A. Yes, I -- I'm very clear what I meant about that and 5 I think I also say somewhere else that, if Susan felt -- 6 but this is what Alice says here too -- that if she had 7 felt conflicted in that way then she could have 8 mentioned it to me and, when I had the conversation with 9 her, I think at the end of July, we talked about giving 10 her more resource, so that she could have the support to 11 deliver the project. 12 Q. You and the Chairman were annoyed that Susan Crichton, 13 who that led on this project, had not influenced or 14 massaged the key stakeholders in a way that was 15 favourable to the Post Office, weren't you? 16 A. No, I -- 17 Q. She hadn't marked them close enough? 18 A. That's what the Chairman said; that was not my view. 19 Susan wouldn't have been able to influence Second Sight 20 on a number of the areas that they were critical of the 21 Post Office on because a number of those areas were 22 related to operations. Susan was a lawyer, not 23 an operations manager but she was the director who was 24 overseeing the project, and the project was late. 25 Q. So it's coincidence, is it, that on 31 July, the 185 1 Chairman is writing a note about a conversation that 2 she's having with Susan Crichton, which involves the 3 lawyer's duties and whether it was appropriate or 4 inappropriate for her to mark the key stakeholders. 5 A month later, you wrote a note which said that, in your 6 view, she had allowed her professional obligations and 7 integrity to come above the interests of the business 8 but that note didn't refer to this at all, and was, in 9 effect, a misunderstanding between you and the keyboard? 10 A. Between me and? 11 Q. The keyboard you were typing on. 12 A. I've already explained to you what I was trying to 13 convey in that comment. I would -- and I don't think 14 Alice Perkins would either, have wanted Susan to 15 compromise her professional code, but Alice can speak 16 for herself. My view -- but I was being heavily 17 criticised by the Board because the business hadn't 18 delivered this project to budget and to time, that there 19 were serious complaints within the report that the 20 business said it hadn't been able to deliver its 21 evidence on, and the individual who was overseeing that 22 work from the business point of view, was Susan. 23 And that was all I was trying to say: is that she 24 needed to be able to do both and I was happy to support 25 her to do that going forwards. 186 1 Q. Thank you. Can we turn to a fresh topic, please, which 2 is about the Post Office's attempts to control the 3 narrative. 4 You tell us in your witness statement, it's 5 paragraph 765 -- there's no need to turn it up -- that: 6 "The most important outcome for you and the Board 7 was to ensure that the Post Office complied with its 8 legal obligations." 9 You tell us that you: 10 "... genuinely do not believe there was any culture 11 within senior management at the Post Office to prevent 12 the investigation of complaints about Horizon, rather, 13 we had to do everything reasonable to investigate the 14 complaints." 15 Correct? 16 A. Yes. 17 Q. Can we turn up, please, POL00294854. Turn to page 2, 18 please. If we look down the page, please, to the foot 19 of the page, we will see an email from David Simpson to 20 a group of people. We will later see, I think, that 21 this email gets sent on to you, about Horizon and 22 Private Eye. 23 A. Yes, I'm actually copied. 24 Q. Oh, yes, you're in on this copy. Thank you. Tell us 25 who David Simpson was? 187 1 A. He was the Communications Director for Royal Mail Group. 2 Q. "Mike, Susan, Rebekah, the new edition of Private Eye 3 out today has, as expected, ran an article (attached) 4 about Horizon and the criminals made by some former 5 subpostmasters. The names of the subpostmasters 6 featured are very familiar and the claims made against 7 Horizon are the ones we've seen many times before. The 8 article mentions Shoosmiths and a possible legal action 9 ..." 10 Then: 11 "... not surprisingly -- Private Eye has not run in 12 full the very short statement we [gave] them ... 