1 Friday, 27th September 2024 2 (10.00 am) 3 MR BLAKE: Good morning, sir. 4 SIR WYN WILLIAMS: Good morning. 5 MR BLAKE: This morning we're going to hear from Ms Burton. 6 AMANDA BURTON (sworn) 7 Questioned by MR BLAKE 8 MR BLAKE: Thank you very much. Can you give your full 9 name, please? 10 A. Amanda Jane Burton. 11 Q. Ms Burton, you should have in front of you a witness 12 statement dated 3 September of this year; is that right? 13 A. That's right. 14 Q. Could I ask you to have a look at the final substantive 15 page, please. 16 A. Yes. 17 Q. Is it dated 3 September? 18 A. Yes. 19 Q. Is that your signature? 20 A. It is. 21 Q. Can you confirm that as the date of signature, that 22 signature is true to the best of your knowledge and 23 belief? 24 A. I can confirm that. 25 Q. Thank you. I think you've told me in advance that there 1 1 may be some subsequent developments which caused you to 2 reflect on some matters that you have addressed in your 3 witness statement, but the statement itself is true to 4 the best of your knowledge and belief? 5 A. It is. 6 Q. Thank you. That witness statement has the Unique 7 Reference Number of WITN11330100 and will be published 8 on the Inquiry's website shortly. 9 By way of background, you are a qualified solicitor; 10 is that right? 11 A. Yes, I am. 12 Q. You have a wide range of business experience in public 13 companies and you've set those out in your witness 14 statement and that includes as Global Chief Operating 15 Officer of Clifford Chance; is that correct? 16 A. That is. 17 Q. And you retired from Clifford Chance in 2014? 18 A. I did. 19 Q. And subsequently have been developing a portfolio of 20 Non-Executive Director positions? 21 A. Correct. 22 Q. And you have recently also become chair of a publicly 23 listed distribution company? 24 A. I have. 25 Q. Thank you. Relevant for today's purpose, you were 2 1 appointed a Post Office Non-Executive Director in 2 April 2023; is that right? 3 A. Yes. 4 Q. Thank you. I want to begin just by asking you a little 5 bit about your appointment. Can we bring on screen, 6 please, POL00363049, we're going to be looking at your 7 letter of appointment dated 27th April of 2023. If we 8 scroll over to page 3, please, and paragraph 2.1 sets 9 out there the time commitment as Director. And the 10 appointment letter says: 11 "You will be expected to devote such time as is 12 necessary for the proper performance of your duties as 13 a director. Overall, we anticipate that you will spend 14 a minimum of 24 days per year each year on work for the 15 Company, following the induction phase." 16 In practice, how much time do you spend in this 17 role? 18 A. A great deal more than 24 days. 19 Q. Do you think that the minimum of 24 days as set out 20 there was realistic? 21 A. No, although some things happened, for instance my 22 review of the bonus scheme that nobody could have 23 foreseen at the time I was appointed. 24 Q. If we put to one side work on the Inquiry, work on the 25 fallout, so the matters relating to the Horizon issues, 3 1 nevertheless, do you think that that is a correct period 2 of time for the role? 3 A. Normally you'd anticipate as a Non-Executive Director to 4 spend around up to 30 days a year on a particular role, 5 and if this was a stable organisation, I would expect 6 that to be about the right time. 7 Q. Are we to read into that that it's your view that it's 8 not a stable organisation? 9 A. Correct. 10 Q. One matter that we dealt with in the previous phases was 11 the issue of overboarding. Do you feel that you have 12 sufficient time, and do you feel that other members of 13 the Board have sufficient time? 14 A. I think we definitely find that Post Office is the most 15 time-consuming one in each of our portfolios, but 16 I think we're all professional enough to be able to 17 manage the workload. 18 Q. Do you have any concerns in respect of other board 19 members? 20 A. No, other than the postmaster NEDs, actually, because 21 they're also running full time businesses and so I do 22 think it's a particular strain for them to also sit on 23 the Board. 24 Q. Thank you. That can come down. You became chair of the 25 Remuneration Committee on 26th May of 2023 so as good as 4 1 straight away, or very soon into your time on the Board. 2 I think you've said in your witness statement that you 3 were always going to take that role but it was brought 4 forward; is that right? 5 A. That's correct, yes. 6 Q. And why was it brought forward? 7 A. It was brought forward because I was asked to undertake 8 a review of a particular bonus scheme very shortly after 9 I joined the Board, and as a result of that review, it 10 was decided that I would take over the chair of the 11 Remuneration Committee a month earlier. 12 Q. And the review concerned something called the 13 Transformation Incentive Scheme. Can you assist us with 14 what the Transformation Incentive Scheme was? 15 A. It was designed as a one-off bonus scheme and it was put 16 in place during the time of the pandemic when it was 17 difficult, as was the case with a lot of companies, to 18 determine the financial health of the organisation, 19 et cetera and therefore more difficult to put in place 20 certain financial metrics. So this was put in place for 21 other purposes, and replaced the normal annual bonus 22 scheme. 23 Q. And why does there need to be a review of that scheme? 24 A. Because one of the submetrics had some wording in that 25 was not actually correct, which related to this Inquiry, 5 1 and it had -- the wording assumed that Sir Wyn would be 2 reviewing the out-turn of the metric. 3 Q. Thank you. Perhaps the best place to see that is 4 POL00363154. This is a document we after going to come 5 back to but if I can just take you to page 3 of this, 6 it's a Simmons & Simmons report, and we'll get to that 7 in due course but it sets out there in a table, the 8 bonus metric. It's page 3. Thank you. So was it 9 concerning the table that we see, if we scroll down to 10 paragraph 1.4? 11 A. That's correct, yes. 12 Q. And the wording there, this is taken from the annual 13 report, it stated: 14 "Delivery of all the required information and 15 support for the Horizon Inquiry satisfying the 16 requirements of Sir Wyn Williams, ensuring there is 17 a clear measurable plan created to demonstrate action on 18 improving the overall culture to be postmaster centric 19 and to ensure processes for Postmasters are addressed in 20 line with recommendations from the Inquiry. Any actions 21 or plans must have been endorsed by the Inquiry and the 22 Board". 23 Then it says, "Inquiry support" is the metric and 24 then it sets out there a target: 25 "All required evidence and information supplied on 6 1 time, with confirmation from Sir Wyn Williams and team 2 that the Post Office's performance supported and enabled 3 the Inquiry to finish in line with expectations." 4 And it's set out that that outcome had been 5 achieved. In simple terms, what was the issue with 6 this? 7 A. Well, the issue was that during the time of this plan, 8 the Inquiry became a statutory inquiry, and clearly the 9 onus on people to provide evidence changed considerably, 10 and it would not have been appropriate at all to have 11 any suggestion that Sir Wyn would be involved in a bonus 12 scheme. 13 Q. Is there a broader issue, not simply that it was based 14 on the Inquiry before it was a statutory inquiry, but 15 irrespective of the status of the Inquiry, do you see 16 any issue with performance being -- and a bonus being 17 based on compliance with an investigation into 18 wrongdoing by the company? 19 A. I understand -- I wasn't in the Post Office when this 20 was set, but I understand the rationale was to ensure 21 that the team were fully engaged with the Inquiry, and 22 absolutely had to deliver what was required of them. 23 Definitely in hindsight, this would not have been 24 appropriate, regardless of whether it was a public or 25 statutory inquiry but I understood that to be the reason 7 1 for it. 2 Q. Thank you. That can come down. When you were 3 conducting your review of this, were you aware of the 4 background to the Horizon issues? 5 A. Yes, I had been following it, just as a member of the 6 public has been, as well, and I was obviously horrified 7 by what had been happening, and, you know, very 8 distressed around the issues that the postmasters and 9 postmistresses faced. I was -- so I had that element of 10 knowledge, I literally had only just joined the Post 11 Office so I hadn't really started my induction by the 12 time I was asked to do this review, so my further 13 knowledge didn't really happen until later on. 14 Q. We heard evidence later this week from Saf Ismail, one 15 of the Non-Executive Director postmasters, and in his 16 view there were number of people on the Board he said 17 who didn't really appreciate the extent of the scandal 18 until the ITV drama. Were you one of those people? 19 A. No. 20 Q. Do you think that you had a sufficient grip at the time 21 that you were investigating these issues on the 22 seriousness of the underlying matters? 23 A. I believe so, yes. 24 Q. Were you, at the time that you were carrying out the 25 review, aware of other ongoing disputes regarding the 8 1 quantum of bonuses among senior executives? 2 A. I had had one meeting with the Chair of the Remuneration 3 Committee shortly after I joined, and she informed me of 4 some of the discussions that had taken place in the past 5 so I did have some knowledge of some of the issues that 6 had been happening. 7 Q. And can you give us an idea of some of those issues? 8 A. That there had been requests to the Shareholder for an 9 increase in the pay of the Chief Executive. 10 Q. And in your view, was that relevant background to the 11 review that you carried out? 12 A. At that stage no, because I was purely looking at the 13 appropriateness of this metric, and how it had come 14 about. 15 Q. Looking back now at the work you carried out, and the 16 information you know now about various disputes 17 regarding bonuses or other income, would you have 18 carried out your review differently? 19 A. I don't think so, no. 20 Q. Do you think your conclusions would have been any 21 different? 22 A. No. 23 Q. Could we please turn to BEIS0000655, this is an email 24 note of a meeting with Minister Hollinrake of 25 22nd May 2023 and I'm just going to read to you a few 9 1 passages from it. If we scroll down we see the 2 attendees and then it says: 3 "HS [so that's Mr Staunton] the Chair of Post Office 4 expressed how disappointed he was regarding the bonus 5 payment issue (the submetric which referred to the 6 Inquiry). He has confidence in Amanda Burton as the new 7 RemCo Chair, and values her judgment. She has produced 8 her report, which the Board have had sight of today." 9 If we scroll up slightly we can see this was 22 May, 10 can you assist us, was that a draft version of the 11 report at that stage? 12 A. Yes, it would have been. 13 Q. Can you recall when you were first asked to write the 14 report or to investigate the matters? 15 A. Right at the beginning of May. 16 Q. So you had been working on this for three weeks or so? 17 A. Yes. 18 Q. "Amanda is satisfied that the decision to introduce the 19 submetric wasn't an unreasonable one to take, given that 20 the Inquiry was at this time non-statutory." 21 Just pausing there, I think from your evidence today 22 I think you take a slightly broader view on that. 23 A. Yes, I think, as I say, I was so new into the Post 24 Office at the time that I was taking certain things at 25 face value and in fact this is the first time I've been 10 1 involved in an inquiry. So I was still very much 2 learning at that point. 3 Q. Yes. Who in particular had briefed you? 4 A. I actually didn't really receive any brief, as such. 5 I just asked to see as many documents as I possibly 6 could in order to make up my own mind. I was conscious 7 that there were certain people who might be conflicted 8 in the outcome, so I was careful not to talk to too many 9 people. 10 Q. "The Shareholder was involved throughout and there was 11 appropriate governance. In [Mr Staunton's] view, the 12 wording which said that Sir Wyn approved it was a huge 13 mistake and he is baffled that it went through so many 14 clearances without being picked up on." 15 Do you share that bafflement? 16 A. Yes, still to this day I do not know how the wording was 17 not picked up and particularly when it went into the 18 report and accounts. 19 Q. If we scroll down, please, we see towards the bottom of 20 the page, it says: 21 "DB [and that's David Bickerton, the Director 22 General of the Department for Business and Trade] said 23 that the most recent issue was the third time that 24 mistakes had been made at the Post Office related to 25 senior management compensation. The review which DBT is 11 1 commissioning will look into whether there are more 2 deep-rooted issues here." 3 Were you aware that this was the third time that 4 mistakes had been made by the Post Office? 5 A. I had been told that there had been some mistakes, yes. 6 Q. Were you aware then or are you aware now of what those 7 other two mistakes were? 8 A. I certainly recall one was in relation to the 9 enhancement that the Chief Executive and Finance 10 Director can get in certain circumstances, and that 11 although the Remuneration Committee had approved the 12 change and had requested that the Chief People Officer 13 ensure that the appropriate approval from the 14 Shareholder took place, that approval did not take 15 place. So I'm certainly aware of that one. 16 Q. And do you have an idea of what the other one was? 17 A. I can't recall, I'm sorry. 18 Q. At the bottom we see: 19 "[Minister Hollinrake] mentioned that [Mr Staunton] 20 asked previously to effectively double [Nick Read's] 21 pay. [Minister Hollinrake] said he was not willing to 22 agree to this as not only is the Post Office publicly 23 owned but it is also under huge financial pressures. 24 [Mr Hollinrake] asked [Henry Staunton] if this request 25 came from [Mr Read] and [Mr Staunton] said that this 12 1 isn't the case." 2 Again, was that something that you were aware of? 3 A. I wasn't aware about the request to double pay but 4 I knew there had been discussions around Mr Read's pay. 5 Q. We may hear evidence next week from Mr Staunton to the 6 effect that Mr Read was obsessed with his pay. What's 7 your view on that? 8 A. He certainly did take an interest in his pay. That is 9 absolutely correct, yes. 10 Q. I mean, everybody takes an interest in their pay. 11 A beyond average interest? Unusual interest? 12 A. Yes, I would have said, considering the background 13 against which we were operating, when I would have 14 considered it was, you know, a highly sensitive matter, 15 and we needed to be more circumspect, I think sometimes 16 Mr Read did ask for information about his pay and bonus 17 opportunity et cetera which I might not have expected. 18 Q. Looking at the range of issues here that we've just 19 seen, if we scroll back to the previous page, the 20 reference of a third time that mistakes had been made. 21 The underlying issues that you were investigating, do 22 you think it is common or uncommon for a business of the 23 Post Office's size to have these kinds of issues? 24 A. It's uncommon, but most organisations do not run 25 remuneration committees in the way this one is set up. 13 1 Q. And can you assist us with what you mean by that? 2 A. In public companies, normally what happens is that your 3 policy is reviewed every three years and approved by 4 shareholders and you are entitled to operate within that 5 policy and you do not need to go back to shareholders 6 each time you want to make a pay rise, for example, 7 provided it is within the policy. 8 Here we're very restricted and have to go to the 9 Shareholder if we want to change something. 10 Q. And when you say "the Shareholder" do you mean the 11 Department for Business? 12 A. Yes. 13 Q. And you see that as a problem? 14 A. It makes it more complicated and as say, more unusually 15 restrictive for the Committee. So it's something that 16 I've certainly had to get up to speed on in the way that 17 this organisation operates, and there are a lot of rules 18 and regulations that we have to follow, such as managing 19 public money, et cetera and it is very complex. So in 20 the end I had to have drafted a table showing exactly at 21 what point we need consent for what. 22 Q. We may get to it, but in due course the Chair will have 23 to be making recommendations. Is there anything that 24 you would recommend to overcome that issue? 25 A. I think it would -- well, I think first of all, one of 14 1 the things we have been missing is a very clear strategy 2 and normally strategy sets the direction for bonuses and 3 for setting metrics and long-term bonuses, as well. 4 With the lack of that, we have struggled somewhat to put 5 in place appropriate metrics, and I'm really looking 6 forward to having that resolved through the current 7 strategic review, because I think once we have a clear 8 direction, it'll be much easier for the Remuneration 9 Committee to set sensible targets. 10 Q. I appreciate this is a difficult question to answer but 11 do you think the executive pay at the Post Office is 12 sufficient? 13 A. I think it depends from whose perspective you're looking 14 at. I think from the postmaster's perspective it would 15 certainly look to be more than sufficient. If you are 16 running a charity, for example, and obviously we have 17 a clear social purpose, it would be more than 18 sufficient. If you are running a public company, then 19 it would be less sufficient. So I think it depends on 20 the circumstances. 21 Q. Do you think it's sufficient to attract somebody of good 22 enough calibre, good enough quality, to lead the 23 organisation? 24 A. Some people definitely would not be attracted because of 25 the package, it would put people off. Others might be 15 1 more attracted because of the social purpose of the Post 2 Office. So just like you can get fantastic Chief 3 Executives running charities, they don't necessarily do 4 it for the pay, they're doing it for other reasons. So 5 I think you have to look in the market in a particular 6 way. 7 Q. And in your view, looking forward to the future, is it 8 sufficient? 9 A. I would hope so. As I say, I think the constrains on 10 what we're able to do might put people off. So for 11 instance, normally you would expect to be able to give 12 a regular salary increase in line with the overall 13 workforce. Here, we're not able to do that. We have to 14 keep going back for consent. So I would hope, as part 15 of the discussions around the future of the Post Office, 16 we might be able to come to a more sensible arrangement 17 where we take some of the issues away from the sort of 18 adversarial nature between ourselves and the 19 Shareholder. 20 Q. Thank you. On the same topic, and still dealing with 21 issues of the involvement of the Department for Business 22 can we please have a look at BEIS0000656, please. This 23 is still addressing your report, your review. We're now 24 on 25th May. It's another meeting with 25 Minister Hollinrake if we scroll down, please. We see 16 1 there are a number of people in attendance including 2 Lorna Gratton, the UKGI director and the Non-Executive 3 Director Shareholder. There is a section at the 4 beginning of the meeting that addresses the bonus issue. 5 Can we scroll, thank you. 6 "NR [so Mr Read] explains that the [Post Office] 7 Board had an emergency meeting last night to review the 8 report written by Amanda Burton, the new Chair of RemCo, 9 into the issue. He summarised the main themes of 10 discussion during the board meeting." 11 I'd just like to take those one by one. 12 "LG [Lorna Gratton] pushed hard for [you] to change 13 the tone of the report so it shows more remorse, and 14 [you] said [you] would reflect on it." 15 What do you recall of that conversation? 16 A. There was a Board meeting where I presented my draft 17 report to the Board, and a number of comments were made, 18 not just from Ms Gratton but from others as well. And 19 I was very keen to ensure that this was my report and 20 put in my words. So that's why I said I would reflect 21 on it. It wasn't meaning to say that I didn't agree 22 that, you know, the tone was right or not right, but 23 I just wanted to make sure that the words were mine. 24 Q. And did you amend the report following that discussion? 25 A. I did. 17 1 Q. Can you give us -- we'll look at the report shortly. 2 You don't have to give us the exact words but what kind 3 of thing did you change? 4 A. Certainly I reviewed the actions following the comments 5 made and I think I made one or two changes to the action 6 plan. 7 Q. In terms of the overall tone, though, did you change 8 that? 9 A. I did, yes. 10 Q. How? 11 A. I -- well, I put in the wording that you see now in 12 relation to that the metric was entirely inappropriate. 13 Q. The second bullet point: 14 "The Chair was keen that the report has clear 15 actions and [Ms Gratton] put for one of them to be 16 removing bonus metrics to do with the inquiry." 17 A. That's correct. 18 Q. And was that implemented? 19 A. Yes. 20 Q. Third: 21 "There was lively debate about handing back the 22 bonus. [Mr Read] had spoken to everybody involved, 23 suggesting that they return the money. From a legal 24 perspective, the approach will be voluntary not 25 mandatory. [Mr Read] will engage with the SMT further 18 1 on this and provide an update." 2 Were you aware of what the "lively debate" was? 3 A. I think it was more a discussion as to whether we could 4 rely on clawback or not. And Mr Read did express, you 5 know, concerns that people were being asked to hand back 6 their bonus, but actually, everybody did so. 7 Q. And was it a lively debate? 8 A. I -- 9 Q. "Lively" suggests that there was strong differences of 10 opinions or strong views? 11 A. I can't -- no, not in my recollection. Not in that 12 respect, no. 13 Q. Can we please turn to RLIT0000342. And this is your 14 final report. Is that right? 15 A. Correct. 16 Q. If we scroll down slightly, we can see on that first 17 main paragraph under "What has been reviewed?", it says 18 at the final sentence of that paragraph: 19 "Following commission of the report to 20 Minister Hollinrake on 26th May 2023, some additional 21 clarification has been requested and this final report 22 reflects that clarification where I have been able to 23 give it." 24 Can you assist us with what that was addressing? 25 A. Yes. The Minister did make some comments and I'm sorry, 19 1 I now can't recall entirely what they were, but again, 2 I reflected on them but as I say, I was very keen to 3 make sure this was my report. 4 Q. On coming into the business and being new in the 5 business, was this level of involvement from the 6 Shareholder Non-Executive, from the Minister, did that 7 strike you as unusual in any way? 8 A. Yes, I was quite surprised by it. 9 Q. Did you have any concerns in that regard? 10 A. My concern was that I am an independent Non-Executive 11 Director and I wanted to remain so, and the reason that 12 I've been asked to do this report was because I was 13 completely new to the organisation and didn't come with 14 any knowledge of the personalities involved et cetera, 15 and I wanted to retain that independence. 16 Q. And -- 17 SIR WYN WILLIAMS: You may have already mentioned this, but 18 was it Mr Staunton personally who asked you to do it, or 19 a number of people involved, or what? 20 A. Yes, it was Mr Staunton, yes. 21 SIR WYN WILLIAMS: Yes, fine. Thanks. 22 MR BLAKE: Thank you. From this experience can you assist 23 us with anything to do with the culture vis-a-vis, for 24 example, the Shareholder or the Department for Business 25 more broadly? 20 1 A. It certainly seemed quite a difficult relationship. 2 I think because of some of the mistakes that had 3 happened in the past and now this as well, I think the 4 Department had lost confidence in the ability of people 5 within Post Office to manage remuneration issues. 6 Q. So on the one hand, as you describe, you had more 7 involvement by Shareholder and Government than in other 8 companies you're used to, but at the same time, there 9 was a feeling amongst that that Shareholder that things 10 hadn't been going right? 11 A. Correct. 12 Q. Can we please turn to page 7, the bottom of page 6 on to 13 page 7. I'll skip through, but there's a whole section 14 there that sets out the timeline and your views as to 15 how things progressed over time and how it was that the 16 metric became inserted and accepted. 17 We then move to "Findings", I'm just going to take 18 you paragraph by paragraph here. If we scroll down 19 slightly, I think the first finding is essentially that 20 it was a one-off scheme and that's something you've 21 already set out for us. 22 Paragraph 2 you highlight issues there with clarity; 23 is that right? 24 A. Correct, yes. 25 Q. And what were those issues, briefly? 21 1 A. The scheme was over-complicated and there were far too 2 many metrics. Normally remuneration committees prefer 3 to have very clear line of sight and very short, a few 4 number of metrics. There were too many, it was very 5 complicated in terms of how they were going to be 6 reviewed, it was almost like a complete industry going 7 on in the background, which I would not normally expect 8 to see. 9 Q. Was that in any way symptomatic of any other issues 10 within the business that you've experienced? 11 A. I do think the business can be very bureaucratic, and 12 things take a long time, as a result. And there are 13 sometimes, as I say, a lack of clear line of sight as to 14 what you're attempting to achieve, which does cause 15 confusion. 16 Q. If we scroll down to paragraph 3 I'll just read from 17 paragraph 3, it says: 18 "However, the wording of the first submetric was 19 completely inappropriate once the Inquiry was placed on 20 a statutory footing and the timelines moved 21 considerably." 22 Was that wording that you had added following the 23 conversation that we have just seen or was that there 24 before? 25 A. That was there before. 22 1 Q. "In hindsight it was clearly inaccurate to suggest that 2 Sir Wyn would be in any way involved in determining 3 whether any part of the bonus had been achieved. There 4 was no deliberate intention on anyone's part to mislead 5 the role of Sir Wyn in this matter." 6 Do you think you had a sufficient evidential basis 7 to reach that conclusion? 8 A. As far as I could tell, there was no deliberate 9 intention. As I say, I was doing this on my own. I had 10 no support, and I didn't want to particularly talk -- 11 I know it may sound very strange but I didn't 12 particularly want to talk to the individuals involved, 13 because I was just concerned that people would have 14 their own perspective, which might then cloud my 15 judgment. So I very much relied on the documents. 16 Q. Because I think one of the other findings either in this 17 report or in the Simmons & Simmons report is that there 18 was a fundamental lack of documentation of the entire 19 process. Given that finding and given that you didn't 20 speak to anybody, do you think that you had a sufficient 21 basis to reach that conclusion? 22 A. As far as I can tell. 23 Q. Looking back at it now, are you content with that 24 conclusion or would you have put it differently? 25 A. I have not come across anything that suggests to me that 23 1 anybody was deliberately misleading. 2 Q. Thank you. It then says: 3 "Having said that, numerous people both inside and 4 outside [the Post Office] saw the wording over many 5 months, and no one questioned it. The wording was 6 substantially the same in the letter to the Permanent 7 Secretary, the February 2022 Remco and the DRR. I do 8 not find the grouping of the 6 submetrics into 4 as 9 being material ..." 10 The next paragraph, paragraph 4, essentially finds 11 that the Shareholder was involved in the process; is 12 that a fair rough summary of that paragraph? 13 A. UKGI, yes. And the Shareholder itself also signed off 14 the bonus. As I say, everything has to be signed off by 15 the Shareholder, and this did go through a process and 16 was signed off by the Shareholder. 17 Q. Then paragraph 5, my summary of it is that it should 18 have been revisited once it was obvious that it no 19 longer applied. But it wasn't deliberate. Is that 20 a fair summary? Is there something else that you would 21 add in summary of paragraph 5? 22 A. No; as I say it continues to be a mystery to me as to 23 why nobody spotted the problem but I have not discovered 24 anything that would suggest that it was deliberate. 25 Q. If we turn over the page, please, we have "Conclusions 24 1 and Recommendations", if we scroll down: 2 "In conclusion, the rationale for TIS looks sound 3 and the Shareholder was consulted in July 2021." 