1 Wednesday, 5 June 2024 2 (9.44 am) 3 MR BEER: Good morning, sir, can you see and hear us? 4 SIR WYN WILLIAMS: Yes, thank you very much. 5 MR BEER: Thank you very much. May I call Alice Perkins, 6 please. 7 SIR WYN WILLIAMS: Yes. 8 ALICE ELIZABETH PERKINS (affirmed) 9 Questioned by MR BEER 10 SIR WYN WILLIAMS: Ms Perkins, before Mr Beer begins to ask 11 you questions, there's something I need to tell you 12 about and that is that, under our law, a witness at 13 a public inquiry has the right to decline to answer 14 a question put to her by any lawyer, or by me, if there 15 is a risk that the answer to that question would 16 incriminate the witness. This legal principle is known 17 in shorthand form as the privilege against 18 self-incrimination. 19 I consider that fairness demands that I remind you 20 of that principle before you give your evidence. 21 However, I need to tell you that it is for you to make 22 clear to me, in respect of any question put to you, that 23 it is your wish to rely upon the privilege. 24 If, therefore, any questions are put to you by 25 anyone or by me which you do not wish to answer, on the 1 1 grounds that to answer the question might incriminate 2 you, you must tell me immediately after such question is 3 put and, at that point, I will consider your objection 4 and, thereafter, rule upon whether your objection to 5 answering the question should be upheld. Am I right in 6 thinking, Ms Perkins, that you're represented by lawyers 7 here today? 8 THE WITNESS: Yes. 9 SIR WYN WILLIAMS: Well, then, if the issue relating to 10 self-incrimination arises, they are entitled to assist 11 you, so that, if at any stage during the questioning you 12 wish to consult your lawyers about the privilege, you 13 must tell me and then I can consider whether that is 14 appropriate. Do you understand all that? 15 A. I do. 16 SIR WYN WILLIAMS: Thank you very much. Then over to you, 17 Mr Beer. 18 MR BEER: Thank you. 19 Good morning, Ms Perkins, my name is Jason Beer and 20 I ask questions on behalf of the Inquiry. Can you tell 21 us your full name, please. 22 A. I'm Alice Elizabeth Perkins. 23 Q. Thank you. Before we start the questions, I should say 24 that there's a fire alarm at 10.00 am today, it is 25 a drill and therefore we are all going to remain in the 2 1 room while the procedure takes place. 2 Before I ask you questions I understand there is 3 something you wish to say; is that right? 4 A. Yes, there is. 5 Q. Yes, please do. 6 A. Thank you. I realise that the words I am about to use 7 may not be acceptable to some people and I understand 8 that but they are sincerely meant. I want to apologise 9 to all the subpostmasters and mistresses and their 10 families who have suffered at the hands of the Post 11 Office. I have some understanding of what people have 12 been through and the ways, the different ways, in which 13 their lives were wrecked over so very, very many years. 14 I am more sorry than I can say that, despite serious 15 efforts on my part to get to the bottom of what was 16 going on, I did not succeed in doing so during my four 17 years at the Post Office and, therefore, the suffering 18 of those affected was prolonged. 19 Q. Thank you. Ms Perkins, you've kindly made a witness 20 statement which is very detailed. It is 232 pages long. 21 It is dated 26 March 2024. Can we look at the last page 22 of it, please. For the record, the transcript URN is 23 WITN00740100. So the last page is 232. 24 A. Yeah. Yes. 25 Q. Is that your signature? 3 1 A. It is. 2 Q. Are the contents of the witness statement true to the 3 best of your knowledge and belief? 4 A. They were when I signed that, yes. 5 Q. Are they now? 6 A. Yes. 7 Q. Good. Thank you. That witness statement will be 8 uploaded to the Inquiry's website for everyone, if 9 they're interested in it, to read it. I'm not going to 10 ask you detailed questions about every part of it; do 11 you understand? 12 A. Yes. 13 Q. Thank you. Can I start, then, with your background and 14 experience. You were the Chair of the Board of the Post 15 Office between September 2011 and July 2015; is that 16 right? 17 A. Yes. 18 Q. As Chair, you were contracted to work two days per 19 week -- 20 A. Yes. 21 Q. -- but you explain that you, in fact, worked more than 22 that? 23 A. Yes. 24 Q. In terms of your background, you're a history graduate. 25 Upon graduation in 1971, you joined the Civil Service 4 1 and then you worked, is this right, for the DHSS, the 2 DSS, the Treasury, the Department of Health and, 3 finally, the Cabinet Office? 4 A. Yes. 5 Q. You left the Civil Service in 2005, becoming 6 a Non-Executive Director of a company called TNS and 7 then BAA? 8 A. Yes. 9 Q. You tell us in your witness statement -- there's no need 10 to turn it up, it's page 19 -- that you had no direct 11 experience of managing a company operating a large IT 12 system; is that right? 13 A. It is. 14 Q. What impact did the absence of direct experience of 15 managing a large IT system or a company that operated 16 a large IT system have on your work in the Post Office? 17 A. It had the effect that I wasn't familiar with the 18 language, the IT language, I think you could say, and, 19 therefore, when we were discussing IT issues, I didn't 20 have the same instincts which I would have had, had 21 I been dealing with a subject with which I was familiar. 22 So I think that there are two things here: one is that 23 the technical terms were unfamiliar but that, secondly, 24 I could rely on instincts developed over the years in 25 respect of very many of the things that I was dealing 5 1 with at the Post Office but I did not have those 2 instincts in relation to IT. 3 Q. Would you agree, however, and here I'm quoting Lord 4 Arbuthnot, that the issues raised by the scandal relate 5 to more than an IT system: they relate to the behaviour 6 of people within the Post Office; the behaviour of 7 people within Fujitsu and the Government; and the legal 8 system? 9 A. Yes. 10 Q. You tell us in your witness statement -- it's 11 paragraph 441, no need to turn it up -- that you did not 12 seek out Board members with specialist expertise in 13 criminal prosecutions or technical knowledge of large IT 14 solutions. 15 A. Yes. 16 Q. Why? 17 A. Because when I was first at the Post Office, which was 18 in July 2011, the mandate that I was given was set out 19 very clearly by the Chairman of the Royal Mail Group, 20 Donald Brydon, and, subsequently, set out at great 21 length by the then Secretary of State in January 2015 in 22 a six-page letter, where he covered, if you like, the 23 Government's vision for the Post Office, the need to 24 turn it round from a loss-making organisation into one 25 that was breaking even, the requirement to modernise, 6 1 and so on. I won't go on at length but it is all set 2 out there. 3 And what I was looking for was a Board of 4 Non-Executive Directors who would be equipped to deal 5 with that agenda and, at that time, I did not 6 understand -- at the very beginning, when I was selected 7 and appointed, I didn't know anything about this issue 8 at all. It emerged as I joined the Post Office in my 9 induction but, in those early months when I was looking 10 for Non-Executive Directors, I had no idea that this was 11 going to turn out to be the issue that it has turned out 12 to be. 13 Q. It emerged quite quickly though, didn't it? 14 A. It emerged in the sense that a couple of people -- well, 15 two or three people, raised it in the first few months, 16 two of them in, I think, September 2011 and then Lord 17 Arbuthnot approached me in early 2012. So I became 18 aware that there was an issue but I didn't understand 19 the scale of this issue or the complexity of it. 20 Q. By the time the Second Sight investigation was set up in 21 mid-2012, it must have been clear, mustn't it, that this 22 was a very significant issue for the company? 23 A. Yes. 24 Q. At that point, never mind at the beginning, did you 25 consider whether the Board had adequate expertise on it 7 1 in relation to matters concerning either the criminal 2 prosecution of staff or IT knowledge? 3 A. There was one member, non-executive member of the Board, 4 who was the Chair of the Audit and Risk Committee who 5 did have experience of transformational programmes 6 dependent on IT, and that was one of the reasons why 7 I was keen to appoint him. But to answer your question, 8 technical, detailed IT expertise, no, and I'm afraid 9 that that question was not one that came into my mind at 10 that point. 11 Q. You tell us in your witness statement, it's also 12 paragraph 441: 13 "Had such expertise been available to inform our 14 Board discussions, we might have been better equipped to 15 test the information being presented to us regarding the 16 integrity of the Horizon software and the safety of the 17 prosecutions of subpostmasters." 18 Are you saying that there is a possibility that the 19 scandal may have been averted, had the composition of 20 the Board been different? 21 A. I don't know the answer to that question. 22 Q. You raise this as a reflection -- 23 A. Yes, it's possible. 24 Q. -- "Had the expertise been different" -- 25 A. Yes. 8 1 Q. -- "then we may have been better able to test the 2 information" -- 3 A. Yes. 4 Q. -- "being given to us" -- 5 A. Yes. 6 Q. -- "by executives." 7 A. Yes, I think we would have been better able to test that 8 information. I think that is undoubtedly true. Whether 9 that would then have led to the outcome everybody would 10 now have wanted, I can't say. 11 Q. Can we turn -- you've mentioned it already -- to your 12 induction. 13 A. Yeah. 14 Q. One of the things that happened in the very first month 15 of you attending a Board meeting, September 2011, is you 16 had a meeting with Angus Grant? 17 A. Yes. 18 Q. He was the partner at Ernst & Young handling the Post 19 Office Account; is that right? 20 A. Yes. 21 Q. Was this a one-to-one meeting -- 22 A. Yes. 23 Q. -- ie it was a meeting without any Post Office 24 Executives present? 25 A. Yes. 9 1 Q. I think this would have been one of your very first 2 meetings on appointment as Chair of Post Office, ie very 3 early in your tenure? 4 A. Yes. 5 Q. In what circumstances was the meeting arranged; why was 6 it arranged? 7 A. It was part of my induction. I asked for advice when 8 I first arrived about who I should meet. A lot of the 9 meetings were internal meetings with Post Office 10 Executives but a lot of them were with people outside 11 the company and it seemed to be, you know, the obvious 12 thing to do to talk to one of the auditors, or to talk 13 to the audit partner. 14 Q. Who advised you to talk to the audit partner? 15 A. I'd have asked -- I can't remember exactly but I think 16 I would have asked for that. 17 Q. Right. You would wish to pay, I suspect, very careful 18 attention to what Mr Grant told you? 19 A. Yes. 20 Q. He was independent of the Post Office? 21 A. Yes. 22 Q. He was a professional person? 23 A. Yes. 24 Q. He was part of a regulated profession? 25 A. Yes. 10 1 Q. He, would you agree, would be exactly the type of person 2 who would give you or may give you information which 3 company executives might not? 4 A. Absolutely. 5 Q. Indeed, that's the very purpose or one of the very 6 purposes of independent auditors -- 7 A. Yes. 8 Q. -- is that right? 9 A. Yes. 10 Q. Can we look, please, at WITN00740122. It'll come up on 11 the screen for you. 12 A. Yeah. 13 Q. This is a handwritten note, is this right, that you took 14 of the meeting? 15 A. I don't know whether I wrote these notes as he was 16 talking or whether I wrote them afterwards. 17 Q. So they are either contemporaneous notes, ie you jotted 18 things down as he spoke -- 19 A. Yeah. 20 Q. -- or the meeting ended and then you wrote the note up 21 at some point afterwards? 22 A. Yes. 23 Q. Is this in a Post Office notebook? 24 A. Yes. 25 (Pause for fire alarm test) 11 1 Q. Thank you. I think we can see that this a Post Office 2 notebook if we just pan out a little bit. The logo in 3 the bottom left, a symbol in the bottom right and then 4 one of those messages in the top right-hand corner? 5 A. Yeah. 6 Q. "We do not see things as they are, we see them as we 7 are!" 8 Can we look halfway down the note, please. It's 9 about two-thirds of the way down the page there and it 10 starts with the words "With Fujitsu", can you see that? 11 A. Yeah. 12 Q. I wonder if that can be highlighted. It's the seventh 13 clip. That's it. Does that read: 14 "With Fujitsu, [Post Office] drove a very hard 15 bargain on price but they took back on 16 quality/assurance." 17 A. Yes. 18 Q. I want to ask you about all of the note that follows 19 that sentence -- 20 A. Okay. 21 Q. -- and, in particular, three things, starting with that 22 very sentence: 23 "With Fujitsu, [Post Office] drove a very hard 24 bargain on price but they took back on 25 quality/assurance." 12 1 Firstly, is that Mr Grant, the partner at Ernst & 2 Young, speaking? 3 A. Yes. 4 Q. That's something that he said to you? 5 A. Or words to that effect, yes. 6 Q. Yes. Do you understand that what you were being told 7 was that the Post Office had driven a hard bargain with 8 Fujitsu on the price of Horizon? 9 A. Yeah, that's what he was telling me, yes. 10 Q. But that Fujitsu, for its part, had compromised on the 11 quality of Horizon -- 12 A. Yes. 13 Q. -- ie they, Fujitsu, had taken back on quality? 14 A. That's what I would have understood him to be saying at 15 the time, yes. 16 Q. And that they, Fujitsu, had taken back on assurance: 17 they had compromised on the assurance that they could 18 give as to Horizon? 19 A. Yes. 20 Q. That's a very significant message to have received -- 21 A. Yes. 22 Q. -- wasn't it? 23 A. It was. 24 Q. Would you agree that's the first significant message you 25 received in this meeting? 13 1 A. Yeah -- I mean, I haven't looked at what goes before -- 2 Q. The top bit? 3 A. But yeah, I think, yes. 4 Q. Then the next part we should read it as well: 5 "Chris ..." 6 I think that's: 7 "Chris's role in relation to procurement." 8 Is that a reference to Mr Day -- 9 A. I think so. It must be. 10 Q. -- ie the newly appointed Financial Director for the 11 Post Office? 12 A. Yes. 13 Q. "Chris's role in relation to procurement. 14 "Very close relationship with Mike Young." 15 A. Yes. 16 Q. On that -- and this isn't central but I just want to get 17 your evidence on it -- is that Mr Grant saying that 18 Chris Day had a very close relationship to Mike Young or 19 Ernst & Young had a very close relationship to Mike 20 Young? 21 A. I can't remember. I think it's probably -- I think it's 22 probably a reference to Chris Day but I don't -- I can't 23 be sure. 24 Q. Then: 25 "RMG [Royal Mail Group], good procurement -- Cath 14 1 Harmiston." 2 Is that right? 3 A. Yes. 4 Q. "IT -- have made progress. 5 "Getting documentation [and] process better." 6 Then this the second thing I want to ask you about. 7 You've written: 8 "Horizon -- is a real risk for us." 9 Then, as subpoints: 10 "Does it capture data accurately. 11 "Cases of fraud -- suspects suggest it's a systems 12 problem." 13 A. Yeah. 14 Q. Can I look firstly then at what that means. As to the 15 sentence which says "Horizon is a real risk for us", 16 does the "us", to your understanding, refer to Ernst & 17 Young or the Post Office? 18 A. Ernst & Young. 19 Q. So Ernst & Young were saying to you directly that 20 Horizon, to them, was a real risk? 21 A. To them, yes. 22 Q. That's a very significant piece of information to 23 receive, isn't it? 24 A. Yes. 25 Q. You would agree that, if the computer system, which 15 1 11,900 Post Office branches use at this time, as we 2 often hear on a daily basis, to process millions of 3 transactions worth billions of pounds a year, is a real 4 risk to the independent professional auditors, then it's 5 also a real risk to the Post Office too, isn't it? 6 A. I think that when I was listening to this, one of my 7 very first meetings, I interpreted this point as a point 8 from the perspective of the auditors and their ability 9 to audit the accounts. I don't think -- wrongly -- that 10 I would have made the connection to the operation of 11 Horizon at the branch level. I'm not sure I would have 12 made that connection. But I think you're coming on to 13 the next point. 14 Q. Yes. Doesn't one follow the other? 15 A. I realise now, yes. But I don't think -- I mean 16 I remember something about this meeting and I don't 17 remember that that was the connection that I made at the 18 time. 19 Q. But why not? Isn't it rather straightforward and 20 obvious, if the auditors are saying that the computer 21 system is a real risk for them, ie it may affect their 22 ability to sign off the audit, there may be something 23 wrong with the computer system and, if there's something 24 wrong with the computer system, that's important for the 25 Post Office itself in its day-to-day business? 16 1 A. Yes, I see that absolutely clearly. But I think what 2 I'm trying to say to you is that, at the time, I'd been 3 in the role for a few weeks, I'm absorbing a great deal 4 of information and I don't recall making the link, the 5 weight of that link, in that way, if I can put it like 6 that. 7 Q. The two lines that are underneath, "is a real risk for 8 us", are they essentially bullet points explaining some 9 of the reasons why Horizon was seen as a real risk for 10 Ernst & Young? 11 A. The two bullet points? 12 Q. Yes. 13 A. You mean -- 14 Q. So one starting "does it capture" and the next starting 15 "Cases of fraud"? 16 A. Okay. So the first of those, "does it capture data 17 accurately", I am clear that that was said from the 18 Ernst & Young auditing perspective. The second one was 19 a different point. What Angus Grant was saying to me 20 was that there had been cases of fraud and that some of 21 the suspects thought that this was a systems problem. 22 Q. So they're not subparticulars of "is a real risk for 23 us": only the first of them is? 24 A. For Ernst & Young, yes. 25 Q. The first bullet point, as I've called it, then, the way 17 1 you've written it suggests that this is a concern being 2 raised by Ernst & Young, rather than something that the 3 suspects suggest, which is the next bullet point, yes? 4 A. Yes. 5 Q. Again, on its own, that is rather significant 6 information to receive, isn't it? 7 A. Yes. 8 Q. The auditor questioning whether the Horizon system 9 captures data accurately? 10 A. Yes. 11 Q. You say in your witness statement, in relation to 12 this -- I'm not going to turn it up at the same time: 13 "... Angus Grant had identified Horizon as 'a real 14 risk' for his audit team and they had to provide 15 assurance that the system was capturing data 16 [accurately]." 17 A. Yes. 18 Q. Maybe we should look at it at the same time. It's 19 witness statement, page 48, please. 20 Can we just look at the foot of page 47, first. The 21 very last sentence on page 47 is: 22 "My note of the meeting would suggest that Angus 23 Grant had identified Horizon as 'a real risk' for his 24 audit team", which is what you've told us today. 25 A. Yes. 18 1 Q. Then: 2 "... and that they had to provide assurance that the 3 system was capturing data [accurately]." 4 That's not recorded in the minute, is it, or note? 5 A. No. 6 Q. Instead, what's recorded in the note is a different 7 point, which is an issue being raised by Ernst & Young 8 as to whether Horizon captures data accurately, not 9 saying, "and we had to provide assurance that it was"? 10 A. I think what I'm saying in the witness statement is kind 11 of a follow on. I'm not -- so he had identified Horizon 12 as a real risk for his audit team. Whether he then went 13 on to say they had to provide assurance that the system 14 was capturing data accurately, I think is a thought that 15 comes from later papers about the management -- about 16 the annual report and accounts. 17 Q. Yes, well, if we can put to side thoughts that came 18 later as a result of management papers and reports -- 19 A. Yes. 20 Q. -- you've suggested in your witness statement that Angus 21 Grant had said that Ernst & Young had to provide 22 assurance that the system was capturing data accurately. 23 Are you rewriting history a little bit here? 24 A. No, I don't think so. I mean, I can see why -- exactly 25 why you're asking this question but the "does it capture 19 1 data accurately", you know, is there on the record. 2 This wasn't a -- you know, I wasn't writing a verbatim 3 note of everything he was saying and I think the 4 inference of this is he's questioning whether Horizon 5 captured the data accurately and, if it didn't, then, if 6 they were going to audit the accounts, they would need 7 to find a way around that. 8 Q. That's not recorded at all. It doesn't -- the note does 9 not read as if he was saying "and we have had work to 10 do" or "and we will have work to do"? 11 A. It doesn't say that. I completely agree with you. 12 I think what I'm trying to say is that this wasn't 13 a formal note of a meeting; it was a kind of me jotting 14 down the key points that struck me. 15 Q. But the point that you've remembered for your witness 16 statement is not something that you jotted down, is it? 17 A. No, no. 18 Q. Is it the case that you know that this note is deeply 19 problematic for you because you did nothing with the 20 information given to you? 21 A. I -- as soon as I saw this, I realised that this was -- 22 looked very, very different to me today, compared with 23 how it looked to me at the time. I haven't sought in 24 any way in my witness statement to try and play games 25 with the truth. I'm on oath and I signed this in good 20 1 faith as something that I believed to be true. 2 Q. In fact, you didn't do anything with the information 3 that he gave you? 4 A. I don't accept that. 5 Q. Your witness statement does not address in any way how 6 this information affected you or your conduct, does it? 7 A. Not at this point, no, not directly. But it did affect 8 my conduct. 9 Q. You received three pieces of information which you've 10 accepted were significant, very early in your tenure, 11 and you don't say in your witness statement what you did 12 with them, do you? 13 A. No. Not in terms here, no. 14 Q. Does that reflect the fact that you never raised the 15 three pieces of information that I've highlighted, given 16 to you by Mr Grant, with anyone after this one-to-one 17 with Mr Grant? 18 A. I'm not -- I can't -- I simply can't remember who 19 I would have spoken to immediately after this meeting. 20 What I was doing at the time was meeting a huge -- well, 21 a great number of people who were giving me a lot of 22 information about the Post Office, which I had never 23 previously worked in before and I was trying to 24 assimilate that and make sense of it. 25 Because I had never previously heard of Horizon or 21 1 of the cases of the subpostmasters, this didn't ring the 2 kind of alarm bells to me that it would obviously ring 3 if I had, or thinking about this now, but it did 4 absolutely inform how I thought about the Post Office's 5 relationship with Fujitsu, and when, in a couple of 6 other instances, the question of Horizon and the cases 7 of the subpostmasters was raised with me, that -- it 8 started to emerge in my mind as a proper -- as a real 9 issue. 10 Q. You don't describe anywhere in your witness statement 11 you telling any other person about what Mr Grant said to 12 you. Does that reflect the fact that you didn't tell 13 any other person? 14 A. It reflects the fact that I simply don't remember. 15 Q. Did you discuss this with Paula Vennells? 16 A. I don't know whether I would have discussed this -- 17 I don't think that I would have discussed with Paula 18 Vennells the content of every single meeting that I was 19 having at that point. I think this would have made me 20 realise how important it was to get -- to recruit 21 somebody as the Chairman of the Audit and Risk Committee 22 who was really competent to carry out that role and it 23 would have influenced how I thought about -- well, as 24 I've already said, I'm repeating myself -- how I thought 25 about the relationship with Fujitsu and also thought 22 1 about the Finance -- the running of the Finance 2 Department. 3 Q. Did you disclose this information to anyone else at the 4 Post Office? 5 A. I can't answer that question because I don't remember. 6 Q. Did you report this information to the Board? 7 A. At that stage, the Board was in embryo. I don't -- 8 I mean, I don't think -- no, I think the answer is 9 I didn't come to the next Board meeting and discuss this 10 with the then Board. 11 Q. The next Board meeting, as you say in paragraph 95 12 there, is on 10 November 2021 (sic), POL00021502. 13 A. Yes. 14 Q. No need to display that. There is no record of you 15 having told the Board at that meeting of what Mr Grant 16 had told you. 17 A. No. 18 Q. You tell us in your witness statement that, when you 19 were recruited, nobody told you that there was any 20 problem with Horizon? 21 A. That's correct. 22 Q. Were you surprised or taken aback when you were told 23 that there were problems with Horizon, in one of your 24 very first meetings? 25 A. I was absolutely on the alert about it. But I didn't 23 1 know how to -- the second of the bullet points, I didn't 2 know how to weigh that at that point. 3 Q. Someone, the auditors, could plainly see that the 4 Fujitsu product was problematic in terms of its quality 5 and their ability to give assurance of it, correct -- 6 A. Yes. 7 Q. -- specifically in relation to data accuracy? 8 A. Yes. 9 Q. Did you enquire why you hadn't been told this by anyone 10 upon appointment? 11 A. Not at this point, no. 12 Q. At any later point? 13 A. I think I was trying then to deal with events, rather 14 than having a kind of enquiry about why nobody had told 15 me about this. 16 Q. The second point under "Horizon is a real risk for us" 17 is: 18 "Cases of fraud -- suspects suggest it's a systems 19 problem." 20 Is that right? 21 A. Yes. 22 Q. Can you expand on what you were told by Mr Grant? 23 A. I'm sorry, I can't. 24 Q. Was he drawing a link between the data accuracy issue 25 and criminal prosecutions? 24 1 A. I did not see it that way at the time. 2 Q. Why did you not see it that way at the time? 3 A. I'm a human being and I didn't see it. 4 Q. You're told in one sentence "Horizon is a real risk for 5 us". You're told that the auditor has concerns over 6 whether it captures data accurately and then you're told 7 that suspects are suggesting that it's a systems 8 problem. Aren't those things linked together? 9 A. Well, clearly, now, they are absolutely linked together. 10 Q. Clearly, on the face of the page, they're linked 11 together: one follows the next. 12 A. They were not -- they weren't linked in that way in my 13 mind, at that time. Bear in mind that this was the very 14 first time -- although, actually, I'm not sure whether 15 the day before I hadn't had -- hadn't seen an email from 16 Donald Brydon about Horizon and the Private Eye 17 allegations. Those two things came very, very closely 18 together. But this is the first time I'd ever heard 19 of -- I'd absolutely no -- 20 Q. The Private Eye email comes two days later. 21 A. Okay. 22 Q. But we'll come to the Private Eye email in a moment. 23 A. Okay, but here, if I can just try to explain how this 24 would have felt at the time: I'm newly appointed; I have 25 not worked in the Post Office before; the Post Office 25 1 covers an absolutely huge range of very different and 2 very complex issues and I'm trying to get up the 3 learning curve as quickly as possible and absorb a whole 4 lot of information, some of which is on subjects which 5 are completely new to me. 6 I'm not trying to make excuses for myself here but 7 I'm just trying to explain what it felt like. I didn't 8 read Private Eye and I didn't read Computer Weekly. 