13 "We think we should write a letter to Private Eye 14 for publication making two simple points: the fact that 15 it is the courts and not [the Post Office] that convict 16 people, and (the point we made in our statement) that 17 the courts have upheld [the Post Office's] position in 18 each court case. 19 "The draft [should] say: 20 "Sir, the Post Office takes meticulous care to 21 ensure that the Horizon ... system in branches 22 nationwide is fully accurate at all times. We do this 23 because public money is entrusted to the Post Office and 24 our customers and subpostmasters rightly expect the Post 25 Office to fully account for every penny. We have fully 188 1 confidence in the Horizon system. 2 "There have been a [small] number of cases involving 3 a small fraction of the Post Office Network where court 4 action has been taken over missing sums of public money. 5 In every case, the courts have consistently upheld the 6 Post Office position that the Horizon records are 7 accurate and reliable. When former subpostmasters have 8 been convicted of theft, it is, of course, the courts 9 that have convicted them, not the Post Office, which has 10 had to provide sufficiently robust evidence of proof 11 otherwise the cases would have failed." 12 Then further up the page, please, Susan Crichton 13 says: 14 "[Thank you] -- my own view and experience I would 15 not write ... this is old news and we don't want to 16 prolong the story." 17 Then your view, at the top of the page: 18 "Susan, I understand and it's a fine line; but 19 I disagree. We need to be front foot and counter 20 anything that has a reputation impact. It is a goal of 21 mine that all press even local press (perhaps especially 22 local press) should be scoured for negative comment and 23 refuted. 24 "I would only NOT do so only if in Shane or Alana's 25 view, it is likely to cause more trouble than it's 189 1 worth." 2 Why was it important for you, at this time, to 3 counter anything that has a reputational impact? 4 A. This was a general ambition of mine, and the important 5 phrase here is where I say "Perhaps especially local 6 press". It's in my statement and I spoke about it at 7 numbers of conferences. The Post Office -- the Post 8 Office's reputation and its brand was built every single 9 day in post offices across the country by the people who 10 worked so hard serving customers, many of whom were 11 particularly vulnerable people, and so it was important 12 to me that, where the Post Office was misrepresented, 13 that that should be corrected, and especially at a local 14 level, because the local post offices were so important 15 to people that -- I think I said yesterday, the 16 reputation of Post Office Limited had no weight at all. 17 It was irrelevant. It was the reputation of the Post 18 Office, your local post office, and that's what I'm 19 trying to say here. 20 It's an ambition to make sure -- because when -- 21 over a number of years, Post Office had been very much 22 a sort of second cousin to Royal Mail, within the group, 23 and what we were trying to do now was to start to build 24 Post Office, its confidence, and to recognise the 25 importance of it in communities, and I think that's what 190 1 I mean here about that. 2 Q. Was that your general instruction to the business: 3 contest all and any negative comments? 4 A. I don't think it's a general -- it was an ambition -- 5 well, only if they were inaccurate. 6 Q. In the Post Office's view? 7 A. In the Post Office's view, yes. 8 Q. So that's why it was a goal to scour local press for 9 negative comment, leaf through newspapers and online, 10 actively find negative comment and knock it down? 11 A. It wasn't -- I didn't commission a piece of work as 12 a result of this. I'm simply stating an ambition for 13 the business here to try to portray the Post Office 14 on -- in a positive way, particularly locally. 15 Q. What did you mean by that local press should be scoured? 16 A. Oh, I think it's a hypothetical statement I'm making, to 17 try to illustrate how important it was that the Post 18 Office was portrayed in the way that people loved it and 19 trusted it. It really was a -- is -- 20 Q. Maybe "was". 21 A. -- a very important -- I'm sorry? 22 Q. Maybe "was". 23 A. I fully accept that this has damaged hugely the Post 24 Office brand but I imagine, if you go to your local post 25 office, you will still find the same level of service 191 1 and the same level of value, and people will respect 2 that. 3 Q. Can we move forwards, please, to other ways in which the 4 narrative, I suggest, was sought to be controlled. 