4 Again, revisiting that from the evidence you gave 5 earlier today, I think you have a slightly more nuanced 6 position than the fact that it looked sound? 7 A. In relation to that submetric, yes. 8 Q. Yes. 9 "However, the TIS became too complex with 17 10 submetrics, and many people involved in the drafting and 11 approval process over a long period of time. It is 12 difficult to understand why the Inquiry first submetric 13 was not questioned by anyone, and yet seen by so many 14 people. However, having taken into account the 15 discretion available to RemCo and the confirmation 16 I have received that RemCo considered that there had 17 been very good progress in supporting the Inquiry, 18 I consider that the decision made should be taken in 19 that light." 20 In essence, the Committee exercised their discretion 21 irrespective of the fact that it wasn't met in any 22 event; is that your finding? 23 A. Correct, yes. 24 Q. If we scroll over the page, you set out a list of 25 recommendations. One of them, the first one: 25 1 "Variable pay schemes, whether short-term or 2 long-term, need to be simple, transparent and clear. 3 2: "The timeline between the initial proposal, 4 design and approval of variable pay schemes needs to be 5 shortened as it does not make sense to have schemes 6 being debated months (even a year) after the awards 7 should have been made. 8 3: "When assessing whether metrics have been 9 achieved, there needs to be a clear audit trail ... 10 4: "The RemCo must assess whether any metrics remain 11 valid if circumstances change ... 12 5: "RemCo needs to be mindful of all stakeholders 13 when putting in place new schemes, when determining the 14 outturn and when reporting on reward due in the DRR. 15 6: "[Post Office] needs to reengage with the 16 Shareholder. Just reading the RemCo minutes and 17 background information, I can see that a large amount of 18 time is taken in schemes being drafted at a detailed 19 level but I think we need better engagement at the macro 20 level ... 21 7: "The RemCo will review the terms of the 2022/23 22 STIP when it meets later in June and I will be 23 recommending that RemCo exercises its discretion not to 24 award the element of bonus specifically relating to the 25 Inquiry." 26 1 Have those proposals been implemented? 2 A. Most have. I would say number 6 is the one that we need 3 to work on, but that would make most sense once we have 4 a clear strategy which hopefully will be agreed by the 5 Shareholder because I think then that will put into 6 context what we hope to achieve through bonus schemes. 7 Q. Thank you. In terms of an apology, I understand that 8 there was an apology to the Inquiry. Did there need to 9 be an apology to subpostmasters? 10 A. Yes. 11 Q. Why do you say that? 12 A. Because this did cause unnecessary distress. It just 13 means that Post Office once again looks as though it's 14 not listening and not being sympathetic and 15 understanding of the issues. 16 Q. Are you aware of an apology being issued to 17 subpostmasters? 18 A. I do believe that on the website there was some 19 information addressed to the postmasters, from memory. 20 Q. Do you think enough was done to apology to 21 subpostmasters in respect of this particular issue? 22 A. Probably not. 23 Q. Can we please turn to POL00447839, please. This is 24 a Remuneration Committee evaluation report produced on 25 3 July 2023, so after the production of your review. 27 1 Can you give us a little bit of background as to why 2 this was produced? 3 A. Yes, it's perfectly normal practice every year to review 4 the Board itself and each committee. This was an 5 evaluation done before I joined. So this report came to 6 this committee, but it had already taken place. And the 7 purpose of this was to look at what the proposed actions 8 were. 9 Q. If we scroll down to the recommendations, so these 10 recommendations had already been drafted before your 11 report, had they? 12 A. They had. 13 Q. And in some ways they are consistent with your report? 14 A. Correct. 15 Q. So if we look at paragraph 1: 16 "It is recommended the committee focus greater 17 efforts to ensure that remuneration structures and 18 packages are simplified." 19 And that coincides with one of your recommendations? 20 A. That's correct. 21 Q. "The quality of papers/presentations submitted to the 22 Committee from management require improvement." 23 Do you know what went wrong prior to your time, that 24 there were such difficulties in the paper trail? 25 A. There had been a churn of Chief People Officers, and 28 1 people in their teams as well. And so I think there was 2 just a lack of memory and new people turning up all the 3 time, it meant that things got lost. And clearly, it's 4 important to document things, have good minutes, and 5 minutes that reflect the decisions. And I just think 6 some things got rushed through and were poor quality. 7 Q. An issue that we've been looked at in previous phases is 8 a potential failure to pass on information to people who 9 come into the business. Is this a wider concern that 10 you have? 11 A. Yes, I -- well, the Board is very new, for example, and 12 so we don't have the corporate memory and therefore are 13 having to rely on others quite a lot. And you wouldn't 14 expect to see the churn of staff that we are seeing, for 15 understandable reasons. But it does make it harder, and 16 it makes it harder to get that paper trail. 17 Q. And is this simply a fallout of the historic scandal or 18 is there something wider that you're concerned about 19 within the business that leads to those issues? 20 A. I think the Post Office is under a lot of stress as an 21 organisation, not just because of the Inquiry and 22 what -- the awful things that have happened in the past, 23 but just also, it's at a bit of a crossroads in terms of 24 its future, and that, even in a stable organisation, 25 would cause some issues. 29 1 Q. If we scroll down, please, to page 5. We can see at 2 paragraph 10 or box 10: 3 "Please include any thoughts you have about the 4 operation of the Committee and any ideas for its future 5 operation." 6 It says: 7 "More to do to get a better timetable of 8 decision-making; 9 "More to go to balance, reward, fairness and 10 affordability; 11 "More to go to simplify reward structures; 12 "Trust needs to continue to be built between the 13 Executive and the Committee -- a focus on 14 engagement/listening/incentivisation would be helpful; 15 "The interplay with Shareholder approval remains 16 a significant working issue for the Committee -- in 17 particular the level of approvals required for any 18 executive board comp." 19 Was this drafted before your report? 20 A. Yes. I think these are comments from individual members 21 of the Remuneration Committee. 22 Q. And does this in some way coincide with the concerns you 23 have already raised? 24 A. Correct. 25 Q. "There seems to be much merit in trying to simplify the 30 1 incentive plans." 2 And it's this last paragraph I'd like to spend a bit 3 of time on: 4 "The appointment of a new head of HR provides an 5 opportunity to reset the relationship with the 6 committee. It must be recognised that the environment 7 in which the company is operating and pressures it is 8 under (both internal and external) make the job of the 9 HR team and RemCo difficult." 10 What do you understand by those concerns about the 11 environment? 12 A. It's acknowledging that people are under stress, and how 13 you continue to motivate them, not necessarily through 14 pay, but in other ways, to ensure that people stay and 15 do a good job. 16 Q. "Turnover in the HR team also means that corporate 17 memory is sometimes missing. However, it has been 18 disappointing that some decisions which should have been 19 taken at RemCo have not (eg certain senior exec exit 20 packages)." 21 Can you assist us with that, please? 22 A. I actually can't. I don't know what that is 23 particularly referring to. 24 Q. Are you aware of any individuals amongst the former 25 Executive Team being paid when exiting the company, and 31 1 authorisations hadn't been through the usual channels? 2 A. With the help of people in HR, I have -- and actually, 3 Mr Ismail also prompted me to have a look at some 4 particular examples. Unfortunately a lot of these 5 people because they'd left I obviously didn't know them 6 and wasn't necessarily sure where to look. But we 7 looked through the documents just to check whether there 8 had been issues with whether the Remuneration Committee 9 should have signed off or not. 10 The ones that I saw, I could you see that the 11 Remuneration Committee had been consulted. Some of the 12 decisions looked potentially a bit odd, but they had 13 been consulted. 14 Q. In broad terms what was odd about the decisions? 15 A. Just in the way that some of the exit packages were 16 proposed. But as I say, a discussion had clearly gone 17 through the Remuneration Committee. I didn't sit on it 18 at that time. I assume they had good reasons for 19 agreeing to the proposals. 20 Q. It says: 21 "In addition, the process of STIP LTIP design 22 continues to a problem. More interaction before the end 23 of the previous [financial year] would speed up 24 framework design and would help with the creation and 25 presentation of the supporting papers on the metrics 32 1 themselves. As a result, the quality of RemCo papers 2 has been poor and decisions delayed for too long." 3 Again, that's much in line with your evidence so 4 far? 5 A. Correct. 6 Q. Can we please turn to POL00448606. We're now moving to 7 the 5 August this year and this is an email from 8 yourself to the Postmaster Non-Executive Directors. And 9 you say: 10 "Further to [your] email of 26th July I have had 11 a look back through RemCo meetings and also got some 12 further information from Nic Marriott. All of the below 13 happened when Angela Williams was Chief People Officer. 14 Most of the arrangements were signed off by RemCo 15 although having gone through the papers I think that 16 they sometimes lacked clarity and there wasn't 17 consistent sign-off." 18 You say: 19 "As you know, Ian and I have worked hard to put in 20 place better governance around senior pay and we are all 21 determined to learn from the past." 22 Is this the email that you were just referring to? 23 A. Correct. 24 Q. Can you assist us, insofar as you haven't already 25 covered it, what the governance concerns were regarding 33 1 senior pay? 2 A. Just following the policies and procedures, so sometimes 3 retrospective approval had to be given which wouldn't 4 normally happen, and I just think that some of the 5 proposals could have been better thought through. 6 But as I say, I've found that RemCo was aware -- 7 RemCo is only responsible for very senior pay packages, 8 so there will be people that fall below this, but as 9 I say, I think that there clearly needs to be 10 a tightening up of the processes, more clarity on the 11 policies. We have been doing all that. I would hope 12 that we are in a better place. 13 Q. What do you see as the cause of that issue? 14 A. I think, again, it is a sign of an organisation under 15 some stress. And a sign of the fact that some people 16 were interims, so Mrs Williams, for example, was an 17 interim. I say lack of corporate memory, and I think 18 also just a lack of understanding of the environment in 19 which we were operating. 20 Q. Can we now turn to that Simmons & Simmons review, that's 21 at POL00363154. It's the August 2023 review that was 22 carried out. Can you assist us with a bit of background 23 as to why this was carried out? 24 A. This was carried out at the request of 25 Minister Hollinrake so this was not a Post Office 34 1 report; this was done by the Government. And it was -- 2 they were instructed pretty shortly after I was also 3 asked to do my review, but their conclusions came up 4 later. 5 Q. And can you assist us with why there were the two 6 reviews, then: your review and this review? 7 A. I'm afraid I wasn't party to the decision on 8 Simmons & Simmons because as I say, it was outside of 9 Post Office. I'm guessing it would have been because of 10 this lack of trust in relation to what was happening in 11 the Post Office. 12 Q. And do you agree with the findings in this report? 13 A. We come at our conclusions in a different way, but 14 I think we both conclude in similar fashion. 15 Q. Perhaps we'll go through a few recommendations and a few 16 findings and we can see -- if we turn over the page, 17 please, we can see the background. Over the page again, 18 thank you. 19 "We have been asked by the Minister to conduct an 20 independent review into the governance practices of, and 21 decisions made by, the Post Office's ... Remuneration 22 Committee in relation to the remuneration metric known 23 as the Inquiry Support Target ..." 24 If we scroll down, that's the section I took you to 25 earlier. The summary of findings can be found on 35 1 page 4. They say: 2 "Before addressing our findings, it is important to 3 note that the Inquiry moved on to a statutory footing on 4 1 June 2021 and was, from that point, anticipated to 5 finish in the autumn of 2022. Neither RemCo nor [Post 6 Office] Human Resources appear to have recognised the 7 significance of this change and particularly the 8 consequences that the performance that the Inquiry 9 Support Target incentivised would now be compelled by 10 law. 11 "Had that been considered and appropriately 12 addressed by RemCo, then the issues that we have 13 considered in this review would not have arisen because 14 the target would likely not have been approved either at 15 all, or certainly not in its final form. A number of 16 those ... we have spoken with have acknowledged that in 17 hindsight." 18 Is that a finding that you agree with? 19 A. I do. 20 Q. Yes. If we scroll down, thank you. At 1.13. 21 "Findings in relation to [the Post Office's] 22 governance around remuneration: 23 "From the evidence we have seen, we conclude that 24 there are aspects of [the Post Office's] governance 25 around remuneration that would benefit from further 36 1 consideration and enhancement because they do not align 2 with best practice for a private corporation. However, 3 those findings ought to be balanced against the facts 4 that [the Post Office] is a public corporation and 5 therefore has particular requirements that are different 6 to those of a private corporation. Our recommendations 7 are therefore focused on maximising the effectiveness of 8 [the Post Office's] governance around remuneration." 9 Do you agree with that? 10 A. I do. 11 Q. Is there a tension there between the two? 12 A. There is to some extent, yes. We do try and comply with 13 the code on corporate governance, which is designed for 14 private corporations and public limited companies. But 15 there are certain issues which we can't comply with. 16 For instance, the make-up of Remuneration Committee 17 members and, as I say, we have to go consistently to the 18 Shareholder for approval for any changes. 19 Q. And is that a problem? 20 A. I just think it does create extra work, and perhaps 21 extra focus on pay, which, to be honest, we don't need. 22 I think if there was more flexibility done in a proper 23 way, and absolutely aligned to a strategy, that would 24 really assist. 25 Q. Thank you. If we scroll down, I'm just going to skip 37 1 through these findings quite quickly: 2 "Findings in relation to the Inquiry Support Target. 3 "Because there is more than one way in which to 4 interpret the target we consider there was a justifiable 5 basis on which RemCo could decide that it had been 6 achieved and there was therefore a justifiable basis on 7 which to make the award." 8 Do you agree with that? 9 A. Yes. 10 Q. "The Post Office is not able to evidence the basis on 11 which RemCo awarded [the] bonuses including the Inquiry 12 Support Target, because there are no written records of 13 the rationale for its decision and the recollections of 14 those involved are inconclusive. This means that it is 15 practically impossible to ascertain the basis for 16 RemCo's decision in respect of the Inquiry Support 17 Target. The fact that RemCo's decision making was not 18 better recorded is a clear governance failing, including 19 on the part of the RemCo members who should have 20 identified that the minutes were deficient." 21 Do you agree with that? 22 A. I do. 23 Q. Does that concern you? 24 A. Well, it was clearly something that needed to be 25 rectified, because I think you always have to ensure 38 1 that the documents are there so that when you hand over 2 to the next person, it's very clear why those decisions 3 were made. 4 Q. 1.17: 5 "We have also concluded that [the Post Office] 6 intended the Inquiry Support Target to be validated 7 internally and we have found that it did not intend for 8 a confirmation specific to this target to be obtained 9 from Sir Wyn Williams or his team. 10 "The language of the Inquiry Support Target was not 11 considered or discussed in the course of RemCo preparing 12 the Directors' Remuneration Report which RemCo approved 13 for inclusion in the annual report and accounts." 14 Et cetera. 15 I think you've said that your conclusions are 16 slightly different to these. What do you see as the 17 fundamental difference between the two here? 18 A. They are broadly the same. I think they just added one 19 or two more which we adopted as part of the Remuneration 20 Committee, and we have also tracked now the 21 recommendations from the Grant Thornton report as well, 22 which came out later. 23 Q. Thank you. So we see below here the Summary of 24 Recommendations. Have you taken forward those 25 recommendations? 39 1 A. Yes. 2 Q. If we scroll over the page we can see some more. Again, 3 do you feel that you have sufficiently implemented those 4 recommendations? 5 A. Yes, we have. 6 Q. Can we please turn to POL00438390. We're moving now to 7 23 April this year and this is an email that we've seen 8 before with Mr Ismail. It's an email chain where you 9 emailed the two Non-Executive Director subpostmasters. 10 If we scroll down. we can see you say: 11 "I welcome your views on the following. The 12 Remuneration Committee is discussing what would be the 13 most appropriate metrics for the long-term incentive 14 scheme. We have asked management whether there is 15 a target we could put in to improve the customer 16 experience or improve footfall ..." 17 If we scroll up, we can see the response from 18 Mr Ismail. He says: 19 "I have received your email, and I appreciate the 20 opportunity to provide input on the subject. In regards 21 to the [long-term incentive plan] I suggest the 22 following factors: 23 1: "Postmaster profitability; postmaster 24 remuneration percentage increase; reduction in central 25 overhead costs; increase in footfall that leads to 40 1 profitability; commercial deals made over the period and 2 their payback; postmaster survey results over the last 3 three years; cultural changes from the postmasters' 4 perspective. 5 "I am disappointed with the management's suggestion 6 as postmasters have limited control over customer 7 complaints and they are aware of this. I am willing to 8 discuss this further and would like to know if it's 9 possible to have similar input for the [short-term 10 incentive plan]." 11 Can you assist us with the background to that is 12 email exchange? 13 A. Yes. The Remuneration Committee had been looking at the 14 targets for the long-term incentive scheme, and felt 15 that we ought to have one in that related to customers, 16 because we are obviously a customer-facing business. It 17 proved remarkably difficult to receive some sensible 18 proposals, and eventually the retail team suggested one 19 to do with customer complaints. The Remuneration 20 Committee were rather surprised by this and didn't feel 21 that this would be an appropriate metric, and I took it 22 upon myself to ask Mr Ismail and Mr Jacobs myself, 23 because I really valued their input, which was why this 24 email was sent. 25 So I did it as an open question because I just 41 1 wanted to test whether my thoughts were correct. 2 Q. And what's your view of his proposals? 3 A. Some of these are actually already in the short-term 4 incentive scheme. So some are more appropriate for 5 short-term schemes and some of them are in the long-term 6 scheme. So it was good to see that broadly, even though 7 he wasn't aware of the details, that we were in 8 agreement. 9 Q. Looking at, for example, those final two bullet points, 10 do you think that there is a sufficient emphasis on 11 postmasters' feedback on cultural change? 12 A. Certainly in the metrics, there are metrics to do with 13 the postmaster survey results, and they have been for 14 a while, actually. It's not just the current schemes. 15 I think, when we determine the strategy, it will be much 16 clearer to look at the cultural changes. I just -- 17 that's what I talked about before. I think we've been 18 a little bit hampered by the fact that we haven't got 19 a clear strategy. 20 Q. We've heard some evidence that a slightly rosy picture 21 is painted of the postmaster survey results amongst the 22 Board. Are you aware of that? 23 A. Yes. 24 Q. And has that happened? 25 A. Sorry? 42 1 Q. The first question was: are you aware of that complaint? 2 A. Yes. 3 Q. Are you aware of it actually happening? 4 A. That there's a rosy picture? 5 Q. Yes. 6 A. I do think that when the last postmaster survey was 7 presented to the Board, it was perhaps done in a light 8 that did look a little skewed, whereas when you read the 9 actual survey results, you could see that the views of 10 postmasters were quite polarised and I think more should 11 have been done to bring those out to the board meeting. 12 Although as I say, we actually did see the results 13 ourselves. 14 Q. Why do you think it is that a rosy picture is painted of 15 those kinds of things at board level? 16 A. Well, you would probably have to ask the people who 17 presented what was in their minds, but sometimes what 18 can happen is that people do feel that they are expected 19 to give a positive outlook on things, but, you know, 20 it's important that the Board sees the background 21 papers, and is able to challenge. 22 Q. I want to move on to the topic of whistleblowing and you 23 as the Speak-Up Champion. You have been Speak-Up 24 Champion since August of 2023; is that right? 25 A. That's correct. 43 1 Q. Perhaps we can just have a look at a document by way of 2 background. It's POL00448689. This is an email to 3 Mr Staunton that just pre-dates your time as Speak-Up 4 Champion. Can you just assist us with what a Speak-Up 5 Champion is? 6 A. Yes, the Post Office decided, as part of the 7 recommendations that came out of the judgments, that 8 there should be a board member who is Speak-Up Champion. 9 And the role is not to do the investigations myself -- 10 although, as I'm sure we'll come on, there is one 11 exception to that -- but to ensure that the policies and 12 processes are properly run, and the Board has confidence 13 that people feel able to speak up, and they know the 14 channels in which they can speak up, and that there will 15 be no detriment to them if they do speak up. 16 Q. Thank you. 17 This email is from somebody calling themselves 18 John Doe, it would be a remarkable coincidence if that 19 is their actual name. It looks like an anonymous 20 whistleblowing email or an email that's entitled 21 "Whistleblowing". It's Mr Staunton, and it says as 22 follows: 23 "I am writing to you directly because I don't trust 24 the Post Office whistleblowing process and escalations 25 into Nick Read have not been dealt with. This email 44 1 will also be sent to Sir Wyn Williams and Darren Jones. 2 "The disaster of NBIT is well known across different 3 levels within the business. Recently a number of people 4 have raised concerns to Nick Read that have been 5 ignored. More than one individual is aware and has told 6 Nick the Board have been told untruths by the NBIT team 7 and the [Chief Information Officer] about the extent of 8 defects timescales for R2 rollout that now wouldn't be 9 delivered until August, if then." 10 So this email in the first instance raises concerns 11 about the NBIT programme. Were those concerns that you 12 were aware of prior to seeing this document? 13 A. I knew that there were concerns as to whether the 14 timetable would be achieved, and that the costs were 15 increasing. 16 Q. If we scroll down, there are concerns raised about the 17 governance in place for NBIT. If we scroll over the 18 page, please, the letter says: 19 "Anyone who questions the CIO or Programme Director 20 are badged as difficult and troublemakers when in 21 reality it's a case of having the experience to see the 22 mistakes being made and wanting to do the right thing. 23 These people are bullied either into staying quiet or 24 there are campaigns to undermine them. This is exactly 25 what happened in the past when people too scared to 45 1 speak up and say what's really going on because of the 2 repercussions even from Nick." 3 So there's a complaint there about bullying; is that 4 right? 5 A. Yes. 6 Q. If we scroll down to the final paragraph, there's 7 a complaint there about criticism of the Chief 8 Information Officer again, suggesting that he's open 9 about misleading the Board with inaccurate dates and 10 costs for NBIT and is incapable of making a decision or 11 having a difficult conversation. 12 Could we scroll over the page, please. There's 13 criticism directly of Mr Read again. 14 "Nick Read has openly acknowledged and accepted the 15 failings of some of his [Group Executive] team to more 16 than one employee that's been to him to express 17 concerns, but has taken no action to deal with it. He 18 is also aware of toxic behaviour from senior leaders and 19 again does nothing to address it even when he's 20 witnessed it directly. He refuses to make the difficult 21 decisions and nods along when people raise concerns, 22 saying everything they want to hear, but then does 23 nothing to resolve it. He is aware he has senior people 24 in role not doing what they should like Jeff Smyth, and 25 again does nothing to manage or deal with it even though 46 1 it's a waste of public money." 2 There's then a concern raised about the culture of 3 the business, regarding treatment of junior and female 4 employees. 5 If we scroll down, there's another paragraph, and 6 more criticism of Mr Read. 7 "Nick made comments last week to the senior team 8 about the horrific behaviours of the people who were 9 part of the Horizon debacle especially if they are still 10 in the business. He doesn't seem to see how much of 11 this is still going on and it feels like he's doing 12 exactly what those people did before saying if you were 13 here in the past you need to go regardless of the 14 situation." 15 That's echoing some of the evidence that we heard 16 earlier this week from the Non-Executive Director 17 subpostmasters. 18 "A lot of people are also saying this is 19 hypocritical when he doesn't manage his own team or 20 their behaviour. He has lost the respect and support of 21 a lot of senior leaders in the business by failing to 22 address known issues, allowing unacceptable behaviours 23 and backing poor performing and inappropriate members to 24 his own team. There is a common perception that his 25 priority is clinging on to his job by his fingertips 47 1 rather than actually leading the business in any way 2 ..." 3 Et cetera. 4 This email, I think it's an email, is then discussed 5 at a board meeting. Could we please turn to POL00448509 6 and that's a board meeting of 5 July 2023. Am I right 7 to say that is the email that was discussed at this 8 board meeting? 9 A. That's correct, yes. 10 Q. Thank you. We see there that you are in attendance, 11 5 July 2023. And the second item, after the welcome and 12 conflicts of interests, et cetera, is entitled 13 "Speak-Up". And it says: 14 "The Chairman spoke to the above materials ..." 15 There seems to have been an email from the Head of 16 Investigations and an email from Mr Foat that were being 17 discussed in this context. 18 A. Yes. 19 Q. "... noting the advice provided by [Mr Foat] and 20 [Mr Bartlett] and advised that he had replied to the 21 whistleblower. The Chairman shared his view that some 22 of the allegations raised did not appear to be strictly 23 whistleblowing issues and that it may be in order for 24 the Board to consider a different approach to address 25 allegations of this nature." 48 1 If we scroll over the page, please, we then have 2 Mr Read advising that he was of a similar view and set 3 out his perspective on the allegations. 