1 Friday, 11 October 2024 2 (10.00 am) 3 NICHOLAS JAMES READ (continued) 4 Questioned by MR BEER (continued) 5 MR BEER: Good morning, sir. Can you see and hear us? 6 SIR WYN WILLIAMS: Yes, thank you very much. 7 MR BEER: Thank you. 8 Good morning, Mr Read. 9 A. Good morning. 10 Q. Can I once again turn to the topic of whether the Post 11 Office did not wish to have ownership of, or administer, 12 any of the redress schemes. You remember we discussed 13 this on Day 1, and we addressed it again on Day 2 of 14 your evidence. I'd like you to consider, if we may, 15 an additional piece of evidence in the light of the 16 answers you gave. Can we see, please, WITN00200300. 17 You'll see that this is a witness statement of 18 Thomas Cooper, who you'll know. 19 A. Indeed. 20 Q. By way of reminder for others, he was the UKGI 21 Non-Executive Director on the Post Office Board for five 22 years -- is that right -- 23 A. Yes, that's correct. 24 Q. -- between March 2018 until May 2023, when he was 25 replaced by Lorna Gratton? 1 1 A. That's correct. 2 Q. He gave evidence, by way of reminder for the transcript, 3 in Phases 5 and 6 of the Inquiry, on 10 June 2024. 4 A. Yes, that's correct. 5 Q. This is a subsequent witness statement of his addressing 6 some Phase 7 issues. Can we look, please, at page 11, 7 under the heading "Operational resourcing", and this is 8 part of his statement which addresses the governance and 9 resourcing of the HSS. He says: 10 "During this phase, there were discussions at the 11 Board about how [the Post Office] would operationally 12 resource the compensation workstreams. 13 "In Spring 2020, the Shareholder Team contributed to 14 those discussions by providing advice to the Department 15 concerning the separation of historical liabilities and 16 compensation matters arising from the GLO from the 17 'business as usual' commercial operations of the 18 Company. One option that was suggested was to transfer 19 the management of [Post Office's] compensation-related 20 liabilities into a newly created separate company owned 21 wholly by [His Majesty's Government]. This would have 22 enabled [the Post Office] to focus on the strategic and 23 operational issues it faced, whilst in parallel having 24 a dedicated resource set up to deliver compensation to 25 victims of the Horizon scandal. The alternative to this 2 1 proposal was the establishment of a unit within [the 2 Post Office] to handle all compensation related 3 matters." 4 Paragraph 30: 5 "UKGI's advice was discussed with [Post Office] and 6 [His Majesty's Treasury] as well as the Department. 7 [Herbert Smith Freehills] assisted [the Post Office] in 8 preparing its own paper on the topic, which was 9 discussed at the Board. The idea of separating the 10 compensation workstreams from [Post Office] received 11 little or no support. The Board determined that [the 12 Post Office] would take responsibility for the 13 compensation workstreams itself rather than pass it to 14 [His Majesty's Government]. It was decided that 15 an internal unit would be set up within [the Post 16 Office], the Historical Matter Business Unit, now known 17 as the Remediation Unit. That was set up in July 2020 18 and had a remit to deliver the legal and compensation 19 workstreams flowing from the GLO proceedings." 20 Just to complete this: 21 "Having reflected on this decision and reviewed the 22 advice that UKGI provided, as well as the Board paper, 23 one thing that is conspicuously missing from both 24 documents is the claimants' perspective. Claimants were 25 not approached to give their view at the time and, in 3 1 hindsight, the lack of trust that claimants had in [Post 2 Office] should have been included as a factor in support 3 of separation. We now know that trust remains a major 4 issue for claimants, one example of which is the GLO 5 claimants' refusal to have the GLO scheme administered 6 by [the Post Office]. Given that, as of today, 7 significant elements of the compensation being delivered 8 to [subpostmasters] are being administered by the 9 Department, as well as the very significant strain that 10 compensation has placed on [the Post Office's] 11 management which has lacked the bandwidth to handle the 12 multiple, complex issues in front of it, I believe that, 13 with the benefit of hindsight, the option of separating 14 the compensation from [Post Office] should have been 15 considered more seriously. However, at the time, 16 following the successful settlement of the GLO and the 17 participation of the GLO claimants in the design of HSS, 18 there was a perception at [the Post Office] that 19 a degree of trust in [Post Office] had been restored. 20 It is possible, therefore, that even if UKGI's advice 21 and the Board paper had identified the issue of trust 22 and captured it fully, the decision made may well have 23 been the same in any event." 24 Just going back to paragraph 30, please. 25 In the third line, Mr Cooper says that: 4 1 "The idea of separating compensation workstreams 2 from [Post Office] received little or no support. The 3 Board determined that [the Post Office] would take 4 responsibility for the compensation workstreams itself, 5 rather than pass it to [His Majesty's Government]." 6 Is that correct? 7 A. I think recollections do differ. I am very clear that 8 I have contemporaneous notes from May, June and July 9 where the notion -- 10 Q. Sorry, that's 2020? 11 A. Yeah -- where the notion of a good bank and a bad bank 12 was put forward by myself and Carla Stent and Carla 13 Stent was the Chair of the Audit and Risk Committee, and 14 we were quite vociferous about the necessity to separate 15 good bank from bad bank, by which I mean how could we 16 ring-fence the different elements of these particular 17 schemes? 18 So I don't support the notion that it received 19 little interest or little support from the Board. 20 I think the Board were very aware of the amount of work 21 that would be required, let alone the level of trust 22 that needed to be established. So I have a different 23 view and a different recollection. 24 Q. Given that, in any event, there appears not to have been 25 agreement with Government that Post Office should not 5 1 participate in or administer the compensation schemes, 2 wouldn't that, therefore, present the ideal opportunity 3 to tell the Inquiry, when it was considering that issue, 4 Post Office's view? 5 A. Quite possibly. As I mentioned yesterday and I think, 6 indeed, as we discussed on Wednesday, this was very 7 clearly an instruction from the UKGI. It wasn't 8 a "Shall we decide how to do this, what is the best 9 way?" So I'm very clear on that. 10 Q. When you say it was an instruction from UKGI, the 11 instruction was to what effect? 12 A. To the effect that we would manage the compensation 13 schemes. 14 Q. So it's almost precisely the opposite of what Mr Cooper 15 says? 16 A. Yes, I -- as I say, I'm very clear that this was 17 something that wasn't a choice for the Board. The Board 18 didn't have a choice about whether or not it would 19 administer compensation schemes. 20 Q. Again, given that that was, on your account, 21 a significant difference with Government, why wasn't 22 that ventilated or submitted to Sir Wyn in any of the 23 hearings that we had? 24 A. It's a good question. I can't answer that. 25 Q. Thank you. That can come down. 6 1 Can we just briefly address a couple of issues on 2 Postmaster NEDs. We've done this a couple of times 3 already, a couple of points to clear up. You tell us in 4 your first witness statement -- there's no need to turn 5 it up, it's paragraph 94 -- that they were not provided 6 all papers that went to the Board because of conflicts 7 or a conflict; is that right? 8 A. Yes, that's correct. 9 Q. What was the conflict that the provision of papers to 10 the Postmaster NEDs -- that would have arisen? 11 A. I think, very specifically, we were conscious that 12 Postmaster NEDs were, first and foremost, postmasters in 13 their own right and, therefore, by definition, there 14 were commercial sensitivities that may or may not have 15 determined a particular cause of action. We were making 16 decisions with banks, with Royal Mail Group, with travel 17 businesses, with our online business and, clearly, 18 postmasters would have been privy to particular 19 information that might have had a commercial sensitivity 20 that might well have impacted decision making that they 21 could have been involved in, as in on their own 22 accounts, and I think it wouldn't be unreasonable to 23 expect, given the duality of their role as both 24 a postmaster and an entrepreneur running their own 25 business, as well as determining and deciding what the 7 1 direction of travel for the Post Office is, that they 2 would be privy to certain information that might have 3 put them in an advantageous place, or indeed in conflict 4 with the organisation. 5 Q. Was a similar approach taken to the UKGI NED because 6 they had a duality of role, didn't they? 7 A. Yes, they did but they don't have a financial interest, 8 per se in the operation of their post offices, as the 9 postmasters themselves do. 10 Q. No, they have a different dual role? 11 A. Yes, they have a different role, clearly. 12 Q. Was information and papers kept from them? 13 A. Well, I'd probably put it in a slightly different way. 14 I'm -- as we saw, I think it was yesterday, we saw, 15 indeed in Project Pineapple, information that was shared 16 with the Non-Executive Directors by Henry, was not 17 shared with myself and Lorna. So there was a very 18 evident illustration of that point. I, for instance, 19 don't get the documents that go to RemCo because, 20 clearly, there would be potentially a conflict for me, 21 in that documentation. So I don't think it's wholly 22 unusual to identify conflicts where people may or may 23 not have interests in the workings of the organisation. 24 So I didn't see that as a particular issue. 25 Q. How did it affect, if any, their role, the Postmaster 8 1 NEDs' role on the Board, by the non-provision of papers 2 and information? 