5 POL00380985. If we scroll down, please, we'll see 6 an email from you to a group of senior Post Office 7 Executives, amongst which was Susan Crichton, saying: 8 "My engineer/computer literate husband [has] sent 9 the following reply to the question: 10 "'What is a non-emotive word for computer bugs, 11 glitches, defects that happen as a matter of course?' 12 "Answer: 13 "'Exception or anomaly. You can also say 14 conditional exception/anomaly which only manifests 15 itself under unforeseen circumstances'. 16 "Does that help?" 17 Mr Davies replied at the top: 18 "I like exception [very] much." 19 Did you consider the terms "computer bug", "computer 20 glitch" or "computer defect" to be emotive? 21 A. I shouldn't have engaged in this at all. We -- 22 Q. That's an answer to a different question. 23 A. No, I realise that but I want to say very clearly we 24 should have said "bugs". 25 Q. Did you consider the word "computer bugs, glitches or 192 1 defects", to be emotive? 2 A. I'm not sure why I used "non-emotive". I think what 3 I was trying to do here -- and the Inquiry has seen that 4 the conversation had been started some days earlier -- 5 and I assume that I was asked, so whether I was asked 6 "What's a non-emotive word", I don't know. In my own 7 mind, this seems a -- it isn't now, I fully accept 8 that -- but it seemed a reasonable request because the 9 two bugs that we were dealing with -- and this is wrong, 10 but I understood at the time to be not -- as I've 11 mentioned before the word "red herring" was used. 12 They were two bugs which had been fixed, the 13 business had responded to them appropriately and 14 I didn't think that -- what I was trying to do was to 15 avoid what often happened within the Post Office, and 16 I imagine still does, was misinterpretation of something 17 in relation to the Second Sight work and the Horizon 18 computer system, where it had been dealt with, and my 19 understanding of the way it was explained to me was that 20 that had been done in the way it should. 21 I should have said "bugs". I should not have sent 22 the email. I should have said "bugs" and so should the 23 rest of the organisation. 24 Q. Did you and your senior Post Office colleagues call 25 these things "bugs", "glitches" and "defects", during 193 1 your internal meetings or did you call them "exceptions" 2 and "anomalies"? 3 A. I think we've seen numbers of different descriptions. 4 Q. Before this time, did you call them "bugs"? 5 A. There was certainly -- I think when Alwen Lyons phoned 6 me to tell me about it, I think she said, "We found two 7 bugs", or -- mm, I'm not sure, but ... 8 Q. Why did you ask your husband for non-emotive words for 9 computer bugs, et cetera? 10 A. Because we were looking to find a different word than 11 "bugs". 12 Q. Yes, but why? 13 A. Because, as I've just tried to explain -- wrongly and 14 stupidly, and we should have said "bugs" -- we were 15 trying to keep the proportionality, I thought, around 16 two issues that had arisen that were not anything to do 17 with the systemic impact on the system or the Second 18 Sight Interim Report. 19 Q. Did you initiate this discussion or was it one of the 20 recipients to your email? 21 A. I think it had been initiated beforehand because I think 22 the Inquiry has seen a note from Alwen -- but I don't 23 necessarily want to suggest that it was Alwen who 24 initiated it -- but her note where she talked about 25 incidents was a few days before this. 194 1 Q. Did this become part of the Post Office's communication 2 strategy? 3 A. The words were picked up, yes. "Anomaly" was picked up 4 and "exception" was picked up. "Strategy" is probably 5 too strong a word but, yes, the words were adopted. 6 Q. You were seeking to manipulate language here, weren't 7 you? 8 A. Yes, we were seeking to use language that I thought 9 described better the situation and avoided confusion and 10 conflation with something that I viewed as completely 11 separate. 12 Q. You thought that using the word "anomaly" or "exception" 13 would help people to understand that a problem with 14 a computer, which was a bug, a glitch or a defect had 15 limited impact? 