9 I just did not know -- I mean, this the first time that 10 anybody had made the suggestion to me and I simply did 11 not weigh this in the way that, of course, everybody 12 now, with the benefit of hindsight, looking back at 13 this, would weigh it. 14 Q. Doesn't the fact that you weren't imbued in the issues, 15 by reading Computer Weekly, reading Private Eye, make 16 this more of a stand-out moment for you? This isn't 17 part of a piece or a narrative that you already know 18 about. This is the auditor saying -- and it takes up 19 half of your note -- that Horizon is a real problem? 20 A. Yes, but I think what I'm trying to say here is that he 21 was absolutely telling me that he thought Horizon had 22 real problems and he was explaining the background to 23 that. But what was not jumping out at me, in the way 24 that it now would, was the reference to the cases of 25 fraud, and the suspects suggesting it's a systems 26 1 problem. 2 Q. The next line is: 3 "Post Office POL v Fujitsu -- naive/too nice." 4 Is that right? 5 A. Yes. 6 Q. Was the sense of what was being conveyed to you that the 7 relationship between the Post Office and Fujitsu was too 8 nice? 9 A. That the Post Office were being too nice in relation to 10 Fujitsu, yes, yes. 11 Q. Okay, and it was the Post Office that were being naive? 12 A. Yes. 13 Q. What did you think about what you were being told? 14 A. I thought -- I wasn't entirely surprised because I think 15 it is not uncommon for organisations contracting with IT 16 companies to be at a disadvantage in relation to those 17 IT companies and I would, therefore, have been very 18 concerned to know what Angus Grant's opinion was of the 19 key individuals who would be dealing with this. 20 Q. You tell us in your witness statement -- it's 21 paragraph 90, no need to turn it up: 22 "I recall from my earliest days with the Post 23 Office, I had concerns about [Fujitsu's] relationship 24 with Fujitsu and whether or not it was an equal 25 relationship." 27 1 A. Yes. 2 Q. Why did you have such concerns? 3 A. Partly because I think that's something that I -- you 4 know, at a general sense, I would -- might have been 5 looking for but, at least in part, because of what Angus 6 Grant was saying to me here. 7 Q. In what way or ways did you consider the relationship to 8 be unequal? 9 A. I think that it would have been to do with the scale of 10 the people who would have been working in Fujitsu on 11 this contract. It would have been to do with the level 12 of -- so numbers of people, experience of people, the 13 fact that in departments and companies and organisations 14 buying IT services, they have often hollowed out their 15 own capability, and I knew that the procurement of IT 16 systems relating to the Post Office, up until that 17 point, had been handled in the Royal Mail Group, and 18 that the Post Office was going to have to build its 19 capability to stand on its own feet. But those would 20 have been things that I would have been concerned about. 21 Q. You continue: 22 "Lesley Sewell 'knows what good looks like'." 23 A. Yes. 24 Q. Then: 25 "Over dependence on Fujitsu?" 28 1 A. Yes. 2 Q. What did you mean by "over dependence on Fujitsu"? 3 A. I think I -- 4 Q. What did Mr Grant mean by "over dependence on Fujitsu"? 5 A. Well, I same it's the gist of what I've just been 6 saying; it's about the balance of -- I suppose you could 7 say the balance of power and expertise. Information, as 8 well. 9 Q. Overall, would you accept that you were provided with 10 three very significant pieces of information in the 11 course of this meeting? 12 A. Yes. 13 Q. Would you accept that they ought to have conditioned 14 your conduct thereafter? 15 A. Yes, and I think they did. 16 Q. Can we turn, please, to -- both documents can come 17 down -- WITN00740126. If we look at the bottom of the 18 page, please. So the meeting with Mr Grant was on 19 27 September -- 20 A. Yes. 21 Q. -- and, as I mentioned a moment ago, it was two days 22 later that the Private Eye email arrived from 23 Mr Brydon -- 24 A. Yes. 25 Q. -- 29 September? 29 1 A. Yes. 2 Q. So it's an email from Mr Brydon. So he was the Chairman 3 of the Royal Mail Group at this time? 4 A. He was. 5 Q. It's to Paula Vennells and others, including you. The 6 subject is "Class Action", and he says: 7 "Paula, 8 "I was a bit surprised to see the article in Private 9 Eye this week about a class action by subpostmasters. 10 It may be a bit after the horse has bolted but it may be 11 appropriate to have an explicit litigation/legal report 12 in the [Post Office] Board papers for the future -- 13 obviously Alice's call. 14 "The article raises some questions about Horizon. 15 I suspect the [Audit and Risk Committee] ought to take 16 an interest. Have we ever had an independent audit of 17 Horizon?" 18 Yes? 19 A. Yes. 20 Q. Now, this is the very thing that you had been briefed 21 about by Mr Grant two days earlier, isn't it? 22 A. Yes. 23 Q. It must have been quite concerning to have received 24 this? 25 A. It was. 30 1 Q. The last question that the Chairman asks is: 2 "Have we ever had an independent audit of Horizon?" 3 A. Yes. 4 Q. You knew at this time -- it must have been fresh in your 5 mind -- that the independent auditors had concerns over 6 the integrity of the data produced by Horizon? 7 A. Yes. 8 Q. So why did you not pipe up and say in response to this 9 "I've got some significant information that's relevant 10 here"? 11 A. I don't know why I didn't do that. I mean, I -- the 12 fact is, I didn't do that. I waited for Paula to 13 respond to this. I think -- I mean, I think at this 14 point, I would have thought the question was addressed 15 to her and I wanted to hear what the Post Office 16 Executives' answer to that question was. I also 17 remember thinking that the idea that we should have 18 an explicit litigation report in the Board papers was 19 right and we should do it. 20 Q. If we scroll up to Paula Vennells's reply, she says: 21 "... you may remember this has reared its head 22 before. I'll get a brief circulated for the new Board 23 members. 24 "In summary, each time any cases have gone to court, 25 [the Post Office's] position has been upheld. And from 31 1 memory, in at least 2 cases fraud was proven with 2 subsequent imprisonment. 3 "However, to avoid future doubt, [the Post Office] 4 took a decision several months ago to have Horizon and 5 the newer [Horizon Online] independently verified by 6 an external systems auditor. This is currently in 7 process and we should have the results at the end of 8 next month." 9 So this is an entirely reassuring message, isn't it? 10 A. Entirely reassuring. 11 Q. Yes, it's one of a series of entirely reassuring 12 messages that you received from senior executives in 13 Post Office over the years, isn't it? 14 A. From the beginning to the end, yes. 15 Q. You say had your role as Chair of the Board was, amongst 16 other things, to challenge what you were being told by 17 senior executives? 18 A. Yes. 19 Q. Here, you had the information, the ammunition, with 20 which to challenge, didn't you? 21 A. I had some information on which to challenge, yes, 22 I did. 23 Q. You had good information on which to challenge, didn't 24 you? 25 A. Yes. Yes, I did. 32 1 Q. So again, why did you not say, "Hold on, Paula, what 2 about Ernst & Young? Don't you know about them?" 3 A. I simply can't remember. 4 Q. Did you just instead accept the reassurance that the 5 Chief Executive gave in this email? 6 A. Yes, I did accept that. 7 Q. Is that what happened consistently in your time: if 8 somebody from the company gave you reassurance, you 9 gladly accepted their reassurance? 10 A. Absolutely not. 11 Q. On a related issue, you may have heard Ms Vennells give 12 evidence that she was unaware that the Post Office 13 prosecuted its own subpostmasters until mid-2012. Were 14 you ever under the impression that, before mid-2012, 15 Ms Vennells didn't appreciate that the Post Office was 16 bringing its own prosecutions? 17 A. Sorry, could you say that again? 18 Q. Yes. Were you ever under the impression that before 19 mid-2012 Ms Vennells didn't know that the Post Office 20 prosecuted its own subpostmasters? 21 A. No, I didn't know that. 22 Q. Or there came a moment in mid-2012 when this new news 23 was revealed to her: that, in fact, the Post Office did 24 prosecute its own subpostmasters? 25 A. I don't -- you know, I have nothing to say to help with 33 1 that, I'm afraid. 2 Q. The Private Eye issue didn't entirely go away, did it? 3 A. No. 4 Q. It was raised again by Les Owen, one of the 5 Non-Executive Directors, at a Board meeting, wasn't it, 6 in early January 2012? 7 A. It was, yes. 8 Q. Can we look at the minutes of the Board meeting of 9 12 January 2012, POL00021503. If we just quickly look, 10 so minute of Board, 12 January 2012. See who is 11 present: amongst other people, you. 12 A. Yeah. 13 Q. Les Owen, a NED; Paula Vennells, Managing Director; 14 Chris Day, Chief Financial Officer; Neil McCausland, 15 Senior Independent Director; and then those who aren't 16 members of the Board but who were in attendance are 17 listed. Then if we go to page 6, please, and look at 18 the foot of the page, please, under the heading 19 "Significant Litigation Report": 20 "Les Owen [so he's a director] asked for assurance 21 that there was no substance to the claims brought by 22 subpostmasters which had featured in Private Eye. 23 "Susan Crichton explained that the subpostmasters 24 were challenging the integrity of the Horizon system. 25 However, the system had been audited by [Royal Mail 34 1 Group] Internal Audit with the reports reviewed by 2 Deloittes. The audit report was very positive. 3 "The Business has also won every criminal 4 prosecution in which it has used evidence based on the 5 Horizon system's integrity." 6 So, at this meeting, you were told, according to the 7 minute, that the system had been audited, yes -- 8 A. Yes. 9 Q. -- and you had been told that the system had been 10 audited by Royal Mail Group Internal Audit, and that the 11 reports, plural, had been reviewed by Deloitte. Yes? 12 A. Yes. 13 Q. I think you weren't shown a copy of the internal Royal 14 Mail Group audit or audit reports at that meeting? 15 A. No, we weren't. I think because Les Owen, you know, he 16 brought it up probably -- I'm sure he wouldn't have, as 17 it were, pre-notified that he was going to bring that 18 up. 19 Q. So the internal audit or audits were not shown to you 20 nor the review or reviews of them by Deloittes? 21 A. No. 22 Q. You tell us in your witness statement -- no need to turn 23 it up, it's paragraph 107 -- that you would have taken 24 comfort from the fact that Deloitte, an extremely well 25 regarded firm of professionals, were said to have 35 1 reviewed the internal audit reports? 2 A. Yes. 3 Q. If we look at the entry at the foot of the page: 4 "Susan Crichton suggested that she clear the audit 5 report [we're back to singular now] with the external 6 lawyers and if it is possible to give the report 7 privileged status it would be [circulated] to the 8 Board." 9 Yes? 10 A. Yes. 11 Q. Is that how it worked in Post Office at this time, to 12 your understanding, that if an existing document, 13 a document that had already been typed up and there was 14 a printed copy of it, it was in somebody's desk or in 15 their drawer or on their computer, it was okay to give 16 it to the Board, if that document could be given 17 privileged status? 18 A. I simply don't know why she said that. You know, what 19 the reason was that she said that and, coming back to 20 this afresh, in preparation for my evidence to the 21 Inquiry, I'm afraid I'm mystified by it. 22 Q. Surely, you as the Board were entitled to see relevant 23 documents? 24 A. Yes. 25 Q. They didn't have to be privileged -- 36 1 A. Yes. 2 Q. -- or given privileged status for them to be passed to 3 the Board? 4 A. I don't know. I mean, I wouldn't have thought so. 5 Q. Now, you did subsequently receive a copy of the Royal 6 Mail Group Internal Audit? 7 A. I did, later, yes. 8 Q. It was a single report. There was not more than one. 9 Can we look at it, please. POL00107127. I think this 10 is your personal copy, isn't it? 11 A. Yeah, it's my writing. 12 Q. Yes. So this the one that's marked up by you? 13 A. Yes. 14 Q. It's got your handwriting, as we can see at the top of 15 it, on the right-hand side, and there's some more 16 handwriting further on in the document. 17 Now, it's nine pages long, this audit report or 18 assurance review. That nine pages includes the cover 19 page. You'll see that it has been badged up as being 20 legally privileged; can you see that? 21 A. Yes. 22 Q. Under the big black box -- 23 A. Yes. 24 Q. -- "Legally Privileged and Strictly Confidential"; down 25 in the bottom left, "Legally privileged and strictly 37 1 confidential", on each page. 2 Do you know why an internal audit would be badged up 3 in this way? 4 A. No. 5 SIR WYN WILLIAMS: I'm sorry to interrupt, Mr Beer, but what 6 about the date: March 2012? The minutes were January, 7 were they not? 8 MR BEER: Yes. 9 SIR WYN WILLIAMS: I'm just wondering if it's the same 10 document as the minute refers to, that's all. 11 MR BEER: It is, sir. There is in existence at the January 12 meeting a copy of this document in draft. A date then 13 gets put on it of February 2012 and then, when it's 14 provided to Ms Perkins, the date of March 2012 is added. 15 SIR WYN WILLIAMS: All right. Thank you. 16 MR BEER: We've seen discussion in the Board meeting about 17 giving the document privileged status. You've looked at 18 this document recently, I think? 19 A. Yes. Along with a great many others. 20 Q. Yes. There isn't any mention in the document, from 21 start to finish, about it being prepared for the purpose 22 of litigation or being prepared for the purposes of 23 receiving legal advice; would you agree? 24 A. I take your word for it. I can't be certain without 25 re-reading it. 38 1 Q. Anyway, you'd been told at the Board meeting that 2 Deloittes had reviewed this report, yes? 3 A. Yes. 4 Q. I don't think there's any mention in the document of 5 them having reviewed it, is there? 6 A. No, and that was a great mystery to me when I came back 7 to look at this. But I think I now understand. 8 Q. What's your understanding? 9 A. I think -- I may be wrong about this but I think 10 I understand, from a previous witness, that this report 11 was not independently reviewed by Deloitte as such but 12 that there had been somebody from Deloitte who had been 13 seconded who had been part of the team. 14 Q. So that's very different from what you had been told at 15 the Board meeting? 16 A. Yes. 17 Q. I think it's right that you saw no document at the time 18 to say that Deloitte had reviewed this report and, if 19 so, what the outcome of the review was? 20 A. No, there was no document and, when I came back to look 21 at this recently, that was -- one of my questions was: 22 well, where is this Deloitte report? 23 Q. You've written "Deloitte" in the top right-hand corner 24 at the time -- 25 A. Yes. 39 1 Q. -- and put a circle round it? 2 A. Yeah. 3 Q. Was that a note to check about the so-called Deloitte 4 review or so-called Deloitte assurance? 5 A. It's -- obviously in my mind is that we had been told 6 that Deloitte had, whatever it was I said, reviewed 7 this, and I guess I was trying, in my mind, to think 8 "Well, is this the Deloitte report or is there 9 a separate Deloitte report?" But I'm afraid I can't 10 remember -- you know, I simply don't remember my thought 11 process at the time. 12 Q. You know now that there was no Deloitte -- 13 A. I do know that now but only very -- 14 Q. -- review, no Deloitte report? 15 A. I've only known that in the very recent past. 16 Q. You've told us that, given their status and professional 17 independence, the fact that Deloitte had reviewed the 18 report would have been an important factor for you? 19 A. Yes. 20 Q. Wasn't it important to nail down that review at the 21 time, then? 22 A. Well, with the benefit of hindsight, absolutely. It 23 would have been a very good thing to have nailed that 24 down at the time. But I'm afraid that I didn't nail it 25 down at the time. 40 1 Q. Can we go to page 9 of the document, please. There is 2 here a table in which the authors set out the extent to 3 which progress had or had not been made against ten 4 issues raised by Ernst & Young in their 2010 to 2011 5 management audit, yes? 6 A. Yes. 7 Q. They were reported in a letter and accompanying report 8 of August 2021 (sic), and you tell us in your witness 9 statement that you're not sure whether you saw that at 10 the time? 11 A. I don't think I could have seen that at the time. 12 Q. In any event, this is a record of the progress that had 13 or had not been made against the issues identified by 14 Ernst & Young in their August 2011 management letter and 15 report. You'll see that, in relation to all ten issues, 16 none of them had been completed -- 17 A. Yes. 18 Q. -- and that, in relation to four of them, including one 19 which enjoyed an Ernst & Young risk rating of high, 20 further work is required? 21 A. Yes. 22 Q. This was presented at the January 2012 Board meeting, as 23 we've seen, as being very positive? 24 A. That -- I don't think we saw the report, no, but -- 25 Q. We've established that already. 41 1 A. -- the way it was described, yes. 2 Q. Yes. 3 A. Yeah. 4 Q. Is that how you read it, looking at it now? 5 A. Well, no, it's not how I would see it now. No. 6 Q. It had been presented to the Board at the meeting of 7 January 2012 as being a review of the entire system? 8 A. Yeah. 9 Q. You know now that that's incorrect; it wasn't a review 10 of the entire Horizon system, was it? 11 A. No. 12 Q. If we go back to page 1, please. You wrote along the 13 top, the very top of the document: 14 "Which parts of this are relevant to the 15 subpostmasters' issues?" 16 A. Yes. 17 Q. Who was that question addressed to? 18 A. I don't know. I can't remember. It's a question that 19 obviously occurred to me and I would have followed it up 20 with somebody but I can't tell you who that was. 21 Q. Did you ever ask that question of anyone? 22 A. I'm sure I would have done but -- 23 Q. Did you get an answer? 24 A. I can't remember. I just can't remember who I would 25 have spoken to and I can't remember, therefore, what 42 1 they would have said. 2 Q. I mean, it seems to have occurred to you -- 3 A. Yes. 4 Q. -- that an issue is the subpostmaster claims -- 5 A. Yes. 6 Q. -- and that you've got a report that doesn't really, on 7 its face, match the claims? 8 A. Yes. 9 Q. It doesn't address them. 10 A. Not -- it didn't jump out to me that it addressed them, 11 no. 12 Q. But you can't recall whether you raised that with anyone 13 and, if so, what the answer was? 14 A. It's -- it would have been unusual for me to write 15 something like that and not to raise it and I think I'm 16 right in saying that this was -- this document was part 17 of the briefing that I had for a subsequent meeting with 18 Lord Arbuthnot. So I think on the -- you know, thinking 19 back as to how I worked and how I went about things, 20 I think I would have raised this but I am sorry that 21 I can't add more. 22 Q. Is the position we've reached, Ms Perkins, that we've 23 ended up with this nine-page document that, on its face, 24 has not been approved by Deloitte or reviewed by 25 Deloitte, when you've been told that it had; it's 43 1 protected by privilege; it was presented at the Board as 2 being very positive, when it isn't? 3 A. I think that I would have thought, wrongly, that 4 somewhere there was a separate document from Deloitte. 5 That's what I would have thought. 6 Q. Again, wouldn't you want to nail that down at the time? 7 A. Now I would absolutely want to nail it down, yeah. 8 I think -- if you look at these issues now, we all know 9 what actually happened. At the time, we didn't know and 10 I am dealing with not just this issue. This -- at this 11 time, this issue was absolutely there on the table but 12 it was there on the table with a great many other issues 13 that I was attending to and I had to give attention to 14 those other issues as well as this. 15 So when we are talking about this now, I absolutely 16 accept that there were questions that I could have 17 followed up but that I don't think I did. I think there 18 were other questions which I think I probably would have 19 followed up but I can't swear to the fact that I did. 20 But I do think it's important to understand that this 21 was not the only issue on the table, and -- 22 Q. Ms Perkins -- 23 A. Sorry. 24 Q. So sorry. Ms Perkins, even with that context, I'm 25 suggesting to you that you should have followed up, in 44 1 circumstances where you say that you took reliance from 2 the fact that a well-known firm of City auditors had 3 reviewed a report that was said to be very positive, you 4 get a report that, on its face, has not got Deloitte's 5 fingerprints on it at all and isn't very positive. You 6 should say, "Hold on, why are the Board being given this 7 information when it's palpably wrong?" 8 A. I should have asked. I should have followed it up. 9 Q. Can we turn, then, to the meeting with James Arbuthnot 10 and the events that led ultimately to the appointment of 11 Second Sight. 12 I think the first of this was you receiving an email 13 from James Arbuthnot on 23 February 2012? 14 A. Yeah. 15 Q. Can we look at that, please, POL00095973, and go to 16 page 2, please, and look at the bottom. This is the 17 originating email in the chain from James Arbuthnot to 18 you, heading "Subpostmasters and the Post Office": 19 "Dear Alice, 20 "You may remember that when ... we met at, I think, 21 Ditchley Park I mentioned the issues of the Horizon 22 computer system in use in sub post offices throughout 23 the country, and I said I had a real concern about the 24 way some of the subpostmasters in and outside my 25 constituency had been treated." 45 1 Then second paragraph: 2 "May I please come and see you about it? I know it 3 is the position of Post Office (supported by the 4 [Federation], though not by the [CWU]) that there is 5 nothing wrong with Horizon. I am deeply sceptical about 6 this, and hope I can persuade you to look afresh at the 7 matter, rather than accepting that there should be 8 a closing of ranks round the computer." 9 Then if we go up the page, please. Thank you. On 10 the same day, you send this on to Paula Vennells and 11 Susan Crichton. You say: 12 "Hi there, 13 "James Arbuthnot is a Conservative MP who is, 14 I think, Chairman of the Defence Select Committee. 15 I knew him when I was in the Treasury and he was 16 a Minister at the MoD. He is a thoroughly decent and 17 sensible person. 18 "I will reply later today saying of course I will 19 meet him. I think I should probably see him on my own, 20 to look open and receptive but equally, if you think 21 I should take someone with me, I would be open to that. 22 I will need briefing of course. Is there anything else 23 I should know at this stage?" 24 We've got a reply of yours to James Arbuthnot 25 saying: 46 1 "Yes, of course I will meet you." 2 Can we go to the briefing for the meeting with James 3 Arbuthnot that you received. POL00179470. If we look, 4 please, at the bottom email, 12 March 2012, from Susan 5 Crichton to you: 6 "Here is a briefing paper for your meeting with 7 James Arbuthnot ..." 8 Yes? 9 A. Yes. 10 Q. Can we look, please, at the attachment to the briefing, 11 POL00107701. This is at the briefing. I just want to 12 ask you one thing about it. If we look at the middle of 13 page 1, I think that's it, the third -- sorry, scroll up 14 again. Yes. It's sort of the third paragraph under 15 "Overview": 16 "[Post Office] has rigorously tested the Horizon 17 system, using independently assured processes and it has 18 been found to be robust. Horizon has been in successful 19 operation for in excess of 10 years", et cetera. 20 So the line "[The Post Office] has rigorously tested 21 the Horizon system using independently assured processes 22 and it has been found to be robust", at the time that 23 you received this, you knew that Ernst & Young had 24 conducted an audit, yes? 25 A. Yes. 47 1 Q. You knew that they thought that Horizon was a real risk? 2 A. To their auditing, yes. 3 Q. You knew that they had concerns over the accuracy of the 4 data that it produced? 5 A. In that context, yes. Yes. 6 Q. When you read this, did you think, "Hold on, this is in 7 conflict with what I've been told by the partner who 8 conducted the audit"? 9 A. I think, at this point, the thing that would most 10 recently have been in my mind was the assurance that 11 we'd been given about the internal audit report and the 12 assurance of that by Deloitte, and that, I think -- 13 Q. I'm sorry to speak over you but, by this time, you'd got 14 the report -- 15 A. Yes. 16 Q. -- and you could see that it wasn't very positive? 17 A. If you go back to the table that you showed, there are 18 certainly are things in there which are not very 19 positive but there was -- if you look at the overall 20 column showing progress, there was quite a lot of 21 progress that had been made against most of the items 22 there. 23 Q. Did you regard it at the time as very positive? 24 A. No, I don't think I would have regarded it as very 25 positive but I think I would have regarded it as real 48 1 progress. 2 Q. What about what the auditor themselves, the independent 3 auditor, had said; was that cast to one side? 4 A. No. But I think I would have put the two things 5 together, that the auditors were concerned about the 6 reliability of the data for auditing purposes, and had 7 flagged those up, and that improvements were being made, 8 that there was -- it was not the end of the story but it 9 wasn't a totally -- it wasn't a negative picture. 10 It wasn't -- I absolutely see that it wasn't a very 11 positive picture but I think it's more nuanced, perhaps, 12 is what I'm trying to say. 13 Q. You knew that the internal audit function in Royal Mail 14 Group had conducted a review or an assurance exercise of 15 sorts, which, it was said, had been reviewed by 16 Deloittes. You'd seen nothing to support that. You'd 17 been told by the audit partner at Ernst & Young that 18 they had real -- they thought that Horizon was a real 19 risk and had concerns over the integrity of its data. 20 When you read this, did you not think, "Hold on, that's 21 a bit strong; it's not really supported by what I've 22 been shown and read with my own eyes"? 23 A. I can't remember what my reaction to this was. But it 24 is clear that I didn't take any action at that point in 25 relation to these issues that you have been raising. 49 1 I think that I was more reassured than I should have 2 been and I can see now, looking back at this, that 3 I should have asked more questions about this. 4 MR BEER: Thank you. 5 Sir, that's an appropriate moment to take the 6 morning break. Can we break until 11.10, please. 7 SIR WYN WILLIAMS: Yes, certainly. 8 MR BEER: Thank you very much, sir. 9 (11.00 am) 10 (A short break) 11 (11.11 am) 12 MR BEER: Good morning, sir, can you see and hear us? 13 SIR WYN WILLIAMS: Yes, thank you. 14 MR BEER: Ms Perkins, before the break, you told us that you 15 had recently established or found out that the extent of 16 Deloitte's involvement in the internal audit was that 17 there had been a person seconded to the RMG Internal 18 Audit Team rather than Deloitte having reviewed the 19 report. 20 A. That is my understanding now. 21 Q. Can we look, please, at POL00338794. This is an email 22 of 23 March 2012 from Alwen Lyons to you, and the first 23 line says: 24 "We have found the two reports by RM Internal Audit 25 (with assistance from Deloittes) and Gartner 50 1 Consulting." 