3 A. Difficult for me to answer that, in the sense that you 4 would have to ask Elliot and Saf what they felt that 5 they were being excluded from. My sense is that it was 6 very little and very limited in terms of what they were 7 excluded from. If I think back over the last three 8 years, where we have been in a Board meeting where 9 either they've had to excuse themselves or leave the 10 room because of conflict, I genuinely wouldn't be able 11 to identify any specific issue -- any specific time. 12 Q. You tell us in the same statement, it's paragraph 98, 13 that both the current Postmaster NEDs were consulted on 14 how to approach the next round of NED recruitment and, 15 based on their input, the criteria for the role has been 16 "rebalanced and made more objective and clearer". What 17 was unbalanced and/or unobjective about the previous 18 criteria? 19 A. I think what we've learnt, sort of specifically, in 20 terms of the first term that the Postmaster 21 Non-Executive Directors have done, is that there are 22 ways to improve both the process of recruitment, both 23 the expectations of the role, both the level of training 24 and support that we can provide. So there were a range 25 of different issues that we wanted to improve and it was 9 1 those that we discussed with Saf and with Elliot: how 2 does the selection process work; what are the 3 expectations of the role? 4 So, for instance, we've talked quite extensively 5 here about the commitment that the Non-Executive 6 Directors, the NEDs, have made. So I don't think it was 7 anything particularly specific. It was about -- it was 8 about refining and getting their view on how the job and 9 how the role could be done better, and I think that's 10 what we've taken forward. 11 Q. Both of them -- I'll give the crossreferences, no need 12 to display: Mr Jacobs WITN11180100, at paragraph 14, and 13 Mr Ismail, WITN11170100 at paragraph 150 -- say in their 14 written evidence, and they've repeated it in their oral 15 evidence, that the amended criteria mean that they have 16 not been shortlisted for reappointment when they applied 17 to stand again. Is that right: the change in criteria 18 meant that they were not shortlisted when they applied 19 to stand again? 20 A. I wasn't aware that it was a change in criteria that 21 stopped them from being shortlisted. I haven't seen the 22 analysis of all the participants who have come forward 23 to put their names forward. That's obviously something 24 that's managed and run by the Company Secretary and the 25 Nominations Committee will be the individuals that 10 1 determine what the criteria is for the selection 2 process. So that's obviously not a committee that I sit 3 on. 4 Q. Mr Ismail says in his statement, same reference, 5 paragraph 150: 6 "I believe the timing and criteria were engineered 7 to exclude me and Mr Jacobs because we are too 8 challenging, too inquisitive and ask too many awkward 9 questions." 10 Is that right? 11 A. I don't believe that's right. 12 Q. They gave interviews to the press; that's right, isn't 13 it? I think you refer to one of the articles based on 14 what they had said in your witness statement, a Times 15 article in February 2024? 16 A. I think that was an article that you presented to me, as 17 opposed to my presenting to you, if you see what I mean. 18 Q. Yes. 19 A. I responded to it, yes. 20 Q. Yes. So what would you say to the suggestion that they 21 were "too challenging, too inquisitive and asked too 22 many awkward questions"? 23 A. I would say that was their job. I made it very clear 24 yesterday that I championed Postmaster Non-Executives to 25 be on the Board for exactly that reason: I knew they 11 1 would bring a tactical focus and an operational focus 2 and an understanding of what was going on in the 3 business at the time. It would be uncomfortable at 4 times and I was very aware that that would be the case. 5 I had experienced it at Nisa, I knew what I was letting 6 myself in for and I think, certainly, my own expectation 7 was that it would bring the Board closer to postmaster 8 issues and it would bring the Board closer to what is 9 going on from a trading perspective, as well as from 10 a cultural perspective, in the organisation, and that 11 was an important way of trying to rebuild trust. 12 That was the ultimate aim of the objective, as well 13 as getting their unique experiences of being 14 a postmaster in the organisation around the boardroom 15 table. 16 Q. What would you say to the suggestion that Post Office 17 did not listen to the Postmaster Non-Executive 18 Directors, marginalised them after it had appointed 19 them, they got frustrated and went to the press, and 20 Post Office, therefore, made it difficult for them to 21 effectively stand for re-election by amending the 22 criteria? 23 A. I disagree with that. I absolutely refute that 24 allegation. 25 Q. I think it's right that exit interviews were conducted 12 1 with Non-Executive Directors; is that right? 2 A. That's correct. 3 Q. Can we look, please, at POL00448681. "NED Exit 4 Interviews -- Written Summary", conducted by Ernst & 5 Young, EY? 6 A. Yes, that's correct. 7 Q. If we go, please, to page 5, I just want to look at some 8 of the things that were suggested. Top line: 9 "I have found it a challenge being on the [Post 10 Office] Board -- it can feel like a puppet Board where 11 we don't have real decision making powers while actually 12 having a lot of responsibility." 13 Then further down, just under the line, in answer to 14 the question "What are the issues facing [Post Office] 15 that will likely consume the time of incoming NEDs?" 16 Answer: 17 "That they will be coming into a Board that is 18 actually not that influential as a whole, that it really 19 has no authority, it just rubber stamps decisions made 20 elsewhere." 21 Then over the page to page 6, please. Just at the 22 bottom on the page that's being displayed at the moment, 23 two paragraphs up: 24 "The GE use the Board to rubber stamp things but 25 don't involve the Board as they might. I am not sure we 13 1 are respected or valued, we are all vested. 2 "There isn't the level of trust in the GE nor are we 3 trusted by them -- this has resulted in a lack of 4 commitment to minuted actions." 5 Those comments -- and I realised that I'm 6 selecting -- 7 A. Yes. 8 Q. -- from a large number -- come during your tenure as 9 Chief Executive, doesn't it? 10 A. Yes, that's correct, although, I think Carla Stent in 11 particular, her tenure was six years, so it -- 12 Q. So it was partially pre-dated? 13 A. Indeed. 14 Q. Do you accept the description of the role and function 15 of the Group Executive? 16 A. No, I don't think so. We have a -- this has been 17 discussed, I think, quite extensively by other 18 colleagues -- the range of information that comes to the 19 Board and the issues that the Board has had to grapple 20 with over the last four or five years has been quite 21 unique, in the sense that there are just a range of 22 priorities that are very difficult to distinguish 23 between. And so it has been difficult to get that level 24 of genuine decision making, I think would probably be 25 the best way to describe it. 14 1 The sort of broader challenge, I think, is around 2 the effectiveness and independence of the Board and 3 whether or not they have the levers and the power to 4 make the decisions that Post Office needs. 5 I think that is the underlying theme that is being 6 expressed here, certainly in the first two or three 7 bullet points that you were making, and there is 8 a challenge around that, and that is when you read the 9 context of the entire feedback, that is the underlying 10 theme of why, I think, individuals have found that they 11 would only stay for one term on the Board: because they 12 felt -- I think it's in the first bullet that you 13 made -- that they have an enormous amount of 14 responsibility and accountability, but they have very 15 limited and little decision-making powers, primarily 16 because those decisions are either made by the 17 shareholder/UKGI or they are difficult to influence. 18 Q. So what is described by these exiting NEDs is not your 19 experience at all of the Board? 20 A. Which particular bit? 21 Q. Well, the three that I've read to you. 22 A. I -- 23 Q. It's a puppet Board, we don't have any real 24 decision-making power; the Board isn't influential as 25 a whole, it rubber stamps decisions in fact made by the 15 1 GE; and the Board rubber stamps things for which it 2 isn't respected or valued? 3 A. No, I don't think I would agree with that. I think the 4 first two points you make are actually more references 5 to the influence and shape of the Board with regard to 6 the shareholder, as opposed to with regard to the Group 7 Executive. It has been very tough, I think, for the 8 Board and the Group Executive, certainly at this 9 particular juncture but I don't think that is something 10 that is widely experienced, in terms of the Group 11 Executive just expecting the Board to rubber stamp 12 issues. I think it's more the volume of work that the 13 Board was having to deal with that meant they couldn't 14 give the level of attention to the specific issues and 15 topics that were being brought forward. 16 And, secondly, I think the nature of the business, 17 and I say this in my original witness statement, my 18 first witness statement, is that for the five years 19 certainly that I have been in the business, it has been 20 in crisis, and so many of the decisions that have come 21 to the Board have been tactical, short-term and 22 reactive, as opposed to long-term strategic, which you 23 would expect from a business that was perhaps under 24 the -- less under the strain that the organisation has 25 been for the last five years. 16 1 Q. I think you've had your attention drawn to an email 2 exchange between Lorna Gratton and Rachel Scarrabelotti 3 in October 2023 -- I'm not going to display it unless 4 it's necessary, in the interests of time -- about the 5 SID appointment where she, Lorna Gratton, expressed the 6 view that it would be beneficial to appoint a woman to 7 give balance to the Post Office Board. Do you recall? 8 A. Yes, I do recall that. I thought -- I think -- this is 9 the exchange where Lorna wanted, and I shared this view, 10 that we have an external SID appointed to the Board -- 11 Q. Did you agree that the Board lacked balance and 12 therefore needed balance brought to it by the 13 appointment of a woman SID, a female SID? 14 A. Yes, I think so. So Lisa and Carla and Zarin all left 15 within the space of four months, and I think the Board 16 would have benefited from an additional female, perhaps 17 a SID as well. 18 Q. Other people have raised concerns about your treatment 19 of women, and I must give you opportunity to respond to 20 the allegations that have been made. I am not going to 21 display them in the interests of time and, instead, 22 summarise them for you, Mr Read: 23 Firstly, Mr Staunton claiming in March 2024 that you 24 had overseen a culture of misogyny. 