16 A. Yes, because that was how I understood it: that these 17 were anomalies or exceptions. They were bugs. 18 Q. Why do you think you got this wrong, then, now? You've 19 said sorry, you shouldn't have asked this, you shouldn't 20 have done this. But, if what you're saying is true, it 21 was entirely appropriate? 22 A. It was, and that was why the -- that was why I engaged 23 in doing this but, with hindsight -- 24 Q. So why are you apologising? 25 A. Because, with hindsight, it was wrong. 195 1 Q. But why, with hindsight; what was wrong? If what you're 2 saying is true, that what you'd been told that these two 3 bugs had very limited impact, they were red herrings, 4 why are you apologising? 5 A. Because what I've learned since is that there were many 6 other bugs in the system that affected restricted 7 numbers of branches, that, equally, could have been 8 described as anomalies or exceptions and, in fact, what 9 these were manifestations of was an instability in 10 a system that I wasn't aware of. 11 Q. You were involved consistently over the years in the 12 development and agreement to the Post Office's media 13 strategy in relation to Horizon, weren't you? 14 A. Yes, the Communications Director worked to me. 15 Q. Sorry, this email can come down. Can we look, please, 16 at POL00111694. We're quite late in the piece here, 17 February 2019. So a couple of months before you left. 18 If we look at the foot of the page, please, you'll see 19 an email from Tom Cooper at UKGI to, amongst other 20 people, you; can you see that? 21 A. Yes. 22 Q. He asks, second paragraph: 23 "To what extent can the court protect [the Post 24 Office] against journalists overstating the evidence re 25 Horizon? If a journalist writes that there is evidence 196 1 of [systemic] problems with Horizon when in fact no such 2 evidence exists, will the court help us? 3 "Seems to me extremely important to have a press 4 strategy that seeks to stop misrepresentation by 5 journalists and seeks to protect [the Post Office's] 6 business today against the implication that the current 7 system doesn't work properly." 8 If we just look at your reply at the top of the 9 page, please, you say: 10 "Yes we defend robustly but we avoid adding extra 11 coverage. 12 "As before we hold the ground: the system is robust. 13 And not comment any further during the trial. So 14 'aggressive' no, robust -- absolutely no question. 15 "We are trading well. We will continue to trade 16 well. The system ... works and the trial doesn't change 17 that. A very firm line." 18 This was still your approach in February 2019, 19 correct? 20 A. It was. The system that I was referring to here, 21 though, is the system that was introduced -- I put 2010 22 but actually it was 2017, I think -- and Judge Fraser 23 found that that was far more -- had far more integrity 24 than the other previous -- the Horizon Online and Legacy 25 Horizon. 197 1 Q. Next paragraph-but-one: 2 "The strategy has worked well so far, which is to 3 minimise coverage in mainstream media." 4 Was that the Post Office's approach, even in 2019: 5 minimise coverage? 6 A. Yes, I think it was because there was always this 7 concern, as Tom Cooper himself said in his email, about 8 trying to manage misrepresentation in the media, and -- 9 so that the chronology wasn't confused between Legacy 10 Horizon and the current Horizon. And I can't remember 11 at this stage but I don't believe the company had yet 12 gone through the Horizon trial. 13 Q. Then, penultimate paragraph: 14 "Your questions re how far we go 'legally' are 15 important. We have used injunctions and demanded 16 apologies in the past." 17 When had you used injunctions in the past? 18 A. I'm not sure, actually. I may have got that wrong. 19 There was a -- I know Mark Davies -- 20 Q. Did you threaten injunctions? 21 A. -- Mark Davies had had conversations with some media and 22 lawyers had been -- I think he had maybe sought advice 23 from lawyers but I don't think we had used injunctions, 24 actually. 25 Q. Had you threatened the BBC with injunctions? 198 1 A. We had certainly considered legal advice at the time, 2 where people thought the coverage was wrong. 3 Q. And demanded apologies in the past. Is what you say 4 here reflective that, in your tenure as CEO, you had 5 always defended Horizon robustly? You had taken a very 6 firm line with the media, including threatening 7 injunctions and demanding apologies? 