4 Now, just pausing there, do you think it's 5 appropriate for Mr Read to be addressing the Board in 6 relation to those allegations when, as we've seen, 7 a fair amount of that criticism was directed towards 8 Mr Read himself? 9 A. Yes, I can see that there may be circumstances where it 10 is inappropriate, however the whistleblowing was on 11 a variety of topics where we did need the Chief 12 Executive's input because certain decisions were going 13 to have to be made. 14 Q. If we scroll down, please, we have some views from 15 yourself over the page. It says there: 16 "AB advised that she thought the proposed changes 17 all sounded very sensible, however noted the significant 18 amount of activity going on in the business and that for 19 employees it was not always clear as to what the 20 priorities were. AB queried who would have 21 responsibility for this. [Mr Read] advised that whilst 22 historically this had been T McInnes, this would be part 23 of the Chief of Staff's role and that the Chief of Staff 24 would work with the business to undertake a governance 25 and meeting cadence overview to ensure alignment with 49 1 accountability and decision-making process." 2 Can you assist us with what your concerns were as 3 expressed there? 4 A. That we needed proper organisation. This was going to 5 be a considerable amount of work to look into the 6 whistleblowing allegations, and that we needed to make 7 sure it was sensibly staffed up, because otherwise we 8 would once again add additional workloads to people and 9 they wouldn't necessarily understand what the priorities 10 were. And these allegations were clearly very serious, 11 and needed proper focus. 12 Q. There's suggestion there that this would be the Chief of 13 Staff's role. Did that happen? 14 A. I believe that she does look at the allocation of roles 15 and responsibilities and projects within the 16 organisation. 17 Q. Ah, so investigating the issues wasn't the Chief of 18 Staff's role; it was -- 19 A. No, no, no. 20 Q. -- their role to decide who would take it forward? 21 A. Yeah, yeah. Well, to make sure that people had the 22 right bandwidth. If they needed to drop things to be 23 able to help with this investigation, then who was going 24 to take up the work they were doing, for example? 25 Q. Are you aware of this investigation being undertaken? 50 1 A. Yes. 2 Q. Has it concluded? 3 A. No. 4 Q. Can you assist us with who is undertaking this 5 investigation? 6 A. This particular one is being done by Grant Thornton. 7 Q. Thank you. If we scroll over to page 5, we see there an 8 action point. 9 "SJ [that's Simon Jeffreys] advised that the Board 10 also needed to appoint a whistleblowing champion. The 11 Chairman invited Board members to express their 12 interests in this role by way of to the Chairman. SJ 13 emphasised the need for the Board to make sure an 14 individual with the right profile was appointed for this 15 position." 16 Now, this was the board meeting of 5 July. I think 17 you've said that you became whistleblowing champion in 18 August. Did you put yourself forward after this 19 meeting? 20 A. I did, yes. 21 Q. Were you the only person that put yourself forward, as 22 far as you're aware? 23 A. As far as I'm aware, yes. 24 Q. And why did you want to take up this role? 25 A. I -- well, I suspected that nobody else would volunteer 51 1 and it clearly needed to be done, so I thought I would 2 be able to do this role on top of my other roles. 3 Q. Why do you think others wouldn't volunteer for that 4 role? 5 A. Just because of the amount of time everyone was already 6 undertaking in their various roles. I was still 7 relatively new to the organisation, and I had been 8 involved in whistleblowing issues for other 9 organisations, so I did have some background in this 10 regard. 11 Q. Thank you. Could we please turn to POL00447997. This 12 is the speak-up policy and it's version 9.0. Do you 13 know if this is the most up-to-date version? 14 A. It is. 15 Q. Was it developed prior to you taking up that role? 16 A. There was a speak-up policy in place but it was revised 17 several times, I think. I think this was May? Yes. 18 Q. Yes, if we scroll over the page and look at the very 19 bottom, at the very bottom of the page it has "Group 20 Policy Speak Up_May 24"? 21 A. Yes. 22 Q. So you have been involved in the drafting of this 23 document, or the finalising of this document? 24 A. Well, just understanding what it said and whether we 25 needed to make some changes, yes. 52 1 Q. Can we turn to page 3, please, and it sets out there the 2 core principles. I'll just read out the first few 3 bullet points, it says: 4 "The [Post Office] will treat Speak-Up disclosures 5 consistently, fairly, appropriately, and professionally, 6 and afford the protections from the Public Interest 7 Disclosure Act ... reporters raising a genuine concern 8 will be protected from reprisals, even if they turn out 9 to be mistaken; 10 "Encourage the reporting of any concerns as soon as 11 possible in the knowledge that [Post Office] will take 12 all concerns raised seriously and investigate them 13 fully. Concerns will be kept confidential and disclosed 14 only on a 'need to know' basis." 15 3: "The Speak Up team will seek to not reveal 16 a Reporter's identity outside of the team without the 17 prior agreement of the Reporter. However, there may be 18 occasions when details need to be shared where there is 19 a risk of harm to the Reporter or others or where we 20 need to do so for legal or regulatory reasons, or are 21 required to disclose documents to the Post Office 22 Horizon IT Inquiry. 23 "[Post Office] will promote and publicise how staff 24 can raise these concerns;" 25 And: 53 1 "That [Post Office] will provide a training and 2 awareness programme to ensure all employees are aware of 3 the Speak Up policy and procedure." 4 Is this a policy just for employees or does it 5 extend to subpostmasters? 6 A. It does extend to postmasters as well but I agree that, 7 actually, on reflection, we could be clearer on that. 8 But if you look at the top, it does say that it's the 9 right thing for colleagues and postmasters. 10 Q. So with regards to actively promoting and publicising, 11 for example, the Inquiry has carried out a survey and 12 there were some issues with the knowledge of either the 13 fact that you are able to report a whistleblowing 14 concern, or how to. Do you have any future plans in 15 this regard? 16 A. Well, obviously we've already reviewed the survey that 17 was done and I'll definitely be taking that up, yes. 18 I mean, it is clear that some postmasters do know about 19 the Speak Up because they are speaking up, but obviously 20 we need to do more to make sure that everyone is aware. 21 MR BLAKE: Thank you. 22 Sir, that might be an appropriate moment to take our 23 morning break. 24 SIR WYN WILLIAMS: All right. 25 MR BLAKE: Can we come back at 11.35, please. 54 1 SIR WYN WILLIAMS: Yes, by all means. 2 MR BLAKE: Thank you very much. 3 (11.19 am) 4 (A short break) 5 (11.37 am) 6 MR BLAKE: Thank you, sir. 7 I'm going to move on to the topic of the dismissal 8 of Mr Staunton. This is the first time that we have 9 dealt with this in any depth in the Inquiry. The 10 allegation that we're going to look at has been dealt 11 with already in a Parliamentary committee and the 12 various names that we're going to deal with has already 13 been dealt with publicly, and I think you set that out 14 in your witness statement. 15 Who is Jane Davies? 16 A. She was the previous Chief People Officer. 17 Q. Thank you. And I think you've said in your witness 18 statement that your paths had previously crossed? 19 A. That's correct, yes. 20 Q. In June 2023 I think you've said that following 21 a probationary period she wasn't offered a permanent 22 position at the Post Office? 23 A. That's correct. 24 Q. And you've set out at paragraph 19 that she subsequently 25 wrote to Mr Staunton, so far as you're aware, and that 55 1 Mr Staunton later shared with you and Mr Tidswell a copy 2 of a draft letter from her solicitors which raised 3 concerns regarding Mr Read; is that right? 4 A. That's correct. 5 Q. Now we won't go through the complaints one by one but 6 can you assist us in broad terms what was the nature of 7 the complaints? 8 A. The complaints were partly to do with potential 9 discrimination, partly to do with bullying, and partly 10 to do with not dealing with poor performance, amongst 11 others. 12 Q. You've said in your statement that there was a view that 13 it was shared in an attempt to secure more favourable 14 terms. Can you help us with who held that view? 15 A. Mr Staunton. 16 Q. On 4 September of 2023 you've said that this became 17 a formal whistleblowing report and that you oversaw the 18 investigation because by that stage you were the 19 Speak-Up Champion; is that right? 20 A. That's correct, yes. Mr Staunton asked me to do that 21 role. 22 Q. Was this entitled "Project Rose"? 23 A. Yes. Rose 2, I think it is. Sorry, we have so many 24 projects, it's sometimes difficult to remember, but 25 I think it's Rose 2. 56 1 Q. You've said in your statement that Lorna Gratton also 2 asked to be involved. Can you assist us with why she 3 wanted to be involved? 4 A. Because this related to the Chief Executive it was 5 obviously something that was going to be of interest to 6 the Shareholder. 7 Q. You've set out in your statement that the Post Office 8 was advised by Pinsent Masons and a barrister, Ms Tutin; 9 is that correct? 10 A. That's correct, yes. 11 Q. You say you became aware that Henry Staunton was also 12 the subject of one of the complaints. The original 13 complaint that you saw hadn't named Mr Staunton; is that 14 correct? 15 A. No, it just referred to a board member making some 16 inappropriate comments. 17 Q. There came a point at which he became subject of an 18 investigation. Can you assist us with when, if the 19 4 September was the whistleblowing report, we know that 20 there was a Teams call in January of 2024. Can you 21 assist us with when it became known to you that 22 Mr Staunton was part of that complaint? 23 A. From memory it was sometime in November. So it was as 24 a result of Ms Tutin meeting with Ms Davies to go 25 through her complaints. 57 1 Q. And how did you come to be aware of that information? 2 A. Pinsent Masons informed us. 3 Q. Did you have at that point in time any conversations 4 with any members of the Board about that particular? 5 A. Well, Ms Gratton was also aware because she was also 6 part of the overseeing process. And we spoke to 7 Mr Tidswell as the Senior Independent Director, as we 8 felt that we would have to investigate these further 9 allegations, and that Mr Staunton needed to be aware. 10 Q. And again, in broad terms, what was the nature of those 11 allegations? 12 A. It was to do with remarks in relation to a recruitment 13 process for a Non-Executive Director and they concerned 14 a potential gender matter and a racist matter. 15 Q. It might be suggested that those complaints about 16 Mr Staunton were taken further than Ms Davies had 17 intended, perhaps to get rid of the chair. What's your 18 view on that? 19 A. No, not at all. Clearly, if those comments had been 20 made, they were not appropriate for a very senior person 21 within the organisation and we felt that we absolutely 22 could not ignore the fact that this had now been brought 23 to our attention. 24 Q. It might be suggested that the complaint was principally 25 and overwhelmingly concerning Mr Read's conduct rather 58 1 than Mr Staunton's, and that there was undue focus on 2 Mr Staunton because he didn't fit a particular mould. 3 What is your view on that? 4 A. No, that is not correct. The focus clearly was on 5 Mr Read because most of the allegations related to him. 6 Q. Paragraph 26 of your witness statement, you say that 7 Mr Staunton made repeated attempts to have the 8 investigation stopped. Can you assist us with the 9 sequence of events there? 10 A. Yes. Over several weeks, he spoke to myself, to 11 Ms Gratton, to the Chief People Officer, to the General 12 Counsel, and generally being very firm that we should 13 stop the investigation. He did this under the guise 14 that it was causing a great deal of stress to Mr Read, 15 and that he felt that this was unfair and therefore the 16 investigation should stop. 17 Q. Why do you say "guise"? 18 A. Because we were obviously also aware that there was an 19 investigation into his own remarks. 20 Q. And is it your view that he was asking to stop the 21 investigation because it concerned him rather than his 22 concern regarding Mr Read? 23 A. That thought did cross my mind, yes. 24 Q. You've described it as a guise. You said it crossed 25 your mind. Is it your belief that that is why? 59 1 A. Yes, it did seem coincidental that as soon as 2 Mr Staunton had been informed that there was also an 3 investigation into him, that these conversations took 4 place. 5 Q. And can you please take us through, step by step, your 6 understanding of what Mr Staunton is said to have done 7 in respect of trying to stop that investigation? 8 A. As I say, he had conversations with a number of people. 9 He also tried to delay his own interview with the 10 barrister. 11 Q. How would you describe the conversations that he had, so 12 far as you're aware, from discussions with those 13 individuals? 14 A. That they were quite of an aggressive nature. 15 Q. To who? 16 A. Particularly to the General Counsel and to the Chief 17 People Officer. 18 Q. Are you aware of the content of that conversation? 19 A. That he was just adamant that the investigation had to 20 stop, and that people were not supportive of management, 21 and that they should follow what he recommended. 22 Q. Is this, for you, just an issue with an individual, or 23 does it say something more significant about the Post 24 Office as a business? 25 A. Bearing in mind the absolute requirement to have a good 60 1 functioning speak-up facility, it would be entirely 2 inappropriate to stop an investigation once somebody had 3 spoken up. It's really important that the process is 4 followed through, no matter who that relates to. 5 Obviously it's difficult when more senior people are 6 involved, just because of the nature of it but you still 7 have to absolutely go through same process. And so this 8 was not to do with individuals; this was to do with 9 absolutely following the policy. 10 Q. Irrespective of the particular complaint on this 11 particular occasion, does this incident itself, do you 12 think, tell us anything about the broader business? 13 A. I think it tells me something about Mr Staunton's view 14 of speak-ups. I don't think he necessarily appreciated 15 how important it was that we followed the process. 16 Q. One matter you've highlighted in your statement is 17 you've said that there's an issue that the Board can't 18 get rid of the Chair. What's that concern? 19 A. That's to do with the governance arrangements with the 20 Shareholder, so it is the Shareholder who decides who is 21 appointed and if that person needs to be removed. 22 Q. Ordinarily, how would you have expected this matter to 23 have been dealt with at board level? 24 A. I would have expected that there would have been an 25 ability in the articles for the other directors to be 61 1 able to agree to remove a director. That's normally 2 what you would see. 3 Q. Again, looking forward to the future in terms of 4 recommendations, is there anything that you consider 5 there should be changed about the position? 6 A. I think it would be more -- it would be appropriate to 7 review the articles and really consider what makes most 8 sense to be kept within the remit of the shareholder and 9 what makes most sense to be kept with the directors. It 10 is quite difficult, when you're expected to be 11 a director of a company and be independent but then have 12 one arm tied behind your back. 13 Q. Does the same situation apply to the Non-Executive 14 Directors as it does to the Chair in terms of removal? 15 A. From memory, yes. The -- well, certainly the 16 Shareholder approves all appointments and I am pretty 17 sure has to agree to removals. 18 Q. Thank you. Can we please turn to POL00448674. This is 19 an email from Mr Tidswell of 16th January this year, to 20 Mr Staunton, with you copied in. He says: 21 "As promised, I have spoken with Amanda. She agrees 22 with my suggestion that it would be sensible in all the 23 circumstances (and particularly bearing in mind the 24 intense pressures on Nick) for the Board to review the 25 allegations raised by Rose about Nick, with a view to 62 1 categorising them ..." 2 And he sets them out. 3 Just looking at this first paragraph it does seem -- 4 this is prior to Henry Staunton's departure -- as though 5 there was a concern about the pressures on Nick Read? 6 A. Oh, absolutely, which I also shared. This was during 7 the time when obviously there had been the ITV 8 programme, Mr Read had to appear before the Select 9 Committee. There was a lot of media scrutiny. There 10 was a lot of stress within the organisation, and yes, 11 Mr Read was under -- and of course this investigation 12 going on, as well -- and it would be very surprising if 13 someone didn't feel under stress in those circumstances. 14 Q. In those circumstances, how can you be confident, as 15 confident as you are, with regards to Mr Staunton's 16 motives? 17 A. I think he was genuinely concerned about Mr Read. 18 Q. Is there a "but" there? 19 A. No, no, I genuinely do think he was concerned about 20 Mr Read, yes. 21 Q. I think your evidence earlier was that that wasn't his 22 principal motivation? 23 A. That was my opinion but I also definitely think he was 24 concerned about Nick, yes. 25 Q. Number 1: 63 1 "Allegations where we think there is documentary 2 evidence which is sufficiently unequivocal that 3 Marianne Tutin [the barrister] can be asked to confirm 4 her conclusions without the need to interview Nick. The 5 most obvious applies to the two points about the bonus 6 multiplier, which I looked at in detail for my interview 7 and where the documents are plain in showing the 8 allegation is wrong." 9 Very briefly, what was the issue about the bonus 10 multiplier? 11 A. That was the matter that I referred to earlier when 12 there had been -- the process hadn't been entirely 13 followed to get shareholder consent. But that was 14 actually all well documented, so I think that was behind 15 Mr Tidswell's thinking that because there was a clear 16 document trail, that perhaps we could narrow down some 17 of the things that Ms Tutin was going to interview him 18 about, because at this stage, Mr Read had not been 19 interviewed. 20 Q. 2: 21 "Allegations where the subject matter is not of 22 sufficient significance to warrant an investigation 23 process. This might (without wanting to second-guess 24 the Board) include items such as Angela Williams working 25 for two companies for a period (which was common 64 1 knowledge) and the decision to award her leave status 2 (which may feed into (1) above). The Board may then 3 feel comfortable in asking Marianne not to continue to 4 investigate these matters." 5 Again very briefly what were those matters? 6 A. This was Ms Williams, who was the interim CPO. She was 7 due to leave the organisation, and was asked to stay on 8 for a period, by which time she'd already taken on 9 a position in another company. So I understand that 10 Mr Read agreed she could try and juggle the two jobs for 11 a period. 12 Q. Number 3: 13 "Allegations not falling into 1 or 2 above which may 14 still need some degree of investigation but which ought 15 to be relatively limited in number and scope and perhaps 16 can be managed with Nick more easily. 17 "Amanda makes the point that Marianne is carrying 18 out a dual exercise of gathering material to defend the 19 claim which we understand has been issued. Presumably 20 Nick would be happy to discuss items in (1) or (2) if 21 she needed his input, as long as it was understood that 22 they were no matters under investigation?" 23 Can you assist us, was it an independent 24 investigation that was being carried out by the 25 barrister or was it something else? 65 1 A. No, this was an independent investigation. 2 Q. And can an independent investigation be carried out 3 whilst also gathering material to defend a claim? 4 A. This, perhaps, is slightly clumsy wording, but what was 5 meant by this was that it was the same issues were 6 raised for the Employment Tribunal. So rather than 7 creating two lots of work, the purpose was to make sure 8 that the same points were covered. 9 Q. Thank you. It then says: 10 "If you think this might be workable and valuable in 11 reassuring Nick, I think the next step is to get Lorna 12 involved." 13 Et cetera. 14 This then brings us, in terms of the dates, we are 15 also at the same time as what we know as Project 16 Pineapple. Can we please turn to POL00448300. And it's 17 page 2. Over the page, please. Thank you very much. 18 So this is going on at a very similar time when we 19 are back a couple of days, January 14th now. 20 In your view, should we read in anything to the 21 timing of the Project Pineapple email to the issues that 22 we've just been discussing? 23 A. I don't believe so. 24 Q. Do you consider this Project Pineapple email to be 25 a whistleblowing complaint? 66 1 A. It certainly raises grievances. 2 Q. And under your policy, of which you've been involved, 3 would it qualify as a whistleblowing complaint? 4 A. We did not treat it as that. Instead it went through 5 a grievance process through HR. 6 Q. And why is that? 7 A. Because we felt these were grievances being raised by 8 Mr Ismail and Mr Jacobs. 9 Q. It says there: 10 "Saf said that the views expressed by Richard Taylor 11 and previously by management and even members of the 12 Board, still persisted -- that those [postmasters] who 13 had not come forward to be exonerated and were 'guilty 14 as charged'. Something needs to be done." 15 He then names other individuals, Martin Roberts and 16 certain members of his team were singled out. 17 "Equally, Saf and Elliot are fed up with the amount 18 of power wielded by Ben Foat." 19 Do those matters qualify as whistleblowing 20 complaints? 21 A. Potentially they could be but as say, we considered them 22 to be a grievance. 23 Q. And what do you see is the difference between 24 a whistleblowing complaint and a grievance? 25 A. A grievance will be to do with issues like bullying or 67 1 other sort of HR matters, and this seemed to us to be 2 more to do with how people were behaving in the 3 organisation. 4 Q. A fundamental cultural issue about presuming that 5 subpostmasters are guilty as charged, do you consider 6 that to be a grievance or a matter for the 7 whistleblowing policy? 8 A. I think it could fall into either category, to be 9 honest. 10 Q. The reason I ask is we know that this email was 11 subsequently forwarded by Mr Read to individuals who 12 were named in the email. Do you see that as a breach of 13 the confidentiality obligations of your Speak-Up Policy, 14 if not in letter, at least in theory? 15 A. Um, yes. 16 Q. Because I think you have raised issues of, for example, 17 Mr Staunton's disclosure to Parliament in relation to 18 Ms Davies' complaint. 19 A. (Witness nodded) 20 Q. Isn't disclosure, it might be said that disclosure of 21 this email is very much in a similar category to that? 22 A. Yes, it was immensely unfortunate. 23 Q. And do you think those actions, for whatever reason, 24 might discourage others from coming forward? 25 A. Potentially, and we were also concerned about the 68 1 complaints against Mr Read being made public for the 2 same reason. So we did put out a communication to 3 everyone to reassure them that this is not the normal 4 process, and our expectation is to keep things 5 confidential until the moment when there might be 6 a reason to make something public. 7 Q. Were things going quite wrong in mid-January 2024? 8 A. It was certainly a very difficult period. 9 Q. Could we turn, please, to POL00448301. This is the 10 email that we've seen before from Mr Staunton to the 11 Non-Executive Directors. He says: 12 "Nick confirmed that he had sent the confidential 13 note to the independent [Non-Executive Directors] 14 entitled Project Pineapple to Ben and Martin amongst 15 others. This note containing the private comments of 16 our postmaster [Non-Executive Directors] ..." 17 And this email also addresses the fact that Nick was 18 under huge pressures: 19 "... a lot on his mind ... he understands it was 20 a serious lapse and was very apologetic." 21 Were you aware of any apology being made to the 22 Subpostmaster Non-Executive Directors? 23 A. I know that the postmaster, in line with the Executive 24 Directors, definitely wanted an apology from Mr Read and 25 I understand they feel they did not get one. 69 1 Q. And were you -- 2 A. I think he did it more in the context of the 3 circumstances in which he accidentally forwarded the 4 note. 5 Q. Are you aware of any corrective action within the 6 business to make sure that this kind of issue doesn't 7 crop up again? 8 A. Well, unfortunately it's almost impossible to prevent 9 someone forwarding something that they shouldn't do. 10 But what is important is for people to pause a moment 11 before they press the "send" button and make sure they 12 see what the attachments are. 13 Q. Does this, once again, go to some sort of an overall 14 cultural issue within the organisation? 15 A. As I say, the organisation has been under huge stress. 16 Mr Read himself was very stressed at this point, and 17 I just think he just sent it without really realising 18 what was attached. He hadn't meant to send the embedded 19 attachments. 20 Q. If that can come down. On the same day, an issue arose 21 regarding the appointment of the Senior Independent 22 Director. You've addressed that at paragraph 44 of your 23 witness statement. Can you previously explain to us 24 what the issue was there? 25 A. Yes. Mr Tidswell, who was the Senior Independent 70 1 Director at the time, had given notice that he intended 2 to leave the Post Office, and so it would be necessary 3 to find a replacement. 4 Now, that replacement could either be someone 5 internal or appointment of a new person. The 6 Shareholder advised the Board that they wanted this 7 person to be externally appointed and to have some sort 8 of Government type background. 9 Q. And what was the view of the Chair? 10 A. The -- well, in the initial discussions at the Board, 11 the Chair agreed to that. But he then seemed to change 12 his mind. 13 Q. And do you know why? 14 A. He said it was because there were so many issues facing 15 the Post Office that we didn't need yet another matter 16 which would involve people being distracted in 17 interviewing, et cetera and so felt it would be more 18 appropriate to appoint somebody internally. 19 Q. And was your view that that view was legitimately held? 20 A. I could absolutely understand the rationale for trying 21 to reduce the number of things that were going on in the 22 Post Office, because there were just huge amounts. 23 However, there had been a very, very clear steer from 24 the Shareholder as to what they wanted, and it seemed to 25 me that this was not the moment to -- I think I said the 71 1 words "pick a fight" -- with the Shareholder. 2 Q. If we could bring on to screen your witness statement 3 WITN11330100. It's paragraph 45, page 13, that I'd like 4 to ask you about. Thank you. Page 13, paragraph 45. 5 You say there: 6 "I had various discussions with Mr Tidswell and 7 Ms Gratton as this was yet another example of 8 Mr Staunton's inappropriate conduct. It is well 9 accepted that cultural change starts at the top. The 10 Post Office was in the very unfortunate position of 11 having a Chair of the Board who was acting contrary to 12 best practice." 13 Can you expand upon that, please? 14 A. Yes, well, we have already discussed the issues in 15 relation to Mr Staunton trying to persuade people to 16 stop the investigation into Mr Read. He had also, I had 17 been told, shouted at the General Counsel in an 18 open-plan situation, so other staff could see. And he'd 19 had various conversations with the Chief People Officer, 20 which had led her to consider that she might need to 21 resign. 22 Q. Thank you. 23 We have heard this week from the Subpostmaster 24 Non-Executive Directors who broadly paint a positive 25 picture of Mr Staunton's commitment to the involvement 72 1 of subpostmasters, for example. Why do you think it is 2 that there is this gulf of views with regards to 3 Mr Staunton? 4 A. I think it is correct. Mr Staunton absolutely wanted 5 the -- a better future for the postmasters. He wanted 6 resolution of the historical compensation process. 