25 Mr Staunton saying that he was aware during his time 17 1 at the Post Office of a "high level of unhappiness 2 amongst a number of the company's senior women", 3 a pattern developing where senior women were not 4 supported in challenging roles. 5 Ms Davies telling him that she had raised the issue 6 of the psychological safety of women in the organisation 7 directly with you but you were not prepared to take any 8 action. 9 Mr Staunton noting that Ms Davies was the fifth 10 Chief People Officer during your tenure, which gave him 11 concern about your ability to retain female talent, she 12 having expressed concerns over a "job for the boys" 13 mentality within your team. 14 Ms Davies' Speak Up report of September 2023, which 15 included allegations against you, which was subsequently 16 independently investigated by Marianne Tutin of Devereux 17 Chambers. 18 Firstly, did you become aware of concerns regarding 19 your views and approach to women in senior roles in Post 20 Office? 21 A. Did I become aware? 22 Q. Yes. 23 A. In what -- well, I became aware when Ms Davies, having 24 left the organisation in June 2023, in September 2023, 25 elected bring a series of grievances against me and 18 1 against Henry Staunton and against the Post Office more 2 generally, having not had her job role and her probation 3 period converted into a permanent role. And so, having 4 left the organisation in June, it was then some two and 5 a half months later that she made a series of 6 allegations against me and -- including Henry. 7 Q. Was that the first time that you became aware of 8 concerns regarding views and approach towards women in 9 Post Office? 10 A. It was the first time that I was aware that allegations 11 had been suggested that I was fostering a culture of 12 misogyny or anything along those lines. 13 Q. When you joined the Post Office, were you concerned 14 about any lack of diversity amongst the Senior Executive 15 Team or the Board? 16 A. Not at the Board. I think we were a diverse and 17 functioning Board. I think it was relatively well known 18 that the Group Executive was male dominated, certainly, 19 and we were keen to set ourselves some targets for the 20 Senior Leadership Group and also for the Group Executive 21 to introduce some diversity to that, to both of those 22 two forums. 23 Q. You tell us in your witness statement -- no need to turn 24 it up, it's the second witness statement, page 17, 25 paragraph 49 -- that a survey conducted by Post Office 19 1 showed that: 2 "The proportion of women experiencing comments that 3 felt offensive, embarrassing or hurtful was greater than 4 men and that that rose consistently and significantly 5 with seniority." 6 Following the results of that survey, what steps 7 were taken, if any, to address it? 8 A. We had an action plan, three things emerged, I think 9 from that, in particular, if it's the one that I recall. 10 The first one was that disabled colleagues within the 11 business were suggesting that they didn't have the 12 opportunity to get on in the same way and weren't 13 supported in the way that some of their abled colleagues 14 were. We had an issue -- a cultural issue in that some 15 of our cultural minority colleagues felt that they were 16 not getting the level of promotion that they wanted and 17 warranted. And then the third piece, which quite 18 rightly you highlight, which was very, very 19 disappointing and surprising to a degree, was that 20 senior women within the organisation had experienced 21 more unwanted comments than their male counterparts. 22 And so we established those three as the core 23 equity, diversity and inclusion elements to our strategy 24 and we advised the organisation that that is where we 25 were going to spend our time. We have recruited a new 20 1 capability and inclusion director, and also a new 2 equity, diversity and inclusion director, to spearhead 3 the strategy, our EDI strategy, that we want to develop. 4 So we are very conscious of that feedback and have 5 been very transparent in the fact that this is something 6 we will be addressing over the next few months. 7 Q. One miscellaneous topic, before I ask my final questions 8 to you. Can we look, please, at POL00448381. This is 9 a letter you'll be familiar with: it's your letter to 10 the Lord Chancellor, 9 January 2024. You're familiar 11 with this? 12 A. I am indeed, that's right. 13 Q. I'm therefore going to skip over the first three 14 paragraphs, if we scroll down, please. That refers to 15 some work that's been done by external legal advisers, 16 which had identified 30 potential appellants, to whom 17 POL would write, because it would be highly likely that 18 POL would concede their appeals in the Court of Appeal. 19 The letter continues: 20 "A natural corollary of that exercise has been to 21 identify those cases in which, on the information 22 available to us and following the judgment in Hamilton, 23 we would be bound to oppose an appeal. Typically, these 24 cases involve convictions obtained by reliance on 25 evidence unrelated to the Horizon computer system. The 21 1 number of such cases is very much more significant, at 2 369, with a further 11 still under review. There are 3 another 132 in which we cannot determine the sufficiency 4 of evidence without more information. This clearly 5 raises acute political, judicial and communications 6 challenges against the very significant public and 7 Parliamentary pressure for some form of acceleration or 8 bypassing of the normal appeals process." 9 Was this essentially you, on behalf of the Post 10 Office, saying to the Government that it should not 11 legislate, in an exoneration bill or similar, because of 12 an assessment by Post Office that the vast majority of 13 convicted subpostmasters were, on its assessment, 14 unlikely to have their convictions quashed in a court? 15 A. No, I was making no value judgement, as I said in the 16 fifth paragraph, about what this meant or what you could 17 interpret from it. I was extremely conscious that we 18 discussed with the Advisory Board through the previous 19 autumn, actually in the summer, the real challenge that 20 we had, in light of Hamilton, of encouraging postmaster 21 victims to come forward. 22 We discussed a range of different ways to try and 23 achieve this, and it was really to highlight that we 24 felt we had an obligation -- I was advised that we had 25 an obligation to let the Lord Chancellor become aware of 22 1 the fact that we'd done this work and that we had shared 2 it with the Advisory Board, that we recognised that 3 there were challenges and, you know, clearly it was 4 important that we made ourselves, Peters & Peters, Simon 5 Baker, Jacqueline Carey -- the KCs that had conducted 6 the work on our behalf -- made them aware of what we had 7 done and the challenges that we'd experienced. 8 Q. You tell us that the Board held over 60 meetings 9 regarding the Post Office's responses to the CCRC and 10 criminal appeals, just in the period 2021 and 2022. Has 11 the Post Office similarly engaged with or held meetings 12 in respect of its response to the Scottish Criminal 13 Cases Review Commission and the Procurator Fiscal 14 Service in Scotland? 15 A. No, we haven't. 16 Q. Why is that? 17 A. I think, when we first met in 2021 and went through 18 a series of Board meetings to look at individual cases, 19 we hadn't established our Remediation Committee, which 20 is the subcommittee of the Board that now oversees 21 remediation matters, and my understanding is that the 22 Remediation Committee are overseeing those matters as 23 opposed to the full Board. 24 Q. In May 2024, the Lord Advocate made a statement to the 25 Scottish Parliament that, due to its conduct, the Post 23 1 Office was no longer trusted in Scotland and, as such, 2 had been stripped of its role as a Specialist Reporting 3 Agency in Scotland. What was the Post Office's response 4 to that? 5 A. I'm not sure we had a formal response, per se, at the 6 Board and I don't recall that happening. I think we had 7 and have been very clear that we will not be conducting 8 any form of prosecution, so I don't think it was of 9 enormous surprise that that was the decision that was 10 made. But it wasn't a formal discussion, certainly at 11 the Board. It may well have been something that was 12 considered at the Remediation Committee. 13 Q. Has the Post Office carried out any formal review of its 14 previous performance in the role of a Specialist 15 Reporting Agency in Scotland? 16 A. Not that I'm aware of. 17 Q. Lastly on this topic, can we turn up POL00448701. If we 18 just look at the last page, please, this is a letter 19 from Mr Vamos, Partner and Head of Business Crime, if we 20 scroll down. We can see it's sent for and on behalf of 21 Peters & Peters Solicitors. If we just go back to the 22 first page, please, this was a letter that I think was 23 displayed on the Post Office's website? 24 A. Yes, I understand that, yes. 25 Q. Do you know how that came about? 24 1 A. How it was put on the website? No, I don't but I've 2 learnt during the course of this Inquiry that that was 3 the case. 4 Q. Then it was taken down? 5 A. Quite possibly, yes. 6 Q. Yes, do you know -- 7 A. I don't know -- 8 Q. -- anything about why it was put on the Post Office's 9 website and then it was taken down? 10 A. I don't. No, I can't give you that. 11 Q. Do you know who instructed Mr Vamos, if anyone, to write 12 this? 13 A. No, I understand it was unsolicited, as in it came to us 14 unsolicited. 15 Q. So it's a Post Office criminal lawyer -- 16 A. Yes. 17 Q. -- ie somebody instructed, expert in the criminal law, 18 writing to their client uninvited -- 19 A. Yes. 20 Q. -- unsolicited -- 21 A. Yes. 22 Q. -- or uninstructed -- 23 A. Yes. 24 Q. -- to do that, is your understanding? 25 A. That's my understanding. 25 1 Q. But then it's put on the Post Office's website? 2 A. So I've now subsequently discovered, yes. 3 Q. In the third paragraph, the third on the page here, the 4 second substantive paragraph, Mr Vamos says: 5 "In reality, it is highly likely that the vast 6 majority of people who have not yet appealed were, in 7 fact, guilty as charged and were safely convicted." 