8 A. You won't find that I asked about injunctions. That 9 was -- I think I was informed about that as the Board 10 were informed about it but, yes, certainly demanded 11 apologies where the business felt that it had been 12 misrepresented, and defended Horizon, yes, because 13 again, I had had confidence in the system. I regret 14 that hugely now. 15 Q. Can we turn to POL00184390 and look at the foot of the 16 page, an email from Alan Bates to George Thomson at the 17 NFSP: 18 "Dear Mr Thompson, 19 "So close to Christmas and with delays in the mail, 20 I have attached a pdf of a letter to you which is 21 self-explanatory about a forthcoming investigation into 22 the Post Office Horizon system which I believe will 23 benefit your members. If you so wish, it could be 24 published in the SubPostmaster Magazine. 25 "Once January arrives there will be significant 199 1 press coverage about this investigation in order to 2 ensure the widest possible audience is reached." 3 This is about Second Sight, isn't it? 4 A. Yes, yes. 5 Q. So Mr Bates writing politely to a leader of the NFSP 6 saying, "There's an investigation into Horizon that 7 might be of benefit to your members, maybe you could 8 publish it in the SubPostmaster Magazine". Quite 9 reasonable, really; do you agree? 10 A. Yes. 11 Q. If we scroll up, please. Email to Nick Beal, Kevin 12 Gilliland and you: 13 "Hi Nick 14 "I have just received this rubbish from JSA, 15 obviously I will tell him Horizon is secure and robust 16 and to go away. Just keeping [Post Office] in the 17 loop." 18 The NFSP weren't supposed to be the cheerleaders for 19 Horizon, were they? 20 A. The NFSP, including the Executive Council, were all 21 subpostmasters and they would have fallen into the 22 overused statement about "the majority of people didn't 23 have problems with Horizon". So I imagine they reached 24 this conclusion from their own personal experiences. 25 Q. Really? Or were you just happy to have a tame and 200 1 pliant NFSP in your pockets? 2 A. It was very -- it was very helpful to have the General 3 Secretary of the NFSP saying that Horizon was secure. 4 I didn't use Horizon every day. His wife did, in their 5 post office, and his colleagues were also running post 6 offices. So, for me -- I don't agree with George's 7 style but this is -- 8 Q. Rubbish? 9 A. -- very much -- yes. Yes, with hindsight it is, isn't 10 it? But George was quite independent of mind. 11 Q. And who paid the NFSP's bills? 12 A. At this stage, I'm not entirely sure, but the Post 13 Office certainly made a contribution towards them, 14 I think, a little bit later than this. They lost their 15 status as a union. 16 Q. Penultimately, can I quickly address your approach with 17 Government and MPs. You tell us in paragraph 42 that 18 there were no Government representatives on either the 19 Post Office Board or the Royal Mail Group Board when you 20 first joined the Post Office, but that had changed by 21 the time you became MD. 22 A. No, by the time I became Chief Executive. 23 Q. I see. So in 2012? 24 A. In 2012, post-separation. 25 Q. Can you recall who they were, from time to time? 201 1 A. The first Government Non-Executive Director was Susannah 2 Hooper, who became Susannah Storey. 3 Q. Was that between 2012 and 2014? 4 A. I think so, yes. Then it was Richard Callard and then 5 it was Tom Cooper. 6 Q. Mr Callard, 2014-'18; Mr Cooper '18-'23? 7 A. Right. Thank you. 8 Q. You tell us in your witness statement that the Post 9 Office Board met with Government officials in ShEx and 10 UKGI and that their Non-Executive Directors were active 11 in their challenge and contribution to board meetings; 12 is that right? 13 A. Yes. 14 Q. In your view, were ShEx, and therefore the Government, 15 aware of the views of Alan Bates and the Justice for 16 Subpostmasters Alliance through the Post Office? 17 A. Yes, I think so, particularly because the work had been 18 started with -- by Alice Perkins and Alice was 19 personally quite involved and would often join briefings 20 with the Board. So I'm sure they would be -- 21 Q. Aware of -- 22 A. -- and also there were, at an executive level, fairly 23 regular contacts with officials in ShEx -- what then 24 became UKGI -- as well. 25 Q. Were they aware of the interests and activity of Lord 202 1 Arbuthnot in the cases of individual subpostmasters and 2 with the Horizon system generally? 