2 Then if you skip over a couple of paragraphs: 3 "I have a comment from Internal Audit regarding 4 Deloittes' involvement which may be of interest. 5 "'The preparatory fieldwork relating to the report 6 was carried out by the Royal Mail Internal Audit and 7 Risk Management team, which involved an IT expert 8 seconded from Deloitte UK under an Outsourcing Agreement 9 to assist in the review'." 10 So I think you knew at the time that the extent of 11 the Deloitte involvement was an IT expert being seconded 12 to the RMG Audit Team. 13 A. That email certainly says that, yes. 14 Q. Does that put any different complexion on what you had 15 been told at the January 2012 Board meeting that RMG 16 Internal Audit had conducted an audit and it had been 17 reviewed by Deloitte? 18 A. Yes, I should have seen that those were -- they were 19 different things. 20 Q. In any event, can we turn to the meeting with Lord 21 Arbuthnot, as he now is, on 13 March 2012. POL00105481. 22 Can you see at the top that this is a note of the 23 meeting? 24 A. Yes. 25 Q. Can we look at paragraph 5, please, and just read it: 51 1 "AP [that's you, Alice Perkins] explained that the 2 system had been independently reviewed by several people 3 including [Royal Mail] Internal Audit and Deloittes (who 4 had no relationship with the business or Fujitsu) [Lord 5 Arbuthnot] was not convinced this had been done by IT 6 experts." 7 Firstly, just to be clear what you said, what it 8 means: were you saying there that there had been more 9 than one independent review of the system and that those 10 independent reviews had been conducted by (1) Royal Mail 11 Group Internal Audit and (2) Deloitte? 12 A. I can't remember what was in my mind. Sorry, can I just 13 be clear, the email from Alwen to me that you showed me 14 a minute ago -- 15 Q. 23 March, so a fortnight after 12 March. 16 A. -- and this meeting -- so the meeting preceded 17 Alwen's -- 18 Q. Exactly. 19 A. -- email? 20 Q. Exactly. 21 A. Okay. 22 Q. So, just looking at what you said, do you accept that 23 a plain reading of it is that there had been two 24 independent reviews, one conducted by Royal Mail 25 Internal Audit and the second by Deloitte? 52 1 A. That is the plain reading of it, yes. 2 Q. I think you'll accept, certainly now, that such 3 a statement is not accurate. There had been no 4 independent review -- 5 A. Yeah. 6 Q. -- of the system by Deloitte? 7 A. Yeah. 8 Q. When you said this, were you working from what you had 9 been told at the 12 January Board meeting? 10 A. Yes, and -- I think there was also a brief that included 11 this. 12 Q. No, the brief doesn't touch on the extent of the 13 Deloitte involvement? 14 A. Okay, right. 15 Q. You had yet to receive the email -- 16 A. Okay, thank you. 17 Q. -- that I'd drawn your attention to -- 18 A. Okay, yeah. 19 Q. -- that pointed out the extent of the involvement of 20 Deloittes being much more minimal. 21 A. Thank you, I'm having difficulty sometimes remembering 22 how these things relate to one another in sequence. 23 Q. Paragraph 6 records you offering to: 24 "... consider a further review of the system by 25 an IT expert specifically looking at the integrity of 53 1 the data and discrepancy errors thrown up in 2 subpostmasters' balances." 3 Was that offer made on the basis of what you had 4 been told by Mr Grant? 5 A. I think it would have been a mixture of things. So, by 6 now, obviously, I had had the meeting with Mr Grant. 7 I was aware that Private Eye had been covering this. It 8 was clear to me that Lord Arbuthnot was, you know, very 9 concerned about this issue. I took him seriously. And 10 I think at this point I had come to the view that the 11 Post Office was about to become a separate organisation 12 in its own right, it was about to have a new Board and 13 that I certainly thought, and I thought that any Board 14 would think, that we should take a fresh look at this to 15 see for ourselves. 16 Q. You knew at this time that the internal audit did not 17 address the concerns of the subpostmasters -- 18 A. Yeah. 19 Q. -- hence your handwritten note at the top of it? 20 A. Mm-hm. 21 Q. You knew, at this time, what you'd been told by 22 Mr Grant. Did you reveal any of those pieces of 23 information to Mr Arbuthnot? 24 A. No, I didn't but I think what I was trying to do here 25 was to move things on by taking a fresh look at 54 1 everything. I don't think that I would -- I don't think 2 I really knew what to make of it all. I could just see 3 that there was an issue here that was a serious issue, 4 and I thought here's -- you know, "I'm new, the Board is 5 new, we need to look at this", and my hope was that we 6 would take a serious look at it and then we would all be 7 clear about what the position really was. 8 Q. Wasn't this offer made instead, to try to convince him 9 and other MPs that the system wasn't at fault? 10 A. Absolutely not. 11 Q. Can we look, please, at POL00021505. This is the Board 12 minute of 15 March 2012, so three days after your 13 meeting with -- sorry, two days after your meeting with 14 Lord Arbuthnot on the 13th. We'll see that you're 15 present. Can we go to page 9, please, and the foot of 16 the page. Under "Any other business", (c): 17 "The Chairman [that's you] explained that she and 18 the Company Secretary had met [Lord Arbuthnot] at his 19 request to discuss the subpostmaster cases questioning 20 the integrity of the Horizon system. The Chairman hoped 21 that she could find a way to convince him and the other 22 MPs that the system was not at fault." 23 A. Yes. 24 Q. That's exactly what you said was absolutely not your 25 intention? 55 1 A. It was not my intention. I mean -- 2 Q. Why did you tell the Board that it was? 3 A. I don't know what was in my mind when I said that but it 4 was always -- I'm absolutely clear that it was always my 5 intention that we should take a proper look at this -- 6 and I think you're -- I'm sure you'll come on to this -- 7 that there is a lot of contemporaneous documentation 8 which shows that that was my attitude. 9 Q. That sentence there, recording what you said, reveals 10 a closed mind, doesn't it? 11 A. No, I don't think it reveals a closed mind. I would 12 have been able to see that this was a very serious issue 13 for the business. I would have hoped that the system 14 was not at fault but that doesn't mean to say that I was 15 not looking at an independent study of the issues as 16 exactly that. 17 Q. Can you help us -- I'll just ask you one more time -- 18 why did you tell the Board that you were hoping to find 19 a way to convince James Arbuthnot and other MPs that the 20 system was not at fault, if that wasn't your intention? 21 A. Well, I'm not sure that I can help you with that. At 22 the time, I believed that the system, from what -- on 23 the basis of what I'd been told, that the system was not 24 at fault but I was always open to the possibility that 25 it might be. 56 1 Q. How could you really have believed, at this time, that 2 the system was not at fault, at least in some cases, 3 given what Mr Grant had told you and given what you knew 4 about the limited nature of the RMG audit and the 5 limited assurance that the RMG audit had given? 6 A. Sorry, I'm sorry Mr Beer. I got lost again. 7 Q. Yes. How could you, as you've just said, believe at 8 this time, mid-March 2012, that the system was not at 9 fault, as you put it, when you had been told what we 10 have discussed you were told by Mr Grant and when the 11 only document that you had was the RMG audit? 12 A. Yes, okay. Thank you. I think that I just had not -- 13 I hadn't weighed the Angus Grant comment, which was made 14 in September, in that -- in my mind, in the way in which 15 it is now being -- that you are -- obviously, I can see 16 why you're asking these questions but it is as though 17 we're describing something that was happening in a short 18 space of time and it was the only issue on the table. 19 And I think what I am wanting to try and explain is that 20 I was, over that period, receiving the most enormous 21 quantity of new information about all kinds of very 22 complex and fraught issues to do with the separation 23 from Royal Mail and the future strategy for the Post 24 Office and I just didn't hold these strands, that do all 25 come together, of course they do, and of course I see 57 1 that now, but I was not holding those strands at the 2 same time in my mind and bringing them all together in 3 the way that I obviously now wish that I had. I think 4 that's the case, is that -- 5 Q. Thank you. 6 A. Is that enough? 7 Q. Thank you. 8 A. Sounds like it. 9 Q. You have told us that you were engaging with Lord 10 Arbuthnot. That document can come down. Did you 11 similarly seek to engage with any MPs or similar in 12 Scotland or Northern Ireland at this time? 13 A. No, I didn't. 14 Q. Did you take any steps to investigate or cause to be 15 investigated whether the issues that were being raised 16 in England and Wales were similarly being alleged by 17 subpostmasters in those jurisdictions? 18 A. No, I didn't. 19 Q. Can we move forwards please. We've looked at your 20 meeting with James Arbuthnot on the 13th, the Board 21 meeting on 15 March. 22 A. Yes. 23 Q. Can we turn to a supper you had with Paula Vennells on 24 19 March 2012, please, by looking at POL00413669. This 25 is, I think, some sort of meeting organiser entry. Was 58 1 Glenda Hansen your Executive Assistant or similar? 2 A. Yes, she was at that point, yes. 3 Q. You'll see that the computer diary records a "Supper 4 with Paula" in the top line? 5 A. Yeah. 6 Q. Booked table for 6.00 pm in your name at The Zetter in 7 Clerkenwell on 19 March between 6.00 and 8.30? 8 A. Yes. 9 Q. The topic seems to be just one: 10 "Discuss James Arbuthnot Update -- (meeting 11 scheduled for 28 March Paula not in attendance)." 12 So this is a second meeting planned for 28 March 13 with Lord Arbuthnot? 14 A. Mm-hm. 15 Q. Now, it's right, isn't it, that not all discussions 16 between you and Ms Vennells would be formally noted and 17 minuted? 18 A. I think almost none -- I don't think any of them were. 19 Q. Does that reflect the fact that a range of formal and 20 informal exchanges made up your working relationship? 21 A. Yes. 22 Q. Not all information would come to you, as Chair, by way 23 of written briefings? 24 A. Yes, that's right. 25 Q. Much information would be communicated verbally rather 59 1 than in writing? 2 A. Yes. 3 Q. Now, disclosed alongside this front page of the document 4 are a series of other pages and, if we just skip through 5 them to the next page, please, but one, so page 3, 6 there's the note of the meeting with James Arbuthnot. 7 Yes? 8 A. Yeah. 9 Q. Then, if we go over two pages to page 5, there's a note 10 that James Arbuthnot gave you at the meeting on the 11 13th, yes? 12 A. Mm-hm, mm-hm. 13 Q. If we go over to page 9, thank you. There's 14 a handwritten note. Are these documents that came 15 disclosed with the meeting invitation, essentially, your 16 preparation for and the product of your meeting with 17 Paula Vennells? 18 A. I don't know in which order they came, I'm afraid. 19 Q. They're all together. 20 A. Okay. 21 Q. They're in a group of documents that are all together. 22 The answer is you don't know? 23 A. I don't know. 24 Q. Would you get prepared by Glenda Hansen a little pack, 25 if you were going for supper with Paula Vennells, of the 60 1 relevant materials, so that you could have an informed 2 discussion with Ms Vennells; would that be usual? 3 A. I would either have done it myself or asked her to do 4 it, yes. 5 Q. In any event, there is quite a long, handwritten note 6 here. That's your writing, yes? 7 A. Yes, it is. 8 Q. It says, under (1): 9 "We do not like prosecuting subpostmasters." 10 A. Yes, it does say that. 11 Q. "We are one of the [very] few public bodies who are 12 allowed to bring our own prosecutions. Not something we 13 take lightly -- our lawyers want a [very] high standard 14 of proof." 15 Can you see that? 16 A. Yes, I do see that. 17 Q. Then in brackets: 18 "(+ no one would take lightly the decision to plead 19 guilty to a criminal charge). 20 "We have taken a number of cases to the criminal 21 court and we have never lost." 22 Yes? 23 A. Yes. 24 Q. Is that your note of what Ms Vennells told you? 25 A. I can't tell you that, I'm afraid. I mean, I don't know 61 1 where that came from. 2 Q. I mean, it will be unusual to take a note at a supper 3 meeting at The Zetter? 4 A. I might have written it afterwards. 5 Q. Okay. 6 A. I mean, that is something that I -- you know, memory not 7 always being very reliable, I did sometimes take notes, 8 you know, pretty quickly afterwards. 9 Q. In any event, the "we" referred to here, is that likely 10 to reflect what Ms Vennells was telling you rather than 11 your own self-reflection of what the Post Office did or 12 did not do in prosecuting subpostmasters? 13 A. I don't think I would have had used the word "we". 14 Q. If this was you self-reflecting? 15 A. Yes. 16 Q. So you think it likely that this is a note, maybe not 17 taken at the time, but written after the event of what 18 Ms Vennells told you at the supper at The Zetter? 19 A. I think so but I'm not sure. 20 Q. If this was what Ms Vennells was telling you, at this 21 time on 19 March, do you know why she was telling you? 22 A. Well, presumably we were discussing my meeting with Lord 23 Arbuthnot and she would have been telling me what she -- 24 she would have been telling me her perspective on this, 25 I think. I mean, if you look at the third point, the -- 62 1 Q. "Horizon records transactions", yes. 2 A. Yes, that's not -- 3 Q. Let's just read it together, so we can get your -- 4 A. Okay, fine. 5 Q. Go on, if you translate it, "Horizon records"? 6 A. "Horizon records transactions in great detail and with 7 total transparency -- all the keystrokes are recorded so 8 we can reconstruct precisely what a subpostmaster has 9 done." 10 That's not me thinking that up from nowhere. 11 I mean, that's -- somebody has said that to me and I've 12 written it down, and if it's -- it's a bit hard to tell 13 without seeing how this -- without knowing how this 14 bundle of things were put together but -- 15 Q. There's simply a series of pages, pieces of paper -- 16 A. Right. 17 Q. -- one after the other, given to us by the Post 18 Office -- 19 A. Yes. 20 Q. -- after the meeting invite? 21 A. After -- so they're all together with the meeting 22 invite? 23 Q. Yes. 24 A. That's how they were kept? 25 Q. Yes. 63 1 A. Well, then it does -- yes, that's not me briefing 2 myself, if you see what I mean. 3 Q. Yes, and so this is also likely, the point at 3, to have 4 been something that Ms Vennells was impressing upon you: 5 all the keystrokes are recorded so the Post Office can 6 reconstruct precisely what a subpostmaster has done? 7 A. It -- on the face of it, it must have been, unless 8 somebody else said that to me but that doesn't -- from 9 what you're telling me, that doesn't seem to be likely. 10 Q. Did anyone ever explain to you, at this time or later, 11 what ARQ data was? 12 A. No, I don't think so. 13 Q. Any difference between ARQ data and enhanced ARQ data? 14 A. No. 15 Q. Okay. At the foot of the page, we can still see it, 16 it's recorded: 17 "Vast [majority] of subpostmasters cope well -- 18 Horizon supports them, training [and] free service call 19 centre, help at ..." 20 A. Dearne? 21 Q. Darlington, maybe: at somewhere. 22 A. A place. 23 Q. This series of points -- we don't like prosecuting 24 subpostmasters; there's a very high standard of proof; 25 no one pleads guilty lightly; Horizon transactions are 64 1 all recorded on the system by way of keystrokes, so that 2 the Post Office can reconstruct what has happened; 3 Horizon supports the vast majority of subpostmasters who 4 cope well" -- that, essentially, became the party line 5 that was deployed for the following years, didn't it? 6 A. Yes, it did. 7 Q. On what you know, would you say this is Ms Vennells 8 giving it to you at a supper meeting at The Zetter? 9 A. It looks like that but I don't -- you know, I can't 10 swear that that is what is the case but it does look 11 like that. 12 Q. If we just go back up to (2), which we skipped over. 13 A. Yeah. 14 Q. "We have commissioned a number of studies of the Horizon 15 system -- from internal audit through to Deloitte ..." 16 "Didn't", or "don't", is that? 17 A. I think what that means is that they don't audit the 18 Royal Mail, us or Fujitsu. I think that's what that's 19 saying. 20 Q. Ie that's emphasising their independence? 21 A. Yeah. 22 Q. "... they have looked at the integrity of the system 23 from a managing accounting perspective and have upheld 24 it." 25 A. Yes. 65 1 Q. On the basis of the internal audit report, did you form 2 a view whether what you were being told there was 3 accurate or not? 4 A. I can't remember. But I -- if -- you know, I think we 5 have already established that I hadn't properly checked 6 out what the Deloitte position was. I'd had that email 7 from Alwen. It could have been that there were other 8 studies from Deloitte but I didn't -- I mean, I didn't 9 definitively know that. 10 Q. Thank you. That can come down. Thank you. 11 You've told us already that the record in the 12 15 March Board meeting, that you hoped that you could 13 find a way to convince James Arbuthnot and other MPs 14 that the system was not at fault, didn't reflect your 15 view -- 16 A. Yes. 17 Q. -- at the time. 18 A. Yeah. 19 Q. Can we look, please, at POL00085836, and look at the 20 bottom, please, of page 1. This is an email chain in 21 which you are not involved. 22 A. Yes. 23 Q. It's between Angela van den Bogerd and Craig Tuthill. 24 Ms van den Bogerd says: 25 "I met with Simon Baker today -- he's been asked by 66 1 Alice Perkins to find a way of demonstrating that the 2 Horizon system is robust and not subject to 'glitches' 3 as claimed by the JFSA former [subpostmasters]." 4 Does that again reflect your mind at the time that 5 the purpose of any review contemplated at this time was 6 to find a way of demonstrating that the system is 7 robust? 8 A. Absolutely not. Those are not my words and I'm 9 absolutely sure that that was not what was in my mind. 10 What was in my mind was that we were going to -- I think 11 that we -- we were trying to think of ways in which to 12 demonstrate to Lord Arbuthnot -- and I think later 13 Mr Letwin came -- joined that meeting, there was a kind 14 of model office in the Head Office of the Post Office at 15 the time, where you could -- I'm looking -- trying to 16 find the word here -- you could model what was happening 17 in -- what could be happening in a post office. 18 I thought that it would be very useful to 19 demonstrate the system to them but I was absolutely not 20 asking anybody to spin a message here. 21 Q. This is the second record that we've got -- the first 22 being a direct record in the minutes and this being 23 a conversation between people not including you -- which 24 does attribute to you a desire to spin, don't it? 25 A. It attributes it to me, but that doesn't mean that it's 67 1 correct. 2 Q. So there's been a misunderstanding, has there? 3 A. I think there has been a misunderstanding here and 4 I think -- I'm sorry to make this point again and to 5 jump ahead but I think, if you look at documentation, 6 what I said in my witness statement about how determined 7 I was to get an independent investigation going and what 8 I did about the terms of that investigation, and some of 9 the things that I said later, there is a consistent 10 record of me wanting to set up something that was going 11 to look at this in an independent way, in a -- I was 12 prepared, if you like, to lift the rock and see what was 13 underneath it. 14 Q. Can we move forwards then, please, to 17 May 2012, 15 a further meeting with James Arbuthnot and, as you've 16 said, Oliver Letwin MP. POL00105479. This is 17 a briefing for that meeting, it's about 20 pages long 18 and I think this is your version of the briefing because 19 it's got your handwriting on it? 20 A. It has. 21 Q. Can we look, please, to page 23, please. We can see 22 here, under "External Scrutiny", at the foot of the 23 page, the briefing says: 24 "Horizon and Post Office systems environment have 25 always been subject to external scrutiny both for 68 1 assurance and accreditation purposes. Ernst & Young 2 carry out an annual financial systems audit; 3 an independent auditor also carries out a yearly audit 4 to maintain the system's Payment Card Industry (PCI) 5 accreditation." 6 The reference there to Ernst & Young's yearly audit, 7 yes -- 8 A. Yes. 9 Q. -- annual financial systems audit, would you agree the 10 way that this is being referred to here suggests that 11 Ernst & Young could be relied on because they had given 12 Horizon a clean bill of health? 13 A. That -- just those highlighted words? 14 Q. Well, the whole context of external scrutiny and the 15 first bullet point. 16 A. Yes. But then I asked a question about that in the -- 17 Q. Well, I'm going to come to that in a moment? 18 A. Sorry. 19 Q. It's just what you were being briefed -- 20 A. Okay yes, okay. 21 Q. -- was, essentially, again, a reassuring message. 22 A. Yes. 23 Q. You can take faith in Horizon because of external 24 scrutiny, in particular Ernst & Young carry out 25 an annual financial systems audit. 69 1 A. Yeah. 2 Q. But, again, by this time, you knew that Angus Grant of 3 Ernst & Young was concerned about the situation and had 4 specifically raised his concerns with you, in 5 an introductory meeting. 6 A. Yes. 7 Q. By this time, did you know the results of the 2012 Ernst 8 & Young audit? This is 17 May 2012. 9 A. I think that might have -- I can't remember the 10 sequence. That might have come later. There was 11 an Audit and Risk Committee to which that came, which 12 was -- was that in May, I think? 13 Q. Yes, and I'm asking whether you knew, at that time, the 14 audit of Ernst & Young, for the year 2011/2012 had said 15 that, in high level summary, the IT systems couldn't be 16 relied on for audit control purposes and they had had to 17 take some mitigating measures in order to sign off? 18 A. I remember that. I can't remember whether I knew that 19 at this juncture because I can't remember the exact 20 sequence of when I would have seen that. 21 Q. You write, next to "External [audit]": 22 "How relevant are these to this subject?" 23 A. Yeah. 24 Q. You were concerned, were you not, in the light of what 25 you knew, that deploying points that there had been 70 1 external scrutiny of Horizon in support of its integrity 2 might be misleading? 3 A. I was certainly questioning, yes. I had a questioning 4 frame of mind, here. 5 Q. The briefing does not say directly that the Ernst & 6 Young audit had given Horizon a clean bill of health -- 7 A. No. 8 Q. -- but that's the implication, isn't it, if this kind of 9 briefing was regurgitated to the MPs? 10 A. Mm, yeah, it's intended to be reassuring. 11 Q. When you started to engage with MPs in early to 12 mid-2012, over their concerns with Horizon, were any 13 steps taken at Board level to query the propriety of 14 continuing to prosecute? 15 A. At that stage, not at Board level, no. Not at that 16 stage. 17 Q. Were you aware that criminal prosecutions were 18 continuing, and were continuing to rely on Horizon 19 evidence, whilst you were discussing the setting up of 20 an independent review? 21 A. I would have been, yes. 22 Q. Do you know why that issue was not discussed at Board 23 level, "We're thinking of commissioning an independent 24 review because of these concerns about Horizon data. 25 We're continuing to rely on Horizon data for criminal 71 1 prosecutions"? 2 A. That wasn't -- I -- that was not raised by me at that 3 time and it wasn't raised, as far as I'm aware, by 4 anybody else. 5 Q. Thank you. Can we move forwards, please, to the 6 selection of Second Sight over, in fact, Deloitte, to 7 carry out the independent review -- 8 A. Yes. 9 Q. -- and we're among forward a month now to June 2012. 10 A. Okay, yes. 11 Q. Can we look, please, at POL00096576. This, we can see, 12 on its face, is a document prepared by Second Sight, and 13 its purpose is described under the subtitle: 14 "Proposal to carry out an Independent Review of past 15 fraud and theft cases in order to determine whether the 16 facts support the business's findings and the charges 17 bought against individuals." 18 If we go forwards then, please, to page 5: 19 "This Case Review approach will include the 20 following tasks: 21 "[1] Select a representative sample of cases that 22 have led to prosecutions/court appointed restitution. 23 The sample needs to cover cases: 24 "where defendants claim they didn't take any cash 25 "where assertions have been made that 'The System' 72 1 (ie Horizon) caused the shortage (include new and old 2 versions of Horizon if possible) 3 "which have been taken up by MPs." 4 So did you know that the proposal made by Second 5 Sight to conduct an independent review involved, 6 essentially, those elements set out there? 7 A. Yes, because I'm sure -- I saw those terms of reference 8 in draft and commented on them. 9 Q. So that involves, firstly, the selection of 10 a representative sample of cases; secondly, to include 11 both new and old Horizon, yes -- 12 A. Yes. 13 Q. -- and include cases specifically raised by MPs and 14 where the defendants claim they didn't take any cash, 15 yes? 16 A. Yes. 17 Q. Can we look, please, at POL00180209, and the bottom of 18 page 1, please. If we stop there. There's an internal 19 email chain involving Mr Baker and Ms Crichton and 20 Ms Sewell. You're not copied in. They're discussing 21 Second Sight's proposal that we've just looked at: 22 "Attached is Ron's proposal." 23 Then Simon Baker says: 24 "My view is we make it clear to Alice/Paula the 25 distinction between the work [that] Ron [ie Second 73 1 Sight] is proposing ([which is] an independent review of 2 past cases) and the Horizon Forensic Audit (the 3 Deloitte's proposal) and put it on the agenda to discuss 4 tomorrow." 5 Was the distinction between those two types of 6 investigation ever made clear to you? 7 A. I didn't remember having this -- until I saw some of 8 these documents, when I first started putting my witness 9 statement together, I didn't -- I was mystified by these 10 papers because my recollection was -- and it's a clear 11 recollection -- that when the discussion with Lord 12 Arbuthnot had got to the point of what kind of review, 13 we did talk about whether we should use a big 14 organisation such as Deloitte and Lord Arbuthnot was 15 very clear that he didn't want to use that kind of 16 organisation. He wanted to use a different kind of 17 approach and that was very instrumental -- well, 18 instrumental, it was very influential in my thinking. 19 Q. That's the way you describe things in your witness 20 statement -- 21 A. Yes. 22 Q. -- that it was the species of organisation -- 23 A. Yes. 24 Q. -- which was the relevant consideration? 25 A. Yes. 74 1 Q. The Big Four -- 2 A. Exactly. 3 Q. -- or more boutique, off the beaten track -- 4 A. Yes. 5 Q. -- investigators -- 6 A. Yes. 7 Q. -- rather than a distinction between the type of work 8 that they would be undertaking? 9 A. I think so and, as I said later in my witness statement, 10 one of my regrets is that at this juncture, I didn't 11 stop and think through more clearly with my colleagues 12 on the Board what exactly it was we were trying to do 13 here and what would have been the best way of doing it. 14 I think that -- do you mind me giving you a bit of 15 a context here? 16 Q. Please do. 17 A. I think it's really, really important to understand here 18 that, when I came back from my first meeting with Lord 19 Arbuthnot, when I had proposed that we should take 20 a fresh look at this, I had a meeting with Mike Young 21 and Susan Crichton and they told me that they thought 22 that this was not a good idea, that the system had been 23 investigated numerous times, nothing had ever been found 24 that was wrong, and that the organisation had basically 25 too much on at the time to devote time to setting up 75 1 such a review. 