8 By posting this on the Post Office website, did the 9 Post Office ally itself to that view? 10 A. I don't know the detail of how and why it was posted to 11 the website. I think there is a question that we've got 12 to ask ourselves as to the governance of what it is we 13 put on our website and how it -- how material goes onto 14 the website. I think that's something that we've got to 15 review. 16 Q. Was that the view within the General Executive? 17 A. No, I don't believe that is the case. 18 Q. So looking at the matter generally and standing back, do 19 you know how it is that Post Office's principal criminal 20 lawyer wrote an unsolicited opinion for the Post Office, 21 which said that the vast majority of people who haven't 22 appealed were guilty as charged and safely convicted, 23 and the Post Office publishes that? 24 A. It looks pretty appalling. 25 Q. I'm just asking: do you know how it happened? 26 1 A. No, I don't. I don't know the genesis, as you say, of 2 the letter itself or indeed how it then -- and who 3 determined that it would be put onto the website. 4 SIR WYN WILLIAMS: It's addressed to "Dear all"; who are the 5 "all" there, Mr Read? 6 A. I don't know, sir. I don't know who "all" is, I'm not 7 clear if this was a communication that went more broadly 8 to other all people, I'm not certain. 9 SIR WYN WILLIAMS: Normally, if it's sent electronically, we 10 get a kind of list of recipients on email, don't we? 11 Unless I'm wrong, I don't think the Inquiry knows to 12 whom it was actually sent. 13 A. We can obviously find out who that is and obviously help 14 the Inquiry, if that would make sense. 15 SIR WYN WILLIAMS: Thank you. 16 MR BEER: Lastly, you have heard, I think, a series of 17 witnesses in the Inquiry within this phase suggest that 18 your own personal grievances about your own remuneration 19 became too significant a feature in your tenure and 20 interfered with your ability to carry out your role. 21 A. Yes, I've heard that. 22 Q. Are they right? 23 A. No, I don't believe that to be the case. However, I am 24 very aware that the furore around my pay and 25 remuneration -- and I'm not in any way deaf to that -- 27 1 looks very poor in light of many of the victims who are 2 still waiting for their compensation, and I very much 3 regret that the furore that has exploded as 4 a consequence of that has been a distraction for 5 everybody. 6 Q. To be clear, I'm not asking you questions about whether 7 you thought you were underpaid or not and nor am 8 I asking you questions about your reflections on how it 9 looks that you were complaining repeatedly about your 10 pay, your salary and your remuneration package as 11 a whole. I'm asking you: did your repeated grievances 12 and complaints about remuneration become too significant 13 a feature of your tenure and interfere with your ability 14 to carry out your role? 15 A. No, I don't believe that to be the case. 16 Q. And why? 17 A. I was frustrated at times but I don't believe that it 18 was a distraction. I don't -- I'm sure if you discuss 19 with other colleagues, they would certainly corroborate 20 the fact that it's not something that I was perpetually 21 discussing. There's no question that two of the 22 individuals who have made these allegations have left 23 the organisation under somewhat of a cloud, and so I can 24 understand that that may well be the driver behind why 25 they have made these comments. 28 1 Q. To be clear, it's not simply Ms Davies or Mr Staunton, 2 I think the two people you're referring to -- 3 A. Yes. 4 Q. -- there are contemporaneous materials with you making 5 complaints, saying, for example, "Am I prepared to make 6 a drama out of this? Yes, I am. I'm prepared to submit 7 a formal grievance. I'm prepared to make a claim for 8 destructive dismissal. My patience has expired", and 9 the like? 10 A. I was frustrated. I was frustrated, Mr Beer, yes, I can 11 confirm that's the case. But I think many CEOs and many 12 individuals operating in -- potentially in a role that, 13 as I described on Wednesday, bears no relation to the 14 one that I was recruited to do, and the complexity and 15 the leadership challenges associated with that role, 16 three years in, clearly was something that was 17 frustrating me, and I vented that frustration. 18 Q. You sought legal advice on your position? 19 A. Support -- well, no, it wasn't specifically legal 20 advice. I did obviously -- I discussed it with other 21 colleagues and friends -- not colleagues within the 22 business but other colleagues. 23 Q. You sought PR advice? 24 A. As I say, with other colleagues and friends. 25 Q. I'm not going to go to the text messages that you 29 1 exchanged with Ms Davies but in one of them you said, 2 "I've gained advice on my legal position and PR advice 3 on how I intend to handle this". 4 Did you threaten to resign as CEO unless you were 5 given higher remuneration? 6 A. No, as I say, I was very frustrated at that particular 7 time but I'm still very much in role now. So I didn't 8 offer my resignation or tender my resignation, or 9 anything of that nature. 10 MR BEER: Mr Read, those are my questions. Thank you very 11 much for answering them. 12 Sir, we've now got questions from four Core 13 Participants, starting with Mr Stein for about an hour, 14 then Mr Moloney for about 45 minutes, then questions by 15 Ms Allan for about ten minutes and then questions on 16 behalf of the NFSP for about 15 minutes. 17 So over to Mr Stein, for about an hour. 18 SIR WYN WILLIAMS: When you say for about an hour, we've 19 been going about three-quarters of an hour, so that 20 would be a fairly long session. Can we just confirm 21 that the transcriber is happy with that or will Mr Stein 22 need to take a break at some point? 23 MR BEER: I have already spoken to Mr Stein about it and 24 said that he should take a break at 11.30 or about 11.30 25 when a convenient moment arises so that the shorthand 30 1 writer gets her usual break. 2 SIR WYN WILLIAMS: Fine. Thank you. 3 MR STEIN: Sir, I can confirm I have spoken to Mr Jacobs, 4 who will remind me to take that break at around that 5 time in about 25 minutes. 6 SIR WYN WILLIAMS: Thank you. 7 Questioned by MR STEIN 8 MR STEIN: Mr Read, I think you're aware that I represent 9 a large group of subpostmasters. I just want to break 10 that down so you've got an understanding of who it is 11 that's within that group. 12 The large group that I represent, includes people 13 from the GLO claimants at the High Court. It includes 14 people that have been convicted of offences by the Post 15 Office, or thereafter, once the Post Office stopped 16 prosecuting people itself. It includes people that were 17 branch managers, such as Peter Holmes, deceased, 18 represented by Marion Holmes, who appears in this 19 Inquiry and sits beside me today. It includes people 20 who were working in branches, Ms Falcon, who was one of 21 the last people convicted using Horizon data, who was 22 an employed people within a branch. It includes people 23 like Dr Linnell, a forensic accountant who, in fact, was 24 not a subpostmaster or working in a branch but has 25 devoted a considerable amount of her time and her 31 1 partner's time in supporting postmasters. 2 And it includes importantly the families of those 3 people, who, although we don't, in a legal sense 4 represent, we support and we try and we speak to 5 whenever we can. 6 This is a large group of people, a broad church of 7 people; do you understand that? 8 A. I understand. 9 Q. The final small group of people we represent are current 10 postmasters. 11 So that is the direction of travel that we take, in 12 relation to the questions I am asking you today, 13 Mr Read. 14 Mr Read, shortfall money: where has the money gone, 15 Mr Read? 16 A. As you've heard in this Inquiry on a number of 17 occasions, there have been external forensic accountants 18 looking at this particular problem, trying to assess 19 what it is that has gone and where it has gone to. The 20 current piece of work on this topic has identified 21 a figure somewhere in the region of £36 million between 22 1999 and 2015. 23 The work itself was conducted mainly on 24 an assessment of the HSS and the OC schemes, in terms of 25 who has projected what by way of losses. The challenge, 32 1 of course, is that monies that have been repaid into or 2 through suspense accounts, and the like, could easily 3 have been customer money, client money, as opposed to 4 necessarily specifically Post Office money, and so the 5 proportion that goes straight to the bottom line, for 6 want of a better word, within the Post Office, can be 7 quite obscured. 8 I guess what I'm trying to say is we think we have 9 got a figure of somewhere in the region of £36 million 10 spread across those years. I don't think it is as 11 definitive as we would like it to be. I think the fact 12 that it is known as Project Boland within the Post 13 Office, I think KPMG were the last forensic accountants 14 to look at this problem. 15 You'll be fully aware that data going back a number 16 of years is extremely difficult in the Post Office to 17 identify very often, and that is our best endeavour, in 18 terms of where we've got to. As I understand, it is 19 going to be reviewed again but it is a frustration and 20 I appreciate it's a frustration. We've the talked about 21 this topic at the Inquiry on a number of occasions. 22 Q. You're right, Mr Read. I've raised this time and time 23 again -- 24 A. Indeed. 25 Q. -- witness after witness. I asked Mr Cameron on 17 May 33 1 2024 the very question I asked you: where has the money 2 gone? 3 A. Yes. 4 Q. I got told by Mr Cameron, after a number of other 5 questions, "Well, I think, you know, ask Nick Read. 6 He's the CEO". He said, "I mean, I'm not saying that 7 he's the one who's going to do the work but he's the one 8 that can marshal the resources and make it a priority 9 and ascertain if it is possible at this time of day", he 10 said, "to go back as far to 2005 or indeed before". 11 So these efforts to track down this money that 12 Sir Anthony Hooper, Sir Alan Bates, Kay Linnell -- 13 Dr Linnell -- Second Sight, have been going on about for 14 so many years over the decades, when did they first 15 achieve a priority within the Post Office? 