7 I completely agree with all those comments. I don't 8 think we're inconsistent in that. 9 Q. The suggestion might be made that he was more on the 10 side of the postmasters than other members of the Board 11 and that it's effectively the establishment getting rid 12 of him. What's your view as to that? 13 A. No, I don't think that's correct. As I say, I genuinely 14 believe he wanted to do the best for the postmasters but 15 I think he got very frustrated with the fact that we're 16 a public corporation and some of the policies and 17 processes we have to follow, and perhaps wasn't the 18 right person for this particular role. 19 Q. Thank you. I'd like to move on quickly to Past Roles 20 and Phoenix. Can we bring up on to screen POL00448297. 21 This is an email that we've seen from Mr Jacobs raising 22 concerns that current employees who are still in the 23 business and were involved in the Horizon scandal are 24 still employed. There's another number of emails along 25 the same lines chasing up action. It seems as though 73 1 action is not taken, certainly in their view, swiftly. 2 Were you aware of the differences between Past Roles 3 and Phoenix? 4 A. Not initially. I think it was all a little bit confused 5 as to what we were actually talking about, so it did 6 take a while for the Board to understand that there were 7 two different types of people. 8 Q. And in your view, was there sufficient priority given to 9 both of those projects? 10 A. No, I think we could have been a lot quicker. I think 11 this was a very difficult topic, but at some point 12 decisions have to be made. 13 Q. And looking at the present day, do you think there has 14 been sufficient action taken in that regard? 15 A. It is definitely improving. 16 Q. What's your view of the "Suspend now" proposal that was 17 put forward by Mr Ismail and Mr Jacobs this week? 18 A. I think, again, it depends on the individual concerned. 19 As you know, there are a range of different employees 20 involved in these matters, and I think it would be very 21 unfair for some, and others it might be more 22 appropriate. 23 Q. I mean, there are some names that we've heard mentioned 24 where it's certainly in the view of the Subpostmaster 25 Non-Executive Directors they would clearly fall within 74 1 a category of wrongdoers. Why do you think they haven't 2 been suspended? 3 A. I think because the People Team have been going through 4 a particular process and didn't feel that there was 5 sufficient information to warrant a suspension. 6 Q. Have you heard the term "untouchables" being used by 7 Mr Read? 8 A. I have. 9 Q. And what was your understanding as to that term at the 10 time it was used? 11 A. I heard it in relation to 18th January meeting this 12 year. From memory, the context was Mr Staunton said 13 something like "As Nick describes, there are certain 14 people who are untouchables", and Mr Read agreed with 15 that comment. 16 Q. So in your view, the term came from Mr Staunton rather 17 than Mr Read? 18 A. Yes, but I think he was quoting Mr Read. 19 Q. Ah. Thank you. And what did you understand that to 20 mean? 21 A. I understood that -- well, there was, again, confusion 22 as to quite what this referred to and there seemed to be 23 different names attached to it. But it seemed to 24 suggest that there were certain people who were above 25 normal policies and processes, and that action wouldn't 75 1 be taken against them if action was necessary. 2 Q. And in your understanding, who did that relate to? 3 A. On 18 January, the reference was to Mr Bartlett. 4 Q. And was there another occasion when it was in reference 5 to somebody else? 6 A. I believe it was in relation to potentially the previous 7 investigators. 8 Q. Have you personally done anything to challenge that? 9 A. It's definitely not a -- I know there was concern as to 10 whether this was a sort of word used generally in the 11 organisation, and I have definitely not heard it 12 anywhere else. And in my personal view, you definitely 13 can't have people who are untouchable. That is -- just 14 makes a very unhealthy organisation if that's the case. 15 Q. And as Speak-Up Champion, have you done anything to see 16 whether there is any substance to that allegation? 17 A. Well, the very fact that we are running multiple 18 investigations into people and indeed investigated the 19 allegations in relation to the Chair and the Chief 20 Executive, I would hope would underpin confidence that 21 there are no people who are untouchable. 22 Q. On a related subject, looking at the investigations and 23 the Investigations Team, we've heard evidence, for 24 example, from Mr Jacobs, who is subject to an 25 investigation himself. Who is responsible for oversight 76 1 of that Investigations Team, so far as you're aware? 2 A. It was the General Counsel. 3 Q. Do you consider that the Board has sufficient oversight 4 in respect of, for example, the recovery of apparent or 5 alleged shortfalls? 6 A. I think it's something we definitely need to review. We 7 are -- the Board as a whole is getting more information 8 now and there are regular updates to the Board around 9 the number of investigations. But I think it would 10 really benefit us to sort of really stand back and 11 review some of the processes. 12 Q. You'll have seen in your pack in preparation for today 13 various correspondence between Mr Read and Fujitsu, 14 regarding the provision of witness evidence in criminal 15 proceedings. Was that something that you were aware of 16 before preparing for the Inquiry? 17 A. Yes. I don't think I saw that correspondence, but I -- 18 from memory, Mr Woodley did describe the correspondence 19 to the Board. 20 Q. And what is your view now, having seen that 21 correspondence, of the approach that was taken by Post 22 Office Investigators? 23 A. I think some of the -- we should look at some of the 24 language that's used, and I think people just need to 25 stand back and understand what it is they're trying to 77 1 achieve. We do need to get a balance, in terms of being 2 confident that where there actually has been wrongdoing, 3 the police want to look into something, that we are able 4 to provide evidence to the police. I think we need to 5 get that better into balance? 6 Q. And what in particular are your concerns relating to the 7 particular correspondence that you've seen. 8 A. I think, although the term "victim" would be understood 9 in the criminal context, I think just in the -- the fact 10 that we have got our own background to this, we just 11 need to really review how we approach things. 12 Q. Thank you. 13 I'm just going to deal with a few small 14 miscellaneous topics before we finish, before I move on 15 to subpostmaster questions. 16 Governance issues. Grant Thornton. Were you aware 17 of any changes being made to the Grant Thornton report 18 before it was finalised? 19 A. As you'd expect, a draft was put before the Board, and 20 I also saw the draft of the remuneration element, 21 because obviously I'm very interested in that. And we 22 were given an opportunity to comment and if we thought 23 that some of the information was incorrect, to ask Grant 24 Thornton to reconsider and that is entirely what you 25 would expect in these sort of reports. So that process 78 1 happened. 2 Q. Is there any content that was changed that you consider 3 the Inquiry should be aware of or concerned about? 4 A. I think the first report was actually just too long, and 5 we also wanted to focus on the actions that were going 6 to come out of it. 7 Q. Are there any aspects of that report that you don't 8 agree with? 9 A. From memory, no. I have adopted all the proposals for 10 the Remuneration Committee, as I mentioned before, we 11 now have a tracker for the numerous corporate governance 12 proposals for remuneration. 13 Q. Moving on to NBIT. Have you seen the results in the 14 YouGov survey regarding technical issues still being 15 experienced by subpostmasters? 16 A. I've had a very, very quick look, unfortunately I've had 17 a very busy week for other companies, but yes, I did 18 have a quick look. 19 Q. Have you seen or heard about the concerns raised by 20 Mr Jacobs and Mr Ismail about the current system as 21 well? 22 A. In their evidence? 23 Q. Yes. 24 A. No, I haven't been able to watch all their evidence, I'm 25 afraid. 79 1 Q. The kinds of issues that have been identified, ongoing 2 issues with the Horizon system, is that something that 3 you have been made aware of at board level? 4 A. Yes, we are aware of issues. I would also say it would 5 be highly -- in my experience, highly unusual if there 6 weren't issues with computer systems. That is partly 7 the nature of the beast. 8 I think what's more concerning is how those issues 9 are dealt with. 10 Q. With regards to the new system, what are the key issues 11 that you're aware of that are of concern to the Board? 12 A. Well, there's a broad one in terms of usability. It's 13 a very, very old-fashioned system. It wouldn't help us 14 moving to a more digital world, for example, it's not 15 user-friendly. We couldn't sort of allow customers to 16 input their own data into it, for example. So there's 17 lots of things from a practical, commercial point of 18 view. It really does need changing. There are issues 19 with, I believe, screen freezes, et cetera. 20 Q. Sorry, you're talking about the Horizon system? 21 A. Yes. 22 Q. In terms of the NBIT system, the new system -- 23 A. Oh, I'm so sorry. 24 Q. -- what are the concerns of the board? 25 A. There are various concerns. One that it's overrun on 80 1 budget; two, that it's taken much longer than we were 2 expecting; and three, that some of the back end 3 processes are not as they should be. 4 Q. I think the Inquiry had understood from submissions made 5 in October 2022 that the Post Office planned on retiring 6 Horizon by 2024. And there's a document in your bundle, 7 I don't think we need to get it up on to the screen but 8 by 21st November of 2023, the Post Office sought to 9 extend the Horizon contract to 2030. Can you assist us 10 with what caused that change of circumstance? 11 A. Yes. There'd been some external reports into the system 12 as it was being developed, which made us pause for 13 thought as to the direction on insourcing, outsourcing, 14 et cetera. And these are quite fundamental issues which 15 need time to be addressed, and obviously we felt we 16 would need the further support of Fujitsu for a further 17 period to allow us to get into a better place. 18 Q. Who do you consider has ultimate responsibility for on 19 the one hand the delay, and on the second hand, the cost 20 of the new system and how both of those are out of line 21 with projections? 22 A. Well, the ultimate responsibility is with the Board. 23 Q. And is it your view that the Board failed to properly 24 scrutinise those issues, that they were provided with 25 incorrect information, or something else? 81 1 A. I think we were not given the right information in terms 2 of the complexity of some of the issues facing NBIT, and 3 therefore the knock-on consequences of time and money. 4 Q. And who didn't provide the correct information? 5 A. People in the IT Team. 6 Q. Is there anybody in particular? 7 A. I'm not hugely familiar with the IT Team so I'm sorry, 8 but I think Zdravko Mlandenov would be one name. 9 Q. Thank you. I think we have the full spelling of that 10 name? 11 A. Sorry, yes, I'm sure I've mispronounced it. 12 Q. Compensation and redress. You've said in your statement 13 you're pleased that the Government has moved to 14 exonerate all postmasters, and the speed of the 15 compensation process. Do you know what steps have been 16 taken by the Post Office to identify those who were 17 prosecuted who haven't yet come forward? 18 A. Yes, communications are going out to a broad audience to 19 try and see if we can capture those who haven't made 20 a claim so far. 21 Q. Do you think the steps that have been taken so far are 22 sufficient? 23 A. I'm sure there's always more that can be done. I would 24 hope, though, with the publicity generally around this 25 matter, that postmasters who haven't yet made a claim 82 1 are now fully aware that they can do so. 2 Q. One entirely miscellaneous question. It relates to 3 paragraph 51 of your statement, where you say that there 4 are too many versions of the contract. What do you mean 5 by that? 6 A. This is the franchise agreement with postmasters. You 7 would expect there just to be one, but there seemed to 8 be numerous ones which I don't think is -- and also 9 potentially not entirely known who signed what. So 10 that, obviously, is not appropriate. 11 Q. And has that been addressed? 12 A. Not yet, no. I would hope that following the strategic 13 review, once we know what direction we're going in, then 14 we will be able to revisit what is an appropriate modern 15 franchise agreement. 16 Q. Quite a lot of emphasis today has been placed on the 17 strategic review and what it may offer. When is that 18 going to be taking place? 19 A. We've had a very first high-level look at it very 20 recently. More work is being done and then we will be 21 consulting with the Shareholder because it's really 22 important that we get the Shareholder's agreement. 23 Q. Are we talking months, years? 24 A. No, no, hopefully by the end of this year. 25 MR BLAKE: Thank you. 83 1 Sir, I don't have any further questions. I know 2 there are questions from Mr Henry and Mr Jacobs. 3 SIR WYN WILLIAMS: All right, let them ask them. 4 MR BLAKE: Thank you. 5 Questioned by MR HENRY 6 MR HENRY: Thank you, sir. 7 Ms Burton, you would agree that the degradation of 8 the subpostmasters by wrongful prosecution or fraudulent 9 civil suit is an atrocious chapter in the Post Office's 10 history? 11 A. I certainly would. 12 Q. And so therefore this Inquiry is examining the Post 13 Office's turpitude, its myriad wrongdoing, and its 14 failure over many years to treat the subpostmasters with 15 dignity and justice. You would agree? 16 A. I agree. 17 Q. And knowing that, when the Inquiry's subject matter is 18 the raw material of human misery, and how the Post 19 Office inflicted that, how could it ever be appropriate 20 for very senior management to be enriched with bonuses 21 arising from an examination into the Post Office's own 22 wrongdoing? 23 A. This was a new team that had been brought in, who were 24 not there at the time that these awful events happened, 25 and I understand it was felt important that they 84 1 absolutely focused on what was required to ensure that 2 the Inquiry could undertake the job in hand. 3 Q. New team or not, how could it ever be thought right that 4 very senior management be rewarded for cooperating with 5 the Inquiry, an inquiry into the Post Office's historic 6 and arguably continuing misfeasance? 7 A. As I say, I wasn't there when the metric was set, but 8 the Remuneration Committee felt it was an appropriate 9 metric at that -- have I just gone quiet -- at that 10 stage, this was a public inquiry, not a statutory 11 inquiry. Definitely by the time it became a statutory 12 inquiry, it was not appropriate. 13 Q. Well, irrespective of whether it was a non-statutory or 14 statutory inquiry, nobody questioned the propriety of 15 the scheme, did they? 16 A. As I understand it, no. 17 Q. And it was only until after there had been public 18 outrage after the publication of the annual report and 19 accounts that there was then a realisation that this was 20 potentially misconceived; would you agree? 21 A. I would. 22 Q. But you were still then of the view, at the time of 23 finalising your report, that such an incentive scheme 24 was acceptable, weren't you? 25 A. Not that particular submetric, but the rest of it, yes, 85 1 which was not to do with the Inquiry. 2 Q. But the bonus metric, you accept, should never have been 3 countenanced so far as that specific factor was 4 concerned, regardless of whether the Inquiry was 5 statutory or not? 6 A. I'm sorry, I don't think I entirely followed your 7 question. Sorry. 8 Q. Well, you -- I thought I understood -- and forgive me if 9 I am wrong -- that it is now with hindsight that you say 10 the bonus metric for alleged cooperation with the 11 Inquiry should not have been countenanced, and that is 12 regardless of whether the Inquiry was on a statutory 13 footing or not. 14 A. Correct. 15 Q. Right. Now, how did this happen because the predicate 16 for the bonus that the Inquiry metric had been achieved 17 and had been endorsed, no, less by the Chairman of the 18 Inquiry? This was grossly inaccurate, wasn't it? 19 A. It was. 20 Q. And anyone paying the slightest attention during the 21 whole process of devising or constructing this incentive 22 or checking the annual report and accounts ought to have 23 realised this. 24 A. They should. 25 Q. Yet, and correct me if I am wrong, you never reached 86 1 a conclusion on how these serious misrepresentations 2 were made, not least, of course, that the Chairman had 3 signed off on the metric, did you? 4 A. No. 5 Q. No. So there is no explanation in your report on how 6 a multitude of very senior executives, the Board and its 7 advisers, RemCo in particular, allowed this to happen 8 with blatantly false information being published in the 9 annual report and accounts? 10 A. That's correct, and I couldn't find any reason for it. 11 Q. Now I know that you were unassisted, but I mean you must 12 have asked these questions. Did you encounter 13 opposition, or did you encounter blank faces with people 14 saying, "I can't remember"? I mean, the fact that you 15 reached no conclusion on this matter calls into question 16 the efficacy of the study you conducted? 17 A. No one was able to explain to me why they had missed it. 18 I did ask the question, and everyone accepted they just 19 didn't focus on it. I do not know why. 20 Q. So it looks, from the complexity and the intricacy of 21 all of the equations, et cetera, et cetera, that an 22 enormous amount of time was devoted to constructing 23 this, yet nobody can explain to you why this serious 24 error occurred? 25 A. Correct. 87 1 Q. Now, can you help me: is it not right that the Post 2 Office retained Herbert Smith Freehills to review the 3 transformation and incentive scheme regarding bonuses 4 for work on the Inquiry? 5 A. I'm sorry, I don't know. 6 Q. You don't know. Well, they certainly were the Post 7 Office's lawyers at the time, and were the Post Office's 8 lawyers, and had been for some considerable time in 9 various guises, including lawyers to the Inquiry. Do 10 I take it from your answer that you did not consider 11 asking who the solicitors were who reviewed and, as it 12 were, fact-checked this scheme? 13 A. I don't think lawyers did fact-check the scheme when it 14 was put in place. 15 Q. So they didn't, as it were, ask for it to be reviewed so 16 that it was legally appropriate? 17 A. Not as far as I'm aware, no. 18 Q. I see. Now, it follows that you can offer no 19 explanation for the serious errors, including the 20 misrepresentation that the Inquiry had concluded and 21 that Sir Wyn Williams had personally approved the 22 metric? 23 A. No, I have not been able to find any explanation. 24 Q. Right. 25 Now, this all makes for, at the very least -- and 88 1 I use understatement -- an undignified spectacle; 2 wouldn't you agree? 3 A. I would. 4 Q. Because these are very important legal documents: the 5 annual report and accounts, and they severely 6 misrepresented the facts. 7 A. In that particular instance, absolutely. 8 Q. And scrutiny, it appears, came there none, and it's 9 troubling on many levels; you would agree? 10 A. I would. 11 Q. Crass errors of judgment, propriety, and very serious 12 errors of fact? 13 A. Correct. 14 Q. And you say -- and it's an answer that you have given on 15 numerous occasions this morning to Mr Blake -- that this 16 is a sign of an organisation under some stress? 17 A. Yes, that would certainly be one factor. Absolutely. 18 Q. Yes. Well, of course, I ask you now to consider the 19 other side of the equation, the postmasters: the 20 subpostmasters need no education in stress, do they? 21 A. Absolutely not. 22 Q. Difficult to trust anyone again, when all you've ever 23 had has been taken away from you after you've been 24 falsely accused, wrongly imprisoned, or bankrupted? 25 A. I agree. 89 1 Q. And the plight of the subpostmasters, the vast majority 2 of whom are yet to receive full and fair compensation, 3 is both painful and financially precarious? 4 A. Agreed. 5 Q. So whilst such incentive schemes were being constructed 6 and devised, the subpostmasters were living on food 7 banks and charity, many of them. You would agree? 8 A. Yes. 9 Q. And I suggest that this rather than being a speedy 10 process is an attritional process which -- and I don't 11 suggest that you know this personally -- but it's an 12 attritional process, these three schemes, two of which 13 are overseen by the Post Office, which is designed to 14 drive subpostmasters to settle at a loss. Has that ever 15 been the subject of discussions at board level? 16 A. No. 17 Q. Has anybody properly considered, without of course 18 descending into the detail of individual cases, but has 19 anybody properly considered the nature of the process 20 and what is being done in the Post Office's name? 21 A. In relation to the compensation scheme? 22 Q. Yes. 23 A. Yes, there is a whole team looking at it. 24 Q. Right. So do you think it's appropriate that in one 25 case -- and I won't mention her name at this stage -- 90 1 that the Post Office's requiring not one, not two, not 2 three, not four, but five expert reports into a person's 3 medical condition? 4 A. I'm sorry, I'm not able to comment because I don't know 5 the detail. 6 SIR WYN WILLIAMS: I don't think that's capable of answer, 7 Mr Henry. 8 MR HENRY: So be it, sir. I'll move on. 9 But let us deal with something which I hope you will 10 be able to answer. You recognise, surely, the 11 unfortunate perspective, the unfairness, at least in the 12 eyes of the subpostmasters, that the Board was devising 13 a TIS such as this while many of the Post Office's 14 victims have had to turn to a charitable fund to have 15 their bills paid? 16 A. The purpose of this particular part of the scheme was to 17 ensure that everything was done to make sure all the 18 evidence necessary for the Inquiry was put in place and 19 handed over. So I don't actually see that as 20 contradictory. 21 Q. Well, we know, unfortunately, given the timescale of 22 this Inquiry and the constant disruption to its 23 progress, that that certainly was not accomplished. 24 But in conclusion, this, please: you say that there 25 has been an apology to the subpostmasters for this 91 1 metric. We know that there has been an apology to the 2 Chairman and to the Inquiry Team; but can you please 3 point me to an apology to the subpostmaster Core 4 Participants in relation to this TIS? 5 A. I don't believe there will be one in those terms, no. 6 MR HENRY: Thank you. 7 SIR WYN WILLIAMS: Mr Jacobs? 8 Questioned by MR JACOBS 9 MR JACOBS: Can you hear me now, Ms Burton? 10 A. I can. 11 Q. I will say that again. 12 Good afternoon. I represent a large number of 13 subpostmasters. I want to ask you about the YouGov 14 survey. Gavin Ellison gave evidence from YouGov on 15 Monday, the 23rd. Have you read that survey or heard 16 about it? 17 A. I have, I say, read it in broad terms, and it was 18 discussed at a board meeting. 19 Q. Thank you. So about 100 current subpostmasters 20 responded, so -- 1,000 I ought -- 21 A. Yes. 22 Q. -- to say. And you'll know, then, that in the executive 23 summary -- we don't need to turn it up -- 92 per cent of 24 those who responded said they'd experienced some form of 25 issue with Horizon in the last 12 months. 98 per cent 92 1 of those who'd experienced discrepancies reported 2 shortfalls, and the most common resolution of those was 3 either for them to use branch money or the 4 subpostmasters resolve it themselves; 70 per cent 5 suffered from screen freezes; 68 per cent loss of 6 connection; 57 per cent say unexplained discrepancies 7 occurred in their branches; and, just to round off, 8 65 per cent of subpostmasters who responded said they 9 experienced issues with Horizon at least once a month, 10 and 35 per cent said it was a few times a month. 11 Does that sound familiar -- 12 A. It does. 13 Q. -- from your understanding of the report? 14 So the clear message, then, is that a significant, 15 a very significant, representative sample of current 16 subpostmasters say that the problems with the Horizon 17 system, which Mr Justice Fraser identified, haven't gone 18 away. Do you agree with that? 19 A. It certainly looks like that from the feedback that was 20 given in the survey. 21 Q. Right. And you said that this was discussed at a board 22 meeting. Can you tell us a little it about that? 23 A. Yes. We had a board meeting that was already planned 24 this Tuesday, and obviously this survey had just come 25 out. So it was on the agenda to look at it and 93 1 understand what we were going to do about it because 2 obviously the results of the survey were disappointing. 3 Q. Yes, and this Tuesday, is that Tuesday, 24th September? 4 A. Yes. 5 Q. The one just gone. That was the day when Saf Ismail 6 gave evidence. 7 A. (Witness nodded) 8 Q. And we asked him about this survey, and we said -- we 9 asked him if he knew if the Post Office board or senior 10 executives, before the survey came out, were aware of 11 the huge dissatisfaction amongst subpostmasters with how 12 the Horizon system is working and how they're being 13 treated by the Post Office. And he said the Board is 14 certainly not aware to the level that the YouTube -- 15 YouGov survey broke things down, and the specific 16 points. 17 And he said that what the Board tends to be told in 18 terms of current and existing bugs, for example, is 19 there are a number of bugs, and we fixed X number of 20 bugs, and there is no specific detail. Is that correct? 21 Does that accord with your view of the sort of 22 information you're given? 23 A. Yes. 24 Q. And that's helpful, thank you. 25 He went on to say, importantly, the Executive, the 94 1 wider Executive, is cherrypicking what information it 2 gives to the board, which he said is not helpful. Would 3 you agree with that as well? 4 A. To be honest, it's very difficult to know what you don't 5 know, so I think there are -- there can be some 6 instances where perhaps information is given in 7 a certain way and at other times, actually, it's very 8 honest information. 9 Q. But there is a concern, Ms Burton, isn't there, that the 10 Board is still not receiving accurate information from 11 the Executive in relation to subpostmaster issues? 12 A. It certainly seems there is an issue following survey 13 results, although, to be fair, the postmaster survey we 14 did earlier in the year that the Board looked at also 15 raised issues around dissatisfaction with their own 16 remuneration, for example. So we haven't just heard it 17 from here that there are issues generally. We are aware 18 of them. 19 Q. Mr Ismail also said -- it was part of his evidence -- 20 that the employee surveys, he didn't feel that the Board 21 were receiving information from the Executive that was 22 presented in a helpful or accurate way? 23 A. Well, I think, again, the employee engagement surveys 24 are very helpful, and we actually felt that they were 25 properly presented to the Board. 95 1 Q. What can the Board do, or what should the Board do, 2 about these very real concerns, we say, that the 3 Executive is cherrypicking the information that gets 4 passed on to the Board? 5 A. Definitely continue to do surveys. Also, actual visits 6 to branches to speak to postmasters ourselves and to 7 talk to a wider group of people. 8 To be absolutely honest, in any organisation there 9 is a danger that things get filtered upwards and, as 10 a Non-Executive Director, I think we're always alive to 11 that, and therefore have to find other ways to do checks 12 and balances to assure ourselves that we are being given 13 the right information. 14 Q. It must be important, don't you think, that in an 15 important where there have been deceptions and 16 misrepresentations by senior executive members it must 17 be important in terms of changing culture, that 18 something is done to ensure that the Executive today is 19 candid and transparent in its dealings with the Board; 20 do you accept that? 21 A. I do. 22 Q. And do you have any ideas as to what can be done, in 23 relation to the Executive in particular? 24 A. I think we need to make it very clear that we must 25 receive the right information and it mustn't be filtered 96 1 in any way and to see sort of the next tier down, as 2 well, so not just relying on the senior management. 3 I think that's good practice for a number of reasons. 4 To have wider engagement with postmasters and mistresses 5 as well, and I do think that the fact that we have 6 postmaster NEDs is really critical and I really welcome 7 their role. 8 Q. Thank you. That's helpful. 