2 And it was perfectly true, the organisation did have 3 a huge amount on at that time. I didn't think that 4 either of those reasons were good reasons for not 5 looking at this afresh and there then elapsed 6 a period -- and I can't remember how long it was, but it 7 must have been several weeks -- and absolutely nobody 8 came back to me on this. 9 Q. A period of silence, you describe it as in your witness 10 statement. 11 A. Exactly, and then I then, well, obviously knew that 12 I would need to follow up this discussion with Lord 13 Arbuthnot, couldn't understand why I hadn't heard 14 anything, raised it again, and was told that nothing had 15 been done about it because it was thought to be a bad 16 idea. 17 Q. You subsequently refer to this, I think, as pushback 18 from the business? 19 A. Well, Alwen described it as me saying that this and 20 other things were pushback from the business. 21 Q. In any event, this document on 6 June, records 22 an intention to make it clear to you as to the 23 distinction between the type of work, rather than the 24 nature of the organisation, that is proposed? 25 A. Yes. That is perfectly true. Yeah. 76 1 Q. Can we turn, then, to a meeting that you held the next 2 day at 7 June, POL00233736, and go -- sorry, this is 3 a document created by, I think, the Post Office, 4 subsequently -- 5 A. Oh, yes, okay. 6 Q. -- setting out a timeline -- 7 A. Yes. 8 Q. -- of the Mediation Scheme -- 9 A. Yeah. 10 Q. -- and, in fact, the events that preceded it. 11 A. Yes. 12 Q. Can we go to page 3, please. If we just look there, 13 it's at the bottom of the page we're looking at, its now 14 towards the top 7th June so that's the next day, can you 15 see that? 16 A. Yes. 17 Q. Third box down. 18 A. Yes. 19 Q. "A meeting is held [with] Paula Vennells, Alice Perkins, 20 Susan Crichton, Alwen Lyons and Simon Baker ..." 21 A. Yeah. 22 Q. So we've seen the discussion the previous day between 23 Mr Baker and Ms Crichton: 24 "... where the Deloitte and Second Sight proposals 25 are discussed. 77 1 "Second Sight is chosen as the preferred supplier." 2 We haven't got a record of this meeting of the 7th. 3 This is the only reference to it that I think we can 4 find. 5 A. Yeah. 6 Q. Was the matter that was discussed in the email chain the 7 day before, 6 June, ie an intention to draw to your 8 attention the distinction between the nature of the work 9 being undertaken -- 10 A. Yeah. 11 Q. -- in fact, drawn to your attention? 12 A. I don't remember it being drawn to my attention. That 13 doesn't mean that it wasn't. 14 Q. Was one reason for preferring Second Sight over Deloitte 15 that Second Sight were to conduct a review which was 16 much narrower in scope, ie reviewing the system in the 17 context only of sample cases rather than forensic IT 18 audit of the whole system? 19 A. Not in my mind no, absolutely not. 20 Q. Why was the decision made at this meeting, before you go 21 and see James Arbuthnot again, to prefer Second Sight 22 over Deloittes? 23 A. I think for the reason that I -- as far as I can recall, 24 I think the main reason for this was because of this 25 discussion I'd had with Lord Arbuthnot earlier about 78 1 what kind of organisation should be used to do this 2 review. I think it -- I don't think I can add anything 3 more. 4 Q. So, in your mind, the reason for deciding on Second 5 Sight, rather than Deloitte, was nothing to do with the 6 nature or extent of the audit that would be conducted? 7 A. Absolutely not. No. 8 Q. Can I turn, then, to the scope of the investigation, in 9 terms of whether convicted subpostmasters would be 10 included within it -- 11 A. Yeah. 12 Q. -- and look at POL00096606. If we look at the bottom of 13 the page, please, we see an email from you and, if we 14 just scroll up a little bit, it would have been to, 15 I think, Paula Vennells, Susan Crichton, Alwen Lyons. 16 A. Okay, yeah. 17 Q. Your email: 18 "Following a conversation with Alwen yesterday, and 19 given that I am away now for a few days, I thought 20 I should let you know before I went where I stand on 21 which cases should be in or out of this review. I have 22 given this more thought tins yesterday. 23 "I am clear that we should include ALL the MPs' 24 cases, irrespective of whether they have been decided in 25 court. If we try to draw a distinction here we will be 79 1 accused of picking cases to suit ourselves and [be] 2 vulnerable on the ones we omit. We'll have a row about 3 that instead of moving the issue on. 4 "On reflection, I don't buy the argument that we 5 would somehow undermine the court process by doing this. 6 There are plenty of ways in which people go over ground 7 which has been settled in court and if there weren't, no 8 one would ever be able to get a conviction overturned. 9 And if (which we don't believer) there were new evidence 10 in a case which had been decided, we would want to do, 11 and be seen to do, the right thing by that." 12 So that was your view, your clear view, on 9 June? 13 A. It was, and it's absolutely reflective of my view 14 throughout. 15 Q. Can we look, please, at paragraph 161 of your witness 16 statement, please, which is on page 80. The bottom part 17 of the page, paragraph 161, fourth line, you say: 18 "On the 7 June email Susan refers to comments that 19 Paula and I had given her that morning (I assume in 20 person). She also said in that email that she had given 21 thought to the cases in which subpostmasters had been 22 criminally prosecute -- she thought that we did not want 23 to be seen to reopen those cases, but should position 24 this as a more limited review of the existing evidence, 25 while for those who had not been prosecuted [the Post 80 1 Office] should offer a full and independent 2 investigation." 3 That I think you're attributing to Susan Crichton -- 4 A. I am. 5 Q. -- that view. Was that a view that she held strongly? 6 A. I think, yes, I think she did hold that view strongly. 7 Q. If what you say here is accurate, she's not saying that 8 those that have been criminally prosecuted should be 9 left out of account. She's saying that a separate 10 process should be set up for them in which there is 11 a full and independent investigation, correct? 12 A. That is what she's saying at this point, yes. 13 Q. Why wasn't that done? 14 A. How do you mean, why wasn't that done? I'm sorry. 15 Q. Why was the Second Sight sample case approach to test 16 the integrity of Horizon taken, on the one hand, with 17 a full and independent investigation looking at those 18 that had been criminally prosecuted, on the other -- 19 ie two investigations, rather than one? 20 A. Should there have been two investigations, you're 21 asking? 22 Q. Yes. Well, I'm not asking should there; I'm asking why 23 there wasn't? 24 A. Why there wasn't. I don't think -- I mean, I can't give 25 you a detailed answer to that question. I think that -- 81 1 I can't answer that question. I'm really sorry. 2 I don't know. 3 SIR WYN WILLIAMS: I'm sorry to interrupt again but am 4 I understanding paragraph 161 correctly? My reading of 5 that initially was that Ms Crichton was making the 6 suggestion that there should be a more limited review of 7 the convicted people, with a full and independent 8 investigation only for those who had not been 9 prosecuted. Am I missing something here? 10 A. No, I think that's -- 11 MR BEER: Quite right, sir. 12 A. I've got very confused, I'm afraid, but I think what 13 you've just said, Chair, is right. Yes. 14 SIR WYN WILLIAMS: Well, I think all I'm doing is reading 15 what you've written, Ms Perkins. 16 A. Yeah. 17 SIR WYN WILLIAMS: But there's no nuance that I'm missing; 18 is that correct? 19 A. Just let me re-read it, please. 20 SIR WYN WILLIAMS: Yes. 21 A. Yes, I think that's exactly right. So this is about 22 a single investigation with two different ways of 23 treating different categories of cases. 24 MR BEER: So you understand that's what Ms Crichton 25 proposed: a single investigation with two different 82 1 approaches, depending on whether or not the 2 subpostmaster had been prosecuted or not? 3 A. Yes. 4 Q. Why wasn't that done? 5 A. I don't know. 6 Q. Can we go back to the email chain that we were just 7 looking at. POL00096606. Remember, at the foot of the 8 page here, there's your email -- if we just scroll down 9 to see it -- the one saying you're clear that we should 10 include all cases, irrespective of whether they've been 11 decided in court, yes? 12 A. Yes. 13 Q. If we scroll to the top of the page, please, we can see 14 Alwen Lyons's reply, second email down, just to 15 Ms Vennells: 16 "Paula in case Susan doesn't pick this up as she is 17 in Berlin and before you speak to Alice. The issue that 18 came to light with the list of MP cases was that they 19 included the Mishra [sic] case you will remember the 20 case and the publicity she went to prison and had her 21 baby whilst in there. The husband got publicity through 22 radio and press. Susan's anxiety and she raised this at 23 the meeting with Alice before you joined was whether now 24 contacting her to tell her we review the case would be 25 a red rag to a bull. 83 1 "Alice feels this is the business pushing back 2 unnecessarily and she feels this has happened throughout 3 the process and she is having to keep pushing us! 4 "Susan is getting it external advice on the effect 5 this would have on cases which have been through the 6 courts." 7 So, you remained of the view that all cases raised 8 by MPs should be included in the independent review? 9 A. Yes. 10 Q. Your view was seemingly not shared by, at least, 11 Ms Crichton? 12 A. Yes. 13 Q. Was it also not shared by Ms Vennells? 14 A. I don't know. 15 Q. Did anyone else on the Post Office Board oppose your 16 view? 17 A. So, as I said to you a minute or so ago, I very much 18 regret that I didn't bring in other members of the Board 19 on this process. So I am not sure that other members -- 20 I certainly -- I am sure that I did talk to Neil 21 McCausland about this at some point, I can't tell you 22 when that was, and I know he had some questions about 23 it, but I should -- with the benefit of hindsight, what 24 I absolutely should have done is I should have ensured 25 that this issue, this whole question of setting up the 84 1 review, what the review should have done and who should 2 do it, should have come to the Board and there should 3 have been a proper Board discussion about it and 4 I really regret that I didn't do that. 5 Q. It's suggested in the second paragraph of that email 6 that you felt that the business was pushing back 7 unnecessarily. Did you feel that the business was 8 pushing back unnecessarily? 9 A. Yes, I did feel that, partly because -- I mean -- excuse 10 me. I did feel that because of the reaction that I had 11 to the original proposal, because I got that negative 12 reaction and then nothing happened and then I had to 13 re-raise the issue in order to get something done, and 14 then I thought, which is what we're discussing here, 15 that the scope should be inclusive and I was being -- it 16 was being argued that it shouldn't be. 17 Q. Who in the business was pushing back unnecessarily? 18 A. I thought that Susan Crichton was definitely pushing 19 back unnecessarily. I thought Mike Young was pushing 20 back unnecessarily. I -- and they were -- those were 21 the two people who I had in the front of my mind. 22 Q. Was the substance of their objection that Horizon had 23 been tested independently in the past and had been found 24 to be robust and not at fault? 25 A. That was one of them, yes. 85 1 Q. What were the other elements of the objection to 2 an independent review? 3 A. As expressed to me, that, given everything else that the 4 business was trying to do at the time, there wasn't 5 the -- there wasn't the capacity to do this as well. 6 Q. Did you seek to understand any reasoning that was 7 explained to you that, if Seema Misra's case was 8 included, this might be red rag to a bull? 9 A. I thought that -- I think that what I was wanting to 10 do -- maybe I was being simplistic about this. I just 11 wanted these cases to be independently investigated by 12 people who had credibility -- that would have 13 credibility obviously inside the Post Office but also 14 outside. I don't think I really -- I just wanted to get 15 at the facts. 16 MR BEER: Thank you. 17 Sir, that might be an appropriate moment for the 18 second morning break. Can we break until 12.20, please? 19 SIR WYN WILLIAMS: Yes, of course. 20 MR BEER: Thank you, sir. 21 (12.10 pm) 22 (A short break) 23 (12.21 pm) 24 MR BEER: Good afternoon, sir, can you see and hear us? 25 SIR WYN WILLIAMS: Yes, thank you. 86 1 MR BEER: Ms Perkins, can we turn to your third meeting with 2 Lord Arbuthnot. This one is on 18 June 2012. This time 3 it was with other MPs. 4 A. Mm-hm. 5 Q. Can we look at a record of that meeting, which I don't 6 think you had when you wrote your witness statement. 7 It's JARB0000001. Thank you. These are the minutes of 8 the meeting. Do you recall attending the meeting with 9 James Arbuthnot, other MPs? 10 A. Yeah. 11 Q. If we look at the foot of the page, please, the minute 12 records you giving background information -- 13 A. Yes. 14 Q. -- and the Post Office's perspective. You introduce 15 your colleagues and said: 16 "Post Office is now a completely separate entity 17 from the Royal Mail. She [that's you] arrived at the 18 organisation in August 2011 and became aware of the 19 issue soon after starting." 20 A. Yeah. 21 Q. "She [that's you] emphasised that the matter was a very 22 serious matter for the Post Office, whose business rests 23 on its reputation as being trustworthy. She said that 24 the Post Office also recognised full well that the 25 matter was also very serious for the subpostmasters and 87 1 mistresses involved as it was invariably life changing." 2 Then over the page, please. 3 "[You] said that now was a time of enormous change 4 at the Post Office, and that it was important to give 5 MPs confidence in the business and its reputation. 6 "[You] stated that the matter involved treading 7 a tightrope regarding questions of money. The Post 8 Office and its staff are stewards of large quantities of 9 cash -- the cash does not belong to the Post Office; it 10 is in transit as it comes through the Post Office. 11 There is the issue of trying not to put temptation in 12 people's way, but in any retail business this is not 13 possible." 14 That statement there, "putting temptation in 15 people's way", was that you seeking to imply that the 16 causes of loss was down to subpostmasters taking the 17 money, without actually coming out and saying it? 18 A. No. Well, can I try and explain what I think it was 19 I was trying to say here? 20 Q. Yes, please do. 21 A. It's been suggested that I thought, or was inclined to 22 think, that subpostmasters were more likely to be 23 tempted by the fact that there was a great deal of cash 24 lying around than any other group of people, and that is 25 absolutely not my position -- was not my position then, 88 1 it certainly is not my position now -- but it was not my 2 position then. What I was aware of, because, by then, 3 I had done a number of visits to different post offices, 4 I had been really taken aback, if you like, by the fact 5 that there was so much cash in the business of -- for 6 different reasons, and I was aware of the fact that, in 7 any retail business, there was and is some level of 8 fraud, for want of another word, and this could be 9 something that would be in the minds of some people in 10 the organisation. 11 But it was absolutely not -- I was absolutely not 12 thinking or intending to say that I thought 13 subpostmasters were inherently dishonest or more likely 14 to be dishonest. In fact, my impression from those 15 visits was that subpostmasters were doing a very complex 16 job and I was -- I had a lot of respect for them in what 17 they were trying to do. 18 Q. Why did you hold that belief, as you claimed, when you'd 19 been told that every case that the Post Office had ever 20 taken to prosecution involving the Horizon system had 21 found in favour of the Post Office? 22 A. Because I thought -- I believed what I was being told, 23 that those cases had all been won by the Post Office. 24 I believed that was true and I believed that -- so I did 25 believe that some people -- I did genuinely believe that 89 1 some people were guilty but I wasn't approaching this 2 issue with a mindset that said they were -- you know, 3 that they were more likely to be tempted than any other 4 group of people might be. I'm not sure if I'm 5 explaining myself very -- 6 Q. Yes, it's clear what you're saying. If we move further 7 down -- thank you -- we can see what to Paula Vennells 8 then said: 9 "She said that temptation is an issue ..." 10 Next paragraph: 11 "Of the 11,800 subpostmasters currently employed, 12 only a tiny number are presenting [problems]." 13 "The Horizon system is very secure. Every keystroke 14 used by anyone ... is recorded and auditable ... 15 "It appears that some subpostmasters [next 16 paragraph] have been borrowing money from the [account] 17 in the same way as they might do in a retail business 18 ..." 19 Then: 20 "Every case taken to prosecution that involves the 21 Horizon system has thus far has found in favour of the 22 Post Office." 23 That rather reflects the note that we think was 24 a record of the Zetter supper, doesn't it -- 25 A. Yes. 90 1 Q. -- which you've, I think, said did reflect the Post 2 Office corporate position for a number of years? 3 A. Yes. 4 Q. As the Chairman of the Board, what steps would you 5 expect your CEO to take before telling a group of MPs 6 that every case taken to prosecution has thus far found 7 in favour of the Post Office? 8 A. I would have expected that to be an accurate statement. 9 Q. Reasonable to rely on what she had been told orally? 10 A. No, not really. 11 Q. We know that, by this time, a lady called Nichola Arch 12 had been acquitted in 2004 -- 13 A. Yes. 14 Q. -- having blamed the Horizon system for the losses? 15 A. Yes. 16 Q. A lady called Maureen McKelvey had also been acquitted 17 in 2004 by a jury in Northern Ireland, having blamed 18 Horizon for the losses? 19 A. Yes. 20 Q. And Suzanne Palmer had been acquitted by a jury in 2007 21 and the jury had, in fact, sent a note saying, "What is 22 Mrs Palmer to do if she didn't agree the figures that 23 Horizon had produced?", and the Post Office was unable 24 in court to answer that question and had been on the 25 wrong end of a cost order for £78,000, the Post Office 91 1 had. 2 What steps would you expect, reasonably, a CEO to 3 take to seek to uncover the true position? 4 A. Well, I would -- you know, it's difficult to generalise, 5 isn't it, but I think that, if you are going to say 6 something as the Chief Executive on behalf of the 7 organisation of which you are the Chief Executive, you 8 should have tested those propositions by asking to see 9 the evidence, by asking the key people what the facts 10 were. 11 Q. Lord Arbuthnot has told us that he didn't believe what 12 he was being told for a minute. He thought that he was 13 being misled here -- 14 A. Okay. 15 Q. -- and so it didn't appear to be operative on his 16 mind -- 17 A. Okay. 18 Q. -- because he trusted what the subpostmaster that he'd 19 actually met -- 20 A. Yes. 21 Q. -- had been telling him? 22 A. Yeah. 23 Q. Did you accept, at face value, the accuracy and truth of 24 what Ms Vennells was saying? 25 A. Yes, I did. Yes, I did. 92 1 Q. Thank you. That can come down. 2 Can we move forwards a year, please. I'm not going 3 to ask you questions about the conduct of the Second 4 Sight investigation. You address that in some detail in 5 your witness statement. 6 A. Okay, thank you. 7 Q. Can we turn to the days and weeks before the production 8 of Second Sight's Report on 8 July 2013 -- 9 A. Yeah. 10 Q. -- and the Board's preparation for that publication and 11 the Board's response to the publication. 12 A. Yes. 13 Q. Can we start, please, by looking at an email of 27 June 14 2013. POL00098782. If we scroll down, please, and look 15 at an email from Martin Edwards to Paula Vennells. Can 16 you see that, of 27 June? 17 A. Yes. 18 Q. Then if we just scroll to the top of the page. We can 19 see the next day, that's sent on to you. 20 A. Yes. 21 Q. Okay. So let's go back down to Martin Edwards' email. 22 A heading "Re: [James Arbuthnot]?" In the second 23 paragraph, second line, he says to Ms Vennells: 24 "As discussed we need to think about a Plan B given 25 the likelihood that James won't agree to delay the 93 1 meeting/report. We need to be very careful not to 2 overplay our hand with [Second Sight] -- they could turn 3 out to be quite obvious if we threaten them with legal 4 action or attempt to replace them with another firm. 5 Easy for this to be portrayed in the media as 6 heavy-handed tactics because we don't like their 7 findings (it plays directly into the existing 8 perceptions we're trying to counteract)." 9 At this time, so 27 June 2013, what was your 10 understanding of the concern amongst senior Post Office 11 Executives about the Second Sight review? 12 A. My understanding was that the executives thought that 13 there were likely to be things in the Interim Report, 14 statements made by Second Sight, which were not properly 15 substantiated by the evidence. 16 Q. What steps, if any, did you take to ensure that you were 17 fully aware of what those issues were and the evidence 18 that Second Sight were leaving out of account? 19 A. I think -- I mean, I was bearing it in mind. 20 I obviously, at this stage, didn't know what was going 21 to be in the Second Sight Report but I would have been 22 concerned that there might be things in that report 23 which were critical without being properly 24 substantiated. 25 Q. Were you given any evidence of that, as opposed to what 94 1 people were saying? 2 A. I simply can't remember how much detail I was given 3 about it at that point. I think that it's worth bearing 4 in mind that this thought, that Second Sight were 5 advancing propositions about the Horizon system and 6 other aspects of the Post Office's operations that were 7 not fully substantiated or that the Post Office had not 8 had time to -- there hadn't been time for them to 9 consider properly the Post Office's evidence, those 10 were -- those had been around for some weeks before 11 this. So this wasn't -- there wasn't a new thought at 12 this stage, that this might be happening. 13 Q. Was it the view of senior executives of the Post Office 14 that it, the Post Office, could exert a degree of 15 influence over Second Sight at this time? 16 A. I think -- I am absolutely clear that it was never my 17 intention or the intention of anybody on the Board to 18 influence Second Sight's evidenced findings -- 19 Q. I was asking, sorry, Ms Perkins, about executives? 20 A. Sorry, I know you are. I don't believe that that was 21 something which the executives were trying to do either. 22 Q. To your understanding, was it important for the Post 23 Office to seek to control a narrative in the media 24 regarding its handling of the Second Sight Report? 25 A. For me, what was important was that -- there was a lot 95 1 riding on the Second Sight Reports -- on the Second 2 Sight's Interim Report -- and, if they were going to 3 find -- if they were going to say that they had found 4 things that were wrong, that were supported by the 5 evidence, that would obviously be uncomfortable and 6 there would be all kinds of implications and 7 consequences of that but that was something I was 8 absolutely prepared to face up to. What I didn't want 9 was for there to be any allegations or innuendo that 10 there was more that was wrong than could be properly 11 substantiated. 12 Q. Can we move forwards, please, to the next day, 13 POL00144909, middle of the page, an email from you to 14 Paula Vennells: 15 "[Thank you] for the updates. I am glad we have the 16 best people on this. 17 "Three thoughts -- first is probably a red herring 18 but I'll mention it because it came into my mind. Are 19 the lawyers also thinking about implications for [the 20 Post Office] and the people in it, if there is any 21 suggestion by [Second Sight] that things have been 22 awry -- may be [over the top]/worst-case scenario but 23 just need to be aware of Maxwellisation/Salmon letters 24 angle. 25 "Second, I agree with Martin about the risks of 96 1 getting heavy with [Second Sight] -- deeply 2 unattractive. But I haven't heard anything yet which 3 gives me hope that we can get this properly back on 4 track. Which is worse? (I don't know the answer). 5 (Keep aiming high here! That is, for the goal of no 6 interim/no meeting. But I recognise that this is not 7 within our control.) 8 "Third, a constructive suggestion! Shall we ask 9 Oliver Letwin to help us turn this round?" 10 Before writing this email, had you taken any steps 11 to get fully to the bottom of the apparent tension 12 between the Post Office and Second Sight over the terms 13 of Second Sight's proposed findings? 14 A. I don't think at that stage anybody had seen -- well, 15 I certainly was not given the impression that anybody 16 had actually seen what it was they were going to say. 17 I think it was, as far as I was concerned, it was -- 18 there'd just been a series of discussions or meetings. 19 Q. How was it known, then, that they were going to say 20 things that were unevidenced? 21 A. Because of the things that had been said in those 22 conversations. 23 Q. So it was just oral conversations? 24 A. Over a long period of time. I mean, this isn't just 25 something that's come at this point. As I have set out 97 1 in my witness statement, the -- a series of events, if 2 you like, or things that happened that made the 3 executives and me somewhat concerned about what Second 4 Sight were basing their -- or would be basing their 5 findings on. 6 Q. Were you not concerned at this stage of your previous 7 experience of the business unnecessarily pushing back, 8 that this was happening again and this was a case of 9 executives not wanting to face uncomfortable facts and 10 findings? 11 A. I think that, at this point, I was becoming very 12 sceptical about whether Second Sight were the right 13 people to do this job. 14 Q. I'm asking you about whether you were sceptical of your 15 executives, given that you said that you had been rather 16 unimpressed about their conduct in the very setting up 17 of this enterprise. Had that concern evaporated? 18 A. No, I don't think it had evaporated but what I was 19 worried about was that we were suddenly coming very, 20 very close to there being a public document, which was 21 obviously going to get a great deal of attention and 22 I thought that -- I was concerned about unnecessary 23 damage to the Post Office, as opposed to unavoidable and 24 properly referenced damage. 25 Q. Was this all based on whispers? 98 1 A. No, I don't think it was based -- no, I wouldn't accept 2 that. No. 3 Q. You say here "Keep aiming high" and you tell us in your 4 witness statement that you don't know what you meant by 5 "Keep aiming high"? 6 A. Yes. 7 Q. Isn't it explained by the next sentence, that is "Keep 8 aiming high" means achieving the goal of having no 9 Interim Report and no meeting with James Arbuthnot? 