16 A. Trying to identify where the funds were, this project 17 has been running for some time and Mr Cameron is very 18 aware of it as well, under his tenure as the CFO, 19 clearly it fell within his remit. We reignited those in 20 light of the conversation that you had with Alisdair in 21 May and that's why the Project Boland has been 22 reignited. 23 We've been immensely frustrated. We've all been 24 frustrated that there isn't a simple answer to this 25 question. It's an extremely complex issue because, 34 1 clearly by definition, people have paid in losses 2 themselves and have not alerted the Post Office. We 3 don't have the level of data that goes back or the 4 accuracy of the data that goes back and, as everybody is 5 fully aware, that is a great frustration and, as I say, 6 this is predominantly based upon what victims of the 7 scandal have told us through the HSS, and indeed through 8 the OC, and our attempt to try and understand from that 9 mechanism. It isn't satisfactory. 10 Q. Mr Read, the shortfalls and the paying off of shortfalls 11 continues. You know that the YouGov report that was 12 commissioned by the Inquiry has received consultation 13 responses, demonstrating that people are still paying 14 off shortfalls; do you understand that? 15 A. It's very frustrating that people feel -- 16 Q. Do you understand that, Mr Read? It's not about your 17 frustration. Do you know that to yourself? 18 A. I'm aware that people are paying for shortfalls. We've 19 made it very clear that the Review and Dispute button 20 and the Branch Support Centre will help individuals to 21 understand where discrepancies have occurred and, as 22 I said yesterday on a number of occasions, we are not 23 forcing individuals. There is a presumption of 24 innocence and it's really important that that message 25 lands. 35 1 We have struggled to engage more broadly and 2 communicate more broadly with many postmasters, as we 3 discussed yesterday, going through the YouGov survey. 4 But I'm very, very clear, and you can hear it from me in 5 this forum, that we are not enforcing people to make 6 good losses. We are suggesting that, where there is 7 an issue that they do not understand, we help them to 8 try and understand and, if we can't understand, then we 9 move on. 10 Q. Currently, when a subpostmaster pays off a shortfall, is 11 it investigated? Now, be careful about the answer to 12 this. There's the Dispute button, yes? 13 A. There is a Review and Dispute button. 14 Q. Right, if somebody presses the Dispute button, or Review 15 and Dispute button, then it seems that the current 16 policies mean there is an investigation; do you agree? 17 A. When you press the Review and Dispute button, it goes 18 through to the Branch Support Centre and we try and work 19 out with the postmaster what is the issue. 20 Q. Right, so the answer is actually yes, you could have 21 done that with a "Yes". 22 Okay, next one. When a subpostmaster calls the 23 helpline and says, "Look, I'm having a problem with the 24 account, I'm trying to balance, and there seems to be 25 a discrepancy", is that investigated? Yes, or no, if 36 1 you can please, Mr Read? 2 A. Yes, it is. 3 Q. Right. Let's look at the other type of shortfall, then. 4 So where someone does not press the Review and Dispute 5 button, where someone does not phone the helpline, for 6 whatever reason, is that investigated? So a shortfall 7 that is paid off by a subpostmaster which is not the 8 subject of pressing the button and not the subject of 9 calling the helpline, is that investigated? 10 A. If it isn't brought to the attention of the Branch 11 Support Centre then it won't be investigated because we 12 would be unaware of what had occurred -- 13 Q. Now -- 14 A. -- unless I'm misunderstanding you. 15 Q. -- a system within a branch -- 16 Forgive me, Mr Read, you finish. 17 A. Unless I'm misunderstanding you, we would have to have 18 the discrepancy or the loss brought to our attention for 19 us to be able to investigate it. If people are still 20 paying in because they have done a branch -- done an end 21 of day, end of week, or a trading period reconciliation 22 and found that they've got cash and stock that doesn't 23 match what's on the Horizon, and they determine that 24 they want to pay that money in, then it's very 25 difficult, I think, as my understanding goes, for the 37 1 Post Office to be aware of that particular situation. 2 Q. When individuals within a branch account find they have 3 a shortfall, they're doing so based upon the data that 4 they have, which is also on the Horizon system; do you 5 agree? 6 A. Yes, that's correct. 7 Q. Right. So is it possible for the Post Office to start 8 looking at shortfalls that occur within branches that 9 are then paid off? What I mean is this: individuals who 10 are currently paying off discrepancies that they find, 11 that you know about through the YouGov report, at least, 12 that is still happening. Why doesn't the Post Office 13 actually start to analyse the shortfalls that are 14 occurring on their accounts? 15 A. Well, we have a discrepancy report and shortfall report. 16 Every single investigation that now occurs into 17 a shortfall and/or a discrepancy is recorded. So we 18 have an impact -- a branch impact -- sort of, programme, 19 I think it's called BIP, which identifies all the 20 shortfalls and identifies all the discrepancies, so that 21 that database is available for anybody in the Branch 22 Support Centre or anybody in the Support and 23 Reconciliation Centre to look into to see if there is 24 a commonality or a theme. 25 And what we do is obviously we look at the range of 38 1 discrepancies that occur, and we start to address them 2 by theme, so that those that are occurring more 3 regularly -- and we discussed this yesterday, in terms 4 of moving keys or the like -- we address. 5 Q. Let's go back a couple of minutes into your evidence. 6 You agree that if the situation is that someone within 7 a branch pays off a shortfall that they don't bring to 8 the attention of the wider Post Office, maybe because 9 they're afraid to do so, maybe it's because the history 10 of this very scandal has affected them so that they 11 don't feel they can, or maybe it is because it's 12 a smallish amount of money and they just want to keep 13 trading without interruption, maybe for any one of those 14 reasons that they don't bring it that way to the 15 attention of the Post Office, the Post Office could be 16 monitoring this but isn't; do you agree? 17 A. No, I don't. I don't really understand your point 18 because we're very clear that, if you have a discrepancy 19 and you don't understand the genesis of that 20 discrepancy, then you must ring the Branch Support 21 Centre, you must press the Review and Dispute button and 22 we will help to understand why that is the case. 23 I'm very clear that it's a presumption of innocence 24 here and we will get on and support people and we are 25 doing considerably different work to understand the root 39 1 cause of the issues and make sure we fix them, so I -- 2 Q. Mr Read that's -- 3 A. Maybe we're at different -- at cross purposes here. 4 Q. No, I don't think we are, Mr Read. That's the corporate 5 message you're spouting. The corporate message is, 6 "We're trying to change, we're trying to be different 7 from what we used to be, we're trying not to browbeat 8 the subpostmasters, we're hoping we are not prosecuting 9 anybody"; those are the messages you're essentially 10 trying to get out, okay? But it is clear from the 11 YouGov report that particularly long-term subpostmasters 12 are still paying off shortfalls. You know that, don't 13 you, Mr Read? 14 A. I would be very concerned if people were paying off 15 shortfalls that they felt were not as a consequence of 16 an action that may have taken -- 17 Q. What do you mean concerned, Mr Read? That is 18 essentially what the YouGov report has identified: that 19 people are still paying off shortfalls themselves. It's 20 not just a concern: this is happening. Do you dispute 21 that, Mr Read? 22 A. No, I don't dispute it. 23 Q. Right. 24 A. They need to, as I've mentioned before, get in touch 25 with the Branch Support Centre if they believe that the 40 1 discrepancies that are being generated in branch bear no 2 relation to activity that they have been deployed in. 3 Q. Look at it from the subpostmaster point of view. 4 A. Yes. 5 Q. I'll turn at the end of my questions to what has 6 happened through your visits as part of reparations, as 7 part of meeting people that have been affected by the 8 scandal. You I know have gone on those visits and you 9 have done that and you have shown empathy, yes? 10 A. Yes. 11 Q. And they have affected you -- 12 A. Very much so -- 13 Q. -- we can see that. 14 A. -- yes. 15 Q. You know that the long history of this scandal -- 16 A. Yes. 17 Q. -- has affected people working in brands currently, yes? 18 A. I agree. 19 Q. You're essentially saying, "We're trying to change and 20 we're trying to get that information across"? 21 A. Yes. 22 Q. You understand that the YouGov report is highlighting 23 the fact that people are still paying off using their 24 own money -- 25 A. I do. 41 1 Q. -- and perhaps there's a trend towards it being the 2 longer-term subpostmasters? 3 A. I think that's fair. 4 Q. So you understand that the message that you've been 5 trying to get across, perhaps it's not been received, 6 perhaps it's not even welcome, that the message is 7 a difficult one to get across? 8 A. Yes, and that was very much what I said yesterday: that 9 we are struggling to engage with the longer-term 10 postmasters, for the reasons that I think that you have 11 articulated very clearly. 12 Q. Mr Read, how much longer have you got at the Post 13 Office? 14 A. To the end of March. 15 Q. End of March. It's clear, I think you'll agree, that 16 there's work to be done in this area of shortfalls? 17 A. I would agree with that. 18 Q. Will you rededicate your remaining period of time, not 19 exclusively, but at least a part of it, to working on 20 the shortfalls, to making sure that people know and 21 understand that they don't have to pay it off, that 22 there is a way of sorting it out without having to use 23 their own money; will you do that? 24 A. I will certainly do that. More importantly, and I think 25 what, even more importantly is, we're just not reaching 42 1 some of the postmasters who have had long service within 2 the Post Office, for perhaps some of the reasons you've 3 described, which is the level of trauma and the level of 4 mistrust. That is of great concern to me and that is 5 something that we need to address. 