9 I just have one other point arising from an answer 10 you gave to Mr Blake at about quarter past 12 this 11 afternoon. You were asked about subpostmasters who have 12 been prosecuted but haven't yet come forward and you 13 said that communications have been sent to a broad 14 audience. Could you just elaborate on that, please? 15 A. I understand letters are -- they either have gone out or 16 are going out to as many people as we understand were 17 postmasters and mistresses during that period. 18 Q. And so the broad audience would be people who were 19 postmasters during that time? 20 A. Yes. 21 MR JACOBS: Thank you. That's helpful. 22 I don't have any further questions, sir. 23 SIR WYN WILLIAMS: Can I ask you, Ms Burton, in relation to 24 persons who are entitled to be exonerated under the 25 recent legislation, if I can put it in that way, is the 97 1 process of identifying and notifying them being handled 2 solely by the Ministry of Justice or jointly with Post 3 Office and the Ministry of Justice? Or what, if I can 4 put it in that way, is the process for notifying these 5 people? 6 A. I'm afraid I don't know, Sir Wyn. 7 SIR WYN WILLIAMS: Fine. All right. Thank you. No doubt 8 I'll find out from somewhere else. 9 MR BLAKE: Sir, there is just a question from Ms Patrick. 10 Questioned by MS PATRICK 11 MS PATRICK: Good morning, Ms Burton. My name is 12 Ms Patrick. I think you know I represent another group 13 of subpostmasters who were convicted and have since been 14 acquitted -- sorry, since had their convictions quashed. 15 I just want to ask you about one part of your 16 witness statement because you haven't been asked about 17 it before. You've just confirmed with Mr Jacobs your 18 view that the addition of subpostmaster NEDs to the 19 Board is a helpful thing. 20 A. Yes. 21 Q. And I just want to look at one issue that arose. It's 22 been being called the two-tier approach to the Board. 23 And in your witness statement you deal with that, and 24 you say that when you joined the Board -- it's at 25 paragraph 59 of your statement -- you recognise that 98 1 only those who could sit on particular committees could 2 get papers; is that right? 3 A. That's correct. 4 Q. And that that meant that some were excluded from seeing 5 all of the materials that were being circulated to some 6 members of the Board? 7 A. That's correct, and that included myself. 8 Q. Yes. And, in fact, it came to pass that you'd discussed 9 that with the Chair and the company secretary; is that 10 right? 11 A. I did. 12 Q. And on consulting Mr Staunton, you said: 13 "Mr Staunton said access could be given to 14 independent NEDs." 15 And you said that meant that Ms Gratton, although 16 she wasn't independent, sat on all of the committees and 17 also got the papers. But what that meant was that the 18 change meant that neither Mr Ismail nor Mr Jacobs were 19 getting papers for committees they didn't sit on? 20 A. That's correct. 21 Q. And the committee included the Remuneration Committee? 22 A. (Witness nodded) 23 Q. There were never any SPM representatives on the 24 Remuneration Committee, were there? 25 A. No. 99 1 Q. Now, was that kind of two-tier approach indicative of 2 the continuing possible apparent belief that there was 3 some suspicion afforded to the role that an SPM might 4 play in the business? 5 A. I agree it was not helpful. 6 Q. And has that now changed? 7 A. It has. 8 Q. And is that as part, as a result, of the recommendations 9 made by the Grant Thornton report? 10 A. No, actually. Because I was having conversations with 11 Mr Ismail and Mr Jacobs about some remuneration issues, 12 I realised that they still couldn't see the papers 13 that I could see. So I asked again whether it was 14 possible for them to also get those papers and that has 15 now been agreed and, much more recently, it's also been 16 agreed that any of us can attend any committee meeting 17 even if we're not a member and we can attend as an 18 observer, and that will also apply to the Remuneration 19 Committee. 20 Q. And the Grant Thornton, what, did recognise that this 21 kind of two-tier approach was unhelpful, didn't it? 22 A. Yes, it did. 23 Q. And recommended changes to remedy that? 24 A. It did. 25 MS PATRICK: Thank you. I don't have any other questions. 100 1 SIR WYN WILLIAMS: Thank you, Ms Patrick. 2 Is that it, Mr Blake? 3 MR BLAKE: It is, yes, sir. 4 SIR WYN WILLIAMS: Well, thank you very much, Ms Burton, for 5 your witness statement and for attending to give oral 6 evidence. I am very grateful to you. 7 THE WITNESS: Thank you. 8 MR BLAKE: Sir, could we come back at 1.50? 9 SIR WYN WILLIAMS: What's the time now? Yes, certainly. 10 Yes, certainly. Yes. Fine. 11 MR BLAKE: Thank you very much. 12 (12.47 pm) 13 (The Short Adjournment) 14 (1.50 pm) 15 MR STEVENS: Good afternoon, sir. Can you see and hear us? 16 SIR WYN WILLIAMS: Yes, I can, thank you. 17 MR STEVENS: We are hearing from Sir Martin Donnelly. 18 SIR MARTIN DONNELLY (sworn) 19 Questioned by MR STEVENS 20 MR STEVENS: Please can you state your full name. 21 A. Martin Eugene Donnelly. 22 Q. Thank you for attending the Inquiry today to give oral 23 evidence and thank you for your detailed witness 24 statement to which I would like to turn now. It should 25 be in front of you. Do you have a copy of it? Do you 101 1 see that? 2 A. Yes. I have my own copy. 3 Q. And it runs to 33 pages, excluding the list of exhibits. 4 Could I ask you, please, to turn to page 33. 5 A. Yes. 6 Q. Is that your signature? 7 A. Yes. 8 Q. Now, before I ask you whether that's true to the best of 9 your knowledge and belief, there's one correction 10 I understand we need to make. If we could have 11 paragraph 6 on the screen, please, which is at page 3. 12 In the middle of the third line, it says: 13 "I joined Boeing in July 2019 and worked as UK 14 Managing Director until October 2023." 15 I understand that should read October 2022. 16 A. Yes. 17 Q. Thank you, that can come down. 18 Subject to that one correction, are the facts stated 19 in that witness statement true to the best of your 20 knowledge and belief? 21 A. They are. 22 Q. Thank you. That, for the reference, is WITN11250100. 23 Sir Martin, that statement will be uploaded to the 24 Inquiry's website shortly. I'm going to ask you some 25 questions on it, not on everything, but on certain 102 1 matters. 2 We'll start with your career. You joined the Civil 3 Service in 1980. 4 A. Yes. 5 Q. And you held a range of positions across a number of 6 departments, being made Acting Permanent Undersecretary 7 to the Foreign and Commonwealth Office in 2010? 8 A. That's right. 9 Q. You were then made Permanent Secretary to the Department 10 for Business, Innovation and Skills in October 2010? 11 A. Yes. 12 Q. You remained in that post until that department closed 13 and became the Department for Business, Energy and 14 Industrial Strategy in July 2016? 15 A. Yes. In practice, then parts of the department were 16 split off. The core department had the energy part 17 joined on to it, and then I was briefly a Joint 18 Permanent Secretary whilst setting up the separate 19 Department of International Trade. 20 Q. And you served as Permanent Secretary of the new 21 Department for International Trade, I believe, in 22 September 2016 to April 2017? 23 A. Yes. 24 Q. And at that point you left the Civil Service? 25 A. That's correct. 103 1 Q. Sir Martin, you are the first Permanent Secretary we've 2 heard evidence from, so I want to touch on the role of 3 Permanent Secretary first. 4 You say in your statement -- we don't need to turn 5 it up -- paragraph 10 that the role of Permanent 6 Secretary is to be the Civil Service Head of Department? 7 A. That's correct. The senior permanent civil servant in 8 the department. 9 Q. In respect of your role as Permanent Secretary and 10 fulfilling that role, did you have a private office or 11 staff to assist you with that? 12 A. Yes, I did. 13 Q. Can you just summarise the extent of the private office 14 or staff you had to help. 15 A. So I had, over most of this time, a principal private 16 secretary; usually two junior private secretaries to 17 assist; a diary secretary, and some clerical support. 18 Q. We'll come to their roles in due course as we go through 19 your evidence. I want to look at the Department itself 20 as well, the Department for Business, Innovation and 21 Skills. Please can we bring up paragraphs 7 and 8 of 22 your statement, which is on page 3. 23 We see the section giving an overview of the 24 Department. You refer to the creation of the Department 25 in 2009. That's before your appointment. You go on to 104 1 say at paragraph 8 that the Department had: 2 "... had a very wide range of specific 3 responsibilities within its central objective of 4 promoting economic growth through investment in skills 5 and education, trade and investment promotion, fostering 6 innovation and helping businesses to grow." 7 How did postal affairs and oversight of the Post 8 Office fit within the Department? 9 A. The Department was probably the widest range of 10 responsibilities I came across in my time as a civil 11 servant. It was -- the Post Office, together with Royal 12 Mail, of course, at the start of this period, was one of 13 about 45 partner organisations which were split up in 14 terms of their supervision between different parts of 15 the Department. The Post Office was one of six or so, 16 which was supervised by the Shareholder Executive, and 17 that arrangement remained the case throughout my time as 18 Permanent Secretary. 19 Q. I mean, you do go on to say in your statement about the 20 range and extent of the functions being large. The 21 extent of the functions the Department had, do you think 22 that had a negative effect on its ability to oversee 23 postal affairs as an individual issue or area? 24 A. It certainly had consequences for how we had to do it. 25 Given the range of responsibilities, it was necessary to 105 1 delegate considerably within the Department into the 2 various groups and, for most of the time I was there, 3 certainly by the end, we had six separate groups with 4 their own responsibilities. 5 Whether that was better or worse than other models 6 is difficult to say in abstract. What I would say -- 7 and you may want to come back to this separately -- is 8 we were, from the time that I joined, and increasingly 9 over that period, under considerable resource pressure 10 or, to put it more bluntly, we didn't have as much 11 funding or as many people as we would have liked to have 12 had to do all the things that we had to do. So we had 13 to do the best we could with what we had. 14 But in terms of structures, I thought at the time 15 that the structures we had were reasonable ones. 16 Q. I will come back to the point of the resourcing you 17 refer to later. 18 In terms of at a Department level, I think in your 19 statement you refer to personal involvement in the sale 20 of Royal Mail and an accounting issue with Post Office 21 Limited's consolidated accounts towards the end of 2015. 22 Is that broadly right? Those are the two areas in which 23 you had personal involvement? 24 A. Yes, and in the first case that was because of my 25 specific Accounting Officer responsibility for the 106 1 public assets which were the Royal Mail, which were 2 being sold, and the question of whether the taxpayer was 3 getting value for money for them. That was my role as 4 Accounting Officer and it was a specific one in that 5 case. 6 In the second case, which was a bit different, I was 7 actually annoyed by the fact that the Post Office had 8 made this accounting error because, although the 9 accounts were their responsibility, within the Business 10 Department we tried very hard to -- and I think 11 succeeded -- in achieving a high level of financial 12 transparency. Accounts were produced on time. Our 13 departmental accounts were not qualified and I was angry 14 that the Post Office had messed this one up, and I had 15 to report it in the reporting accounts for that year. 16 Q. Given those were -- we'll come back to some of those 17 later. Given those were the two issues you were 18 involved with, is it fair to say that postal affairs or 19 the Post Office wasn't one of the top agenda items for 20 the Department as a whole whilst you were Permanent 21 Secretary? 22 A. Certainly from my perspective as Permanent Secretary, 23 the major policy issue that took up most of my time was 24 the Royal Mail privatisation. I was aware of other 25 issues, but, as across the range of the partner bodies 107 1 from the Student Loan Company to the Ordnance Survey and 2 so on, my primary concern was to ensure that these were 3 being handled within a structure which made sense. It 4 wasn't possible for me to follow in detail every single 5 issue, nor would it have been desirable, in terms of the 6 responsibilities of the people involved. I relied on 7 them to raise issues, but from my perspective, yes, 8 those were the two salient points when the Post Office 9 was directly on my agenda. 10 Q. We'll come to your personal involvement shortly. 11 Just to put it again, I suppose, in terms of that, 12 what you were dealing with, in terms of what the 13 Department as a whole prioritised or had at the top of 14 its agenda, is it fair to say that postal affairs wasn't 15 on, say, the top five agenda items for the Department as 16 a whole? 17 A. Well, the top five agenda items shifted over time. So 18 early on, we had a bit of a crisis over student funding. 19 Later in my time, we had a crisis over steel. We had 20 continued challenges over funding. We had issues around 21 regional development coming thorough. We had a problem 22 over the funding of further education colleges. So 23 these were the issues which tended to be at the top of 24 the political agenda and therefore affected what I was 25 concerned with as the senior official serving the 108 1 Secretary of State. 2 But in parallel -- and I don't want to sound too 3 bureaucratic about this, but it was important -- we were 4 running a large and complex organisation. So issues 5 around staffing, around funding, around appointments, 6 these all came up and took up quite a lot of time, and 7 so of course did reducing the funding over this period 8 in a managed way. 9 So the Post Office was one of the issues being dealt 10 with within the system during this time. That's how 11 I would put it. 12 Q. Let's look at your role, and I think touching on what 13 you just said. Could we look at paragraph 15 of your 14 statement. It's page 5. We see you start off 15 describing the role of the Permanent Secretary. I'm not 16 going to go through all of that, but if we go down to 17 17, you say: 18 "Given the range of work across the core Department, 19 the Permanent Secretary has to ensure that systems are 20 in place to manage it effectively without personal 21 intervention, while maintaining an overview of the 22 Department's work." 23 And as you've mentioned in doing that, you had 24 Directors General reporting to you? 25 A. Yes. 109 1 Q. One of those was the Chief Executive of the Shareholder 2 Executive? 3 A. Yes. 4 Q. What responsibility did you have as Permanent Secretary 5 to satisfy yourself that a Director General and their 6 team were performing the role effectively? 7 A. I think that was one of my core responsibilities. It 8 was to ensure that the system, as far as I was aware and 9 could professionally judge, was equipped with the people 10 and the resources and the motivation, the values, to do 11 the jobs that it had to do in different settings. And 12 that required looking at the funding; it required 13 looking at the senior leadership; it required ensuring 14 that I had time with those Directors General to know 15 what was on their minds and how I could help. And it 16 also required letting them get on with it without 17 excessive intervention, where that was going to actually 18 complicate their lives and make running the Department 19 as a whole more difficult. 20 Q. Is it fair to summarise your evidence in terms of that 21 reporting line as follows: you first say that you were 22 reliant on accurate information being communicated to 23 and by your officials? 24 A. Yes. 25 Q. And, secondly, you placed reliance in your officials' 110 1 judgment in identifying which issues needed to be raised 2 with you? 3 A. Yes, within the context that obviously more junior 4 officials were being managed by more senior officials 5 and I would expect, where there was an issue that they 6 weren't sure about or required guidance, that they would 7 go to the more senior officials and, where necessary, 8 those officials would bring me in. Or the other way 9 round, that the Secretary of State would say to me, as 10 happened on one or two issues, you know, "Have a look at 11 this, try and sort it out." That didn't happen very 12 often but it did happen occasionally. 13 Q. Can you recall -- so you referred to conversations with 14 your Director General. Let's focus purely on 15 Shareholder Executive at the minute. Can you recall to 16 what extent you tested whether the Director General was 17 providing you with the appropriate information or the 18 most relevant information for you? 19 A. Well, I guess there are two parts to that. One was 20 I had to personally have confidence in the people doing 21 those jobs, that they would do it professionally and 22 ethically, and I did have that confidence, as I built my 23 team. And, secondly, they would use their judgment 24 which I would then rely on to inform me of issues where 25 I could add value or whether I should be aware, either 111 1 for Accounting Officer reasons or because they would be 2 politically important or because 10 Downing Street were 3 involved, and so on. 4 Q. My question is, how did -- or did you test that judgment 5 to see if it was being exercised properly? 6 A. So obviously it's a judgment that I would make over time 7 through contact with them. The other, more formal, 8 arrangement was that we had an annual appraisal and 9 I would collect information from others with whom they 10 worked, including their own staff, and including, in the 11 case of the Shareholder Executive, as a lot of its 12 function was actually outside the business department, 13 from others that it was working with. And I was 14 reassured by the feedback I received. 15 Q. Would one of those sources of feedback on the Director 16 General with responsibility for Shareholder Executive 17 have been the Chair of Post Office Limited? 18 A. Not that I recall. I did, as you know, have separate 19 meetings, roughly once a year, with the Chair of Post 20 Office, and the Chair could at any point have contacted 21 me to say, "I'm not happy with what's going on." That 22 would have been unusual but not completely outside 23 normal behaviour. 24 The process of assessment tended to be more within 25 Government. So from ministers, from other Permanent 112 1 Secretaries, particularly the Treasury. 2 Q. In your statement -- we don't need to bring it up, I'll 3 read it -- in response to the types of issues that would 4 be raised to your attention, you've referred to 5 reviewing a large amount of briefing information, and 6 you prioritise "issues that affect the whole Department 7 or top of the political agenda." 8 When we say "issues that affect the whole 9 Department", can you just say what you mean by that? 10 A. Again, this would often be questions of funding. Were 11 we having difficulty in managing an issue which was 12 arising which would affect the Department's 13 effectiveness and credibility with ministers? Were we 14 being asked by 10 Downing Street or others for a new 15 initiative which had to be managed? Were we dealing 16 with a sudden crisis, for example the steel crisis, or 17 the sort of issue that would rapidly become very 18 political, and again affect how we were perceived as 19 doing our job: for example, the Student Loans Company 20 difficulties at some points with their IT in delivering 21 loans accurately to students. 22 So they tended to be those sorts of issues, or 23 points that I knew were on the Secretary of State's mind 24 or were likely to come forward. 25 But you will also understand that with 40-odd 113 1 partner organisations and a very wide range of issues, 2 there were quite a lot of problems of people resigning 3 or questions of how we would cover emerging areas. So 4 there was quite a lot of organisational material that 5 would come up to me that we would be managing through 6 the departmental board and its systems. 7 Q. On reflection, the fact that there was such a broad area 8 and issues to cover from such a wide spectrum, did that 9 prevent, or do you think it may have prevented, issues 10 such as the Horizon issues we're looking at breaking 11 through to the top level of the Civil Service? 12 A. I find that a difficult question to answer. I think I'd 13 make two points. One was that because we'd set the 14 Department up with this range of responsibilities, it 15 was inevitable that a lot of responsibility would be 16 devolved to the Directors General. That was not 17 necessarily a bad thing. They would competent people. 18 It did mean, though, that there was less overall 19 bandwidth for drilling down into individual issues. But 20 my question to myself would be, if we had had more 21 resource, I'm not sure it would have been best used at 22 the most senior levels. It might have been better used, 23 actually, at the detailed levels of how many people were 24 engaged in working out the detail of what was going on, 25 because the problem was, once you've got information 114 1 coming into the system, everybody was working off the 2 same information further up, and the challenge I see, in 3 retrospect, is we weren't getting access to the correct 4 information on which to take decisions. 5 Q. Going slightly out of order, because you've raised it 6 there, you refer in your statement to cuts and having to 7 cut the budget, once early in the stage of the Coalition 8 Government, and then the second time around in 2015 9 onwards. To what extent did those cuts affect the 10 resource or headcount available to oversee Post Office 11 within the Department? 12 A. It's hard to make a direct connection and, as I say in 13 my statement, I was aware of the importance of the work 14 that ShEx were doing, and indeed other parts of the 15 Department were doing, and I sought -- I think with some 16 success -- to ensure that there was an acceptable level 17 of funding and support. 18 Now, it would have been good to have had more, and 19 in the past there was more, and from 2015 onwards we had 20 to start another process which was very painful and 21 difficult, and involved the projected closure of some 22 offices. So I think at the time, I'd say it was almost 23 less the resource levels, because nobody came to me and 24 said, "I cannot do this with the resource I have." In 25 some policy areas we said, "Well, we just can't do as 115 1 much work on regional policy, we're going to have to cut 2 this down to a minimum." 3 But I did not get the impression the Shareholder 4 Executive did not have the resources they needed. 5 What was true for me, and I think for my senior 6 team, was we had to spend a lot of time trying to shrink 7 the organisation, deal with inevitable morale issues, 8 manage the partner organisations and, latterly, some 9 issues about the speed with which we could renew board 10 members, because there was a degree of involvement, some 11 would say interference, by Special Advisers, which 12 caused some difficulties with some partners. All of 13 these things became very time consuming. 14 So keeping all the plates spinning against this 15 complexity with limited resources didn't, in my memory, 16 honestly, lead us to make any particular mistakes, but 17 it did give us less thickness of people, less bandwidth. 18 Q. Before I move on, now, on reflection, having been in the 19 Civil Service for several decades -- now having left, 20 obviously -- do you have any comments to make, other 21 comments to make, on the size of the portfolio of the 22 Department and whether that's appropriate? 23 A. I think it comes down again to this point of how many 24 senior officials do you need and how do they add value? 25 And the challenge, I think, is if you don't get 116 1 additional perspectives or additional information, then 2 they're unlikely to add a lot of value. 3 I do think there's a question about resource levels 4 in terms of being able to be close to, or closer to, 5 what is going on. But then of course you have to be 6 able to rely on the information that you are getting. 7 So I would say, in retrospect, the model of BIS had 8 some advantages. You could link up different policy 9 areas. You could make them work better together than if 10 they were in separate departments. But it did have 11 consequences for how we had to manage issues, and that 12 meant it had a high level of devolving responsibilities. 13 Q. Before I move on to look at the role of the Accounting 14 Officer, just couple of points on your knowledge. You 15 say in your statement that you don't recall any real 16 discussion on things like bugs and errors in the Horizon 17 system whilst you were Permanent Secretary. 18 A. None at all. 19 Q. When did you first become aware that Post Office 20 conducted its own prosecutions? 21 A. Probably about 2019 -- I think when I read the Nick 22 Harvey (sic) book. 23 Q. So during your -- Nick Wallis, sorry. 24 A. Sorry, yes. 25 Q. So during your period of time as Permanent Secretary, 117 1 your evidence is you weren't aware of its prosecutorial 2 function? 3 A. Not at all. 4 Q. Were you aware that it was involved in prosecutions and 5 that subpostmasters were being prosecuted by someone? 6 A. No, that never came to my attention, because I guess it 7 was never connected to anything that someone said, "This 8 is important, we should be concerned about it." 9 Q. I want to look at the role of the Accounting Officer in 10 relation to Post Office Limited. I'll cover this in 11 a bit of detail, because you're, as I say, the first 12 Permanent Secretary we have at the Inquiry. 13 You were the Accounting Officer for the Department 14 as Permanent Secretary? 15 A. Yes. 16 Q. And that gave you certain personal responsibilities in 17 respect of the Department's expenditure of public money? 18 A. Yes. 19 Q. Please can we look at your statement at page 14, 20 paragraph 38. You refer to the Accounting Officer role, 21 and about six lines down you say: 22 "As Accounting Officer, maintaining transparency of 23 BIS spending was a key objective. This led to 24 a successful consolidation of the accounts of most of 25 the Partners for which BIS had oversight into the main 118 1 BIS accounts. However, this did not include Royal Mail 2 and the Post Office; as noted above they had a separate 3 report and accounts produced to commercial standards 4 given their status as a public corporation." 5 I assume there when you say "a separate report and 6 accounts" you're referring to the accounts filed with 7 Companies House? 8 A. Yes. 9 Q. And if we look over the page, please, at paragraph 39 at 10 the very top, you, I think, effectively make three 11 points. First, you were not the Accounting Officer for 12 Royal Mail or Post Office? 13 A. Except insofar as we've discussed on the Royal Mail 14 share sale, when it came to the disposal of public 15 taxpayer assets, I was the person who had to provide 16 a judgment that that was value for money. 17 Q. So that, with that into account as well. 18 A. (Witness nodded) 19 Q. So that's the other one you say you're accountable as 20 Accounting Officer for any transactions between the Post 21 Office and the Department. Is that what you mean when 22 you refer to being accountable there? 23 A. Yes, and hypothetically, if there had been some issue of 24 having to be alone, or any financial arrangements which 25 involved the Department with the Post Office, I can't 119 1 quite imagine what those would have been, but if they 2 involved funding from the Department, then I would have 3 been involved as Accounting Officer or supervising it, 4 yes. 5 Q. So that, as I understand it, derives from your role as 6 Accounting Officer to the Department? 7 A. Yes. 8 Q. But you are not Accounting Officer to the Post Office or 9 to Royal Mail itself? 10 A. No. That and -- you mentioned managing public money. 11 That was, as far as I could see, a logical evolution of 12 the system that you had an arm's-length body that was 13 a public corporation and it had a pretty high degree on 14 its autonomy, for example, on how many salaries, on how 15 many people it employed, which did not have to come to 16 the Department or ultimately to me for approval, and 17 they did have to produce accounts to commercial 18 standards and be audited and so on. 19 Q. And the third point you say is that public corporations 20 do not have accounting officers. I want to look that in 21 a little bit of detail now, but before I do, in summary, 22 what, if any, responsibility did you have as an 23 Accounting Officer in respect of Post Office's accounts? 