10 A. So what I had in mind there was not what some people 11 might read into this, that I was thinking could he 12 possibly have been thinking that there would be no 13 report at all from Second Sight and, therefore, no 14 meeting to discuss it? I think that what I was 15 expressing there was the thought that the Interim Report 16 was premature. That this was -- that more time needed 17 to be spent on the work leading up to a document that 18 was going to be public. 19 That's what I think I was saying there because 20 the -- as I remember it, the timetable -- first of all, 21 the timetable had slipped very, very, very greatly. 22 Originally, when Second Sight started their work, we 23 believed -- they believed and we believed that the work 24 would be completed in a matter of weeks, a small number 25 of months, and here we were a year later and the MPs 99 1 were perfectly understandably becoming frustrated by 2 that. 3 We were coming up to the summer recess and they were 4 very, very keen, and I completely understand why, to be 5 given an update on where things were and that's what 6 drove the idea of having an Interim Report but, in terms 7 of the substance of what had been done, the timing was 8 artificial. 9 Q. Was this you giving the green light to your executives 10 for taking a robust position with Second Sight to get 11 them, Second Sight, to alter the contents of their 12 report? 13 A. It was never my intention nor did I seek to influence 14 the executives to do anything that would stop the 15 properly evidenced findings by Second Sight being 16 reported. My concern was that there would be, in 17 somebody else's words, "loose language", which would be 18 interpreted negatively, for which there wasn't a proper 19 substantive base. That was my concern and had been my 20 concern for some time, by the end of June. 21 Q. Can we turn to POL00296944. This is a few days later, 22 1 July, an email from Paula Vennells to you, heading 23 "Latest on [Second Sight]": 24 "Hi Alice, I'm looking forward to catching up 25 properly [today]. I thought the board were generous in 100 1 their patience tonight over the [Second Sight] 2 discussion. It is helpful to know that they are 3 supportive of the need to be robust." 4 Then carrying on, second paragraph: 5 "I caught up with Susan this evening after we 6 finished. She had finished her meeting with [Second 7 Sight] and [was] of the view that they do now understand 8 the risk of being caught up in something bigger and more 9 sensitive. She is hoping that their report should be 10 more balanced, should say that they found no evidence of 11 systemic Horizon (computer) issues but will confirm 12 shortcomings in support [of] processes and systems, and 13 that the Post Office has already identified and 14 corrected a number of these." 15 Isn't that a reflection of Second Sight being 16 influenced by the Post Office as to the conclusions in 17 its report? 18 A. I think that's evidence of what it was I said a minute 19 ago, which is that it was really, really important that 20 anything that Second Sight said in the Interim Report 21 was based on firm, provable evidence, rather than 22 speculating, if you like. 23 Q. In what way did you understand Second Sight's Interim 24 Report needed to be "more balanced"? 25 A. My understanding was that there were -- there was a risk 101 1 that there were -- I don't think anyone had seen a draft 2 of it -- 3 Q. No, it doesn't come out until the 5th. 4 A. No. 5 Q. So, we're, at the moment, talking just about what people 6 are saying. 7 A. Yes, that is absolutely right and that's why the Board 8 didn't see that report in draft because there wasn't 9 time. So what I and I believe the Board were being told 10 on that telephone meeting that we had had was that there 11 was a real risk that Second Sight would be saying 12 things, critical things, about the Post Office's 13 operations, which either there had not been -- there had 14 either not been time for them to consider properly the 15 Post Office's evidence, or -- and/or, they were 16 floating, if you like, things that had been said to them 17 that they thought might be true. 18 And that what the Board was saying was that they 19 were encouraging, they were supportive of the executives 20 making a clear distinction between those things which 21 were properly evidenced and properly considered and 22 those which were not yet, and bear in mind that this 23 was -- everybody knew this was an Interim Report and 24 there was further work to be done. 25 Q. Was it your understanding that it was at Post Office's 102 1 suggestion or insistence that a line was included that 2 Second Sight had found no evidence of systemic computer 3 issues? 4 A. I have never understood that that was a phrase that had 5 come from Post Office executives. My understanding 6 always was that when the Post Office executives heard 7 that this was going to be said, obviously that was 8 a relief, if you like, not knowing what might have been 9 said. But I have never ever understood that anybody 10 suggested that Second Sight should say that. 11 Q. Can we move on, please, to 3 July, POL00027852. This is 12 an email from Martin Edwards of 3 July to you and others 13 or to you and Paula Vennells, and others, copied in. He 14 says he's attaching a briefing note, first line: 15 "... here's the briefing note for the meeting with 16 [James Arbuthnot]." 17 Can you see that? 18 A. I don't think I've seen this before but I can see that 19 that's what he's saying, yes. 20 Q. I think this was amongst the documents that you have 21 been shown, yes? 22 A. Was it? Okay. Right. 23 Q. So it's 3 July, I'll take it slowly, if you think you 24 may not have -- 25 A. Yes, thank you, I appreciate that. 103 1 Q. -- read it all. 2 A. Thank you. 3 Q. If we go to the briefing note, which is the second page, 4 "Key Objectives and Points to Cover at the Meeting", and 5 then if we go down, please, to the foot of the page. 6 A. Mm-hm. 7 Q. That's it, "On the two 'exceptions'", at the foot of the 8 page. 9 A. Oh, yes. 10 Q. It's ringing a bell now, is it? 11 A. Yes, thank you. I think it was the cover email I was 12 unsighted on, okay. 13 Q. "... we proactively disclosed to [Second Sight] two 14 exceptions (or 'anomalies') where [subpostmasters'] 15 accounts have been affected. Our internal and system 16 processes identified these cases, appropriate action has 17 been taken and they did not lead to any disciplinary 18 action against [subpostmasters]. No reason to believe 19 this means that there are other undiscovered issues. 20 (We are sorry this information was not passed on to you 21 at an earlier stage -- if we had considered it to 22 materially to change the investigation we would have 23 flagged it directly, but it doesn't)." 24 Did it cause you concern that the two exceptions or 25 anomalies, to use the preferred language, regarding 104 1 Horizon were not passed on to you at an earlier stage? 2 A. I can't remember, there was so much going on at that 3 time. I can't -- I simply can't remember whether I was 4 irritated by that. I mean, the whole thing felt so 5 badly handled that -- 6 Q. By? 7 A. Well, by everybody, really. I mean, you know, we'd 8 commissioned Second Sight over a year before to do 9 a piece of work. It had taken -- it was taking a very, 10 very long time. I'd been told all kind of things about, 11 you know, the length of time it was taking, the way 12 Second Sight were losing objectivity, worried about how 13 the cost was ratcheting up and feeling that there was 14 a real risk that we weren't going to get the kind of 15 report that I had wanted us to get and, at the same 16 time -- and this one of my digressions, I'm sorry, but 17 I do need to give you a bit of context here -- we were 18 negotiating the next five years' of money for the Post 19 Office from 2015 onwards. 20 This was about, you know, obviously the future 21 survival, in whatever shape, of the Post Office and we 22 had the critical meeting with Vince Cable and Jo Swinson 23 coming up two or three days after this Interim Report 24 was going to be published. So -- 25 Q. That's very helpful. In fact, I know that tomorrow 105 1 you'll be asked a number of questions -- 2 A. Okay. 3 Q. -- about the extent to which that motivated Post Office 4 Board's conduct and the conduct of its executives. 5 A. I think what -- the point that I'm trying to make here 6 is that we were in a -- we were very anxious about all 7 kinds of things at that point. 8 Q. Sensitive to criticism? 9 A. Just, there was just a huge amount going on to try -- 10 and lots of other things going on as well, and I think 11 what I'm really trying to say and perhaps taking too 12 long to say it, is that I can't -- I haven't held all of 13 this in my head. 14 Q. So you can't recall your reaction to being told that 15 there are two problems with the system that you hadn't 16 been informed about previously? 17 A. I think I would have been irritated by that, yes. 18 I said that a minute ago. 19 Q. And that there was an apology to be delivered to the 20 MPs -- 21 A. Yes. 22 Q. -- "We're sorry it hadn't been passed"? 23 A. Yes, I mean, clearly that was not -- that was bad. 24 Q. It says in this note that there is "No reason to believe 25 this means there are other undiscovered issues", which, 106 1 in the context of what we know now, is quite a claim. 2 A. Yeah. 3 Q. What steps, to your knowledge, were taken, to establish 4 whether or not the fact that there were two bugs, I'm 5 going to call them, was not indicative that there were 6 other undiscovered bugs at that stage? 7 A. I can't help you with that, I'm afraid. I mean, 8 I certainly -- I don't think I would have concluded from 9 this -- from what is being said here that it followed 10 that there would not be other bugs or anomalies, or what 11 they were being called at the time. 12 Q. Do you agree it's a logical question, if there has been 13 revealed two bugs, which were previously undiscovered, 14 what steps should we take to establish whether there 15 were other undiscovered bugs? 16 A. I think the impression that we were being given by the 17 executives was that they had, in fact -- that their 18 processes had -- well, it says this here -- their 19 processes had identified these cases, in other words, 20 these were things that had been found within the Post 21 Office system and, therefore, that was of -- it was of 22 comfort that those had been found -- that we were being 23 told that those had been found by the Post Office. 24 Q. It was never suggested to you that, far from the Post 25 Office revealing the bugs to Second Sight, it was Gareth 107 1 Jenkins from Fujitsu who had done so? 2 A. Absolutely not, no. No. 3 Q. So in fact this was being presented to you as 4 essentially a good news story -- 5 A. Yes. 6 Q. -- "our systems worked"? 7 A. Exactly. 8 Q. Can we move forward to Second Sight's Interim Report of 9 the 8 July. POL00004406. This is a copy of the Interim 10 Report and it reveals on page 6, if we turn to it, 11 please, at the top of the page, at paragraph 6.5, the 12 receipts and payments mismatch bug affecting 62 branches 13 and then, in 6.6, the local suspense account bug 14 affecting 14 branches. Then, if we go forwards to 15 page 8, please. 8.2: 16 "We have so far found no evidence of system wide 17 (systemic) problems with [Horizon]." 18 A. Yeah. 19 Q. "We are aware of 2 incidents where defects or 'bugs' 20 [arose] which took some time to identify and correct 21 ..." 22 Then at (c): 23 "Occasionally an unusual combination of events, such 24 as power or communications failure during the processing 25 of a transaction, can give rise [to] a situation where 108 1 timely, accurate and complete information about the 2 status of a transaction is not immediately available to 3 a [subpostmaster]. 4 "d) When [subpostmasters] experience or report 5 problems, [the Post Office's] response can appear to be 6 unhelpful, unsympathetic or simply fail to [resolve] the 7 problem. The lack of a 'user forum' ... means that 8 [subpostmasters] have little opportunity to raise issues 9 of concern ..." 10 A. Yeah. 11 Q. Et cetera. When you read this -- and you say in your 12 witness statement that you'd got a copy of the Interim 13 Report and read it -- did you focus on each of the 14 individual concerns raised by Second Sight here, 15 including those which weren't related to Horizon itself, 16 for example lack of training and support -- 17 A. Yeah. 18 Q. -- helpdesk facilities, investigations that had, as 19 their aim, asset recovery, and the contract, which 20 placed risk on subpostmasters, or did you focus on the 21 conclusion that there was no system-wide (systemic) 22 problems with the software? 23 A. I certainly focused more broadly than that and 24 I certainly remember focusing on the training and 25 support issues. I think those had been raised by Lord 109 1 Arbuthnot very early on, if not his first meeting. So, 2 you know, those were in my mind and I think that, by the 3 time this report came out -- but I may be wrong about 4 this -- that people within the Post Office were aware of 5 or had talked about the need to improve training and 6 support, the Helpdesk, and so on. So I was absolutely 7 aware of that. 8 We've just talked about the two incidents where 9 I felt, you know, it was reassuring that the Post Office 10 itself had identified these and taken action and that 11 nobody had been any -- out of pocket or any the worse 12 for that. 13 On these other issues, it seemed to me that these 14 were up in the air and that they would need to be 15 considered -- you know, they were going to be considered 16 further, as part of -- because this was an Interim 17 Report. 18 Q. Can we turn up -- in fact, before we do: what was your 19 understanding of the phrase, "no evidence of system-wide 20 (systemic) problems"? 21 A. My understanding of that was that it was a reassuring 22 message that the Horizon system was basically sound. 23 Q. Did you understand it meant that there were no software 24 problems with Horizon? 25 A. No, because of the point (b). 110 1 Q. Did you understand that point (b) was the only software 2 problems with Horizon? 3 A. At that point, that would have been my belief. 4 Q. Did you know the extent to which Second Sight had 5 investigated the extent of software problems in Horizon, 6 going back to Legacy Horizon, back to 2000 and with 7 Horizon Online? 8 A. I wasn't aware of all the detail of what they'd been 9 doing, no. 10 Q. Can we turn up paragraph 198 of your witness statement, 11 please, which is on page 100. It'll come up on the 12 screens for you. 13 A. Okay, thank you. 14 Q. So page 100. It's just something you say in your 15 witness statement at paragraph 198. You say: 16 "I am asked whether there was any change in approach 17 by the Post Office to the existence of [bugs, errors and 18 defects] since the instruction of Second Sight. As 19 previously explained, I did not understand that Horizon 20 was subject to [bugs, errors and defects] nor had 21 I heard that acronym until many years after I had left 22 the Post Office." 23 A. Mm. 24 Q. Just some clarification, if I may. 25 A. Mm. 111 1 Q. Are you saying that you did not understand that any bugs 2 had affected Horizon at any point during your period as 3 Chair? 4 A. That is what I'm saying here. 5 Q. That can be right though, can it? Because we've just 6 read the Second Sight Report, which said that at least 7 two bugs had affected -- 8 A. Yes, well -- oh, I see what you're saying. Okay. That 9 the two -- I suppose when I was writing this, I was 10 thinking of this acronym, BEDs: bugs, errors and 11 defects. 12 Q. Yes, so is the correct position -- 13 A. So the correct position is that, obviously, when I read 14 the -- when I first read the Interim Report, I could see 15 clearly that there were -- there had been these two 16 things called anomalies in this report, so yes, 17 absolutely, I was aware of them. I'm afraid when 18 I was -- I think when I wrote this I wasn't clear about 19 this acronym or these -- 20 Q. Yes, so this is all about the acronym -- 21 A. Yes. 22 Q. -- rather than the bugs? 23 A. Precisely. 24 Q. Is that a fair way to describe it? 25 A. I think so, yes because I use that -- I say that at the 112 1 end, "nor had I heard of that acronym". So that's what 2 I think I was responding to. 3 Q. Then lastly on this topic, if we can go forward to 4 paragraph 211 of your witness statement, which is on 5 page 105, you say: 6 "The Horizon system was critically important to the 7 Post Office. The subpostmasters and people in Crown 8 Offices and members of the public around the country 9 relied on it daily for transactions. If there was any 10 suggestion that it couldn't be relied on, it could make 11 the public think their money was not safe with us and 12 worry the people under the system. I was not at any 13 point trying to bury information that might reveal that 14 there was something wrong with Horizon. If something 15 was wrong, we needed to know, to be open about it and 16 act on it. If the findings were not evidence-based 17 however, it was going to cause serious damage for no 18 reason -- and it did not appear that all of Second 19 Sight's criticisms were going to be properly evidenced." 20 A. Yes. 21 Q. The last sentence first, "it did not appear that ... 22 Second Sight's criticisms were going to be properly 23 evidenced"; that's what you were told -- 24 A. Yes. 25 Q. -- orally -- 113 1 A. Yes. 2 Q. -- and that was based on what somebody else had said to 3 the person that was telling you? 4 A. It was based on, I think, what several had said to me 5 over a long-ish period of time. 6 Q. When you say here that the Horizon system was important 7 for the public because it relied on it daily for 8 transactions, did you consider that a similar or greater 9 concern at the time ought to have been whether such 10 suggestions about Horizon's integrity were relevant to 11 a substantial number of convictions that may have been 12 unsafe? 13 A. I don't think that, at that point -- I don't think -- 14 that I was aware and the Board was aware of the scale of 15 the issue. But we -- I mean, clearly we were aware that 16 people had been prosecuted and so there had to be 17 a possibility that some of those -- you know, if anybody 18 is successfully prosecuted, there has to be 19 a possibility that that prosecution might not have been 20 safe. 21 Q. That's a very abstract statement. I'm asking in the 22 context of what you say here about the critical 23 importance of Horizon to the Post Office and the public 24 that it served. I'm asking whether that overshadowed, 25 in your mind and the Board's mind, the possibility that 114 1 Horizon had been relied on to produce data that had led 2 to convictions that may be unsafe? 3 A. No, I don't think it did overshadow that. But I think 4 what I was trying to deal with here in my witness 5 statement was the suggestion that the Board or I were 6 improperly concerned about the Post Office's reputation, 7 and what I was trying to say here -- and it's borne out 8 by other evidence, is that I was absolutely prepared to 9 face up to findings by -- evidence findings by Second 10 Sight that things were wrong. 11 But what I was -- really, really did not want to 12 happen, was that things would be said that weren't -- 13 I mean, I've said it already -- that things would be 14 said in that report that were critical of the Post 15 Office's operations, which were not actually justified. 16 That was the concern. 17 Q. At this point in time, had what Mr Grant said to you 18 been lost in the midsts of time? 19 A. I think I -- to be quite honest, I'm not sure that 20 I would have remembered that conversation at that point. 21 I mean, that conversation took place in September 2011, 22 in the middle of a huge inflow of information onto -- 23 not a blank mine but, you know, a very unfilled mind, 24 and here -- we're now in July 2013, it's nearly two 25 years later. 115 1 MR BEER: Thank you. 2 Sir, that's an appropriate moment; we're changing 3 topics. Could we reconvene at 2.00 pm, please? 4 SIR WYN WILLIAMS: Certainly, yes. 5 MR BEER: Thank you very much. 6 (1.10 pm) 7 (The Short Adjournment) 8 (2.00 pm) 9 MR BEER: Good afternoon, sir, can you see and hear us? 10 SIR WYN WILLIAMS: Yes, thank you. 11 MR BEER: Good afternoon, Ms Perkins. We were dealing with 12 the publication of the Second Sight Interim Report on 13 8 July 2013 and the events that immediately preceded it, 14 and now turning to the events that followed it. 15 A. Yes. 16 Q. Can we look, please, at POL00407582, please. If we look 17 at the top part of the page, thank you, it's a Bond 18 Dickinson attendance note and you know that Bond 19 Dickinson were one of the firms of solicitors instructed 20 by the Post Office at this time? 21 A. Yes. 22 Q. It's an attendance note of Simon Richardson, who is one 23 of the solicitors there, and it's an attendance upon 24 Susan Crichton and Hugh Flemington. 25 A. Right. 116 1 Q. It's on 10 July. You're not party to this but it says 2 things about you and about the Board, of which you were 3 a member? 4 A. Yes. 5 Q. So I want to ask you some questions about it. 6 A. Okay. 7 Q. Sorry, if we just scroll up a little bit. The "Matter", 8 second from the top, is "Horizon Challenges General"? 9 A. Yeah. 10 Q. Then, if we scroll down, please, and look at numbered 11 paragraph 3, the introduction to this says there was: 12 "... general discussion about how [we] were going to 13 manage the additional complaints and resourcing. 14 Essentially, where we got to ... was quite a lengthy 15 brainstorming session ..." 16 Then 3: 17 "The Board want to sack [Second Sight] and of course 18 are ... not coping well with the fact they are 19 independent. [Susan Crichton] is going to arrange to 20 meet [Second Sight] and asked if she could use our 21 offices next Tuesday." 22 Then paragraph 7: 23 "There was generally an overall defensive air and 24 the Board are also feeling bruised. There are tensions 25 between people and that includes Alice Perkins (the 117 1 Chair), Paula Vennells (CEO) and [Susan Crichton]. 2 I said I thought the Minister had dealt with the 3 questions extremely well and looked in control of the 4 brief. Evidently she had [Post Office] in to tear them 5 off a strip for not thing someone up earlier in the day 6 for interviews on radio and [television]", et cetera. 7 So, just scrolling back up to paragraph 3, at this 8 time, 10 July 2013, did the Board want to sack Second 9 Sight? 10 A. No. 11 Q. Do you know where either Susan Crichton or Hugh 12 Flemington may have got the idea from that the Board 13 wanted to sack Second Sight? 14 A. Well, Susan Crichton, I think, would have been aware of 15 the fact that the Board was concerned about Second Sight 16 for the reasons I gave this morning. I think that the 17 telephone board meeting that we had had, I think it was 18 on 1st July, we talked about this morning? 19 Q. That's right. 20 A. Yeah. That meeting had been in people's diaries for 21 a completely different reason and the discussion about 22 the coming of the Interim Report was sort of shoe-horned 23 into that. People on the Board weren't expecting that 24 to be happening at that point and, obviously, there was 25 no -- there were no papers or anything like that, they 118 1 were just, you know, having to react on the hoof. And, 2 as I said this morning, we were at a critical point in 3 our negotiation with Government about the next five 4 years' funding and I think people were more sensitive, 5 if you like, than they would normally have been. 6 Q. But they didn't want to sack Second Sight? 7 A. No, I think there were questions being asked about the 8 competence of Second Sight -- the capability, the scale 9 of the enterprise, if you like, and their competence to 10 deal with these issues in the context in which we all 11 found ourselves but I think that really is 12 an exaggeration of the situation. 13 Q. Was, to your knowledge, the Board not coping well with 14 the fact that Second Sight were independent? 15 A. No, I don't think so. I don't think that was it at all. 16 I think the Board -- I mean, I wouldn't say the Board 17 weren't coping well. I've had quite a lot of experience 18 of looking at how Boards operate. One of the things 19 that I think almost all Boards take badly is being 20 taken -- being bounced, is being taken by surprise. 21 They don't -- 22 Q. That's not what this is talking about; this is talking 23 about the independence of the investigators? 24 A. No, absolutely. I understand that. But I think what 25 I'm trying to say is this was something that everybody 119 1 was finding very uncomfortable. You can't -- you 2 shouldn't -- they were finding it uncomfortable and, you 3 know, were perhaps reacting in ways that they didn't 4 normally react, but that was absolutely not the same 5 thing as saying that they weren't coping well with an 6 independent review or report. 7 Q. Is what we read here, in fact, the truth of the 8 position, not reflected at all in the Board minutes, but 9 piercing the veil, peeling back the veil -- 10 A. No. 11 Q. -- with Susan Crichton speaking on a legally privileged 12 occasion and revealing the truth? 13 A. Sorry, can you take me to what you're looking at here? 14 Q. Yes, "The Board want to sack Second Sight and are not 15 coping well with the fact that Second Sight is 16 independent". 17 A. You're talking about piercing the veil? 18 Q. Yes. We don't see in either of the Board minutes of 19 1 July 2013 or 9 July, which was, in fact, about 20 a different issue that Board was convened, any mention 21 of the Board's concern over Second Sight being 22 independent or any concern that they, the Board, wished 23 to sack Second Sight. What I'm asking you is are the 24 minutes are sanitised? 25 A. No, no, no, they're certainly -- the minutes were never 120 1 sanitised. Absolutely not. 2 Q. Can you explain how it is that either Hugh Flemington or 3 Susan Crichton are telling the Post Office lawyer that 4 the Post Office wants to sack Second Sight and your 5 board is not coping well with the fact that they're 6 independent? 7 A. No, I have absolutely no idea what they base that on but 8 I can absolutely assure you that that was not the case. 9 Q. Paragraph 7: 10 "There was generally an overall defensive air and 11 the Board are ... feeling bruised." 12 Was the Board feeling bruised? 13 A. No, I don't think the Board was feeling bruised, the 14 board was feeling, if I can be colloquial about this, 15 "Oh my goodness, you know, there is an awful lot to cope 16 with here and it's difficult", but they weren't feeling 17 bruised. 18 Q. It records that either Hugh Flemington or Susan Crichton 19 said there were tensions between people, including you, 20 Paula Vennells and Susan Crichton; is that accurate? 21 A. Well, I think that I felt -- and I think I say this, 22 don't I, in my witness statement -- that the Post Office 23 had not handled the run-up to this well and I was cross 24 that we had been taken by surprise in this way. 25 I didn't -- it was not right that a telephone Board 121 1 meeting called for something else was the forum for 2 discussing something as serious as this. There were no 3 papers for it. Nobody had had any time to prepare for 4 it, and that's not the way I would ever have wanted to 5 conduct a Board discussion about something as important 6 as this. 7 Q. Was the Board operating with a defensive air about it? 8 A. I don't think that's a correct interpretation and 9 I don't think -- I may be wrong about this -- I don't 10 think Hugh Flemington was present at either of these 11 discussions. 12 Q. So, if this was said, it would be Susan Crichton saying 13 it? 14 A. Well, I mean, he may have chosen to say it but, if 15 I'm -- 16 Q. Not knowing the truth? 17 A. If I am right, that he wasn't on the call, I mean, 18 I don't know whether I am right. I don't think he would 19 have -- 20 Q. Hugh Flemington wasn't. 21 A. No, so I don't know on what basis he would have been 22 saying that. 23 Q. It must be Susan Crichton? 