6 Q. I'm going to turn to a document that is called one of 7 the Postmaster Support Policies, of which there are 8 many, and it's the Postmaster Account Support document, 9 POL00448000. Now, Mr Read, you may have some 10 familiarity with these documents. On the original 11 they're bright red, as they come on to the screen they 12 appear to be rather dark -- 13 A. Right. 14 Q. -- and we can see this one is version 4.0. In fact, 15 there's a slightly later version but they don't appear 16 to differ. This one is postmaster support policy, 17 Postmaster Account support. Can we go, please, to 18 page 8 of this document. 19 Sir, for your assistance, these are documents from 20 this year, 2024. 21 SIR WYN WILLIAMS: Yes. 22 MR STEIN: If you scroll down to on that page, I think the 23 title is "The risk", which is paragraph 2.5. If we read 24 through that: 25 "Post Office can recover losses from a postmaster 43 1 when such losses are caused through negligence, 2 carelessness or error and Post Office has carried out 3 a reasonable and fair investigation, as set out in the 4 Postmaster Accounting Dispute Resolution policy, as to 5 the cause and reason for the loss and whether it was 6 properly attributed to the postmaster. Postmasters are 7 also responsible for losses caused by their assistants." 8 Let's start with the last sentence. That seems to 9 be an echo of the past, with postmasters being asked to 10 account for the losses caused by their assistants; is 11 that quite right? 12 A. I think it needs further clarity, in terms of what does 13 that specifically mean. I think what we -- my 14 interpretation of this is that the postmaster must be 15 responsible, obviously, for the assistant, the level of 16 training, the level of responsibility and the conduct of 17 the individual. I think the inference here is not quite 18 appropriate. 19 Q. No. 20 A. It needs tightening. 21 Q. It needs a bit of work, you might say, Mr Read. The 22 starting point of this part at 2.5 is: 23 "Post Office can recover losses from a postmaster, 24 when such losses are caused through negligence, 25 carelessness or error ..." 44 1 So the system is still saying to subpostmasters that 2 what can happen is that we may pursue you for losses. 3 The tenor of your evidence yesterday was that perhaps we 4 don't do that. What do you think about this policy? 5 A. Well, I think, as we said yesterday, one of the first 6 things that we need to do is make sure that negligence, 7 careless and/or error is described very clearly as in 8 what does it mean? So, as an example, negligence might 9 be leaving the safe door open during the middle of 10 trading in a busy branch. As an example, that could be 11 considered or deemed negligent. 12 But I think it needs a lot more clarity in terms of 13 what is it that these statements actually mean, and how 14 and who is interpreting them, and what are the 15 implications of those interpretations? So I think -- 16 I think -- or I'd agree with you, in that sense, that 17 there's more work to be done. 18 Q. I asked a whole series of questions this morning about 19 shortfalls and people paying them off, what may be the 20 cause of it. It's this type of messaging which says 21 that "We may still go after you", that still exists this 22 year within the Post Office. It doesn't exactly help, 23 does it, Mr Read? 24 A. The tone is inappropriate. 25 Q. I'll go to a different document, please. This is 45 1 a document which is another Postmaster Support Policy. 2 Sir, there are quite a few of these. 3 This one is "Contract termination", and the 4 reference is POL00448206. 5 SIR WYN WILLIAMS: Are all these documents 2024, Mr Stein? 6 MR STEIN: They are, sir. I can show the dates on these 7 things. 8 SIR WYN WILLIAMS: No, I will assume they are all 2024 9 unless you tell me otherwise. 10 MR STEIN: That's right, sir. You might at some stage ask 11 the Inquiry Team for copies of these but they are 12 changing so frequently, to be fair to the Post Office, 13 that it's difficult to identify the ones. The ones that 14 I've got, in fact, are slightly later ones than the ones 15 that I can find on Relativity. 16 THE WITNESS: Just for a point of help, the Postmaster 17 Support Policies, I think there are 12 in total, they go 18 through a yearly cycle of review and revision. The Risk 19 and Compliance Committee and the Board committee, which 20 is the ARC committee, which is -- upon which actually 21 postmasters sit, so Postmaster Non-Executives sits on 22 that committee, in terms of Elliot Jacobs in 23 particular -- 24 Q. Can we go to paragraph 4.5, please. I'm conscious, 25 Mr Read, obviously of time. That's all. 46 1 A. Okay. 2 Q. It should come up as "Repudiatory breach" -- right okay, 3 4.5, "Immediate termination". In fact, on the document 4 I've got, which is slightly later it's called 5 "Repudiatory breach", okay. So 4.5, "Immediate 6 termination": 7 "Post Office may only terminate a contract 8 immediately without notice where ..." 9 Then 4.6, and then further down, please. So 4.6, so 10 this is about immediate termination, okay, and these are 11 the sorts of breaches that can cause immediate 12 termination. 4.6, fifth bullet point down: 13 "Where discrepancies of a significant value have 14 been caused by the negligence, carelessness or error of 15 the postmaster, resulting in a loss to Post Office, and 16 which have been fully investigated by Post Office." 17 Okay? 18 Mr Read, my suggestion is that if we follow through 19 the documents that are in existence, that are live 20 today, that essentially the same message is going out, 21 even to the point of essentially saying, "You might be 22 sacked without notice"? 23 A. Well, I think a couple of points on that. What I'm 24 very, very clear about is there is no -- and there is no 25 termination without the Dispute Resolution Committee, 47 1 which -- upon which sit two ex-postmasters, one of which 2 is the Chair of that committee, that oversees whether or 3 not we can dismiss or can close down an individual post 4 office or postmaster. So we've been very explicit that 5 we do have an independent postmaster or ex-postmaster 6 who sits on that committee. 7 Q. Your understanding, though, from my questions, is, 8 I believe, that you accept that there's work that needs 9 to be done, the tenor of these documents is still 10 saying, essentially, "We may go after you if we find 11 that there are losses to the Post Office through Horizon 12 shortfalls". That's still a message that's out there, 13 Mr Read. Do you accept that this needs, perhaps, at the 14 very least, a bit of rework? 15 A. I think there is some rework that needs to be done. We 16 can agree on that, Mr Stein. 17 Q. We know that, in relation to shortfalls, and I quote 18 here from the statement of Melanie Park -- for those 19 that wish to make a note, it's paragraph 97, page 46 of 20 her statement. Her statement for anyone's notetaking 21 purposes is WITN11600100. I do not need to go to the 22 document. 23 Ms Park, who will be giving later in this Inquiry, 24 says: 25 "However a branch is prevented from completing the 48 1 trading period end process and moving into the 2 subsequent trading period if it has not actioned all 3 transaction corrections, either by accepting them or 4 using the R&D function in Horizon and/or has a balance 5 remaining in the local suspense account." 6 Now, as I understand it, what Ms Park is going to be 7 telling us, therefore, is that unless you sort out the 8 shortfalls, you can't keep on going. 9 A. No, she's not going to tell you that. 10 Q. Okay. We'll ask her those questions. 11 A. Yes, you can. 12 Q. All right. One of the contractual requirements -- and 13 if we need to, we can go to it in the policy 14 documents -- is that the branches, the subpostmasters, 15 comply with visits from the Branch Assurance Team? 16 A. That's correct. 17 Q. Ms Park says about that, paragraph 55 this time: 18 "I would also like to make clear that no member of 19 any team that might ultimately investigate a discrepancy 20 arising from a Branch Assurance Visit will be present 21 during the Branch Assurance Visit." 22 Okay? 23 A. Mm. 24 Q. Shall I repeat that? 25 A. Yes, please. 49 1 Q. I rather mangled it. She's saying this: 2 "I would also like to make clear that no member of 3 any team that might ultimately investigate a discrepancy 4 arising from a Branch Assurance Visit will be present 5 during the Branch Assurance Visit." 6 Of course? 7 A. That's correct. 8 Q. So she's talking about, essentially, separation of 9 teams? 10 A. She is. 11 Q. So let's add this all up together. We've got 12 subpostmasters who are subject to a contractual 13 requirement to cooperate with visits from the Branch 14 Assurance Team, yes? 15 A. That's correct. 16 Q. The Branch Assurance Team may refer matters to 17 an Investigation Team within the Post Office? 18 A. Yes, to the Branch Support and Reconciliation Team. 19 Q. Mr Beer yesterday asked a number of questions about the 20 contract and about whether the terms used within that 21 contract, "Investigation Teams", was appropriate, and 22 you said yesterday, again, that needs work; you agree 23 and you recall that? 24 A. I do recall that, yes. 25 Q. Then we have the policies that we've been looking at 50 1 today that again need work, which appear to be saying, 2 "Look", to the subpostmasters, "we may still go after 3 you for losses", yes? 4 A. (The witness nodded) 5 Q. Again, all needs work? 6 A. Yes, we've got more to do. There's always work to be 7 done. 8 Q. From the subpostmaster point of view, it might be said 9 that whatever you call the Branch Assurance Team, you 10 could call them the "Butterfly Club", Mr Read, it would 11 still be seen as being part of an investigation by the 12 Post Office into shortfalls that may lead to their 13 contract being terminated. That is the message that 14 comes across if you look at the system, Mr Read, and 15 that's the message which I think you're saying you don't 16 in fact want to come across to subpostmasters? 