24 A. As Accounting Officer, I don't think I directly had 25 a responsibility for their accounting process. I did 120 1 have a wider reputational responsibility for how they 2 were doing it and we had the point about the non-cash 3 error which we discussed. And ultimately, of course, 4 they were using public funds because they were in the 5 public sector and the public sector stood behind them. 6 So, had they had a financial crash or run out of 7 money, I would have had to have been involved in that 8 residual role, but not for their normal expenditure, no. 9 Q. I want to look at each of those three points now. Some 10 of these may be perfectly clear to you, so we'll have to 11 go through it stage by stage to make sure it's clear to 12 us. 13 The first point is you being the Accounting 14 Officer -- not the Accounting Officer, sorry, for Royal 15 Mail and Post Office. Could we look, please, at 16 UKGI00006045. It's a document by the Treasury, Managing 17 Public Money, July 2013. As briefly as you can, can you 18 summarise what this document is used for? 19 A. No, I'm not sure I can now, especially at 11 years 20 distance. Essentially, the Treasury were trying, 21 though, to set out a framework for broadly who was 22 responsible for where the money went, and technically 23 I think my Accounting Officer responsibilities were 24 delegated by the Treasury Accounting Officer and, 25 similarly, to other Permanent Secretaries and there were 121 1 practical arrangements whereby some other arm's-length 2 bodies had some quasi-Accounting Officer status. Now 3 I'm not a professional accountant and I'm not sure I can 4 take you much further into that. 5 I'm also aware that the precise definition of 6 Accounting Officer in the case of a public corporation 7 was slightly work in progress over this period. 8 Q. Well, let's pause that because we'll come to it shortly. 9 Could we look, please, at page 19, paragraph 3.1.1. So 10 this is the role of the Accounting Officer and it says: 11 "Each organisation in central government -- 12 department, agency, trading fund, NHS body, NDPB or 13 arm's-length body -- must have an Accounting Officer." 14 We will leave aside public corporations for the 15 time, but do I take it this supports your position that 16 you were Accounting Officer of the Department, and then 17 sponsor arm's-length bodies or public corporations -- 18 well, no, sorry -- 19 A. No, not public corporation -- 20 Q. Sorry, sponsor arm's-length bodies would have their own 21 accounting officers? 22 A. It did depend on the level of the autonomy of the 23 organisation, but it is true to say that -- and I don't 24 know offhand quite what the status of the other 44 or so 25 were in this category, but yes, there were different 122 1 levels of autonomy and with that went a different level 2 of Accounting Officer responsibility so it wasn't always 3 entirely black and white, in practice, this system. 4 Q. Let's look at the public corporations role, please, and 5 first a point on public corporations. That document can 6 come down for the time being. 7 You may have listened to evidence in the Inquiry's 8 Phase 5 and 6 hearings where ministers and civil 9 servants referred to the Post Office as an arm's-length 10 body. Did you hear that evidence? 11 A. Yes, I heard some of it, not all of it. 12 Q. Now, colloquially that may be correct but I understand 13 there's a difference between an arm's-length body and 14 a public corporation for the purposes of public 15 accounts; is that correct? 16 A. Yes, I think "arm's-length body" is not really 17 a technical term. It covered a range of 18 non-departmental bodies, and there used to be trading 19 funds, and so on. And essentially, once you had a unit 20 with some financial autonomy outside the Department, it 21 tended to be known as an arm's-length body. 22 Q. Can we please look at RLIT0000325. This is a Cabinet 23 Office document from 2016 called the Classification of 24 Public Bodies: Guidance for Departments. Is this 25 a document you would have been familiar with when you 123 1 were Permanent Secretary? 2 A. Well, I would have expected my Finance Team to be 3 familiar with the detail and I would have expected to 4 have understood the broad lines of what they were saying 5 about what did and did not fall within the public 6 sector, which was not always a straightforward issue. 7 Q. Can we turn to page 4, please. We see it says: 8 "Public bodies are diverse, which means 9 classification is not always a simple process. For ease 10 of reference, and to help departments understand the 11 different delivery models that exist, this guidance sets 12 out the main categories of public body. This guidance 13 covers: the ALBs that are classified [that's the 14 arm's-length bodies that are classified]; other 15 non-classified central government and Parliamentary 16 entities, and public corporations". 17 And I think your evidence before is that there are 18 different categories of arm's-length bodies that fall 19 within the first group there, the ALBs that are 20 classified; is that right? 21 A. Yes, in terms of how we worked with them and managed 22 them. That is right. And some of those categories, I'm 23 afraid, changed over time. 24 Q. Could we look at page 29, please. This is chapter six 25 on public corporations. And on the left column towards 124 1 the bottom, it says: 2 "A body will be classified as a public corporation 3 where:" 4 It says: 5 "It is classified as a market body -- a body that 6 derives more than 50 per cent of its production costs 7 from the sale of goods or services at economically 8 significant prices ..." 9 There's detail we don't need there. It goes on to 10 say (2): 11 "It is controlled by central government, local 12 government, or other public corporations, and it has 13 substantial day-to-day operating independence so that it 14 should be seen as an institutional unit separate from 15 its parent department." 16 And is it your evidence that the Post Office 17 fulfilled those requirements to be a public corporation? 18 A. Definitely. 19 Q. Thank you. 20 A. I can say why if you want, but that may be too much 21 unhelpful detail. 22 Q. Please do. 23 A. Well, briefly, because this a sectoral classification 24 issue, it's concerned with what does the Government 25 stand behind? So if a public corporation goes bust in 125 1 some way or doesn't fulfil its contractual obligations, 2 the ONS want to know what's on the Government's balance 3 sheet and how much they stand to lose. 4 If it had a slightly different level of control that 5 meant that it was largely, but not entirely, private 6 sector-controlled, the ONS would argue that if it went 7 bankrupt, it was a private sector issue. So their 8 primary concern here is to work out what assets the 9 taxpayer is essentially responsible for, as I understand 10 the system. 11 Q. Okay, thank you. 12 I want to go to your evidence that public 13 corporations do not have Accounting Officers, and you 14 refer to the 2023 edition of Managing Public Money. Can 15 we please bring that up. It's UKGI00043211, and 16 page 208, please. 17 So this is obviously a 2023 document. It was 18 brought into place after you'd left the Civil Service. 19 We see, towards the bottom of the box at the top, it 20 says: 21 "This annex is intended to consolidate existing 22 guidance in relation to their responsibilities for 23 public money and to provide some advice on common issues 24 that arise." 25 Can we turn, please, to paragraph 7.3.13, which is 126 1 over the page. Sorry, two pages over, page 210. And 2 the last sentence says -- this is a sentence you rely 3 on: 4 "Public corporations do not have Accounting Officers 5 and are not subject to managing public money as a matter 6 of course." 7 This sentence isn't in the 2013 edition of Managing 8 Public Money. Is it your evidence, though, that that 9 reflects practice or reflects how Government worked 10 whilst you were Permanent Secretary? 11 A. Yes. I think it was, and I've thought about this, that 12 it was helpful, although you can argue a bit belated, to 13 write this down in 2023, or whenever. Already when 14 I was a Permanent Secretary, it was clear that there was 15 not expected to be the same level of responsibility for 16 expenditure that there was as an Accounting Officer 17 within the Department. So for example, I would control 18 gifts that came into the Department or hospitality. We 19 would have registrars. 20 A public corporation was completely outside that 21 arrangement. They were expected to follow commercial 22 accounting rules, but -- and this, I think, is where it 23 gets a bit less clear -- they were also expected to work 24 within broad public sector parameters. 25 So, you know, in terms of behaviour, in terms of not 127 1 going completely off the rails, in their spending 2 decisions. And I think it took some time to write down 3 the way we were all working, which was that the logical 4 consequence of having a public corporation with all of 5 these other disciplines, external auditors and so on, 6 was that the Accounting Officer system couldn't really 7 function in the same way, nor should it have to because 8 there were other disciplines in place. But at the same 9 time, the public corporation was going to have to go on 10 reporting to its shareholder, if that's the right image, 11 to Government for the way it behaved. 12 Q. And how was that understanding as to the public 13 corporation acting to public standards? How was that 14 communicated to the public corporation? 15 A. Well, again, this, I think, evolved over time. I could 16 not point you to a specific document. From my 17 perspective, these arrangements were managed within the 18 Shareholder Executive with full approval of the 19 Treasury. So the fact that the Royal Mail, first of 20 all, then the Post Office, became a public corporation. 21 We appointed a board, and from my perspective, having 22 the Chief Executive, the Board, the auditors, meant that 23 insofar as I reflected on the issues that were 24 problematic, the Post Office wasn't, because it had 25 these levels of effective control. 128 1 And I was not, for example, ever called to the 2 Public Accounts Committee to discuss the Post Office 3 because it was seen that that was a rather separate 4 organisation. 5 Q. If we can go down slightly, please, to show the next 6 paragraph, thank you. 7 Again referring to public corporations, it says: 8 "They should instead be subject to levels of control 9 and governance that are deemed appropriate by the 10 sponsor department and agreed in the context of the 11 framework document and approved by Treasury. It may be 12 the nature of the body is such that it would be 13 appropriate to consider if that requirement for 14 compliance with the principles of Managing Public Money 15 should be imposed. This should be achieved through the 16 exercise of shareholder rights and is not the default 17 position. If this outcome is sought, it may be 18 appropriate to appoint the Chief Executive as an 19 accountable person mirroring the role of the Accounting 20 Officer for central government bodies to ensure the 21 shareholder expectations in this regard are met." 22 Again, was that idea of how you could approach 23 public corporations and have an accountable person 24 within them, was that practice within Government at the 25 time you were Permanent Secretary? 129 1 A. Well, again, I wasn't close to all the detail of this, 2 given it was being handled between Treasury, Shareholder 3 Executive, and the finance function. But from my 4 perspective as an Accounting Officer, I can see this as 5 a logical development of what we were doing and, seven 6 years later, it was written down. 7 The important step that was taken when I was 8 Permanent Secretary was beginning to put civil servants 9 on the Board and, as you know, that was not 10 uncontentious at the time. I thought it was a sensible 11 idea, and I hoped and expected would give us an 12 additional level of effective control without cutting 13 across the structures that had been put in place to 14 provide the level of operational autonomy which people 15 wanted the Post Office to have. 16 Q. That document can come down. 17 I'd like to go back to the 2013 version of Managing 18 Public Money briefly, please. Page 55. 19 Sorry, I should say UKGI00006045. Page 55, please. 20 Towards the bottom, we should see "Public corporations". 21 Thank you. 22 So we're referring to public corporations here, and 23 over the page at 7.7.2, it says: 24 "Sponsor Department should define any contractual 25 relationship with a corporate in a framework document 130 1 adapted to suit the corporate context while delivering 2 public sector discipline." 3 At the time, were you aware of what contractual 4 framework documents were in place to govern the 5 relationship between Post Office and the Department? 6 A. No, not in detail. 7 Q. Why not? 8 A. Because there was an evolution in how the Shareholder 9 Executive were working with the Post Office over this 10 period. It came out of the Royal Mail. We set up the 11 Board. We had someone on it, and I was aware of all of 12 that. I didn't know how far that had been written down 13 in any contractual document and I wasn't sure -- insofar 14 as I thought about it, I accepted that the Shareholder 15 Executive were managing this relationship as it evolved. 16 We were putting the Non-Executive Director on the Board, 17 and the system was providing, in substance, what was 18 required. 19 Q. Do you think it would have helped to, for example, when 20 Post Office became an independent business, to have sat 21 down, reviewed the business as a whole, and set down 22 a framework as to what -- how Government oversight would 23 work? 24 A. I think it's always helpful to have as much transparency 25 as you can in these cases, although the fundamental 131 1 thing is maintaining an open relationship of trust and 2 transparency between the people involved and, if you 3 don't have that, then any number of contractual 4 documents are not going to work well in my experience. 5 And I think that this is a sensible way of 6 developing the relationship, certainly when there's an 7 element of stability involved and I think, for quite 8 a lot of the time that we were dealing with the Post 9 Office, there was an evolution in the development of its 10 Board and so on, and also, I think, some question over 11 what the final model might be for the Post Office. 12 So I can understand why there wasn't, as far as 13 I know, any formal document on these lines. But 14 I think, yes, I think it's a good idea, over time, to 15 have those in addition to the fundamental point about 16 the relationship of trust and transparency. 17 Q. Should there have been a review of the operations of 18 Post Office Limited, including the fact it conducted 19 prosecutions, to determine how the Department would 20 oversee prosecutions? 21 A. I speak under control here, but my understanding was 22 that Post Office prosecutions had stopped at some point 23 before this period. 24 Q. There were ongoing prosecutions at that -- that stopped 25 shortly after separation. 132 1 A. Right. 2 Q. But at the -- let's look at it from the point of, say, 3 2011 when there's a plan to separate the businesses. 4 Should the Department have reviewed the operations that 5 Post Office were carrying out, such as prosecutions, to 6 determine how it could best oversee them? 7 A. I don't feel competent to comment on the precise nature 8 of decisions on prosecutions. Clearly, with what we 9 know now, it was a very peculiar system that the Post 10 Office had in place until they no longer ran their own 11 prosecutions and it was not an acceptable one, and that 12 should, therefore, have been picked up at some point. 13 When I joined the Department in late 2010 I wasn't 14 aware of that level of detail of how the Post Office 15 performed its prosecutions. In terms of the wider 16 relationship between the Department and the Post Office, 17 my understanding was -- and I think this is correct -- 18 that there was a lot of discussion about what the 19 relationship should be as it moved out of the Royal Mail 20 as we moved towards the Royal Mail privatisation. 21 And that seems, to me, in substance, to fill the 22 question of well, how are we going to do this? We'll 23 set up this Board, and so on. At some point it was 24 obviously sensible to codify it. I think the question 25 as to why it wasn't done earlier, I don't know. But the 133 1 key question was: was the system providing the 2 information that was required by the Department as 3 a sponsor? And I did not have any reason to think, from 4 what I was being told, that that was not the case. 5 Q. I want to look at the -- there's one more point in the 6 Accounting Officer's role. If we look at page 9, 7 please, of the same document. We have 8 "responsibilities" and it sets out there the principles 9 for managing public money. In box 1.1 we -- I think 10 it's the Nolan Principles there. The Accounting Officer 11 has to follow those principles when expending public 12 money, correct? 13 A. Yes. 14 Q. If we turn to page 19, please. This the role of the 15 Accounting Officer towards the bottom, please, the 16 special responsibilities of Accounting Officers. In 17 particular, the Accounting Officer must personally sign 18 the accounts, the annual report and the governance 19 statement. And if we look there at box 3.1: 20 "Standards expected of the Accounting Officer's 21 organisation." 22 So: 23 "Acting within the authority of the minister(s) to 24 whom he or she is responsible, the Accounting Officer 25 should ensure that the organisation, and any ALBs it 134 1 sponsors [arm's-length bodies it sponsors] operates 2 effectively and to a high standard of probity". 3 And under "Governance" we can see there's: 4 "Work cooperatively with partners in the public 5 interest" and: 6 "Treat its customers and business counterparties 7 fairly, honestly and with integrity." 8 If Post Office was a formal arm's-length body to 9 which this document applied, does it follow that your 10 role as Accounting Officer, you would have a 11 responsibility to ensure that it treated its 12 subpostmasters fairly, honestly, and with integrity? 13 A. If you go back to your previous box, I did not sign off 14 the accounts for the Post Office. I did sign off the 15 accounts for the business department and for those 16 arm's-length bodies that were consolidated within those 17 accounts. So there is a significant difference here in 18 terms of the level of control, which I just need to be 19 clear about. However, on the wider point, yes, I think 20 that, as the senior official in the Department, all the 21 bodies, whatever their status, should have been doing 22 all of this and in the case of the Post Office, it 23 clearly did not happen. 24 So I have to accept some responsibility for the fact 25 that one of the organisations which was part of our 135 1 overall grouping was not meeting these standards, and 2 I think that's appalling and I wish we had done better. 3 Q. That can come down. Thank you. 4 Let's turn, then, to the system of oversight 5 because, as I understand your evidence, it's that as 6 Permanent Secretary, you can't be involved in every 7 individual, minor decision; your responsibility is to 8 establish systems of work that ensure that, or should 9 ensure that, these ALBs and public corporations are run 10 effectively? 11 A. Yes, and it's not just minor decisions, it's also major 12 decisions because when you have the a level of 13 complexity that we were dealing with, you have to be 14 able to empower people to take decisions and follow them 15 through in a structure, because otherwise you're not 16 going to get effective outcomes or value for money. So 17 it's really important that these structures are set up 18 and are robust, because there's no alternative. 19 Q. If we look, please, at your statement page 12, 20 paragraph 30. You refer to three main ways in which 21 issues or risk could be escalated up from the various 22 parts of the Department to your attention. The first 23 was through morning meetings with the senior team, so 24 Directors General. So in the case of Post Office, that 25 would be information coming from Shareholder Executive? 136 1 A. Ah, yes, that's right -- if there were any. 2 Q. "The second was through my regular one-to-one meetings 3 with each individual Director General ..." 4 So again, that's information from Shareholder 5 Executive? 6 A. As one of the DGs, yes. 7 Q. "The third was through the Departmental top-level risk 8 register and 'dashboard'. Each of the Directors General 9 contributed to this, drawing upon the risk registers 10 held by each of their own Groups, and it was updated by 11 the Departmental ... secretariat in between meetings." 12 So again, that's information coming from Shareholder 13 Executive? 14 A. Yes, putting together all of their information and then 15 putting forward the most important issues that they saw 16 for the Board as a whole. 17 Q. Another way matters could be raised is through the 18 Secretary of State or a junior minister; would you 19 agree? 20 A. Yes, because that, if you like, is the policy line, and 21 I did not get involved in most policy areas, again 22 because I didn't have time, but also because I didn't 23 usually have anything to add to what was going on, and 24 it wouldn't have been helpful and it could have actually 25 made things less effective. But if ministers wanted me 137 1 to focus on something, they could say so, and they did. 2 Q. You also say -- oh, another way of matters being raised 3 with you would be through being copied into briefings? 4 A. Yes. But if I can give you a little background on that, 5 I would get a large amount of material every evening, 6 usually in three folders. One was "For action for you", 7 something I had to deal with immediately, possibly 8 organisational, possibly a major policy issue. One 9 would be questions of organisation, diary, and so on. 10 And there would be a third, of papers you might just 11 want to have a quick glance at to be aware of, which 12 would be a subset of the several hundred pages and 13 sometimes more of documents that would have come in to 14 my private office during the day. 15 So there inevitably had to be a process of filtering 16 and, again, I tried to stay in touch with as much 17 information as I could, but I needed to focus on the 18 areas that I was leading on or adding value in. 19 Q. In your statement you refer to your private office -- 20 sorry, that can come down. Thank you. 21 You refer to your private office highlighting or 22 identifying what were the key documents. Do you know 23 how they went about that, how they filtered out what was 24 important to you or what wasn't? 25 A. It was a bit of an iterative process. I would say, you 138 1 know, I know that the ministers or Number 10 are 2 concerned about area X. I might have asked for 3 something. If there were major issues around resourcing 4 or the structure of the Department, they would know that 5 I would want to see it. 6 But the bottom line really was I needed to be aware 7 of issues that might produce problems for the 8 organisational structures of the Department, like 9 a steel crisis, how are we going to manage that? What 10 resources were we going to have to find? Or major 11 political issues which were causing significant 12 difficulty, and the Royal Mail privatisation was 13 obviously one that was politically contentious. Student 14 loans, of course, was another. Some business crises 15 occurred rather regularly, or another area like that. 16 So it was really keeping me in touch with issues 17 where I was likely to have to engage to add value or to 18 communicate what the Department had to do. 19 Q. So is it fair to infer from what you're saying that it's 20 unlikely that they would have raised Post Office issues 21 with you or on the Horizon matters, because they 22 obviously weren't -- well, your evidence is they weren't 23 taking up your time when you were Permanent Secretary? 24 A. Yes, because they were being handled in a 25 straightforward, it seemed, way up to the relevant 139 1 Minister, and there was nothing additional coming from 2 Shareholder Executive to say, "Red flag here". 3 MR STEVENS: Sir, we're making very good progress. That's 4 probably a good time to take a break, though, for the 5 afternoon. I wonder if we could come back at 3.05. 6 SIR WYN WILLIAMS: Certainly, yes. 7 MR STEVENS: Thank you, sir. 8 (2.53 pm) 9 (A short break) 10 (3.05 pm) 11 MR STEVENS: Sir, can you see and hear me? 12 SIR WYN WILLIAMS: Yes, thank you. 13 MR STEVENS: I'm going to move on to the timeline now 14 starting in 2012. Following pressure from MPs, Post 15 Office instructed Second Sight to conduct a review, 16 which I'm sure you're aware of now. I want to look at 17 an email, please. UKGI00001424. 18 So this is from Mike Whitehead, if we just go down 19 slightly to see the signature, please. We see within 20 the Department, Shareholder Executive. Do you recall 21 Mr Whitehead? 22 A. Vaguely. 23 Q. He is -- it's hard to tell here because of the 24 redactions, but he is emailing Mike Granville at Post 25 Office and others, and he says: 140 1 "I understand through Will" -- you see in the CC 2 line that we have a Will Gibson, also Shareholder 3 Executive -- "I understand through Will that Alice has 4 asked us to agree a defensive line if pressed on the 5 Cabinet Office commissioning the independent review (as 6 advocated in Andrew Bridgen quote yesterday)." 7 He says, "How about? 8 "'This is an operational matter for Post Office 9 Limited who have already commissioned an independent, 10 sudden review by forensic accountants'." 11 Were you told about the commissioning of the Second 12 Sight review at the time? 13 A. No, not that I recall at all. 14 Q. In this email, what's being discussed is a member of 15 Parliament, Andrew Bridgen, seeking an independent 16 review commissioned by the Cabinet Office into an IT 17 system that was used by a public corporation your 18 department sponsored. Is that something that should 19 have been raised with you as Permanent Secretary? 20 A. I think in these sorts of issues I would expect the 21 senior officials involved to take a judgment as to why 22 that might need to be the case or not. 23 Q. Well, he's taken a judgment, and my question is, looking 24 at it, is that the type of issue that you would expect 25 to have been raised with you? 141 1 A. No, given the range and complexity of the Department, 2 I would have not expected that to be the case unless 3 someone more senior in the Shareholder Executive felt 4 that it raised difficult issues which were of wider 5 concern. 6 Q. So again, what we have here is the commissioning of an 7 independent review or seeking of a review commissioned 8 by the Cabinet Office. The software is the software 9 that produces Post Office's accounts on which it 10 prosecutes people. Why is that not serious enough to be 11 raised with you in circumstances where earlier you 12 referred to an accounting issue on the late filing of 13 accounts being raised with you? 14 A. Well, the accounting point was a direct issue for the 15 overall credibility of the Department's accounting, for 16 which I was personally responsible to Parliament. So 17 I had a close concern with the quality of accounting 18 both because of the credibility to Parliament and 19 because I wanted to make sure the Department had the 20 highest standards of accounting. Now, the Post Office's 21 accounting systems were separate because of their 22 status. Nonetheless, there was a reputational issue 23 there. 24 I hadn't seen this. It looks as though someone 25 outside Government is suggesting there should be 142 1 a Cabinet Office review. The issue of substance for the 2 Shareholder Executive is whether that would be justified 3 on its merits. If they don't think it is, and if they 4 believe that the Post Office independent external review 5 referred to deals suitably with the issue, I would not 6 have expected them to raise it with me, because what 7 wider issue are they saying it raises? 8 I'd only expect them to come to me if they thought 9 that the Post Office review was not going to be 10 effective or sufficiently independent or find out the 11 evidence that was required. And then the question would 12 be: well, how do you do that? But that wasn't their 13 view at the time. 14 Q. Thank you. That document can come down. 15 That leads to the interim report. We don't need to 16 bring it up, but at paragraph 84 of your statement you 17 refer to a number of documents that the Inquiry sent to 18 you that you did not have sight of -- 19 A. That's right. 