24 A. Well, either he's heard something that he's 25 overinterpreting, or it's Susan or it's both of them. 122 1 I don't know. I was pretty shocked when I first saw 2 this, I must say, and -- 3 Q. I'm sure. The headline that the Post Office took from 4 the Second Sight Interim Report was that there were no 5 systemic faults in Horizon and that the Post Office 6 could continue saying that it was a robust system. 7 A. Yes, and that was also the view of Lord Arbuthnot at the 8 time, and he put that -- he said that in his press 9 statement about it. So we were not alone in concluding 10 that. 11 Q. Therefore, there would be no reason to sack Second 12 Sight. There would be no reason for the Board wishing 13 that Second Sight were not so independent, no reason for 14 the Board feeling bruised, if that was genuinely the 15 message that Post Office took from the Second Sight 16 Report? 17 A. Well, we accepted the support and training findings and 18 were -- people were very determined to do something 19 about that. I mean, you know, I'm not trying to say 20 that there weren't reservations about Second Sight. 21 I have already just said that. But -- I mean, this is 22 not a description that I recognise. 23 Q. Can we turn to the 16 July 2013 Board meeting. I think 24 you realise that this is a significant event, don't you? 25 A. Yes, I do. 123 1 Q. Can we turn to the papers that were prepared for the 2 Board meeting first, by looking at POL00099218. This is 3 a paper prepared, if we look at page 3, 12 July 2013, by 4 Susan Crichton. 5 A. Yeah. 6 Q. Back to page 1, please. It's an "Update following 7 publication of the Interim Report" -- 8 A. Yeah. 9 Q. -- whose purpose was to (1) update the Board on latest 10 events and (2) seek input on how the business moves 11 forward with the three new initiatives outlined in the 12 Post Office's press release. 13 A. Yeah. 14 Q. Let's look at the foot of the page. It sets out the 15 "Current Activities ... underway". I'm not going, to 16 read all of those. If we go over the page and just read 17 3.6, "Ongoing/new prosecutions": 18 "we are reviewing these on a case-by-case basis as 19 to whether or not they need to be adjourned or other 20 action taken in the light of the publication of the ... 21 Interim Report." 22 3.7: 23 "Criminal case review: On the advice of our external 24 criminal lawyers we have immediately begun a review of 25 our criminal cases conducted since Separation on 1 April 124 1 2012. More detail is set out in Annex 1." 2 Also, I think you know the date actual given is 3 1 January 2010 in Annex 1. 4 A. Yes. 5 Q. Can we go to Annex 1, please, which is page 4. This is 6 Susan Crichton's Annex 1: 7 "Post Office have been advised by our external 8 criminal [solicitors] to undertake a review of all cases 9 going back to the time of the migration from old Horizon 10 to Horizon Online -- 1 January 2010 -- and this has 11 already begun. They are essentially looking at whether 12 or not anything in the [Second Sight] Interim Report 13 should be drawn to the attention of any defendants 14 (current or past) and if so they will be writing to the 15 relevant defendants providing them with a copy of the 16 ... Interim Report. We have a continuing legal duty as 17 prosecutors to do this." 18 Then 1.1: 19 "... we believe ... that we will have undertaken 20 [around] 55 prosecutions a year for the last 10 years. 21 Our external lawyers have advised us that they believe 22 there will be around 5% where they need to disclose the 23 additional evidence and then it will be up to the 24 defence lawyers to consider the evidence and apply to 25 the Court of Appeal." 125 1 Then keeping to 1.3: 2 "We may also face civil suits for wrongful 3 conviction. The consequences of this 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 for malicious prosecution." 10 If, as the Post Office was presenting matters 11 publicly, there were no systemic defects in Horizon, 12 that the two anomalies or exceptions, as they were 13 rebranded courtesy of Ms Vennells' husband, didn't 14 affect any prosecution or civil cases, and that the two 15 exceptions had been spotted and dealt with entirely 16 appropriately at the time, how could convictions be 17 overturned and the Post Office face claims for wrongful 18 conviction? 19 A. I think that we thought that -- I mean, you know, we 20 were in receipt of advice here. As we've already 21 established, there was nobody -- there were no 22 Non-Executive Directors who had legal knowledge. 23 I think that we were just accepting what we were being 24 told by the General Counsel and thought that this 25 sounded like the right kind of precautionary action to 126 1 be taken. 2 Q. I'm asking how it added up. If Second Sight said there 3 are no systemic problems, if the bugs had not affected 4 any prosecutions and had been dealt with entirely 5 appropriately in accordance with Post Office's usual 6 procedures, why might the Post Office face claims for 7 wrongful conviction? 8 A. I don't know how -- I'm not sure whether I really 9 thought that through at that point. 10 Q. Can you see the point? 11 A. Yes, I understand the point you're making. 12 Q. It doesn't really add up, does it? If the Post Office 13 genuinely believed in the conclusions which it chose to 14 highlight in the Second Sight Report, none of this makes 15 sense; there must be something else, mustn't there? 16 A. I don't know whether we would have thought that it could 17 have been something to do with the lack of support that 18 the subpostmasters were being given, that they were -- 19 I mean, you know, one of the things that Lord Arbuthnot 20 said to me, right at the outset and repeated, was that 21 he thought that some of the subpostmasters had -- 22 because they hadn't been, in his view, properly trained 23 and/or properly supported, they just got into a position 24 where they felt unable to withstand the situation they 25 found themselves in. So perhaps -- 127 1 Q. That could be it. So it could be the training and 2 helpline support issue -- 3 A. It could be. 4 Q. -- that may mean conviction -- 5 A. Could be -- 6 Q. -- a conviction falls to be overturned -- 7 A. Yes. 8 Q. -- and a claim for wrongful conviction sought? 9 A. Because the treatment had been so inappropriate. 10 I don't know. I mean -- 11 Q. Was anything else -- 12 A. -- I'm not a lawyer. 13 Q. -- ever mentioned, anything else dropped in at this 14 stage about a witness giving false evidence? 15 A. I think not at this stage. There was a very -- later -- 16 and I think it's in my witness statement, I can't 17 remember offhand -- but later, there was a Board paper 18 which had a one-sentence reference to finding a new 19 independent expert without any explanation as to why 20 that was, and the sort of -- the inference that people 21 could perfectly reasonably have drawn from that was 22 there was some prosaic reason for that. 23 After I had signed this witness statement, very 24 recently I was shown an email from Paula Vennells to me, 25 which listed a whole series of things that she wanted to 128 1 tell me about, and there is a reference to the 2 independent expert in that, which I think she described 3 as not material. 4 Q. Yes, and we'll come to that later today or probably 5 tomorrow. 6 A. Okay. 7 Q. But, at this point, we're not to draw from this Susan 8 Crichton paper -- 9 A. Yeah. 10 Q. -- the fact that you thought there was anything odd or 11 unusual with, on the one hand, the Second Sight Report 12 being presented to the public as vindicating Horizon -- 13 A. Mm. 14 Q. -- and yet privately, in the Board, it was being told 15 that convictions may, on application, be overturned and 16 the Post Office may face claims of wrongful conviction? 17 A. I think we always knew that there was a possibility that 18 there could be claims for wrongful conviction. I think 19 we would have just thought that this was 20 a precautionary, proper process. 21 Q. Thank you. Can we move on, then, to the Board meeting 22 itself. 23 A. Yeah. 24 Q. POL00021516. We can see a list of those present -- 25 A. Yes. 129 1 Q. -- including you -- 2 A. Yeah. 3 Q. -- and then in attendance those present, if we scroll 4 down a little bit. 5 A. Yes. 6 Q. Then, if we go to page 6, which is the relevant part, 7 please, under "Horizon Update": 8 "The CEO [Paula Vennells] explained that although 9 the Second Sight Report had been challenging it had 10 highlighted some positive things as well as improvement 11 opportunities. The business had been praised in 12 Parliament for setting up the independent review; the 13 proportionality of the tiny number of cases had been 14 emphasised; and no systemic issues had been found with 15 the Horizon computer system. However there were 16 cultural issues which had to be addressed to improve the 17 support we gave to subpostmasters. The CEO stressed 18 that this was now a catalyst to make changes in the 19 Business. 20 "The Board was concerned that the review opened the 21 Business up to claims of wrongful prosecution. The 22 Board asked if Susan Crichton, as General Counsel, was 23 in any way implicated in the prosecutions. The CEO 24 reported that, up until eighteen months ago, Royal Mail 25 Group had run the Criminal Law Team and many of the 130 1 cases in the review had arisen before separation. The 2 CEO explained that the Business was a prosecuting 3 authority and as such bought its own prosecutions. 4 However since separation the General Counsel had 5 proposed moving to the more normal position of using the 6 CPS for prosecutions; this was being explored. 7 "The Board expressed strong views that the Business 8 had not managed the Second Sight review well and 9 stressed the need for better management and cost 10 controls going forward. 11 "(d) The board accepted that this was an independent 12 review and therefore things could happen that were 13 beyond the control of the business. 14 "However the things that could be managed by the 15 business needed to be well managed with strong 16 leadership and the Board asked the CEO if she had 17 considered changing the person leading for the 18 Business." 19 Just to stop there, that's a reference to Susan 20 Crichton. 21 A. It is, yes. 22 Q. "(f) The CEO had considered this and recognised that the 23 Business did not have good governance in place around 24 Second Sight, but that the independence of the review, 25 and the input from MPs and [JFSA] had made this 131 1 complicated. 2 "The Chairman asked for a review, a post-mortem, to 3 report to the Audit and Risk Committee explaining how we 4 awarded and managed the contract. This should be put in 5 hand, swiftly. 6 "Action: Susan Crichton." 7 Then over the page: 8 "The Board asked the CEO to decide the way forward 9 in terms of the leadership of this work based on the 10 option which had least risk to the Business." 11 Then, lastly: 12 "The CFO [that's Mr Day] was asked what the 13 insurance position was. He promised the Board a note on 14 this. He was also asked to ensure that both Royal Mail 15 Group regime and the Business's insurers were given 16 notice of the review findings." 17 Now, we've seen that there was a 12 July 2013 paper, 18 four-page paper written by Susan Crichton. 19 A. Mm, yeah. 20 Q. It was intended, according to the agenda, that she 21 presented that? 22 A. Yes. 23 Q. Who presented the Susan Crichton, 12 July Board report? 24 A. Paula Vennells did. 25 Q. Who presented Susan Crichton's Annex A to it? 132 1 A. Presumably -- I don't think anybody else presented, 2 other than Paula. 3 Q. So Paula Vennells, as well? 4 A. Yes. 5 Q. There was also a Significant Litigation Report before 6 the Board as well, wasn't there? 7 A. There was, yes. 8 Q. Can we look at that, please. POL00099210, and look at 9 page 105, please. Thank you. This is the Significant 10 Litigation Report that was placed before the board -- 11 A. Yes. 12 Q. -- and it's divided into essentially two parts. Part A, 13 a report on Horizon claims. You can see under the 14 "Description": 15 "[Post Office] has received various claims from 16 subpostmasters alleging wrongful termination of contract 17 and/or damages based on alleged defects in the Horizon 18 system and [the Post Office's] internal processes." 19 They were made in five claims brought by Shoosmiths, 20 which is not currently progressing the claims through 21 the courts. Similar allegations have been made through 22 subpostmasters' MPs, through the JFSA and in defences to 23 cost proceedings bought by Post Office to recover debts 24 from subpostmasters: 25 "An independent investigator Second Sight has been 133 1 reviewing these allegations in consultation with James 2 Arbuthnot ..." 3 Then under "Status", in the last paragraph of 4 status: 5 "Second Sight is continuing to investigate the 6 [subpostmasters'] concerns. [Post Office] is 7 cooperating with Second Sight's investigation and 8 conducting a review of the criminal and civil 9 proceedings it has issued against [subpostmasters] where 10 issues with the Horizon system have been raised to 11 establish which cases may be vulnerable to challenge." 12 Who presented this paper to the Board? 13 A. Was this a noting paper? 14 Q. It's difficult to tell. 15 A. Okay. I mean, if it were a noting paper, then it 16 wouldn't necessarily -- it wouldn't normally have been 17 presented unless, you know, if somebody wanted to raise 18 a question on it, on a noting paper, then if we knew in 19 advance, then we would arrange for that person to be 20 there and, if not, it would be picked up and followed up 21 later. 22 Q. In fact, if we just go back to page 1 of the whole 23 document, and scroll down, and again -- 24 A. Yes. 25 Q. -- if you look at 11 -- 134 1 A. Yes. 2 Q. -- the SLR is for noting? 3 A. Yes. 4 Q. So it wouldn't necessarily be presented by anyone? 5 A. No. 6 Q. Thank you. So the 12 July paper and the annex to it, it 7 was intended that they be presented to the Board by 8 Susan Crichton? 9 A. That had been the intention, yes. 10 Q. Did, in fact, as you say, Ms Vennells present it in 11 place of Susan Crichton, who was not invited into the 12 meeting, at your direction? 13 A. That's correct. Would it be all right if I explained? 14 Q. Well, just, if you answer the following questions it may 15 be -- 16 A. Sure, of course. 17 Q. -- that explanation will emerge. 18 A. Yeah. 19 Q. Firstly, was that a unilateral decision? 20 A. I'm not sure whether it was or wasn't a unilateral 21 decision and I can explain why. 22 Q. Okay, go ahead. 23 A. You'll see at the top of the agenda that -- 24 Q. If we scroll up, yeah. 25 A. So, before the Board, there was a meeting of 135 1 Non-Executive Directors, on their own. 2 Q. At Bistrot Bruno Loubet? 3 A. Exactly, which is just down the road. We used to have 4 these approximately every six months, it's considered to 5 be good practice for Non-Executive Directors to meet on 6 their own, from time to time. This would have been 7 arranged months in advance, so it would have had 8 absolutely nothing to do with the fact that it happened 9 shortly after the Interim Report had been published. 10 But there -- it was an opportunity for Non-Executive 11 Directors to share amongst themselves things they were 12 concerned about and there was a good deal of concern 13 expressed at that meeting about the events leading up to 14 the Interim Report, how things had happened in the way 15 they did and it would have been, on the back of that and 16 also possibly, but I can't remember this, conversations 17 I may have had with individual Non-Executive Directors 18 that I felt that we would not be able to have 19 a discussion that we needed to have in the Board if 20 Susan was present throughout. 21 I knew that there were going to be critical 22 questions raised about the way she had handled things, 23 and I thought for two reasons that it was right to have 24 that discussion initially without her. I'll come back 25 to why initially. One was that I thought the 136 1 Non-Executive Directors needed the opportunity to say 2 what they wanted to say in the full Board, and I knew 3 that it was going to be very critical of Susan and 4 I didn't think that it was appropriate for her to have 5 to sit there and take it. But it was my intention to 6 let that happen, and then to bring her in and have her 7 present the paper. But I think what happened was it was 8 one of those discussions which just developed and 9 developed, and took more time than I had expected 10 possibly or wanted, and we had other things on the 11 agenda that were really pressing. And I'm -- I don't 12 remember for certain but I may well have felt "I can't 13 ask her to come in -- having heard all of this, I can't 14 just ask her to walk into this room without knowing 15 something of what had been happening". 16 So that's the background to why she ended up not 17 coming into the room and, obviously, I understand that 18 that would have been very disconcerting for her and, as 19 I said to her later, I am really sorry that that 20 happened. I've been kept outside Boardrooms in my life 21 and it's not a comfortable experience and I knew that, 22 but there were really good reasons for doing what I did. 23 Q. Why is none of that reflected in the Board minutes? 24 A. Because I don't think that we would -- I don't know why 25 it wasn't reflected in the -- I don't know the answer to 137 1 that question. 2 Q. Why is what you've just said not reflected in your 3 232-page witness statement? 4 A. That's because it was only after I had signed my witness 5 statement that I saw that the -- I saw -- I did two 6 things. One was that I saw some documents that I hadn't 7 seen up to that point, and they were my note of my 8 meeting with Susan later in that month, and a note of 9 Paula's, of, I think, two meetings that she had with 10 Susan, and they were really -- the one I've written 11 myself did jog my memory, and then I went back to this 12 agenda and I went back to think about what was happening 13 at this time and what else was on the agenda, and it 14 came back to me. 15 Q. How could Ms Vennells possibly speak to the legal issues 16 mentioned in Susan Crichton's Board paper of 12 July? 17 A. Well, she couldn't, really, have spoken to -- 18 Q. She told us that she didn't know the facts and had no 19 legal knowledge and, therefore, couldn't speak to the 20 paper at all? 21 A. No, I think -- 22 Q. You'd know that, wouldn't you? 23 A. I would have known that and I can see that what I should 24 have done, in retrospective, is that I should have 25 paused and I should have thought "We're not having the 138 1 kind of discussion about this paper that's before us 2 that we ought to be having and, therefore, we'll have to 3 have a separate discussion about it". That's what 4 I should have done but I didn't. 5 Q. I mean, there were really two issues, weren't there -- 6 A. There were. 7 Q. -- one was the legal claims -- 8 A. Yes. 9 Q. -- that Post Office may face and the management of 10 those -- 11 A. Yeah. 12 Q. -- which Susan Crichton's paper had spoken to? 13 A. Yeah. 14 Q. The second was that management by her, amongst others, 15 of the Second Sight process? 16 A. Yes. 17 Q. In making her sit outside because you wanted to discuss 18 the latter, there was no discussion of the former? 19 A. I think that's absolutely right. Yes, and that one of 20 the -- so I have a lot of regrets about this particular 21 period because I think now, looking back on all of this, 22 that what we -- the way in which we followed up the 23 interim review, combined with the fact that -- as I'm 24 sure we'll come on to -- we didn't see absolutely 25 revelatory legal advice meant that we failed to take 139 1 a really important opportunity to go in a different 2 direction on this. 3 Q. You tell us -- I'm going to give the references without 4 going to the witness statement. 5 A. Okay. 6 Q. That document can come down, thank you. You tell us in 7 your witness statement, it's paragraph 81.7.3 on 8 page 39, that you were astonished that the Board 9 received no notification of the Simon Clarke Advice on 10 expert evidence of 15 July 2013? 11 A. Yes. 12 Q. The day before this Board meeting? 13 A. Exactly. 14 Q. You say: 15 "This advice came at a crucial time, when we were 16 considering Second Sight's Report and the review of 17 Horizon based prosecutions but this was never shown to 18 the Board." 19 You say you were never shown Gareth Jenkins' note 20 entitled "Local suspense problems"; you were never shown 21 the Helen Rose Report of 12 July 2013; you say that 22 a subsequent advice by Simon Clarke of 2 August 2013, 23 about the duty to record and retain material, was never 24 brought to your attention, and that you are "astonished 25 that this document was never provided to the Board." 140 1 You say in paragraph 82 on page 41 that you find it: 2 "... extraordinary and highly regrettable that these 3 pieces of information were not provided to the Board." 4 You look back at these omissions and you feel very 5 badly let down by them: 6 "This meant the board did not ask questions which 7 might have got to the truth of the matter, which was 8 that Horizon was unsafe and should not have been relied 9 on for prosecutions." 10 In other parts of your witness statement, you 11 essentially identify Susan Crichton as being principally 12 responsible. 13 A. Yes. 14 Q. You sat her outside on a chair and then criticised her 15 failure to reveal information to you as shocking or 16 astonishing. How do those two things sit with each 17 other? 18 A. I wouldn't describe it as "made her sit outside on 19 a chair" but I understand that she was not in the 20 meeting. She -- well, I don't know to whom the Simon 21 Clarke Advice was originally sent but what I do know is 22 that both pieces of advice from Simon Clarke came into 23 the Post Office when Susan was the General Counsel. 24 It's perfectly true that she didn't have the opportunity 25 to mention that to the Board at the meeting on 16 July. 141 1 We have no way of knowing -- I don't know whether she 2 had even read it by then. 3 Q. She hadn't, in fact. She hadn't been provided it. It 4 sat in a drawer for 12 days, we are told. 5 A. Okay, well, she couldn't have done it, even if she had 6 been there, but two pieces of advice of that nature 7 shouldn't just be reported orally. They should have 8 been the subject of some kind of written note -- not 9 a note, I mean a proper paper, saying, "We've had this 10 advice". 11 Perhaps the original advice might not have been 12 provided in the first instance but the findings of the 13 advice and its implications should have been brought to 14 the Board -- 15 Q. Can we go -- I'm sorry. 16 A. -- and there was -- I'm terribly sorry to cut across you 17 but there was time, after even the 12 days were up, when 18 that could have been done, and it wasn't. 19 Q. Can we look at what you were provided with, and go back 20 to the report for the Board of 12 July 2013, 21 POL00099218. We looked at this a moment ago. If we 22 look, please, at page 3, please, under "Next steps" -- 23 thank you -- "Next steps": 24 "A proactive approach -- there are a number of areas 25 where the Post Office wishes to take a proactive 142 1 approach, for instance looking at processes for managing 2 our relationship with our subpostmasters. Further 3 details will be shared at the meeting." 4 A. Mm. 5 Q. "A reactive approach -- in respect of the criminal cases 6 ... should wait for those to be overturned via the Court 7 of Appeal and for claims for compensation to be made. 8 We then decide whether to settle or fight these on 9 a case-by-case basis." 10 Even on what you were told, there were issues for 11 the Board -- 12 A. Yeah. 13 Q. -- to consider and decide upon, weren't there? 14 A. Yes. 15 Q. But it didn't, did it? 16 A. No, it didn't. 17 Q. One of the reasons was the extent to which excluding 18 cases predating January 2010 from the review was 19 a reasonable approach to take. Was that identified by 20 the board? 21 A. I'm afraid -- I mean, I don't think it's in the minutes. 22 I can't remember whether it was raised or not. 23 Q. The annex to this paper says that we're going back to 24 1 January 2010? 25 A. '10, yeah. I think we knew that there were practical 143 1 difficulties about going back pre that date. 2 Q. Where did you learn of those practical difficulties 3 from? 4 A. I can't tell you for certain but I think there had been 5 references over time to that. 6 Q. Do you accept that the type of questions that the Board 7 ought to have been asking when presented with this paper 8 and its annex is "These bugs that we've been told about, 9 do they pre-date the introduction of Horizon Online or 10 do they post-date it? If some of them pre-date it, why 11 are we only going back to the introduction of Horizon 12 Online? Why is that a reasonable cut-off?" 13 A. Sorry, is that a question? 14 Q. Yes. 15 A. Yes. 16 Q. It started with "Do you accept that". 17 A. Sorry. Look, I have said and I do accept, that, in the 18 event, the Board didn't give this paper -- it didn't 19 give the substance of this paper the attention that it 20 should have done and I take responsibility for the fact 21 that I didn't stop and think about having -- the 22 conversation -- discussion having turned out the way it 23 did, I should have thought about what we ought then to 24 do about aspects of this paper which had not been 25 discussed, and I didn't do that and I'm very sorry that 144 1 I didn't do that. 2 Q. What was yours and the Board's reaction to being 3 informed that the Post Office may face civil claims for 4 wrongful prosecution? 5 A. I think we were concerned about that. 6 Q. What was your reaction and the Board's reaction to being 7 told that, if the Post Office stopped prosecuting, it 8 may face claims for malicious prosecution? 9 A. I think if -- I think I would have thought, if there 10 were reasons, good reasons, for stopping prosecution, we 11 should stop prosecution. 12 Q. Were you and the Board concerned that the review, the 13 Second Sight review, had opened up the Post Office to 14 claims of wrongful prosecution? 15 A. I think we realised that the interim review put us in 16 a different position from the position we'd been in 17 before. I wouldn't want anybody to interpret that as us 18 thinking that that meant that it was a bad thing to have 19 done the independent review. 20 Q. Were you the person on the Board who expressed the 21 strong views, according to the minutes, that the Post 22 Office had not managed the Second Sight review well? 23 A. I think that was a view that was very widely shared. It 24 was my view but I was by no means alone in that view, 25 and it wasn't my style to impose my view on the board, 145 1 I was always really, really careful not to lead the 2 board on -- I would encourage other people to come in 3 and express their views before I expressed my own view. 4 Q. Why were you concerned that the Second Sight review had 5 opened the Post Office up to claims for wrongful 6 prosecution? 7 A. I think we were being told that it -- 8 Q. Yes, but what's the concern? 9 A. I suppose we thought that there might be something to do 10 with -- I mean, you know, I think we were thinking that 11 there could be other bugs. I think we've talked about 12 this already, haven't we, that the absence of adequate 13 training and support could have been part of this? 14 Q. I was thinking more about many organisations have claims 15 brought against them -- 16 A. Yes. 17 Q. -- and they can be concerned about them because they may 18 have a financial impact upon them? 19 A. Yes. 20 Q. They may affect the balance sheet? 21 A. Yes, yeah. 22 Q. They may have staff morale impacts? 23 A. Yeah. 24 Q. They may have an abstraction of resources to deal with 25 the concern. There might be a media or reputational 146 1 harm caused by claims for wrongful prosecution? 