17 A. I certainly don't want that message to come across to 18 subpostmasters. I'm also very clear that the Branch 19 Assurance Team do one thing and one thing only: and 20 that's basically a stock check. They will count the 21 stock and they will count the funds. They won't do 22 anything else. They won't investigate anything. They 23 have no accountabilities, they have no job role 24 associated with anything other than a cash and stock 25 check. If we haven't made that clear for folk then we 51 1 need to be much clearer in doing so. 2 The other point, I think, that is important to make 3 is the presumption of innocence still pervades, and that 4 is really very important. We are here to try and 5 resolve discrepancies, not to insist upon people making 6 them up, if they believe that not to be the case. 7 And you touched on the importance of not being able 8 to trade or move into the next trading period. If the 9 Review and Dispute button is pressed, if there's any 10 disagreement or misalignment associated with 11 a discrepancy, then it gets placed into, effectively, 12 a local suspense account, and you move on, and you 13 trade, and you trade the following week, and you trade 14 the following week after that. And we will then try and 15 resolve what the issue is and, if we can't resolve it, 16 then we have a dispute process that we can go through. 17 But we are not at any stage forcing people to make good 18 losses that they do not agree with. 19 Now, we may well have more to do in terms of our 20 engagement and communication, we've talked about that, 21 and I would agree that we still have pockets of 22 postmasters who are deeply, deeply troubled by what has 23 occurred historically and we need to address that. 24 Q. "Pockets" may be a slight understatement, Mr Read. 25 Looking at the figures you get through the YouGov 52 1 report, you've got significant numbers of people that 2 are still doing this, they may be doing it in £10, £20, 3 £50 or £100 but they're still doing it -- 4 A. (The witness nodded) 5 Q. -- and those £10, £20, £50 adds up to millions, as you 6 accept, over the years? 7 A. Absolutely, it does. 8 Q. Your figure of 36 million is growing, Mr Read. 9 Now, my time has been set. I've asked Mr Jacobs to 10 give me a note to say it is break time and it now is 11 break time. 12 A. Okay. 13 MR STEIN: Fifteen minutes, please, sir. 14 SIR WYN WILLIAMS: All right, certainly. So we resume at 15 11.30, yes? 16 MR STEIN: Thank you, sir. 17 SIR WYN WILLIAMS: Fine. 18 (11.16 am) 19 (A short break) 20 (11.31 am) 21 MR BEER: I think Mr Stein will notice that the Chairman has 22 reappeared. 23 MR STEIN: I thank Mr Beer for pointing that out. 24 Mr Read, the background to this Inquiry, the 25 background to the scandal, it's all been about the 53 1 withholding by the Post Office of information that would 2 have assisted subpostmasters, that would have assisted 3 people that were being investigated, that would have 4 assisted people that were going through the criminal 5 courts or the civil courts or through audits, that's the 6 background; do you understand that -- 7 A. Yes, of course. 8 Q. -- from -- if I call them the Fraser judgments -- 9 A. Yes. 10 Q. -- I hope Lord Justice Fraser will forgive me. 11 A. Yes. 12 Q. Have you ever kept back information that would assist in 13 the investigation of matters, either through the 14 criminal courts or through audits? 15 A. No. 16 Q. No? Because you no doubt understand the ramifications 17 of doing such? 18 A. That's correct. 19 Q. Yet we know that Mr Patterson wrote a letter. 20 Mr Patterson, I think, who is the European Director of 21 Fujitsu, worldwide company, wrote a letter on 17 May 22 this year saying that Fujitsu will not support any 23 pursuit of any enforcement action, civil or criminal, 24 against subpostmasters. It was a pretty clear letter, 25 finishing with the line: 54 1 "It should not be relying on Horizon data as the 2 basis for such shortfall enforcement." 3 Okay? 4 Now, you went through this correspondence with 5 Mr Beer, and I won't redo that. So we know that there 6 was further communication between yourself and 7 Mr Patterson, all right. We know that Mr Railton gave 8 evidence and says that he's going to take up this 9 particular cudgel or this particular stream of 10 correspondence with Mr Patterson and he's going to 11 attempt to deal with it as well, all right? 12 A. (The witness nodded) 13 Q. Okay. You'll recall that yesterday Mr Beer was asking 14 you questions about a meeting of the SEG, that's the 15 Strategic Executive Group. That was a meeting on 16 Wednesday, 26 June 2024, starting at 11.00 am, and it 17 was a discussion document put forward by Ms Gray and 18 Mr Bartlett, which was disclosure to support police 19 investigations. 20 A. Yes. 21 Q. Do you recall that? 22 A. I do recall that. 23 Q. Now, let's ask the specific question: had you, by 24 26 June 2024, disclosed to Ms Gray and Mr Bartlett the 25 correspondence that you received from Mr Patterson on 55 1 17 May 2024? 2 A. Yes, she was aware of it, yes. 3 Q. Had it gone to the Board? 4 A. I said yesterday, it was discussed with Mr Tidswell, who 5 was the Acting Chair at the time, and with Lorna 6 Gratton, who was -- as you know, is the shareholder 7 representative. I don't think the full Board had seen 8 it. It was, as I say at the time, it was correspondence 9 between two CEOs, as opposed to a board level decision. 10 Q. Now, Mr Railton gave evidence saying that he had seen 11 this correspondence as part of his pack, his evidence 12 pack, before giving evidence. He clearly hadn't seen 13 this document and this correspondence that you'd had 14 with Mr Patterson at Fujitsu. How come the new Chair of 15 Post Office hadn't been told about the correspondence 16 with Mr Patterson where the Fujitsu company supporting, 17 creating, essentially, and running the Horizon system is 18 saying, "Don't use our data"? How come that hadn't got 19 to Mr Railton? 20 A. I don't think we saw the engagement with Mr Patterson in 21 quite the same way as you have, and I think the point 22 that I was trying to explain to Mr Beer and to Sir Wyn 23 was that this was more of a spat than anything else. 24 I don't believe that it was the degree that you're 25 suggesting here and now. I think we were quite 56 1 affronted, obviously, by the communication that we 2 received from Mr Patterson, and that was something that 3 Owen Woodley and Neil Brocklehurst have continued to 4 take on over the summer. 5 Q. That's not actually the answer to my question. How come 6 Mr Railton hadn't seen the document until he had it from 7 the Inquiry in his evidence pack before he gave 8 evidence? 9 A. I don't know. 10 Q. Because Mr Railton's evidence, by that point, is that 11 he's coming in, he's suggesting that there's going to be 12 a turnaround of this particular ship and it's going to 13 be to rework the entire Post Office in relation to the 14 questions that concern subpostmasters, a good phrase he 15 used, he's going to reverse the polarity -- 16 A. Yes. 17 Q. -- of the Post Office, so it's subpostmaster centric 18 rather than the other way round, rather than executive 19 centric, is the way I understand it. He's also looking 20 into the question of the Horizon system and whether NBIT 21 should go ahead, whether it should be replaced. It 22 seems that it should have been information that should 23 have gone to Mr Railton, and you don't know how it was 24 missed? 25 A. Quite possibly. 57 1 Q. Now, you've explained in one of your answers just given 2 that, well, you thought this was a bit of a spat, that 3 was your word, a spat between, and you go on to say, 4 however it came about, maybe between two CEOs. Did you, 5 regarding that correspondence, take advice from 6 a criminal lawyer? 7 A. I took advice from my General Counsel, and -- 8 Q. That's not the answer to my question, unless General 9 Counsel turns out to be a criminal lawyer. 10 A. It could possibly be that her training is in criminal 11 law, I'm not sure. 12 Q. Right. Did you purposefully decide, "Well, this is 13 something that has a relevance to investigations, this 14 is something that may be important to what's going on 15 with the police", which you're learning about through 16 the SEG meeting on 26 June? 17 A. Mm. 18 Q. Did you decide, "I'd better run this by a criminal 19 lawyer"? 20 A. No, I didn't decide that at all. I decided that I would 21 take the guidance of my Interim Chair, who is a lawyer, 22 and also the General Counsel and the shareholder 23 representative, and describe what it was that I was 24 communicating with Mr Patterson because -- 25 Q. Did you take advice on this document from Ms Gallafent, 58 1 King's Counsel? I don't ask for what the content of 2 that advice was, I ask you whether you went to her, 3 Ms Gallafent; Nicola Greany, King's Counsel; Simon 4 Baker, King's Counsel. They are all King's Counsel 5 instructed by the Post Office and dealing with different 6 aspects of this Inquiry. Did you go to them and say, 7 "I've had this letter from Mr Patterson at Fujitsu, it 8 concerns me about disclosure, what should we do with 9 it", or something similar? 10 A. I don't know whether the email trails have been 11 disclosed in their entirety, but they may well have been 12 and, therefore, what guidance that General Counsel took, 13 I can't tell you that. 14 Q. When you get to the June meeting, the June meeting which 15 is the SEG meeting, which is a meeting that is 16 discussing the question of disclosure to support police 17 investigations, when a document has been put forward in 18 relation to that, did you or anyone around you, say to 19 themselves, "We'd better have a word with those police 20 investigations and make sure that they're aware of this 21 correspondence"? 22 A. No, I don't believe we did that. I think. 23 Q. I go back to my question. Have you been involved in the 24 withholding of information that may be relevant to 25 investigations that are ongoing? 59 1 A. No, I haven't. 2 Q. Well, it seems that the answer is a "Yes, Mr Stein, 3 I have". 4 A. Well, I don't believe that to be the case, Mr Stein. 5 Q. Now, there are things called entrustment requirements 6 that are set by the Government in relation to the 7 operation of the Post Office, you agree? 8 A. Services of general economic interest. 9 Q. So the Post Office has a wider community service aspect 10 that is the subject of extra funding from Government? 