20 Q. -- at the time. You don't mention the Interim Report 21 within there. Were you aware of the publication of the 22 Interim Report at the time it was published in 23 July 2013? 24 A. No, I have no recollection of that crossing my desk in 25 any substantive way. Probably my office would have been 143 1 copied into the fact that it was coming out, but I did 2 not spend any time focusing on it and I have no 3 recollection of it. 4 Q. Jo Swinson, the then Junior Minister, made a statement 5 to Parliament on the Interim Report on 9 July 2013. 6 Does that in itself show it was a matter of some 7 significance to the Department? 8 A. It showed it was a matter of some significance to the 9 Department but not out of the ordinary. There were 10 statements being made several times a week by Junior 11 Ministers. We had five rising to seven. This was 12 a normal part of business. A whole range of statements 13 would be made on every occasion that Parliament was 14 sitting. Occasionally, they would involve the Secretary 15 of State in major issues. I come back to the Royal Mail 16 as one of those. Junior Ministers, that was part of 17 their job and their normal responsibilities. 18 Q. The Inquiry heard evidence from Jo Swinson and that she 19 was told that Post Office Limited had commissioned 20 external lawyers to review past prosecutions following 21 the Interim Report. Does that not make it a level of 22 significance where past prosecutions by the corporation 23 are being reviewed, where it's so significant that you 24 should have had sight of it, or been involved in it in 25 some way? 144 1 A. In retrospect, obviously these were important moments. 2 At the time, this was a standard Junior Minister 3 reporting on an issue. The Shareholder Executive team 4 did not flag this up, and I am sure in good faith, on 5 the basis that they did not see anything substantively 6 significant out of the normal process of a review being 7 commissioned in an area and followed up, and so on, as 8 happened in a lot of areas across our area of Government 9 and more widely. 10 So it would have required someone to say, "This is 11 actually significant for the following reasons", 12 otherwise it would have been a normal bit of Government 13 business. 14 Q. You say "with retrospect". Trying to put yourself in 15 the position at the time with what you knew then, is it 16 not something you think you should have been informed 17 of? 18 A. It's difficult, knowing what we know now, to go back to 19 then. All I would say is I had confidence in the teams 20 dealing with these areas, and if their judgment -- and 21 they were closer to this than I was, and this wouldn't 22 just have been true of the Shareholder Executive, it 23 would have been true elsewhere -- unless I had some very 24 powerful additional information which would mean that I 25 felt I had a legitimate role in challenging what was 145 1 going on, I would not do so, both because I didn't think 2 it would have been professional, and because it wasn't 3 possible across the range of the Department. 4 Now, our Legal Team could have picked up on 5 something unusual, and didn't, and of course lawyers 6 would have been involved. In other areas, the Finance 7 Team might have picked up on something. But I have to 8 say that that would not have been close to being 9 something that I would have been concerned about without 10 additional input. 11 Q. Can we look, please, at UKGI00001834. It's an email 12 from Tim McInnes at Shareholder Executive, 10 July 2013, 13 so two days after the Interim Report is published and 14 a day after Jo Swinson's statement in Parliament. It's 15 to the private offices of the Secretary of State 16 Sir Vince Cable and Jo Swinson. And in CC we see "perm 17 sec, BIS." Now, is that your private office? 18 A. Yes. 19 Q. It says: 20 "Ahead of the meeting with Post Office tomorrow at 21 12.00, please see attached a briefing that covers some 22 background to the session and highlights areas that Post 23 Office management will be keen to cove off." 24 So referring to a meeting between the Post Office, 25 Secretary of State, and Jo Swinson. Is that 146 1 something -- is that the type of meeting you would have 2 assisted the Secretary of State with? 3 A. No. 4 Q. Why not? 5 A. Because it was a straightforward policy meeting with the 6 Junior Minister and the Secretary of State dealing with 7 several issues related to a specific organisation. 8 There was no wider engagement of the Department, and it 9 wouldn't have been possible or arguably helpful for me 10 to have attended all of the meetings that the Secretary 11 of State held dealing with policy, because I didn't have 12 specific additional value to add. 13 This is how the system was supposed to work. 14 Q. If you'd had -- no, let me ask one question first. At 15 this point, how much time was spent by you on the issues 16 relating to cuts which you referred to earlier? 17 A. I think at that summer, a very large amount, including 18 coming in at weekends and so on, because there was 19 a difficult negotiation with the Treasury over how much 20 capital and current spending we were likely to get, 21 which meant that some of our programmes could not have 22 continued if the initial figures we were given had been 23 the final ones. So there was a very difficult complex 24 negotiation at official level and at ministerial level 25 to try to ensure that we could go on to functioning to 147 1 do what we'd been asked to do, and that was taking up 2 a lot of my time, yes. 3 Q. Now, is it your evidence that you wouldn't have been 4 involved in these sorts of issues, even if you'd had the 5 time, for example? So you didn't have to deal with the 6 cuts, this just isn't the level of priority that you're 7 dealing with -- or was it just because you didn't have 8 enough time to deal with it? 9 A. Essentially, as I've tried to set out in my evidence 10 statement, my job with the Department as we had it was 11 to ensure the systems and culture were in place to be 12 effective and supportive, to give people the time and 13 resources to do their jobs, and also to connect with the 14 Secretary of State, with the Prime Minister, with 15 a range of stakeholders, and manage key critical policy 16 issues where additional input was needed because, for 17 example, a critical industry might require additional 18 emergency help, and that would involve the Treasury and 19 10 Downing Street and so on. 20 So for policy issues which ministers were being 21 briefed on, and were engaging with, I would not normally 22 have got involved because that wasn't how the system was 23 designed to work, given what we were trying to do, and 24 it wouldn't have been efficient for me to try to jump 25 into issues I didn't know much about or I knew less 148 1 about than the people doing it the briefing, unless -- 2 and this is an important caveat, of course -- there was 3 some question over whether the briefing was correct or 4 whether there had been an argument with the Minister, or 5 whether there were wider implications, or whether 6 10 Downing Street were involved. Only if there was 7 something else going on, and even then, my first port of 8 call would always have been to the senior officials to 9 say, "Are we happy with this? What's happening? Have 10 we thought about these options?", you know, "Have you 11 got it under control?" 12 Q. The Inquiry has heard evidence about the Simon Clarke 13 Advice of 15th July 2015, and you say in your statement 14 that you didn't see that at the time. 15 A. I have no recollection of that, no. 16 Q. Have you read his advice as part of the documents that 17 the Inquiry sent to you? 18 A. What was it on again? 19 Q. If we can bring it up. 20 A. Yes, if you could. 21 Q. It's POL00006357. So it's an "advice on the use of 22 expert evidence relating to the integrity of the [it 23 should say] Fujitsu Services Limited Horizon system." 24 And if we turn to page 13, we see "Conclusions"? 25 "What does this all mean? In short, it means 149 1 Dr Jennings [that should be Gareth Jenkins, the expert 2 witness used in the trial and who provided witness 3 evidence] has not complied with his duties to the court, 4 the prosecution or the defence. It is pertinent to 5 recall the test under which a prosecution expert labours 6 ..." 7 And it goes on. 8 So Mr Clarke is advising, in his view, that Gareth 9 Jenkins had breached expert duties. Have you read or 10 are aware now of the content of that advice? 11 A. I am now aware of it, yes. I was not then. 12 Q. That can come down. 13 The Inquiry will in due course determine who was 14 aware of that advice at the time. Assuming -- and this 15 is assuming -- that advice had made the way into the 16 Department and an official had it in the Department, 17 would you have expected, as Permanent Secretary, to be 18 briefed on the contents of that advice or the gist of 19 it? 20 A. I would have expected to have been briefed as the 21 consequences of this became clear, yes, that actually, 22 a large, potentially large, number of criminal cases -- 23 and I'm not a lawyer, so I may not use the terms 24 accurately here -- were completely unsafe and that 25 nothing had been done about this. And indeed -- and 150 1 I would have been most concerned about this in addition, 2 obviously, to the human implications -- that there would 3 have appeared to have been a cover-up in a public sector 4 organisation of this type of material? I mean, that's 5 absolutely nuclear. How on earth could this have 6 happened? 7 Q. Just focusing on the content of the advice, if at the 8 time that it had been provided to you and you were aware 9 of Mr Clarke's advice and his view that Mr Jenkins had 10 breached expert duties to the court, what would you have 11 done as Permanent Secretary, if anything? 12 A. Well, I would have wanted our departmental lawyers -- 13 and presumably the Shareholder Executive lawyers in the 14 first instance -- to get to grips with this and to make 15 sure that those of us who weren't lawyers fully 16 understood the implications of what was being said here 17 and, following on from that, how many cases were 18 involved. 19 And I would have wanted the legal redress system to 20 have worked immediately. My -- probably -- we are in 21 a hypothetical territory here -- but my responsibility 22 and my main concern would then have been, assuming that 23 was all going on as rapidly as possible, how on earth 24 did this happen? And what does this tell us about the 25 organisation we are dealing with? 151 1 And we have all these layers of management and 2 boards and so on, and yet this could have been 3 overlooked, hidden, whatever. It would have suggested 4 to me that we had a massively dysfunctional 5 organisation, and there would have been a lot of 6 consequences to have been discussed, obviously with 7 ministers as well, because rightly this would become 8 a public scandal, as it should have, and we had 9 responsibility for an organisation which was not 10 anywhere near to fulfilling not just the Nolan 11 Principles but normal, commercial behaviour. 12 So, you know, it's -- it would have absolutely been, 13 you know, you ring the alarm bell and you start doing 14 stuff about the organisation as well as the miscarriages 15 of justice that may have arisen. 16 Q. I want to move on slightly in the chronology and look at 17 the sale of Royal Mail which you were involved with. To 18 what extent, if at all, were you involved in matters 19 such as the content of the prospectus of the Royal Mail 20 sale -- sorry, the IPO? 21 A. Not at all. That was not my area of expertise or 22 responsibility. It was precisely what the Shareholder 23 Executive was set up to do and bring in expertise as 24 necessary. 25 My role, very clearly, was when they had done their 152 1 jobs -- and I remember having them in and saying, "You 2 know, you do your work. Your job is not to sell the 3 Royal Mail; it's to let me know whether you think it's 4 value for money and what the evidence is. And if it 5 isn't value for money and we don't sell it, then you've 6 done your job all the same, so don't push it in the 7 wrong direction. You've got to be objective about 8 this". 9 But that was my job. 10 Q. Did anyone raise with you, during the sale, or discuss 11 with you, anything to do with Horizon claims or the 12 Horizon IT System at all? 13 A. No, I have no recollection of that at all coming up. 14 Q. Did you have to take -- as part of your assessment as to 15 whether it was value for money, et cetera, did you have 16 to investigate or look at any of the due diligence in 17 respect of the sale? 18 A. No, I expected all that to have been done by the 19 Shareholder Executive. Again, it was their core 20 activity and I had every reason to assume they would do 21 it efficiently and no reason to assume that there was 22 any question about it, not least because this was 23 a commercial document. 24 Q. Could we look, please, at -- well, no first I want to 25 turn to some meetings you had with Alice Perkins. 153 1 Firstly, how often did you meet Alice Perkins in your 2 role as Permanent Secretary? 3 A. So I think we have in the papers, pretty much all of 4 them. I think it was about once a year. And I think on 5 the first occasion it was with Paula Vennells, and 6 that's the only meeting with Paula Vennells that I can 7 recall, and after that it was just with Alice Perkins. 8 Q. When you met Alice Perkins, did she raise or discuss 9 with you the role of the Shareholder Non-Executive 10 Director? 11 A. I have a vague recollection of this from the first 12 meeting, and I was briefed that she was not entirely 13 happy with that. I knew both the Shareholder Executive 14 and our ministers thought that it was the right thing to 15 do and I quite wanted her to think that she was happy 16 with it. I only had limited sympathy with her concerns, 17 to be honest. I thought it wasn't appropriate not to 18 have a Shareholder Executive Non-Exec Director, but 19 I don't recall that there was a difficult discussion on 20 it, in the meeting. 21 Q. Do you recall what her reasons were? You say you 22 weren't impressed with them. What were they? 23 A. I don't have a clear recollection, and so this may be 24 from the briefing: that she, and perhaps some of the 25 Post Office team, were worried there would be too much 154 1 intervention in their day-to-day or operational 2 business. 3 Q. Did you have any discussion about the type of 4 information that the Shareholder Executive Non-Executive 5 Director could pass back to the Department? 6 A. No, it wasn't that level of discussion. I know the 7 Shareholder Executive did look at whether there were 8 limited issues on which there might be a case for their 9 non-exec director recusing him or herself, but that did 10 not come up at my level. I expected it to be an 11 additional level of transparency and connectivity with 12 what was going on in the Post Office. 13 Q. Could we look, please, at BEIS0000010. Thank you. So 14 it's a briefing from Peter Batten to you. Do you recall 15 working with Peter Batten? 16 A. Not in detail, no. 17 Q. So it's for a meeting on 8 April and the recommendations 18 summarise the point, the lines to take, and at the 19 bottom it says: 20 "Note risks [on] the Valuation Office agency and 21 Horizon Working Group." 22 And then if we turn to page 3, please, we see it 23 says: 24 "All in-branch transactions performed by 25 subpostmasters and [Post Office] staff are recorded by 155 1 [Post Office's] accounting software, known as 'Horizon'. 2 Shortly after joining [Post Office] and in response to 3 persistent grumblings by a small number of former 4 subpostmasters, Alice commissioned a review of the 5 integrity of the Horizon system. An independent report, 6 published in July 2013 found that there were 'no 7 systemic' issues with the software, but made 8 recommendations about [Post Office's] training and 9 support processes. 10 "Following the report, [Post Office] has worked to 11 establish a working group under an independent chair 12 that has set up a mediation process for former 13 subpostmasters who feel wronged by the Horizon system." 14 Then it goes on to provide details of the working 15 group. 16 Can you recall what you thought when you read that? 17 A. No. I did read it, and it was not the major point for 18 the meeting -- in fact, it was some way down the 19 briefing -- and, as far as I can remember, it did not 20 come up. 21 The fact that I read it and didn't feel there was 22 anything requiring action for me was not surprising 23 given what is said there. And I was equally concerned 24 about the Valuation Office Agency risks mentioned, but 25 these were points for me to note at that stage. There 156 1 was no suggestion that I should raise them with Alice or 2 that there were wider concerns. 3 Q. Knowing what you know now, do you think that is a fair 4 and full briefing? 5 A. No. 6 Q. Would you have expected the briefing to include details 7 of the review of past prosecutions? 8 A. There is this difference between knowing what we know 9 now and knowing what the Shareholder Executive, in good 10 faith, knew at the time, and I want to be clear about 11 that. I'm sure they were writing this in good faith at 12 the time. 13 It is one example of when more information could 14 have been provided and the fact that it wasn't 15 reflected, I think, the Shareholder Executive's view 16 that this was not a major issue, particularly compared 17 with the other ones, which they already mentioned, 18 mutualisation and the change in status of various 19 postmasters and the finances, all of which were very 20 live, ongoing issues. 21 Q. Do you think the language there, we see "and in response 22 to persistent grumblings by a number of former 23 subpostmasters", is that the sort of language you would 24 expect in a briefing describing the types of complaints 25 that were being made through the Mediation Scheme? 157 1 A. I would say that it was not a fair description of what 2 had been happening over so many years. In the context 3 of just mentioning it briefly at the end of a brief for 4 a meeting which was essentially for me to listen to 5 Alice, and just have a bit of background, you know, it's 6 a sort of -- I wouldn't say it was a major failing but 7 it could certainly have been put better, yes. 8 Q. Can you assist with why it may have been put in that 9 way? 10 A. No, except I assume -- as I say, I'm sure the briefers 11 were working in good faith, but this must have reflected 12 their views at the time. 13 Q. That can come down. Thank you. 14 If you'd been told at that point, prior to your 15 briefing with Alice Perkins, that there had previously 16 been a review of criminal convictions and that the CCRC, 17 the Criminal Cases Review Commission, was in contact 18 with Post Office, would it have changed your approach to 19 the meeting with Alice Perkins? 20 A. The meeting with Alice Perkins was one of an annual 21 series of, you know, "Let's just touch base on how it's 22 all going, you can tell me anything on your mind." It 23 wasn't an operational meeting in that sense. So I would 24 have expected that to have been followed up in the first 25 instance by the Shareholder Executive with the relevant 158 1 parts of the Post Office. 2 If they had not been satisfied with the result, then 3 they could have briefed me for that meeting to say 4 something like, you know, "Be aware, we have an 5 outstanding issue with the Post Office here where we're 6 not happy with what has been going on, and you ought to 7 flag up our concerns, and this is what we plan to do 8 next." 9 Without that, it's -- it isn't the sort of material 10 or the sort of meeting in which I would have expected 11 that issue to have come up, as it were, at that -- just 12 on those terms. 13 Q. Could we look, please, at POL00116554. If we go down to 14 the bottom of the page, please. This not an email you 15 would have seen at the time. It's internal to Post 16 Office from Belinda Crowe to Martin Edwards on 12th May 17 2014. It says: 18 "As requested, please find below a note for Paula 19 including recent activity, a timeline of upcoming events 20 for the Scheme, a suggestion for the date of the next 21 Board subcommittee in light of the above, and some 22 suggested names of people for Paula to consider with 23 whom she might discuss the Tony Hooper meeting." 24 Referring there to Sir Anthony Hooper there, the 25 Chair of the Working Group. 159 1 If we go over the page, please. Further down. It 2 says: 3 "Discussion with an external sounding board ahead of 4 meeting Tony Hooper." 5 At number 4, your name. It says: 6 "At some point will need to engage with this issue 7 and getting an early perspective/understanding may be 8 a useful side effect." 9 Were you ever approached by Paula Vennells or 10 someone else at Post Office to discuss the Working Group 11 or Sir Anthony Hooper? 12 A. No, not that I recall. No. 13 Q. What we can see here is, internally within POL, the Post 14 Office, sorry -- the view that you'll need to be engaged 15 at some point. Was that ever made known to you? 16 A. No. 17 Q. The Mediation Scheme itself and the proposed changes to 18 it, and closing the Working Group, are those matters 19 that you think should have been raised with you as 20 Permanent Secretary? 21 A. Well, I think again there's a distinction between what 22 we know now and what we knew at the time. On the basis 23 that this was a process being managed by the Post 24 Office, supervised by the Shareholder Executive, 25 ministers being kept informed, I can understand why it 160 1 wasn't highlighted to me. 2 Q. Could we look, please, at WITN00800100. This is Mark 3 Russell's witness statement to the Inquiry. And page 6, 4 paragraph 16, please. It says: 5 "The appointment of Shareholder Executive 6 [Non-Executive Directors] complements but does not 7 replace the primary points of departmental contact. In 8 the case of [Post Office Limited], the key contacts were 9 between the Post Office CEO and (i) the Minister, and 10 (ii) the Permanent Secretary/Accounting Officer. Such 11 meetings provide senior members of the Department with 12 a direct line of sight into the ALB and are a key 13 mechanism for reinforcing departmental objectives for 14 the ALB." 15 Do you agree with that? 16 A. Not in precisely those terms, no, because we had over 40 17 arm's-length bodies of very different types with 18 different challenges, and it was clearly not practical 19 or, I would argue, desirable for there to be key 20 contacts between those Chief Executives and me, as the 21 Permanent Secretary, or my successors or predecessors, 22 because it would not be a professional way of doing 23 business. 24 I would interpret this as meaning officials 25 reporting to the Permanent Secretary and of course, in 161 1 this case, those officials were within the Shareholder 2 Executive. 3 I can understand it in that perspective. 4 Q. I think you said in your evidence earlier you met once 5 with Paula Vennells? 6 A. Yes. 7 Q. Did you ever discuss with Mr Russell your level of 8 contact with Post Office directly? 9 A. No, because again, apart from the meetings I had with 10 Alice Perkins, which I did not do with most of the 11 chairs, the Post Office was obviously a larger and more 12 significant organisation, and I thought that that was, 13 therefore, appropriate, I would have done so had the 14 Shareholder Executive wanted me to do so, and at no 15 point did they say that they did. 16 Q. Could we -- I want to look now at how Shareholder 17 Executive handled matters. If we could go still in Mark 18 Russell's statement, please, but go to paragraph 214, 19 page 94. 20 Mr Russell says: 21 "When I did learn that Post Office was undertaking 22 its own prosecutions I also took some comfort that, in 23 spite of the [Post Office] led Prosecution Policy, the 24 courts were making criminal convictions with the strict 25 standard of proof that is applied, and that there had 162 1 been few appeals. Wrongly, I did not consider the risk 2 of unsafe convictions as a result of failings in the 3 Horizon system to be significant, in large part because 4 of the repeated and categorical assurances that [Post 5 Office] had provided to [Shareholder Executive]/UKGI and 6 others about the Horizon system." 7 And then if we could look over the page at 217, 8 please. It says: 9 "The strong assertions made to Ministers in 10 submissions around the integrity of Horizon were wrong 11 and make for uncomfortable reading now. At the very 12 least, the submissions should have been clearer that the 13 views were the views of [Post Office] and that they 14 needed to be balanced by alternative points of view. 15 The submissions may have led to Ministers being too 16 cautious in their engagement on Horizon but, as 17 mentioned above, their direct involvement and clear 18 determination to pursue their own courses may not have 19 meant that this advice had any particular impact or 20 consequence." 21 That can come down, thank you. 22 We have that. We also have, in Mr Callard's 23 evidence to the Inquiry, he accepted that he wasn't 24 curious enough, and showed undue deference to what the 25 Post Office was telling him. 163 1 With reflection, do you think there's anything the 2 Department could have done, in terms of oversight of 3 Shareholder Executive, to correct these issues that they 4 identify: a lack of curiosity and not identifying the 5 right issues at Post Office? 6 A. Again, I find this a difficult question to answer, which 7 I have reflected on. The challenge of adding additional 8 layers is if you do not have additional information on 9 which to base your challenge, it can merely add 10 bureaucracy and actually make it more difficult to get 11 at the facts which is why, earlier on, I mentioned that 12 I thought if we'd had more resource, having more 13 resource at expert level connected with the detail and 14 following it up was perhaps one of the areas where this 15 did not work. It also did not work through various 16 levels of management and it did not work through the 17 Post Office Board. 18 The difficulty I have is that inside the business 19 department as it was and, you know, one of the 20 consequences of the range of responsibilities was that 21 I was perhaps, you know, submerged in managing all of 22 this all the time. I wasn't as out there in the wider 23 world as I might have been. But it's very difficult to 24 see how you manage a structure which isn't getting the 25 information it needs if no one is challenging at the 164 1 basis of the information provision, because the problem 2 of having an extra layer or an extra set of questions is 3 we would have received the same answers that ministers 4 got. 5 The truth is that we did not, inside the Department, 6 manage to pick up on what was going on inside the Post 7 Office in these areas, and that is a matter of huge 8 regret and had awful consequences over very many years. 9 But I-- the people involved at senior levels, I have 10 said in my statement, and I believe, were competent and 11 professional. I do not see any lack of that in terms of 12 the people who were making those decisions. So it's not 13 clear to me that adding another level would necessarily 14 have produced a different result. 15 And I come back to this problem of how do you deal 16 with a department which is not -- I'm sorry, with an 17 organisation like the Post Office, which is not 18 following the standards of honesty and integrity, at 19 least in these issues, which you tend to rely on and 20 you're not really resourced to second-guess? 21 Now, you know, I don't think that's a good enough 22 excuse for what happened, but I think it is what 23 happened. 24 Q. The Inquiry has heard evidence from Richard Callard and 25 he -- there's an email we can go to -- he received 165 1 something called the Deloitte report, which -- in fact, 2 let's bring that up, please. It's POL00028069. You say 3 in your evidence that you didn't receive this document 4 at the time. Are you now aware of it, or its -- 5 A. I'm aware of it in outline. I haven't read it in 6 detail. 7 Q. So there were initial findings made on Fujitsu's ability 8 to access remotely branch account data; are you aware of 9 that? 10 A. Yes. 11 Q. And this was sent to Richard Callard by email. And if 12 it wasn't raised, do you think this document should have 13 been raised with you or raised within the Department? 