2 A. Yeah, yeah. 3 Q. There might actually be a concern that some people have 4 been wrongfully prosecuted? 5 A. Yes. 6 Q. Which of those things was the concern of the Board? 7 A. I can't remember the detail of these concerns but 8 I think it could have been all of them. 9 Q. Did you consider that the Second Sight investigation 10 needed better management? 11 A. This is something I know there's been much discussion 12 about. I thought that the Post Office had not properly 13 liaised with Second Sight over their work and that the 14 whole basis of the relationship between Second Sight and 15 the Post Office had not been put on a proper footing. 16 Q. Why was the Post Office's governance around Second Sight 17 unsatisfactory to you? 18 A. I don't know whether I was aware of this at the time but 19 I certainly became aware of the fact that there'd been 20 absolutely -- there'd been no letter of engagement for 21 Second Sight, which seems very strange, that, as I said 22 to you earlier, there had been an understanding on my 23 part and I think on the part of everybody concerned, 24 that Second Sight expected to complete their work within 25 a matter of weeks or short months. There was a kind of 147 1 budget set up for it and, in practice, it took -- I've 2 already said this, so I'm sorry I'm repeating myself -- 3 it went on much, much, much longer than anyone -- 4 Q. Sorry to speak across you. 5 A. Yes. 6 Q. Did you establish who bore responsibility for that? 7 A. So part of what I was thinking here was why was the 8 board and why was I so unaware that these -- that this 9 Interim Report was coming when it was? And the whole 10 thing, after Second Sight had been set up, went very, 11 very quiet from my perspective and the Board's 12 perspective for a very, very long time and then it kind 13 of emerged as a sort of -- as something that was 14 happening in this most enormous hurry, and I just -- 15 I didn't think that that was professional. 16 Q. Did the Board approve the reactive strategy, namely not 17 itself review the safety or propriety of the convictions 18 that it had obtained but, instead, give disclosure of 19 the Second Sight Report to some subpostmasters, and let 20 them pursue their cases through the Court of Appeal? 21 A. As I understand it, that was the advice we were given 22 and we took it. 23 Q. Why did the Board take the reactive approach rather than 24 say, "We ourselves should commission a review of the 25 safety of the convictions that we've obtained"? 148 1 A. Because I think that -- that was the legal advice that 2 we were given but I agree that we could -- you know, of 3 course we could have had a discussion about that and we 4 could have asked, you know, we could have asked for 5 another view. 6 Q. If we go back, please, to POL00099218, and page 3, 7 please, and "Next steps". You'll see the reactive 8 approach set out there. There's no note in the Board 9 minutes that this was discussed or approved. 10 A. No. I mean, the Board is asked to note the update and 11 the actions set out above and decide whether the Audit 12 and Risk Committee should consider the position of the 13 Post Office as a prosecuting authority, which, of 14 course, it wasn't, alongside its risk work in September. 15 So I think -- 16 Q. So you're saying that it wasn't actually asked to make 17 a decision? 18 A. It wasn't asked to make a decision but that doesn't mean 19 to say that you can't, you know, you can't -- I'm not 20 saying for one moment that if the board was asked to 21 note something and it decided that it, actually, wanted 22 to have a discussion, of course it would have had 23 a discussion. But, you know, I think what I've tried to 24 explain is that this item, it went off the rails, 25 I think you could say, at short notice, and we didn't 149 1 have the kind of discussion which we should have had 2 about it. 3 Q. You put a fair and full discussion of these issues 4 beyond the reach of the Board by sitting outside the 5 author of this document, didn't you? 6 A. No, I don't think that's fair. I think that, in the 7 circumstances in which I found myself on that day, 8 I think I took a perfectly understandable decision that 9 it wasn't in anybody's interests for Susan to come into 10 that discussion at that time. And I think, had she -- 11 events -- sometimes the most rational processes get 12 hijacked by events. This was an occasion when that 13 happened, and I really don't think that, had Susan been 14 brought back into the room, in that context, that we 15 would have had a fruitful discussion. 16 What I do think, and I've said this already, is that 17 I should -- well, either I -- and I take responsibility 18 for this because I was the Chair of the Board -- or 19 somebody else on the Board could have said to me -- and 20 they were well capable of doing this -- "Alice, I think 21 we haven't done justice to this and we'd better have 22 a separate discussion". 23 We were always having separate discussions. We were 24 constantly having unscheduled telephone meetings about 25 this and that and the next thing, and that could have 150 1 been done. But we didn't do it. 2 Q. Even at its lowest, this Board paper asks the Board to 3 note the update and the actions set out above, including 4 the reactive approach -- 5 A. Yeah. 6 Q. -- to past possible miscarriages of justice, yes? 7 A. Yes. 8 Q. Can we go back to the Board minutes, please, at 9 POL00021516, and page 6, please. This is the Horizon 10 update that we read through in full earlier. If you 11 just scroll through it, and down, and down, and down, 12 and down and then stop. The paper isn't even noted? 13 A. Well, that's just -- I mean, that's just stupid. Sorry, 14 but I mean it should have been -- you know, we -- you 15 know, I can't understand whether that was just 16 an omission from the minutes or what it was. I really 17 don't know. 18 Q. Do you think the paper got entirely overlooked? 19 A. No, I don't think it did get entirely overlooked. 20 I don't think it did. I think probably what happened 21 was that Paula spoke to the bits that she felt able to 22 speak to. I think that's probably what happened. 23 Q. So what's the status of the recommendation in the Board 24 paper that the Post Office should adopt a reactive 25 approach rather than a proactive one to possible past 151 1 miscarriages of justice? 2 A. I think -- 3 Q. Where does that sit? 4 A. Well, there wasn't a discussion about it. I mean, 5 I think all you could say was, in the absence of 6 a discussion, and nobody saying, "I want to talk about 7 this" or "I don't agree with this", that you could say 8 it had been noted because people would have read it and 9 nobody would -- and nobody had said, you know, either of 10 those two things. But I agree. I mean, the fact that 11 it has not even recorded what the status of the paper 12 was at the end of that item, is -- it's not right. 13 Q. Would you agree that, overall, the handling of the issue 14 of the impact of the Second Sight Report on past 15 criminal convictions by the Board on 16 July was very 16 considerably suboptimal? 17 A. I think I've accepted that. 18 Q. In particular, the suggestion of a reactive approach 19 appears not to have been the subject of discussion, 20 decision, or even noting? 21 A. I think that is right. Yes. I think that is right. 22 Q. Can I explore some of your criticisms of Susan Crichton, 23 please. That document can come down. 24 I should have said that Susan Crichton has told us 25 in evidence that, before the Board meeting of 16 July, 152 1 she met with Paula Vennells and told her that, in her 2 view, Susan Crichton's view, there would be many 3 successful claims against the Post Office arising from 4 past prosecutions. Was that information passed on to 5 you by Paula Vennells? 6 A. No. 7 Q. Did you know from any other source that that was Susan 8 Crichton's view, that there would be many successful 9 claims against the Post Office arising from past 10 prosecutions? 11 A. No. 12 Q. Do you agree that that is important information to have 13 received or would have been important information to 14 have received from your General Counsel? 15 A. I do. 16 Q. Do you accept that this critical information may have 17 been passed to you if she had been allowed into the 18 room? 19 A. I have no way of knowing that but the way that -- if you 20 look at Annex 1 of that paper that, we were looking at, 21 it talked -- there's a sentence in there about 22 disclosure being required in about 5 per cent of cases 23 so that was a sentence that was in there, which was 24 a very, very partial account of what Susan understood 25 the position to be. 153 1 Q. Can I then explore some of your criticisms of Susan 2 Crichton by moving forwards to POL00381455. This is 3 a note of your meeting with Ms Crichton on 31 July -- 4 A. Yeah. 5 Q. -- at Post Office's premises at 148 Old Street. 6 A. Yeah. 7 Q. If you just forgive me a moment, I need a reorg. 8 If we look, please, at the second page, at the third 9 paragraph, starting "I understood", you record: 10 "I understood that [Second Sight's] investigation 11 had to be independent but in the Civil Service there 12 would have been someone marking it who was close to all 13 of the key people, (Second Sight, [James Arbuthnot], 14 JFSA) and knew what was going on between them." 15 Then the next paragraph: 16 "[Susan Crichton] said that as a lawyer it was 17 inappropriate for her to influence key stakeholders. 18 She would have been criticised had she become close to 19 them." 20 A. Yeah. 21 Q. You record that: 22 "[You] commented that if she had felt unable to play 23 that role, she should have flagged that up and someone 24 else could have been brought into perform it (privately 25 I am astonished at this view which I simply do not 154 1 recognise from my experience elsewhere)." 2 Would you agree that marking someone means to stay 3 close to them, usually an opponent, in order to hamper 4 his or her play? 5 A. If you're a footballer, that's certainly what it means. 6 I realise that that verb, and the one about influencing, 7 give a very particular impression of what I was trying 8 to do. 9 What I was actually talking about -- and I wrote 10 this note and so, you know, I take responsibility for 11 the words in it -- what I was talking about was liaison. 12 So I'm talking about somebody in an organisation keeping 13 the channels of communication open with people who are 14 doing an independent review, knowing how their time 15 frame is working out, knowing how their costs are 16 building up, knowing what they're planning to do in 17 terms of the way they go about their work, and when it's 18 going to be presented, and finding out whether there are 19 things that they are encountering which are causing them 20 difficulty, or anything else that the organisation can 21 reasonably be expected to want to understand. 22 It was absolutely not my intention that Susan or 23 anybody else in the Post Office should be trying to 24 influence the substance of Second Sight's Report, and 25 that, in fact, is corroborated by other emails that 155 1 I was sending at that time. 2 Q. You meant "mark" in exactly that sense: influence, 3 hamper their conduct, stay close to them. You wanted 4 the key people -- Second Sight, James Arbuthnot and 5 JFSA -- influenced in their conduct, didn't you? 6 A. No. 7 Q. If you didn't mean that or you were not to be understood 8 to mean that, then can you explain why Susan Crichton 9 replied in the second paragraph there that it was 10 inappropriate for her to influence the key stakeholders? 11 A. So I think what happened here was that there was 12 a complete failure of communication between what it was 13 that I had in mind and what she interpreted that I had 14 in mind. So I was -- I've already said this -- I am on 15 oath and I'm a truthful person: I am absolutely 16 categorical that I -- it was never my intention for 17 anybody in the Post Office to try to influence Second 18 Sight's evidence-based findings. 19 Q. The -- I'm so sorry. 20 A. And I can see that if that is what Susan thought 21 I meant, why she didn't think that that was a proper 22 thing for her to do because it wouldn't have been 23 a proper thing for her or anybody to do. But what I was 24 saying was that there had been this total vacuum, as it 25 seemed to me, where we had appointed Second Sight, we 156 1 had some expectations about how that work would 2 progress, it had progressed in an entirely different way 3 and we didn't know anything about it, or very little 4 about it. 5 Q. Can I explore what you said on three basis: first, I'll 6 suggest to you that the reply she gives, "inappropriate 7 for her to influence key stakeholders", gives the lie to 8 what you meant, doesn't it; it reveals what you meant? 9 A. It reveals her interpretation of what I meant. It 10 absolutely does not reveal my intention. 11 Q. The second point, then, is when she says, "But hold on 12 that's inappropriate, it would be inappropriate for me 13 to influence key stakeholders, I'd be criticised because 14 of my professional duties, for doing that", why did you 15 not say, "Well, hold on Susan, I'm not even suggesting 16 that at all. You've got the wrong end of the stick" -- 17 A. I've got the wrong end of the ... 18 Q. -- "there's a miscommunication between us" -- 19 A. There's a miscommunication. 20 Q. -- "I'm talking about marking somebody in the benevolent 21 sense of being a liaison point" -- 22 A. Yeah. 23 Q. -- "your understanding of it is completely wrong". That 24 didn't happen, did it? 25 A. My understanding of it is completely right from my point 157 1 of view. What I am saying is that I completely failed 2 to communicate what I was tying to say. 3 Q. When she gave her evidence to the Inquiry on 23 April 4 2024, it's page 142 of the transcript, Susan Crichton 5 said that this is exactly what you were doing: you were 6 suggesting to her that she should have exerted influence 7 over the people responsible for the commissioning and 8 conduct of the independent report and that's why she 9 said what she did about her professional duties. 10 A. She -- I mean, she did say that, you know, if -- I -- 11 but that doesn't mean that it's right. 12 Q. So why wasn't it corrected at the time? 13 A. Well, I obviously wish that I had paid more attention to 14 making sure that the record of this meeting was 15 a correct description of what I intended. 16 Q. Isn't the truth of the matter that, through the use of 17 the language which you have recorded as coming from you, 18 "marking the key people involved", the natural meaning 19 of that, and Susan Crichton's reply, you were suggesting 20 that she should have exercised actively influence over 21 them on matters of substance? 22 A. No, I don't accept that. I absolutely don't accept 23 that. 24 Q. Were you unfamiliar with the professional duties imposed 25 on lawyers and the Solicitors Code of Conduct? 158 1 A. I've no -- I would never have studied the Solicitors 2 Code of Conduct. 3 Q. Is the reality that you were annoyed that Susan 4 Crichton, who had led on the Second Sight project, had 5 not influenced Second Sight in a way that was 6 sufficiently favourable to the Post Office? 7 A. No. 8 Q. You accept, I think, that on Susan Crichton's 9 understanding of what you were chiding her for, you were 10 asking her to undermine her professional obligations and 11 integrity? 12 A. Sorry, somebody was talking whilst you were asking me 13 the question, would you mind repeating it? 14 Q. Yes, on Susan Crichton's understanding of what you were 15 chiding her for in this meeting, you were, in fact, 16 asking her to undermine her professional obligations and 17 integrity? 18 A. Had her interpretation been correct, then that might 19 well be so but her interpretation was not correct and 20 I misunderstood -- I misunderstood her interpretation. 21 And I don't know what -- I don't know what more I can 22 really say about this. 23 Q. If, as you say, executive members of the Post Office 24 team were engaged in a process of not revealing serious 25 matters to you, preventing the Board from finding out 159 1 about them -- 2 A. Yes. 3 Q. -- the first Clarke Advice, the second Clarke Advice -- 4 A. Yes. 5 Q. -- the Helen Rose Report, the Gareth Jenkins report 6 about suspense accounts -- 7 A. Yes. 8 Q. -- why do you think they did it? 9 A. I don't know. I really don't know. I mean, I am 10 a believer, if I can use this phrase, in the cock-up 11 rather than the conspiracy theory of life. I tend not 12 toy think that people in large, complex organisations, 13 are conspirators. I really do not know why that didn't 14 happen but it should have happened. I mean, it is 15 extraordinary that it didn't happen and I think the 16 thing that -- you know, when I saw the Simon Clarke 17 Advice, many, many years later, one of the things that 18 struck me about it was that it was written in such clear 19 language, whereas many of the documents that you've been 20 talking about, ones we saw and ones that we didn't see, 21 were quite technical in nature and wouldn't necessarily 22 be obvious to somebody who didn't have a background in 23 those subjects. 24 But if you read the Simon Clarke Advice, there is no 25 mistaking what it is that he's saying. 160 1 Q. Looking back on matters now, knowing everything that you 2 do now and having, I think, listened and watched to 3 a substantial body of evidence -- 4 A. Yes. 5 Q. -- in the Inquiry and read a substantial number of 6 documents -- 7 A. Yeah. 8 Q. -- was this done to prevent an emerging scandal from 9 surfacing? 10 A. I wish I knew. I just don't understand it. So, for 11 a General Counsel to receive advice like that, to put it 12 at its lowest, it would be in your own best interests to 13 share it. Wouldn't it? I mean, you know, it wasn't in 14 your best interests not to show it to anybody. So 15 I just -- I can't -- I'm sorry but I don't know -- and 16 we can all speculate but I don't know the answer to 17 that. But I just, I see this as one of a number of 18 failed turning points in this very sorry story. And 19 I do really believe that, in that summer of 2013, things 20 could have been very different, and they weren't. 21 Q. Just on a point of detail, I think I suggested earlier 22 that the Jenkins advice of 15 July stayed in a drawer 23 for 12 days. It was, in fact, the shredding advice of 24 2 October that stayed in a drawer for 12 days? 25 A. Oh, okay, okay. 161 1 Q. Knowing what you know now and knowing very closely at 2 the time the personalities involved, do you believe that 3 the senior executives were trying to deal with the 4 problems themselves in the hope that they could make 5 them go away, without revealing them to the Board? 6 A. It's possible. 7 Q. Were they concerned, do you think, that the Board 8 members might break things out into the public domain by 9 telling MPs, or even subpostmasters directly, about the 10 matters revealed in the Clarke Advices, for example? 11 A. I can't think that anybody would have thought that we 12 would leap from -- you know, supposing the Clarke Advice 13 had been shown to me before it was shown to the Board, 14 I would have said, "This needs to go to the Board and we 15 need a proper discussion of this". If it had gone to me 16 and the Board simultaneously I'm absolutely sure that 17 people would have wanted a proper discussion of it. But 18 that -- they wouldn't have gone -- there wouldn't have 19 been a leap to tell people outside the Post Office as 20 the first reaction; do you see what I mean? I mean, we 21 would have wanted to talk about it amongst ourselves, 22 and get advice on it, and decide -- I mean, the first 23 thing we would have had to have done would have been to 24 talk to the shareholder about this. 25 MR BEER: Sir, that's an appropriate moment for a break. 162 1 Can we take the afternoon break of 15 minutes, 2 please, until 3.25. 3 SIR WYN WILLIAMS: Certainly. 4 MR BEER: Thank you. 5 (3.11 pm) 6 (A short break) 7 (3.25 pm) 8 MR BEER: Sir, good afternoon. Can you continue to see and 9 hear us? 10 SIR WYN WILLIAMS: Yes, I can, thank you. 11 MR BEER: Thank you. 12 Ms Perkins can we just finish off, please, the note 13 that you wrote of your conversation with Susan Crichton, 14 by just going back to the last part of it, POL00381455, 15 and page 3 which is the last page. At the bottom of the 16 last page, it's the "PS": 17 "PS At one point Susan Crichton referred to a recent 18 conversation with the BIS team [that's Business, 19 Innovation and Skills team] at which one of them 20 commented that they had always felt uncomfortable about 21 the Horizon cases. When she had asked why they hadn't 22 pursued that, the person had said it was because the 23 [Post Office] had always been so forceful in its defence 24 of the issue and its handling." 25 Did Susan Crichton name the person at that 163 1 Government department who that felt uncomfortable about 2 the Horizon cases? 3 A. If she did, I don't remember who it was. 4 Q. If she had named them, would you have recorded it? 5 A. Yes, I think so. I can't see why I wouldn't have done. 6 Q. The person said, according to Ms Crichton, that they 7 hadn't pursued the issue of being uncomfortable about 8 the Horizon cases because the Post Office had always 9 been so forceful in its defence of the issue. Is that 10 an accurate characterisation of how you, at this time, 11 would have viewed Post Office's response to criticism of 12 its prosecutions and the Horizon system, ie forceful? 13 A. I think we've talked, haven't we, about the concern 14 about unevidenced allegations. So I think the Post 15 Office was forceful about unevidenced allegations. 16 I mean, certainly I had conversations with people in the 17 Shareholder Executive at various times about this and 18 I -- you know, I don't think I would describe -- I don't 19 think I would describe those conversations as forceful. 20 What other people said when I wasn't there, I can't 21 say. 22 Q. Did anyone from the BIS team say anything to equivalent 23 effect as is recorded there to you -- 24 A. No. 25 Q. -- that they'd felt uncomfortable -- 164 1 A. No. 2 Q. -- about the Horizon cases? 3 A. No. I did -- I mean, I do remember some, you know -- 4 I can't remember the detail of them but I do remember 5 that, you know, this did come up from time to time. But 6 I don't -- I absolutely don't remember that and I would 7 have been -- I would have been alert to that. 8 Q. Did you pursue this in any way with anyone in the BIS 9 team? 10 A. I don't think so. 11 Q. Why wouldn't you have done? 12 A. I don't know. I think that this conversation 13 happened -- I think I must have been about to go away 14 for three weeks because it was the summer and perhaps 15 I didn't come back to it. I just don't remember that 16 I ever did raise it with anybody from BIS. 17 Q. I mean, it's quite significant, isn't it, that somebody 18 in the -- would this be the shareholder team that's 19 being referred to there? 20 A. Not necessarily because, at that point, there were these 21 two different parts of the business department. There 22 was the Shareholder Executive, which sat within it, and 23 there was the Post Office team, that sat within it, and 24 they were separate. 25 Q. So it could either be the Shareholder Executive or 165 1 somebody in Government itself? 2 A. It could. 3 Q. Thank you. That can come down. 4 You say throughout your witness statement, as we've 5 addressed in part already, that you were shocked or 6 astonished at the fact that the Post Office Board was 7 not provided with the Clarke Advice of 15 July 2013 8 concerning Gareth Jenkins -- 9 A. Yeah. 10 Q. -- the Clarke Advice, known as the shedding advice, of 11 2 August 2013 -- 12 A. Yeah. 13 Q. -- about document retention or destruction, nor any of 14 the advices written by Mr Altman that revealed the 15 existence of those previous two advices. 16 A. Yes. 17 Q. Does that suggest to you that successive General Counsel 18 within the Post Office were responsible for the same 19 failing or the same approach, at least Ms Crichton and 20 Mr Aujard, in not giving disclosure to you? 21 A. Well, neither of them did give disclosure but -- 22 Q. And, incidentally, nor did Jane MacLeod, when she became 23 General Counsel, did she? 24 A. No, she -- not to me, certainly, she didn't. No. 25 Q. She was handling the ongoing interest in the Post Office 166 1 from the CCRC, wasn't she? 2 A. She was, yes. 3 Q. None of those documents were, therefore, shown to you by 4 three successive General Counsel? 5 A. That's true. 6 Q. Do you know why three successive General Counsel were 7 not showing to you, so far as we can tell, and not the 8 non-executive director Board members? 9 A. No, I don't. I mean, we had a bit of a discussion about 10 this before the last break and I was saying to you that, 11 you know, I can't understand why, if somebody knew 12 advice like that -- I mean, had seen advice like that 13 come into them, why they wouldn't have wanted to share 14 it. I mean, if something like that had -- I mean, you 15 know, I -- obviously, it's evident I'm not a lawyer, but 16 as a civil servant, over very many years, I dealt with 17 lots and lots of really difficult things, some of which 18 were really hard to handle and, if I got a piece of 19 really bad news, if you like, the first thing I would 20 have wanted to do was to share it because -- I mean, why 21 wouldn't you want to share it? You'd want somebody 22 else's view on it, you want to be open about it. It's 23 beyond me. I don't understand it. 24 Q. One reason that has been given is that it was not the 25 practice of General Counsel to provide to the Board the 167 1 originating advices of counsel or solicitors. Can we 2 look, please, at POL00027688, and if we scroll down, 3 please, thank you. 4 A. Okay, yeah. 5 Q. Your email of 8 February 2014. 6 A. Yes. 7 Q. This is unconnected with the topic that we were 8 addressing, ie Second Sight in the middle of 2013 -- 9 A. Yes, yes. 10 Q. -- but I'm looking at the issue of the practice of 11 sending on originating documents, legal documents, to 12 the Board or to you. 13 A. Mm. 14 Q. You say: 15 "Alisdair, 16 "It is not yet clear whether it will be possible for 17 me to participate in this telephone conference. I will 18 if I can. My reaction to this paper which is helpful 19 and clear in many respects ... is that it does not spell 20 out clearly enough for me, why we think it is right in 21 principle for us to maintain a different policy from 22 other organisations ..." 23 A. Yes. 24 Q. "... (the Brian Altman point) ie option C is dismissed 25 too summarily." 168 1 A. Yes. 2 Q. "I do, of course, understand that we couldn't just throw 3 our cases at the CPS and walk away at a moment's 4 notice." 5 Then you continue. The detail isn't actually 6 relevant for the moment. Then if we scroll up, please, 7 Ms Vennells then forwards that on to the then Interim 8 General Counsel, Chris Aujard, saying: 9 "Alice has sent a good set of challenges. You will 10 ... be able to answer most and in fact, I think the cost 11 question is a case of adding up what you have in 12 already." 13 Then the second paragraph: 14 "The difference from my experience and perhaps not 15 immediately obvious to our leading Counsel, is scale. 16 None of the businesses Brian Altman compared us to has 17 a network the size of ours ... and although some may 18 operate agencies, none will have the unique relationship 19 that we do with [subpostmasters], nor the cash handling 20 through individuals", et cetera. 21 This appears to suggest that you had seen either 22 Brian Altman's advice about the continuation of the Post 23 Office prosecution role or a detailed summary of it. 24 A. I certainly had not seen the original advice and my 25 recollection is that Chris Aujard had written a paper on 169 1 this question of the future of prosecutions where he 2 gave some selective quotes from that advice attributed 3 to Brian Altman. 