3 A. I believe so. 4 Q. Aware of the involvement of Second Sight and the work 5 carried out by them? 6 A. Yes. 7 Q. Aware of the concerns which the Post Office had at the 8 time about the nature and quality of Second Sight's 9 work? 10 A. Yes. 11 Q. Aware of the concerns raised about the reliability of 12 some past convictions? 13 A. Yes. 14 Q. Were they made aware that advice had been obtained from 15 Cartwright King and Brian Altman KC? 16 A. Yes. 17 Q. Aware of the involvement of, and a summary of the advice 18 of, Linklaters? 19 A. Yes. 20 Q. Were they aware of the fact of the Group Litigation and 21 the Post Office's strategy in the Group Litigation, 22 including the decision to apply for the recusal of 23 Mr Justice Fraser, as he was? 24 A. Yes. 25 Q. Were you a party to the decision -- 203 1 A. Sorry, just on that last point, if I may? 2 Q. Yes. 3 A. Because of a family situation, I had to step back from 4 my role as Chief Executive sort of from January 2019 5 onwards. I was involved sort of in and out of the 6 business as we were going through hospital visits, and 7 then stepped back much more from March. So I wasn't 8 always in the meetings where the Board discussed the 9 recusal, but I'm fairly sure there are Board minutes 10 that list -- that Richard Callard or Tom Cooper was 11 present at the time. 12 Q. That was the last topic I wanted to ask you about. 13 I think you -- is this right, although you make the 14 point that you just have -- that, through personal 15 circumstances, your involvement in the strategy and 16 direction of the Group Litigation diminished in the 17 course of 2019; is that right? 18 A. Yes, that's right. 19 Q. You, nonetheless, I think, were on the call in which 20 a decision was made to ask the judge to recuse himself? 21 A. No, that's not quite right. I joined a call late and, 22 just for clarification, there is documentation that says 23 that the Tim Parker didn't know that I was on 24 a particular call. It was because I joined late. He 25 did know later on; I told him about that. And I'd been 204 1 asked to join the call. I think he and possibly Tom 2 Cooper had to recuse themselves from that decision, 3 which was taken later than the call and I had been asked 4 to join that call by Al Cameron and by Ken McCall, who 5 was the SID. 6 Q. You joined silently; is that right? 7 A. I joined silently, yes. 8 Q. Without anyone knowing that you had joined? 9 A. Ken McCall and Al Cameron, and possibly Jane MacLeod, 10 knew, but I wasn't sure that I was going to be able to 11 join it at all, and I didn't take part in -- I left the 12 call, and the discussion about the recusal took place 13 either later, or on a different call, or a different 14 meeting. 15 Q. Can we look, please, at PVEN00000505. Then next page, 16 please. I think these are a series of communications 17 between you and Jane MacLeod; is that right? 18 A. Yes, that's right. 19 Q. Are they texts or some other form of communications that 20 you've cut into a Word document? 21 A. I think ... I imagine they were texts. Yes, I -- 22 Q. Anyway, second one down. Whatever medium was used to 23 communicate, you sent a message at 1.04 on 20 March, and 24 you say: 25 "Jane, I was listening on the earlier call. I get 205 1 the impression Tim intends to join the main [board] call 2 now. Obviously he doesn't know I was on the [earlier] 3 call. Can you let me know if you still want me to give 4 a view? [Thanks] Paula." 5 Jane MacLeod: 6 "Sorry Paula -- I wasn't watching my phone and 7 didn't see your message. The board has approved both 8 appeal and the recusal. Happy to discuss if [it] 9 helps." 10 Then you: 11 "[Thanks] -- I'm pleased." 12 Then further down: 13 "Apologies ... Been running around getting things 14 going." 15 Then later, at 11.33: 16 "Hi Al, any chance of a quick call ..." 17 This is to Mr Cameron: 18 "As Tim and Tom are excusing themselves from the 19 recusal decision and Ken is [very] worried about 20 chairing it, she has asked if I might offer a view, by 21 email and caveated of course. 