14 A. Well, knowing what we know now, it definitely should 15 have been raised further within, first of all, the 16 Shareholder Executive and then, I would hope, more 17 widely. Because the question I draw from this -- and 18 it's for you and the Inquiry to decide, of course -- is 19 that at what stage did all of these different pieces of 20 evidence amount to, "Really, we've got this wrong, the 21 scales have shifted", and why did we not pick that up? 22 And I think that is the challenge which bothers me 23 most about the professionalism of how we handled this. 24 There were too many occasions where something else came 25 in, but it was never connected properly, it wasn't 166 1 raised, the Post Office were of course just sticking to 2 various positions that they held, and we didn't ever get 3 to the stage inside the organisation of saying, you 4 know, "We've really got to not just talk about having 5 a zero-based review or an independent review; we've got 6 to get right to the bottom of this and take as much time 7 and spend as much money as is needed." 8 Q. That can come down. Thank you. 9 Part of your evidence is that there is a lack of 10 information flowing from Post Office to the Department. 11 The point you've just made there is, within the 12 Department itself, connecting the dots and acting on it, 13 on the information it had, on reflection, having heard 14 what you heard, can you assist us in any way by way of 15 recommendations as to how, if it was done again, the 16 Department could have put those things together and 17 could have acted differently? 18 A. I wish I could come up with an easy answer to that 19 question. It looks to me, knowing what we know now, and 20 having read everything that I've read and, you know, the 21 great work that went on to right this injustice, that 22 one of the problems was that it had lasted so long. So 23 there was never a moment when people went back to the 24 beginning and said, "But hold on, you know, there's 25 always been issues here" and they then just got used to 167 1 accepting the assurances that were being given. 2 And, of course, then there were a series of reviews, 3 and so on and everyone said, "Well, we're looking into 4 this" or whatever. But we didn't step back and say, 5 "But fundamentally, you know, either the people raising 6 all these issues over all these years are, you know, 7 dishonest or completely deluded, or there's something 8 here we haven't got to" and we relied too much on the 9 Post Office to do it. And inside the Department, this 10 was one of our silos and it didn't get out of that. 11 So I struggle to see how we could have better picked 12 that up. Obviously people could have performed, and 13 should have performed, better at various times in 14 various ways. In the overall structures? I think I'd 15 come back to we should have had more people in detail 16 marking the Post Office and accepting that that was 17 against all of the movement towards arm's-length bodies, 18 commercial responsibility, avoiding micromanagement. 19 And we should have said this is too important to leave 20 it to the organisation, as long and in as many ways as 21 has happened. 22 Q. I want to look at one last topic, please. It's late 23 2015 now. Could we look at UKGI00017443. Can we look 24 at page 3, please. 25 So this is from Mark Russell, the Shareholder 168 1 Executive, to other Shareholder Executive officials. It 2 says: 3 "Some negative feedback from BNR" -- I take that to 4 be Baroness Neville-Rolfe -- "on ShEx, I'm afraid, in 5 accordance with GIB and PO [Post Office]. Came through 6 Martin." 7 Would that be you? 8 A. Yes. 9 Q. Can you recall what Baroness Neville-Rolfe said to you 10 or emailed you? 11 A. Not in detail. This was -- it was not unusual for me to 12 chat to Junior Ministers about how things were going 13 over a cup of tea and particularly with a new group, as 14 we had after the election. It was also not unusual for 15 officials to come to me and say, you know, "We're having 16 a bit of an issue with Minister X on this", and I would 17 see what I could do to ensure that the system worked 18 better, taking, you know, both sides' legitimate 19 concerns into account. 20 On this occasion, Baroness Neville-Rolfe, who was 21 a very experienced Minister and had a lot of commercial 22 experience, raised these issues with me and, as far as 23 I can recall -- because, you know, it was something 24 I did as part of my normal job. I spoke, either that 25 day or the next -- probably the next morning -- to Mark, 169 1 and I made, I think, the points that he has accurately 2 put down there. I passed them on and I didn't hear any 3 more. So, as in other such cases, I assumed that action 4 had been taken, communication properly restored, and 5 things were going on in a satisfactory way. 6 Q. This was at the time when Baroness Neville-Rolfe had 7 asked Tim Parker to commission or carry out an 8 independent review, and at this point Jonathan Swift QC, 9 as he then was, was reviewing the situation. If we go 10 to page 2, please, at the bottom. We see Richard 11 Callard's email in response, it says: 12 "Marvellous. Yes, [we] can give you a full 13 briefing. The problem is we cannot deliver what she 14 wants (a green locked GIB, and a Post Office without 15 a perceived but non-existent IT problem)." 16 We know, of course, that it wasn't simply 17 a perceived IT problem. 18 A. No. 19 Q. Was it the case that Baroness Neville-Rolfe had raised 20 with you concerns about Shareholder Executive's handling 21 of the Horizon issues? 22 A. I cannot recall in detail. I do think that the previous 23 email's account was accurate. I think she did say that 24 there were they were too technocratic and they weren't 25 aware of the politics around some of these Post Office 170 1 issues. I can't remember whether she specifically 2 mentioned Horizon or not. 3 Q. You said that you -- I think you said you left it after 4 this and didn't do anything further? 5 A. Well, I did what she asked me to and I-- what I said 6 I would do, which was to raise it with Shareholder 7 Executive, with Mark as the head of the Shareholder 8 Executive, pass on the concerns, and then it was up to 9 him to follow up, and there was follow-up, and I did not 10 hear any more from the Minister. 11 Q. But in your role as Permanent Secretary, did you -- was 12 it not incumbent on you to see that the concerns had 13 been addressed and follow up on them? 14 A. Well, insofar as I can recall, Mark said that he would 15 follow this up, and he did. And, as with other such 16 issues, I did not hear any more of a problem, so 17 I assumed that it was being managed. 18 Q. Could we look, please, at UKGI00006366. If we go to 19 page 3, please. It's an email from the then Secretary 20 of State, Sajid Javid's private office, regarding the 21 restatement of accounts -- so it's the issue we 22 discovered earlier -- and reporting what the Secretary 23 of State wanted from it. 24 We see your private office is in copy. So 25 presumably this -- these emails would have been raised 171 1 with you, given you were hands-on, as it were, on this 2 issue? 3 A. Yes, I'm sure I saw this, and I think I may have written 4 something about the restatement of accounts point. 5 I certainly followed up with our own finance people and 6 with the Shareholder Executive, and made clear my 7 annoyance of what had happened, and desire to ensure it 8 wasn't going to happen again, which was the other key 9 point. 10 Q. And so this is December 2015, so the next month on from 11 the last email we saw. If we go to page 1, please, 12 further up the chain. It's an email from Baroness 13 Neville-Rolfe's private office. Again, we see you're in 14 copy or your private office is in copy but, again, it's 15 likely you would have seen this because you were 16 involved with the issue? Would you agree? 17 A. Probably. 18 Q. And what is reported from Baroness Neville-Rolfe to have 19 said is: 20 "These are very disappointing developments on top of 21 earlier difficulties in the Post Office with the Horizon 22 IT system. The good news is that we have a new 23 chairman -- Tim Parker and two new non-execs -- 24 Carla Stent and Ken McCall. Carla Stent will chair the 25 Audit, Risk and Compliance Committee and Ken McCall, the 172 1 Senior Independent Director. Tim is working on these 2 issues with their management and I have discussed the 3 matter with Mark Russell who is engaged with this issue. 4 I will be kept informed on matters progressing." 5 So it's evident that Baroness Neville-Rolfe is still 6 concerned about the Horizon issues? 7 A. And she is taking it forward in a way which she finds 8 satisfactory, and that was positive. 9 Q. Why, at this stage, did you not seek to follow up on it 10 when it had been raised by a Junior Minister as a matter 11 of importance? 12 A. Because I had already followed up on it with Mark 13 Russell. What we see here is what is now happening, and 14 the fact that there was the new corporate governance 15 level, and that Mark and team were engaged, and that the 16 Minister notes that. So that is what the system is 17 meant to be doing, and so now this takes place. 18 So from my point of view, that's what should be 19 happening, and it is happening. 20 Q. So from your perspective, within the Department, it's 21 being handled by the relevant body, Shareholder 22 Executive, and that's the Department functioning 23 properly? 24 A. Correct. 25 Q. That can come down. 173 1 I have a couple of questions on just your 2 reflections generally. The Inquiry has heard evidence 3 recommending that ministers should have express powers 4 to involve themselves in decision making in arm's-length 5 bodies. What do you say to that? 6 A. That's quite a sweeping comment. I think essentially 7 ministers always did have power. They could, for 8 example, have said to a chief executive or a chair 9 -- and occasionally this happened across Government, 10 I believe -- you know, "You know longer have my 11 confidence" in which case it would have been impossible 12 for the person to carry on. 13 I think the point is perhaps a slightly more nuanced 14 one. It's how easy was it for ministers to engage on 15 issues below that rather excessively dramatic, you know, 16 risk to the Board, resigning, or whatever, level. 17 And in my experience, ministers did, as they should 18 have been allowed to, ask probing questions, expect to 19 get responses from the relevant organisations, not just 20 the Post Office, but more widely, and where these issues 21 were politically sensitive or raised other issues, they 22 could be very forensic and concrete. 23 So I'm not sure myself there is an issue about 24 a lack of power, though it perhaps would be better to be 25 explicit about that, but in my experience, ministers did 174 1 think, and did behave, as though they had access to the 2 organisation, and could query its decisions. 3 Q. The Inquiry has heard evidence about the use of risk 4 registers, both at the corporate level with Post Office, 5 and in Shareholder Executive, and indeed you've said in 6 your witness evidence, with the Department. And my 7 understanding from your evidence is the Department risk 8 register didn't refer to the Horizon issues as a risk? 9 A. No, it was much higher level. So if you look at one of 10 the report and accounts, you can see the sort of risks, 11 because we write them in the report. They were things 12 like the 2020 change programme, the 30 per cent cuts, 13 apprenticeship targets, higher education funding and 14 accountability, Student Loans Company, capacity, partner 15 board appointments. It was those sorts of level of 16 issue, and those are all set out in the accounts. 17 Q. On reflection, do you think there's any changes you 18 could -- sorry, I'll restart that. 19 Do you think there's any changes or any benefit in 20 amending or changing the way in which risks are 21 identified and reported within the Department? 22 A. Well, the risk registers, as I think others have said, 23 are basically a management tool, and there were plenty 24 of risk registers at a devolved level, inside the 25 Shareholder Executive, in other parts of the Department, 175 1 so that those devolved levels of responsibility were 2 working with the more granular risks. I don't think 3 that there is a particular solution to having a huge 4 risk register. In my experience that doesn't work well. 5 The challenge, is, once you've identified risks at 6 different levels, you know, well, how are you dealing 7 with them and how do you use that to produce a more 8 effective outcome? 9 Q. And finally, you've referred in your statement to 10 a suggestion of implementing the Nolan Principles into 11 Post Office, or a similar public corporation. How do 12 you think that would have helped in this situation? 13 A. Well, I put it there just as an example of perhaps being 14 explicit, but the problem I have personally with that is 15 it shouldn't be necessary to say that. Public servants 16 understand, those of us who join the public sector do so 17 on the basis we want to work ethically and effectively. 18 So I think it's perhaps useful to remind people of them, 19 but, you know, signing up shouldn't make a difference 20 because it ought to be implicit in everything everyone 21 does. And obviously, you know, we're all imperfect and 22 we don't manage to do it as well as we should, but it's 23 just a core responsibility of anybody working in public 24 services. 25 MR STEVENS: Those are all the questions. 176 1 Sir, I think there are questions from Core 2 Participants: yes, from Hudgells and from HJA as well. 3 Do you have any questions before I hand over to the 4 floor? 5 SIR WYN WILLIAMS: Oh no, let the Core Participants go. 6 Questioned by MS PAGE. 7 MS PAGE: Sir Martin, I'm acting on behalf of a group of 8 subpostmasters, and I want to talk about a very 9 important year for the Horizon scandal, 2013. And in 10 that summer, just for context, we have both the Second 11 Sight Report being published and also the Clarke Advice 12 that you've looked at earlier, and that you pointed out 13 would have been nuclear, if it had come to your 14 Department and been dealt with as it should have been. 15 Also important in that year was the Network 16 Transformation Programme, and Post Office was securing 17 640 million over a three-year period. That's right, 18 isn't it? You were kept abreast of that, weren't you? 19 A. In broad terms, yes. I don't recall the precise figure. 20 Q. And it was all part of trying to keep 11,500 branches 21 going. Again, you may not remember the figure, but that 22 was part of the overall package, wasn't it? 23 Well, in April of that year, internal documents show 24 that the Post Office was looking at making a change in 25 direction for the Network Transformation Programme, 177 1 which is perhaps emblematic of the Post Office attitude 2 towards subpostmasters, because they were going to move 3 from a voluntary process to a compulsory process whereby 4 they compelled subpostmasters to move their branches 5 into the Network Transformation Programme. And internal 6 documents made free use of that word "compulsion". 7 This was an issue not least because ministers in 8 your Department had already publicly committed to the 9 process being voluntary. And in light of what came up 10 in the Common Issues trial about the relationship 11 between Post Office and subpostmasters, would you agree 12 this rather goes to the heart of the way that the Post 13 Office behaved towards subpostmasters, this attitude of 14 compulsion? 15 A. Well, I read one of the documents just recently which 16 referred to that, I think it was a PR document, and 17 I found the tone distasteful, frankly. I -- beyond 18 that, I was aware that this was an important issue 19 politically for ministers, and I didn't know that the 20 Post Office was talking to itself in those terms. 21 Q. Shall we look at that document, because I suspect I know 22 which one you're talking about? 23 A. Yeah. 24 Q. It's POL00027540. And if we could go, please, to 25 page 33. This is an annex to a document that was 178 1 presented to the Board by their Communications Director 2 called Mark Davies, and I see you're nodding so I think 3 we're on the right document? 4 A. Yes. 5 Q. And Mark Davies presented the paper to the Board saying, 6 "Well, we want to move to compulsion and we need to know 7 how we're going to deal with that from a communications 8 point of view." 9 And what we see here is his annex A, the first 10 paragraph: 11 "The following script seeks to set out how we could 12 try to sell compulsion to ministers, with a view to how 13 they might sell it on to other elements of government, 14 Parliament, and the media." 15 And so clearly that's quite direct at the start 16 there, isn't it, suggesting that this is about selling 17 compulsion? 18 A. (Witness nodded) 19 Q. It's a frank introduction, isn't it, shall we say? 20 A. Well, as I say, I didn't find the tone or frankly the 21 content of this piece particularly impressive. 22 Q. Well, if we just go down, we can see that there's 23 a contrast, isn't there, between the language of the 24 introduction and then if we go down to the paragraph "it 25 means continuing", this is the script that he wants to 179 1 sell: 2 "It means continuing the existing network 3 transformation plan which has so far introduced whatever 4 number of new Post Offices with longer opening hours, 5 modern environments, but introducing a planned approach 6 which will mean that new models will be introduced 7 alongside compensation for existing subpostmasters who 8 leave the business." 9 This is the way he wants to dress up the compulsion; 10 is that fair? 11 A. Well, my concern with this was simply that ministers' 12 decisions were respected and that the process worked 13 professionally and loyally to do that. So as I say, 14 when I read this document, I was very unimpressed. 15 Q. Yes, because in fact, in Annex D, we don't necessarily 16 need to go to it, page 37, Mr Davies actually sets out 17 all those occasions when the ministers committed to a 18 voluntary process. So in other words, this is a script 19 that he seeks to suggest Post Office can sell to the 20 ministers, sell to the Department, to change ministers' 21 policies and to change the stance that they've taken 22 publicly. 23 It looks, doesn't it, as if he wanted to keep the 24 compulsion element covert? 25 A. Well, I think it's difficult for me to comment on an 180 1 internal PR Post Office document. As I say, my concern 2 was to ensure that ministers absolutely that the 3 information they needed and then the decisions they took 4 on this and other key issues were respected, and, you 5 know, I would expect the Post Office to respect them in 6 spirit, as well as in letter. 7 Q. When we look at page 39, we see that you're actually 8 named as one of the people that he seeks to engage in 9 his delivery of this strategic plan. He says: 10 "In addition to regular meetings with day-to-day 11 Shareholder Executive contacts a series of meetings with 12 key BIS officials are taking place over the coming 13 weeks: they include Howard Orme, Mark Russell, 14 Anthony Odgers and Martin Donnelly." 15 Do you sort of recognise this script or this 16 mechanism that he sought to try to use to sell 17 compulsion? 18 A. No, I do not, and I don't recall having any such 19 meeting. I'm also aware, as I mentioned briefly, that 20 this was a time when there was a massive amount of 21 engagement in how the Department's finances were going, 22 which was taking up a lot of my time. 23 Q. In this effort to apparently use you and your team and 24 your ministers to carry out this sort of rather covert 25 move to compulsion, looking back, knowing everything 181 1 that we know that the Post Office was doing covertly in 2 2013 around Second Sight, around Horizon, what was going 3 on internally with the Clarke Advice, do you think that 4 this shows the way that Post Office was operating? It 5 was using whatever levers it had in Government to 6 advance a covert agenda. 7 A. I'm not sure I in all honesty could go that far. And 8 the Post Office obviously had the right to give their 9 views to ministers, but I would reiterate that this does 10 sound unpleasantly manipulative and it's not how I think 11 you deal with arguments. You put them in 12 a straightforward way to people and let them respond. 13 MS PAGE: Thank you. Those are my questions. 14 SIR WYN WILLIAMS: Thank you Ms Page. Next? 15 Questioned by MS PATRICK 16 MS PATRICK: Thank you, sir. 17 Sir Martin, my name is Angela Patrick. I represent, 18 with Mr Moloney KC, a number of subpostmasters who were 19 convicted and have since had their convictions quashed, 20 including Mrs Hamilton and Mr Trousdale, you can see 21 near me. I want to ask you about one issue. 22 We have looked just now at 2013, I want to go back 23 to 2014 and ask you about one document. Have you seen 24 the slide deck that the Inquiry has been looking at with 25 a number of witnesses which was produced by the 182 1 Department and of ShEx to discuss that Mrs Vennells was 2 thought not to be capable of remaining in post in 2014? 3 A. I did not see it at the time. 4 Q. No, I appreciate that. I'm just working on a shorthand 5 so we can save bringing the document up. Everybody is 6 familiar with it. 7 A. Yes. 8 Q. If you remember, it was a PowerPoint presentation where 9 there was a conversation about remove, retain, or retain 10 and review. 11 Now you've just said that wasn't a document that was 12 escalated up to you at the time, and you're nodding. 13 You have to say "yes" or "no" for the transcriber. 14 A. That is correct, in my recollection. 15 Q. Thank you. And that was dated February 2014, take it 16 from me. 17 Now at that point, February 2014, Post Office has 18 separated from Royal Mail and of course that was an 19 issue that had touched your desk. 20 A. Yes. 21 Q. The flotation. And Post Office continued on, of course, 22 with the major public subsidy, with an aim that the 23 subsidy would be reduced and mutualisation was the goal. 24 And again, you're nodding, Sir Martin? 25 A. I would just say that was, I believe, Government policy 183 1 at the time. 2 Q. Indeed, indeed. 3 A. Yes. 4 Q. Now, Ms Vennells at that time is responsible for 5 a partner organisation, albeit a public corporation, 6 which was politically and socially important, and 7 dependent on a substantial Government subsidy; is that 8 fair? 9 A. Yes. 10 Q. Whether that subsidy was in safe hands and whether the 11 Post Office would ever be in a position to operate 12 without public support, an important policy issue with 13 the public purse, wasn't it? 14 A. Yes, and for the provision of service. 15 Q. Now, ought that discussion, prompted by somebody under 16 a ShEx or a Department umbrella, ought that discussion 17 or the concern that she was simply not up to the job to 18 have been put on your radar? 19 A. I think it was important that the Shareholder Executive 20 did their job for the Post Office as for other 21 organisations, which they were sponsoring -- 22 Q. Can I just stop you, Sir Martin. It's a simple 23 question. Ought it to have been put on your radar that 24 someone under a ShEx or a departmental banner, thought 25 that Ms Vennells might not be up to the job? 184 1 A. So the point I was going to make -- let me start at the 2 other end. If they had thought the answer was yes, 3 definitely. The idea that they were reviewing, not 4 necessarily. 5 Q. Okay. So it's a conversation that's going on at a time 6 when the business is newly separated from Royal Mail, 7 with the associated political significance of that 8 process. Ought that political significance ought to 9 have been part of the consideration as to whether, if 10 there was a doubt or certainty, that question mark over 11 Ms Vennells ought to have been escalated up for your 12 consideration? 13 A. It depends how big the question mark was, honestly -- 14 Q. Okay. 15 A. -- and what the alternatives were. I would have been 16 interested to have known that. I, having seen the 17 document, I accepted that the Shareholder Executive 18 would have thought: well this is our job, this is what 19 we do. We review people. We decide whether they're up 20 to it or whether we get anybody better or what we can do 21 in the middle. And since they decided not to pursue 22 that, I can see why they didn't tell me, though I would 23 have been, as I say, interested to know, because it's 24 a very important job. 25 Q. Okay. And of course you've talked about the judgment 185 1 and the fact that you were leaving judgment to these 2 officials. 3 Now this is a conversation that's occurring at 4 a time when Parliamentarians and the press are asking 5 serious questions as to whether the Post Office have 6 wrongly prosecuted its own people for years. It's an 7 issue that was being investigated by the Post Office at 8 a significant and considerable cost to the public purse. 9 Was that an issue that ought to have factored into the 10 judgment as to whether that doubt over Ms Vennells' 11 capabilities ought to have been escalated up to you? 12 A. I find that difficult to answer, because the Shareholder 13 Executive needed to look at, in the round, how the Post 14 Office was being run, and how far the relatively new 15 Chief Executive was on top of the job, and they had -- 16 or they should have had -- access to all of the 17 evidence, including the importance of the job, required 18 to make that judgment. And they were experienced 19 people, and would not, honestly, at the time, have 20 second-guessed their judgment without additional 21 information. 22 But the fact that they were concerned is something 23 I would actually have liked to have known. 24 Q. Okay. Now Ms Perkins, who was in the chair at the time, 25 has been asked about this document, and she says that 186 1 she wasn't aware of this discussion. 2 Now, professional, senior people at ShEx who you 3 thought could be responsible for their job, would you 4 have expected them to have raised these concerns with 5 the Chair? 6 A. Yes. 7 Q. Okay. Ms Perkins also said at the time that, although 8 the discussion wasn't raised with her -- that's her 9 evidence -- that she also had doubts, including as to 10 Ms Vennells' personal grip on the Horizon issue. We've 11 discussed some of your meetings with Ms Perkins, 12 including that you were having a meeting in April 2014, 13 some time after this discussion. We've seen the 14 briefing note. As an aside, can you remember if 15 Ms Perkins raised any of her personal concerns about 16 Ms Vennells' capabilities in that April meeting? 17 A. It was 10 years ago, but I am pretty confident that, had 18 she done so, I would have remembered, because that is 19 a significant issue. And in terms of the levels of 20 control of the Post Office, the first level was the 21 Board. And so obviously, the Chair of the Board's view, 22 you know, what's communicated or not communicated, is 23 very, very important. 24 Q. But as far as you can recall, neither ShEx nor the Chair 25 raised these concerns with you? 187 1 A. No. 2 Q. And your view is that that really isn't something that 3 ought to have been on your radar? 4 A. The fact that ShEx concluded that they should stick with 5 the Chief Executive meant that, in a sense, there wasn't 6 anything changing. I would have appreciated, in 7 retrospect, knowing that they'd had that question mark. 8 And I am surprised that they didn't contact the Chair of 9 the Board on that issue, given the Chair's important 10 role in supervising, really, the Chief Executive. 11 Q. And in 2015 when a question mark is raised by the 12 Minister, Baroness Neville-Rolfe, with you as to whether 13 ShEx is really doing its job properly, whether it's 14 politically aware enough of the sensitivities around the 15 Post Office, at no point in that conversation did anyone 16 say, "Hang on a minute, last year we were talking about 17 whether Paula was up to the job"? 18 A. No. 19 MS PATRICK: Thank you. Those are all the questions that 20 I have. 21 SIR WYN WILLIAMS: Thank you. 22 MR STEVENS: Thank you, sir. 23 I think that's everyone, so we break until Tuesday 24 morning. 25 SIR WYN WILLIAMS: Right. 188 1 Well, Sir Martin, I am very grateful to you for 2 fielding all those questions this afternoon, and for 3 providing a witness statement. And as was pointed out 4 to you, it was the first time that we'd heard from 5 a Permanent Secretary, so thank you for that part of 6 your witness statement which educates me about the role 7 of a Permanent Secretary. 8 Right. We'll resume again on Tuesday, as you 9 suggest, Mr Stevens. 10 MR STEVENS: Thank you, sir. 11 (4.22 pm) 12 (the hearing adjourned until Tuesday, 1st October 2024) 13 14 15 16 17 18 19 20 21 22 23 24 25 189 I N D E X AMANDA BURTON (sworn) ................................1 Questioned by MR BLAKE ........................1 Questioned by MR HENRY .......................84 Questioned by MR JACOBS ......................92 Questioned by MS PATRICK .....................98 SIR MARTIN DONNELLY (sworn) ........................101 Questioned by MR STEVENS ....................101 Questioned by MS PAGE. ......................177 Questioned by MS PATRICK ....................182 190