4 Q. That could equally have been done in relation to the 5 other advices, the Clarke Advice of 15 July -- 6 A. It could. 7 Q. -- 2 August -- 8 A. Yeah. 9 Q. -- or Mr Altman's reviews, there are two advices in 10 2013, that he conducted. 11 A. Yeah. 12 Q. That wasn't done even to that extent, was it, 13 ie a summary with quotes? 14 A. No. 15 Q. Was it the practice that you were not generally supplied 16 with original documents emanating from legal folk? 17 A. Well -- yes, clearly it was. But I didn't understand 18 until very recently that that was, as it were, conscious 19 policy, if you see what I mean, rather than something 20 that just hadn't happened. I didn't realise that and, 21 of course, I have seen other things, other consultations 22 between, for example, Susan Crichton and Richard Morgan, 23 very early on, about the unwisdom of going down the 24 independent review route, which I was totally unaware 25 of. I mean, I had no idea why that conversation had 170 1 taken place, why it had taken place at that point when 2 we had decided to go down that route, or, you know, 3 I mean, I was -- 4 Q. Just on that point, it looks rather as if she was going 5 off to get some advice to support her position, doesn't 6 it? 7 A. Well, you said it. I didn't. 8 Q. Would that be part of the approach of unnecessarily 9 pushing back that you mentioned earlier? 10 A. Well, I didn't know about it when I said that. 11 Q. Yes, but you do now? 12 A. I do now, yes. I think it's extraordinary. You know, 13 I really -- anyway, I keep using that word in this 14 context. So I'm sorry. 15 Q. So is the position that you did not generally receive 16 originating legal advice -- 17 A. It is. 18 Q. -- from the authors but you received papers in which 19 Post Office lawyers summarised -- 20 A. Yeah. 21 Q. -- it and quoted from it? 22 A. Yes. 23 Q. Thank you. Thank you, that can come down. 24 Going back to mid-2013, then, it is right that 25 Alasdair Marnoch was deputed to deal with or to oversee 171 1 the insurance position of the Post Office, wasn't it? 2 A. Yes. 3 Q. Can we look, please, at POL00099331, and go to bottom of 4 page 3, top of page 4, please. Thank you. 5 So there's an email from Alwen Lyons to you and 6 others. 7 A. Yeah. 8 Q. We'll see in a moment that this is about 19 July 2013. 9 Alwen Lyons says "Dear all", and then over the page. 10 A. Okay. 11 Q. "On Tuesday the Board asked for information on [the 12 following three things]." 13 We can skip over 1 and 2. Then, if we scroll down 14 a little further, 3: 15 "The impact on Horizon/Second Sight on our insurance 16 cover." 17 A. Mm. 18 Q. Then Ms Lyons says that point is: 19 "... explained by Chris below. 20 "Insurance [if we scroll down a bit] 21 "We discussed what impact the current Horizon issues 22 might have on our insurance on which we are advised by 23 our insurance broker, Miller. Their view is that whilst 24 other insurance policies may be impacted the most likely 25 one is D&O [directors' and officers'] -- this has the 172 1 added complication that it is the only policy we share 2 with [Royal Mail] and was placed by their broker, JLT. 3 The excess on the policy varies under different criteria 4 but the main one is £25,000 on each and every claim. 5 A meeting is being set up with JLT and Miller to ensure 6 they are fully briefed on the issues before JLT engage 7 with the insurer." 8 Then there is a lot of email traffic. 9 A. Yes. 10 Q. Go to page 1, please. You have been removed from the 11 thread now -- 12 A. Okay. 13 Q. -- and this a conversation by email between Alasdair 14 Marnoch and Paula Vennells? 15 A. Yeah. 16 Q. Alisdair says: 17 "I'm afraid Chris's answer ..." 18 I think that's the answer that we have just read -- 19 A. Okay. 20 Q. -- as supplemented a little in the email chain but we 21 needn't address that: 22 "... does not address the key question as to whether 23 or not we've got cover. He dropped me a note which 24 suggested we do but seems to suggest it would be under 25 the [director and officer] cover. Like you, I'm 173 1 concerned that we believe this policy would cover up for 2 this sort of issue -- rather I'm sure we will have a PI 3 policy [professional indemnity or public liability] 4 which will cover us for this and any other like issue. 5 "The follow on issue is that to avoid the 6 underwriters rejecting our claim we need to keep them 7 abreast of developments and any possible claims (on this 8 and any other issues). Experience tells me that keeping 9 underwriters update on this sort of developing issue can 10 be very tricky getting the balance right in levels of 11 disclosure. Normally I would have expected Chris to be 12 involved in discussions with Susan testing the thinking 13 at each stage of the process." 14 Then skipping a paragraph: 15 "The issues about any disclosure is that it will 16 affect our premiums even if the underwriters don't pay 17 out. It's a bit like having to report near misses when 18 you are driving as well as crashes. The result will be 19 higher premiums", et cetera. 20 Was this reported back to you? 21 A. I don't -- I certainly have never -- had never seen that 22 email at the time. I mean, I was aware that Alisdair 23 was taking the lead on this. 24 Q. As Chair of the Audit and Risk Committee? 25 A. Of the Audit and Risk Committee, exactly. I think that 174 1 was perfectly right, actually, both in the capacity that 2 he had, and also because he would have had a much better 3 understanding of these sorts of issues than certainly 4 I would have had. 5 Q. Thank you. Can we turn to some related questions, then, 6 arising from questions put by Mr Henry to Chris Day, on 7 Tuesday of this week, by looking at POL00021991. 8 There's, I'm afraid, quite a long run-up to the wicket 9 here in getting to the questions but I need to give you 10 the context before we look at the issues of substance. 11 Can we look at the bottom of the page, please. 12 Thank you. Stop there. If we just go up a little bit. 13 We're in March 2014 and an email exchange between Andrew 14 Parsons -- and I think you would know he was a partner 15 at Bond Dickinson? 16 A. I do now, yeah. 17 Q. Did you then? 18 A. I don't think so but I can't be sure. No, I don't think 19 so, quite honestly. 20 Q. Okay, David Oliver? 21 A. Yes, David Oliver was working in the Post Office. 22 Q. Chris Aujard, Interim General Counsel? 23 A. Yes. 24 Q. And Gavin Matthews, that's Mr Parsons' colleague -- 25 A. Okay. 175 1 Q. -- at Bond Dickinson? 2 A. I don't know. 3 Q. Then he says, Mr Parsons: 4 "Please find attached the key pieces of formal 5 advice that have been prepared by [Bond Dickinson]. 6 There are obviously thousands of other emails which 7 provide further ad hoc advice." 8 So next, if you look at the subject matter, is that 9 the Post Office is bringing in Linklaters -- 10 A. Right. 11 Q. -- to give advice. Here, Mr Parsons is providing some 12 of the material, some of the legal advice that the Post 13 Office has previously received, so that Linklaters, 14 presumably, can know about it? 15 A. Okay. 16 Q. Okay? 17 A. Yes. 18 Q. So he attaches a number of documents. 19 A. Right. 20 Q. There's the note of the meeting with Richard Morgan at 21 number 1, a settlement presentation at number 2 and then 22 something called "Insurances risks note" at 3. Can you 23 see that? 24 A. Yes. 25 Q. He says that that note had: 176 1 "... the dual purpose of advising the board (its 2 contents were later reflected in a Board paper) and 3 acting as notification to [the Post Office's] 4 insurers -- hence why this doesn't look like 5 a traditional piece of legal advice." 6 Okay? So this is Mr Parsons saying in 2014 the 7 insurance risk note had two purposes: advising the Board 8 (its contents were later reflected in a Board paper) and 9 a notification to the insurers. Okay? 10 A. Yes. 11 Q. Can we look at the note, please, with that context in 12 mind. POL00021996. If we go to page 4, please. We'll 13 see that it's dated 15 August 2013. 14 A. Right. 15 Q. Okay? 16 A. Yes. 17 Q. We go back to page 1. "Horizon risks", and if we then 18 go to page 2, under the heading "Risks to the Post 19 Office"? 20 A. Right, yes. 21 Q. "Prosecutions & Convictions 22 "As noted above, where circumstances warrant, Post 23 Office prosecutes subpostmasters who have acted 24 criminally. The basis of these prosecutions is often 25 found in the transaction records recorded in Horizon. 177 1 As a result of Second Sight's investigation/Interim 2 Report, Post Office is reviewing all its criminal 3 prosecutions over the last three years to identify any 4 cases where a conviction may be unsafe." 5 A. Mm-hm. 6 Q. Then this: 7 "In particular, the expert evidence of one Post 8 Office witness, Dr Gareth Jenkins of Fujitsu, may have 9 failed to disclose certain historic problems in the 10 Horizon system. Under the criminal prosecution 11 guidelines, Post Office has an obligation to disclose 12 (even retrospectively) this previously undisclosed 13 information to subpostmasters' defence counsel. Post 14 Office is required to make these retrospective 15 disclosures where the additional information 16 (ie Dr Jenkins' knowledge of historic, but now resolved, 17 problems with Horizon) may have undermined a prosecution 18 case or assisted with an accused's defence." 19 Was that paper presented to the Board? 20 A. No. I don't think that the Board ever saw any papers 21 directly from Bond Dickinson because, when I looked at 22 these, at these papers recently, I didn't -- if you look 23 at the top right-hand corner of the top of the 24 document -- 25 Q. There's the Bond Dickinson symbol? 178 1 A. I honestly don't think I've ever seen that before in my 2 life. 3 Q. Were the contents of this paper, as Mr Parsons said in 4 his email that we read, later reflected in a Board 5 paper? 6 A. No. I mean, there was one sentence, which I've already 7 referred to, in a paper from Chris Aujard, which I think 8 the sentence may have been repeated then in significant 9 litigation reports, which made this very bland reference 10 to looking for a new expert evidence. 11 Q. Yes, I'm looking for something that is other than bland? 12 A. Yes, precisely, and I had never heard of Gareth Jenkins 13 until the High Court case. 14 Q. So, although Mr Parsons says the contents of this advice 15 were later reflected in a Board paper, your evidence is 16 that, to your recollection, they were not? 17 A. Absolutely not. No. I mean, I'm absolutely sure that, 18 if I had known about this -- I mean, (a) I would not 19 have forgotten and (b) I would have done something about 20 it. 21 Q. The document ought to have got to the Board or at least 22 the substance of the information in it -- 23 A. Exactly, of course it should. 24 Q. -- shouldn't it? 25 A. Of course it should, yes. 179 1 Q. So we can add this to the list of documents not passed 2 to or appropriately summarised to Post Office's Board, 3 can't we? 4 A. We can. 5 Q. I should say, just for the note -- and this is mainly 6 for you, sir, rather than Ms Perkins -- that I've 7 checked the following, bearing in mind that this 8 document is dated 15 August 2013. There was no Board 9 meeting in August 2013, presumably everyone was in 10 Tuscany. 11 A. Not everybody. 12 Q. 25 September 2013, the Board asked for a noting paper on 13 whether any claims on the business from Horizon work 14 would be covered by indemnity or D&O insurance. 15 31 August 2013, no mention of these issues. 16 27 November 2013, no mention of these issues. 17 4 December 2013, that was a meeting of 18 a subcommittee of directors and the issue wasn't 19 addressed. 20 21 January 2014, an agenda for the Board meeting 21 says that a paper called "Insurance Cover for Project 22 Sparrow" is to be presented as a noting paper but no 23 such noting paper is, in fact, within the Board pack and 24 there's nothing in the minutes of that meeting about 25 a discussion of that issue or even a paper being noted. 180 1 So for the Board meetings between August 2013 and 2 March 2014, when Mr Parsons wrote his email, I, at 3 least, can see no record of this paper or a summary of 4 it being presented to the Board. 5 SIR WYN WILLIAMS: That's a very helpful, Mr Beer. Can 6 I ask that your team, if it hasn't already started or 7 doesn't already know the answer, try and ascertain what 8 Mr Parsons -- well, we don't know that Mr Parsons was 9 the author of this, do we? 10 MR BEER: If we go to the top of the page. 11 SIR WYN WILLIAMS: Yes, it's Bond Dickinson in the 12 right-hand corner. 13 MR BEER: Yes, the very top of the page. 14 SIR WYN WILLIAMS: Ah, sorry. 15 MR BEER: Then if we scroll down to the bottom left-hand 16 side, just right at the bottom, we can see a reference 17 number at the foot of the page. 18 SIR WYN WILLIAMS: Yes. 19 MR BEER: Then if we go to the last page and scroll up 20 a little bit, we can see that it's signed off 21 corporately. 22 SIR WYN WILLIAMS: Yes, that was what was in my mind. So, 23 as of the date of the document, we don't yet know, is 24 this correct, who actually authored it in Bond Dickinson 25 and, just as importantly, what they did with it when it 181 1 first came into existence? 2 MR BEER: Sir, I think that's right and I think we'll get 3 helpful assistance from Mr Parsons on these issues when 4 he gives his evidence. 5 SIR WYN WILLIAMS: Yes, okay. Fine. Thanks very much. 6 MR BEER: So what I have been able to establish from the 7 minutes of the Board meetings and the agendas which set 8 out which papers were put up to the Board -- 9 A. Yeah. 10 Q. -- either for decisions or noting, suggest that's what 11 you've said is right: that this was not placed before 12 the Board, even for noting. Again, can you help us as 13 to what may have been going on at the Executive Team 14 that meant that there was this collection of rather 15 significant advice that never percolated to the Board? 16 A. I just -- I honestly don't know. I mean, perhaps people 17 weren't -- so there are obviously a whole list of 18 possible reasons for this. One is that people weren't 19 paying attention, didn't understand, and another is that 20 this was -- 21 Q. Sorry, just to stop there, just to speak over you, that 22 would mean that a succession of General Counsel were 23 each not paying attention on each occasion -- 24 A. Yes. 25 Q. -- to a variety of papers? 182 1 A. Yes. That -- absolutely. However, these -- the 2 documents that we're talking about, I've now lost track 3 of this, but the documents came in at different times, 4 these documents that we're talking about, under 5 different General Counsels. So I think Chris Aujard 6 said in -- when he was here, I think he said that he had 7 either not seen some of this or had assumed that it had 8 already been shared with the Board. 9 Q. Yes. I mean, the two Clarke Advices -- 10 A. Yes, and they did come in before him. That is true. 11 Q. -- are on Susan Crichton's watch? 12 A. Yes. 13 Q. The Altman advices, at least three of them post-date 14 September 2013 -- 15 A. Okay. 16 Q. -- and, therefore, they are on his watch -- 17 A. Yes. 18 Q. -- and, as I've said, Jane MacLeod had a continuing 19 interest in these issues -- 20 A. Yes. 21 Q. -- because she was administering the Post Office's 22 relationship with the CCRC. 23 A. Yes. Well, I just -- I mean, maybe it was too 24 difficult. But I still don't really understand that 25 because, if something is very difficult, then you want 183 1 to share it to make it hopefully less difficult. 2 Q. That can come down. Thank you. 3 Can we look, please, at paragraph 416 of your 4 witness statement, which is page 210. Paragraph 416, 5 you say: 6 "I welcomed the CCRC's intervention." 7 A. Yes. 8 Q. "I believed that the Horizon system was safe but 9 I couldn't see how the Post Office on its own could 10 bring closure to this issue. So I thought it was 11 helpful that another well respected independent agency 12 was getting involved, and if -- despite all the 13 assurances we had been given, both internal and 14 external -- there was something wrong, the CCRC would be 15 in a good position to find it." 16 Similarly, at page 142, at paragraph 291 -- in fact, 17 that's a separate issue. Dealing with the paragraph 18 that I've drawn your attention to already, you welcomed 19 the external scrutiny of the CCRC. 20 A. Absolutely. 21 Q. Did everyone within Post Office senior Executive Team, 22 to your knowledge, welcome the external scrutiny that 23 the CCRC would bring? 24 A. I don't remember anyone telling me that they didn't. 25 I think that I was -- I was quite speedy in saying 184 1 I thought that it was -- that we should welcome it and 2 we absolutely should cooperate with it because that was 3 what I felt and, by the time of the paragraph that you 4 were just looking at, I think it's in the context of 5 2015, and, by then, you know, it was clear that -- 6 I think as I say in there -- there was -- it just didn't 7 seem to me that the Post Office was going to be able to 8 find a real resolution to this without another body that 9 was a really authoritative body that had powers of its 10 own independently that could look into this and decide 11 for itself whether things were all right or not. 12 Q. Was that consistently your position from when the first 13 communication from the CCRC came in, in July 2013? 14 A. Yes. I mean, you know, I had never worked with the CCRC 15 but I would have taken an organisation like that -- 16 I would have been very respectful of an organisation 17 like that and I would have wanted everything that should 18 be done to be done. 19 Q. Can we look, please, at POL00146704. If we just look at 20 the top part, thank you, it's not an email exchange 21 involving you? 22 A. Okay. 23 Q. But it's about a briefing to be provided to you. It's 24 between Andy Holt and Alwen Lyons; do you remember who 25 Mr Holt was? 185 1 A. No. 2 Q. Okay. He says: 3 "Hi Alwen -- this is based on an update I pulled 4 together with the CEO's report that is going to the 5 Board. I think this feels like the right sort of level 6 or Alice/[James Arbuthnot]." 7 Then he cuts into the email the Project Sparrow 8 update; can you see that? 9 A. The paler writing, is that the cut-in? 10 Q. No, the whole thing, I think. 11 A. Oh, the whole thing. 12 Q. Yeah. In the second paragraph of the proposed update to 13 you, he says: 14 "Brian Altman QC's first review has now been 15 received. This first review looked into [the Post 16 Office's] compliance with its prosecution duties in 17 light of Second Sight's findings -- in particular it 18 considered [Post Office's] legal duty to ensure that 19 Second Sight's findings were fully disclosed to any 20 person who is currently being or has previously been 21 prosecuted by [the Post Office]. He concluded that [the 22 Post Office] is complying with its duties and that the 23 approach adopted by the prosecution team was 24 'fundamentally sound'." 25 Then this: 186 1 "The report gives [the Post Office] good grounds to 2 resist any formal external review of its historic 3 prosecutions (ie by the [CCRC])." 4 A. Mm. 5 Q. Was that sentiment communicated to you: that the Post 6 Office had received advice from Brian Altman which gave 7 good grounds to resist external scrutiny by the CCRC? 8 A. No, I don't think I've ever heard that before. 9 Q. Were the sentiments in this proposed update conveyed to 10 you, ie they were taking the opposite view to you about 11 the CCRC? 12 A. Mm. 13 Q. There were pleas that Mr Altman had provided the Post 14 Office with grounds to resist scrutiny. They were using 15 the review to fend off the CCRC? 16 A. I don't remember very much about this but I think that 17 I may have picked up some sort of flavour -- nothing 18 like these terms here -- but some sort of flavour of 19 wanting this to go away, shall we say, and I think 20 that's why I -- there's -- I think some Board minutes, 21 I think quite late on, 2015, I think, where I said -- or 22 it's recorded that the Board had said that we wanted the 23 Post Office to cooperate fully, or words to that effect. 24 I think it may have been me who said that but it's not 25 attributed to me. 187 1 Q. If we look at the top of the email: 2 "Hi Alwen -- this is based on an update I pulled 3 together for the CEO's report that is going to the 4 Board." 5 A. Yes. 6 Q. It seems that those within the Post Office hadn't got 7 the message from you as to how they should be 8 approaching external scrutiny, ie they were prepared to 9 write a CEO's report that would be going to the Board 10 and to you saying, "Good news, Brian Altman has given us 11 good grounds to resist review by the CCRC". 12 A. I think, at that stage, I was only dimly aware of the -- 13 if I was aware at all. There was some correspondence 14 between the CCRC and Paula Vennells and Susan Crichton 15 I think in 2013. I may be wrong about that. 16 Q. In July, yes? 17 A. Yes? Which I don't think I saw at the time but I think 18 that there was some sort of reference to it, one of 19 those passing references, in a subsequent Board paper. 20 Q. My question, essentially, is: you've told us in your 21 witness statement that your view throughout is that the 22 Post Office should be welcoming scrutiny -- 23 A. Yes. 24 Q. -- by the CCRC, the statutory body. 25 A. Yes. 188 1 Q. Do you know how it's the case that your message had 2 seemingly not found its way down to those within the 3 organisation, that they were seemingly taking the 4 opposite view? 5 A. I don't know, because -- I mean, you know, in fairness, 6 to whoever these people were, I don't think I had 7 expressed that view about the CCRC at that point. 8 Q. That's what I'm going to be driving at. Do you think 9 that you are maybe less welcoming of the scrutiny at 10 this time, 2013 -- 11 A. No, no. 12 Q. -- as you now like to think, looking back? 13 A. No, no, no, sorry, that's not what I was saying at all. 14 I think what I'm trying to say here is that that 15 correspondence with the CCRC that was happening in 2013, 16 I did not see that at the time and it was only 17 referenced in passing in a Board paper in 2013 or 18 whenever that was and I don't think -- I didn't express 19 a view, I don't think, about it at the time. I'm not 20 sure. But it absolutely was not my position at any 21 point to be resistant to the CCRC's involvement. But it 22 was later, in 2015, when we were much more aware of 23 this, that I was explicitly positive about it. 24 Q. Thank you. This time, late October 2013, were you aware 25 of a Fujitsu employee who was considered to be an unsafe 189 1 witness? 2 A. I didn't know -- there's reference -- no, absolutely 3 not. I didn't know that there was an unsafe witness -- 4 oh, actually, hang on a minute. Sorry, I'm getting 5 a bit tired now. I think that I referred earlier to 6 an email that Paula Vennells had sent me, which had 7 a list of things she was updating me on, and -- 8 Q. I'm going to come to that. 9 A. Okay. But I can't remember when that was. 10 Q. It is October 2013. 11 A. Okay. 12 Q. If you're getting tired now, I'll make this the last set 13 of questions and we'll pick it up fresh tomorrow 14 morning. 15 A. Okay, thank you. 16 Q. Can we look, please, at that email. 17 A. Yeah. 18 Q. POL00382001. At the foot of the page, please. Thank 19 you. So it's about the same time, the email we just 20 looked at on CCRC -- 21 A. Okay, yes. 22 Q. -- review being maybe unnecessary in the light of the 23 Altman advice. An email of 21 October from Paula 24 Vennells to you. 25 A. Yeah. 190 1 Q. "Signing out! 2 "Hi Alice, don't worry about the lateness of the 3 note [12.47 in the morning] -- I am clearing the tray 4 before signing out. I hope your weekend has been good 5 despite the autumn rains ... 6 "A couple of updates." 7 Then second update: 8 "My concern re Sparrow ... is our obligations of 9 disclosure re an unsafe witness. (The representative 10 from Fujitsu made statements about no bugs, which later 11 could have been seen to have been undermined by the 12 [Second Sight] report). We do not think it material but 13 it could be high profile. Martin [Edwards] is briefed 14 if you want more detail. This is just in case." 15 Then if we scroll up, please. You say: 16 "Paula, 17 "Thank you for this. All clear and helpful. I hope 18 you get a real break this week." 19 Then you talk about a separate issue. Ms Vennells 20 replies: 21 "... put it down too late night grump!" 22 That's something to do with something else. She has 23 been out for a muddy run, the local abbey and done some 24 gardening. Then you say thank you at the top, okay? 25 A. Yeah. 191 1 Q. So this email told you that there was an issue of 2 disclosure -- 3 A. Mm. 4 Q. -- which related to an unsafe witness -- 5 A. Yeah. 6 Q. -- who was a representative from Fujitsu? 7 A. Yeah. 8 Q. Presumably, you would have been concerned about that? 9 A. I don't remember seeing this email until it was shown to 10 me very, very recently indeed. 11 Q. Looking back at it now, whether you remember an email 12 that was sent over a decade ago or not -- one wouldn't 13 blame you if you didn't remember an email sent a decade 14 ago -- looking back at it now, reading the words as they 15 appear on the page, you would have been concerned at 16 receiving an email which said that there was an issue of 17 disclosure concerning an unsafe witness who was 18 a representative of Fujitsu? 19 A. But she goes on to say -- can we come -- 20 Q. Yeah, if we go down to the bottom of the page. 21 A. Do you mind? 22 Q. She says: 23 "We do not think it material but it could be high 24 profile." 25 A. "This is just in case." 192 1 I didn't -- you know, it's obvious, from the email 2 exchange with her, that I didn't react to that. I think 3 that -- you know, I can't explain to you now why 4 I didn't react to that. I wish that I had reacted to 5 that but I think, if your Chief Executive is saying to 6 you that she doesn't -- "We do not think it's material 7 and this is just in case", I'm afraid I took that at 8 face value. I shouldn't that have done. 9 Q. We know this was written on the back of the Brian Altman 10 KC general review -- 11 A. Yes. 12 Q. -- of 15 October 2013 -- 13 A. Yeah. 14 Q. -- which mentions an unsafe witness -- 15 A. Yeah. 16 Q. -- and does not say in any way at all that this is not 17 material. He mentions Gareth Jenkins 55 times in his 18 advice, and the word "material" dozens of times and, in 19 particular, highlights the case of Seema Misra on 20 a dozen or so occasions. 21 A. Yeah. 22 Q. Was this because of the balm that was poured on it, in 23 this email by Ms Vennells, an opportunity missed -- 24 A. Yeah. 25 Q. -- to see, in fact, what Mr Altman was saying about the 193 1 unsafe witness? 2 A. It clearly was a missed opportunity. I mean, it doesn't 3 refer to Brian Altman's advice here. 4 Q. No. 5 A. But, you know, I don't know what I can say about this. 6 I don't remember seeing it but I obviously -- it's quite 7 clear from the record that I didn't pick up on it, and 8 I'm really sorry. I'm really sorry about that. 9 MR BEER: Thank you. 10 It's 4.10 now, sir. Can we call a halt to the 11 proceedings now and recommence at 9.45 tomorrow? 12 SIR WYN WILLIAMS: Yes. Yes, that's what we'll do. 13 Ms Perkins, I'm sure it's the last thing on your 14 mind that you want to talk about your evidence overnight 15 but, if you do, please resist the temptation, all right? 16 THE WITNESS: Yes, I am happy to resist the temptation. 17 Thank you. 18 SIR WYN WILLIAMS: So we'll resume at 9.45 tomorrow. 19 MR BEER: Thank you, sir. 20 (4.12 pm) 21 (The hearing adjourned until 9.45 am the following day) 22 23 24 25 194 I N D E X ALICE ELIZABETH PERKINS (affirmed) ............1 Questioned by MR BEER .........................1 195