22 "I'm prepared to do that but as you know, I would 23 normally consult widely on something this serious. We 24 can talk before or after the Lord Grabiner call." 25 A. Yeah. 206 1 Q. Then scroll down. If we look at the next page, there, 2 if we just get the date by scrolling up a little bit. 3 I think it's the 21st, the next day, and then scroll 4 down. 5 You to Mr Davies: 6 "... I felt the same about the board, very proud and 7 pleased. Difficult but completely the right decision 8 (the opposite would have been unconscionable after what 9 both Lords Grabiner and Neuberger [had] said)." 10 A. Yeah. 11 Q. Had you listened to what Lords Grabiner and Neuberger 12 had said on the call? 13 A. I only listened on one call and I think that was 14 presumably the Lord Grabiner call. I had had 15 conversations with -- these would have been phone calls, 16 because I wasn't in the office -- with Al Cameron, 17 I think Ken McCall and Jane MacLeod. So I may have 18 heard what Lord Neuberger said through them. 19 Q. Not directly but indirectly? 20 A. I don't think so, yes. Indirectly. 21 Q. Overall, was the board keen to take these decisions to 22 recuse and to appeal? 23 A. It was really difficult. I mean, I've said this here. 24 It was -- and the Inquiry has documentation on it -- it 25 was a very, very difficult decision. Nobody really 207 1 quite knew what to do but the views that came through 2 from Lord Grabiner that I heard, and I think what 3 I heard about from Lord Neuberger -- and again, you have 4 documentation on this -- were very strong that the Post 5 Office had a very good case and the Board took that 6 decision. 7 Q. Why were you proud? 8 A. Because I think it took -- so I knew the colleagues 9 around the Board table. This was about the people 10 around the table, not anything more than that. They 11 were being asked, as individuals, to take 12 an extraordinarily difficult decision to ask a judge to 13 recuse himself and I think it was also about appealing 14 the case, and they're decisions that nobody in their 15 professional life wants to be involved in, frankly. 16 They're very, very difficult, and I -- 17 Q. Why were you pleased? 18 A. Because I think, had I been involved in the 19 conversation, I probably would have arrived at the same 20 conclusion. 21 MR BEER: Thank you. 22 THE WITNESS: Thank you. 23 MR BEER: Ms Vennells, they're the only questions that 24 I ask. You will be asked some questions tomorrow by 25 Core Participants. Thank you. 208 1 THE WITNESS: Thank you. 2 SIR WYN WILLIAMS: Speaking of tomorrow, Mr Beer, 3 I understand that you've agreed a timetable with the 4 Core Participants. We needn't address it now but it's 5 all in hand. 6 For personal reasons, I will not be participating in 7 the room but participating remotely, but I fully expect 8 that the excellent behaviour which has prevailed 9 throughout the course of the day will continue, 10 notwithstanding I'm on the screen, as opposed to sitting 11 here. I have an easy means of controlling you all, even 12 on the screen, but Mr Beer will act as my adjutant, or 13 whatever the correct army term is, in ensuring 14 everything goes smoothly. 15 That's tomorrow. 16 Just one or two other announcements, firstly, some 17 people are aware -- in fact you may all be aware, that 18 the lady you have heard about, Ms MacLeod, is not 19 willing to come and give oral evidence to the Inquiry. 20 I think I indicated to Core Participants through the 21 Secretariat or my Legal Team that we would provide 22 an explanation for that. If I haven't done that, I'm 23 now telling you that we will provide an explanation in 24 writing which should be with you tomorrow. 25 The final announcement I wish to make is that you 209 1 may have heard there's going to be a general election 2 shortly. My view currently is that that will not 3 interfere with the timetable of the Inquiry, save for 4 the day of the election and the day after. I have 5 decided that we will not sit on 4 July and 5 July but, 6 subject to that, I propose, so far as humanly possible, 7 to continue as if the election is not occurring. 8 So those are the announcements that I wish to make, 9 and tomorrow we'll start again at 9.45. Thank you. 10 MR BEER: Thank you, sir. 11 (4.37 pm) 12 (The hearing adjourned until 9.45 am the following day) 13 14 15 16 17 18 19 20 21 22 23 24 25 210 I N D E X PAULA ANNE VENNELLS (continued) ...............1 Questioned by MR BEER (continued) .............1 211