11 A. Very much so. 12 Q. Just describing one of those, by way of example: 13 nationally, 99 per cent of the UK population to be 14 within 3 miles and 90 per cent of the population to be 15 within 1 mile of their nearest post office outlet. Yes? 16 A. That sounds correct. 17 Q. So using those as my example in relation to the 18 requirements set, we know there is, if you like, this 19 outreach by the Post Office that is directed into 20 communities, whereby it might not be economically 21 sensible to open up a post office if you want to make 22 money. 23 A. That's correct. 24 Q. The Government provides, essentially, compensation, 25 which I think is the word used, to the Post Office, to 60 1 allow the support for such branches; do you agree? 2 A. The expression I used was "subsidy". 3 Q. Fine. Now, in your statement, you refer to a review by 4 the Government to undertake a review of its policy for 5 the Post Office, and you refer to a letter from 6 Mr Kwarteng, a Member of Parliament -- I can't remember 7 whether he's still elected or not -- who was then the 8 Secretary of State for BEIS, dated 11 March 2022. Can 9 we go to that letter, please, it is POL00448435. 10 Thank you. We see the date of this letter. We see 11 who it is from, Secretary of State for Business, as it 12 was then called, and we see the recipients, it's you and 13 Mr Parker, the date is 11 March '22. Now, some of this 14 letter, in fact, confirms the commitment to the 15 requirements, essentially that the Government is asking 16 the Post Office to continue to commit to those 17 requirements, all right? 18 A. To the SGEIs, yes. 19 Q. I'm very grateful. So the particular part I'd like to 20 refer to, then, is not so much that, but at the bottom 21 of page 2 and top of page 3, please. Thank you. 22 Keeping in our minds the date 11 March 2022, we've got 23 this, "Future policy framework for the Post Office": 24 "Finally, I recognise the need to consider the 25 policy framework in the context of the changes to the 61 1 wider environment and the new challenges you face, on 2 top of Covid-19, and ongoing work to resolve historical 3 matters. It is crucial we develop a sustainable, 4 long-term approach for the network, and I look forward 5 to working with you on this review." 6 Okay? 7 A. Yes. 8 Q. Now, that appears to be, from what I understand, the 9 review you're referring to in your statement, which was 10 requested by the Post Office. 11 A. Looks like it, yes. 12 Q. Yes, it does. We're now getting close to the end of 13 2024 and we learn from Mr Railton that the Post Office 14 is, in fact, saying to the Government, "Look, 15 Government, Post Office needs your long-term commitment 16 for long-term support. It needs money to be able to 17 provide a new system, IT system, to continue operation". 18 That's happening now. That seems to be all Mr Railton 19 is saying since he's come in. 20 Why has it taken so long, Mr Read, for anyone to 21 think about the result of this sort of review back in 22 '22; why has it taken so long, Mr Read? 23 A. I'm not entirely sure I'm clear with your point. The 24 Government's policy review is for the Government to 25 initiate. We pushed the Government in '21 to initiate 62 1 this policy review on the back of a strategic review 2 that we did ourselves in 2019/2020. So I'm not entirely 3 clear on your point other than, as I made the point 4 yesterday, the policy team within the Department has 5 been very focused on compensation. I think it would be 6 fair to say that their resources have been split between 7 doing compensation and initiating a policy review. I'm 8 as frustrated as anyone that we don't have a policy 9 review from the Government that we can build around 10 and -- 11 Q. Mr Read, you may get the direction of my travel wrong. 12 It's not an attack upon the Post Office necessarily. 13 Why has it taken so long for the Government to 14 actually start thinking about the strategic direction o 15 Post Office, in terms of the way that Mr Railton was 16 talking about, the funding commitment, the long-term 17 funding commitment; why has it taken Government so long 18 to wake up? 19 A. I think you'll need to address those questions to 20 Government. 21 Q. Mr Read, you have been in post now for five years? 22 A. Yes. 23 Q. Tell us what you think has been happening with 24 Government. Why has there been a Government failure to 25 essentially support the subpostmasters to make sure that 63 1 they understand that there is a long-term life for the 2 Post Office; why didn't you sell it that off to Amazon, 3 as Sir Alan suggests? 4 A. I think, looking back to the comments that Henry 5 Staunton made when he was in front of this Inquiry, 6 there was -- and there was a determination to get 7 through to the election and then, from the election, to 8 reset the Post Office. And I think that was certainly 9 the direction of travel that was indicated by the 10 Permanent Secretary 18 months ago. So I think that is 11 probably the underlying driver behind this. 12 I am very confident that Mr Railton's enthusiasm and 13 sense of purpose is going to drive the Government hard 14 on this, and he made that point very clearly earlier in 15 the week, and I fully expect that the Government will 16 obviously get hold of the Strategic Review and I hope 17 that they will dovetail that in, as we discussed 18 yesterday, to their own policy review and that we come 19 up with a sustainable strategy, long-term sustainable 20 strategy, for the Post Office. 21 Mr Railton implied on Tuesday that that would be in 22 the next two or three weeks, that the Department would 23 respond to that and I look forward to -- 24 Q. You see that evidence from Mr Railton was remarkably 25 tight to the timing of his evidence and indeed yours. 64 1 So it seems that just before he was giving evidence that 2 something was done. Was it a letter that was sent to 3 Government saying that we need a commitment from 4 Government to fuller funding? Who compiled the document 5 that was sent to Government: was it another 6 organisation; was it the Post Office working with 7 another organisation; where did this impetus come from, 8 just before giving evidence by Mr Railton? 9 A. Mr Railton has been very clear that the terms of taking 10 on the chairmanship of the Post Office was that we would 11 do a strategic review. He was very clear about that and 12 that was part and parcel with his signing up to be 13 Interim Chairman. As a consequence of that commitment 14 from the Government, he engaged with Teneo to do a full 15 Strategic Review of the organisation, they said it would 16 take four months. The conclusion of that four months is 17 literally about now, so the timing is not unique, in 18 that sense. It's exactly what was laid out in the Teneo 19 work that started back in June. 20 Q. So the timing and the question of the timing relates to 21 Mr Railton's appointment? 22 A. Correct. 23 Q. Since he's come in, he's provided that extra impetus, 24 essentially to rattle the Government cage, to say what's 25 going on for the future of the Post Office? 65 1 A. Yes. 2 Q. What you can't say is why it's taken so long for the 3 Government to actually come up with anything itself to 4 guarantee the long-term work of the Post Office; you 5 don't know the answer to that? 6 A. Well, as I say, I think the policy team has been very 7 focused on driving compensation and that is why they 8 have not taken the policy review forward in the way that 9 I'd articulated yesterday and the day before, which was 10 the first time we would have had a policy review since 11 2010. 12 Q. Right. Well, we've got some Government witnesses coming 13 along, and past ministers -- 14 A. Indeed. 15 Q. -- so I look forward to asking them questions about 16 that. 17 Now, we've had various references to strategic 18 plans, we've had various references to Chief People 19 Officers and to reviews that relate to outside 20 organisations drafting up something that comes back with 21 corporate speak saying that everyone needs to be nice to 22 each other and everyone needs to remember that there are 23 other people working in a collegiate way within the 24 organisation. 25 Now, I don't in any way seek to undermine the value 66 1 of such documents. It is important that people working 2 within an organisation do, in fact, respect each other 3 and do trust each other, these are fundamental to any 4 organisation. But one of the matters that was marked 5 out, and I asked questions of Ms McEwan about these 6 documents, they don't mention subpostmasters. There 7 were two documents I asked her about, the People Plan 8 and then the Behaviours Plan, clearly directed at 9 internal employees. 10 How come under your watch, Mr Read, that there'd 11 been the production of these sorts of documents that 12 don't refer to subpostmasters in the way that frankly 13 you would expect after all of this scandal; how come, 14 Mr Read? 15 A. I think, as Ms McEwan referenced, you were talking 16 specifically about behaviours and about the importance 17 of how the Post Office internally transformed its 18 behaviours, and I think that was -- and remains -- 19 a very valid and important part of the work that we need 20 to do to develop our ways of working and to develop our 21 behaviours. The explicit reference or explicit 22 inclusion of the postmasters, I can understand the 23 concern -- if that's the right word -- of you and your 24 clients. The objective of the People Plan, the 25 Strategic People Plan, was very much to shift the 67 1 culture internally, such that it was supporting 2 postmasters. 3 It isn't our place to -- and certainly isn't my 4 place -- to instruct postmasters on how we behave. 5 I think it is our place to communicate to postmasters 6 what we're trying to achieve and that's what we will be 7 doing through our behaviours documents and through our 8 ways of working documents. 9 Q. I have asked you questions about shortfalls, about the 10 policy questions. 11 A. Yes. 12 Q. You agree that they need review. 13 A. (The witness nodded) 14 Q. I'm now asking you questions about these sorts of people 15 plans and the fact that they miss out references to 16 subpostmasters. 17 A. (The witness nodded) 18 Q. There still appears to be a trend within the Post Office 19 to miss out subpostmasters as being a group that the 20 Post Office is, in fact, dedicated towards. Will you 21 again, in the remaining months of your period of time at 22 the Post Office, review these sorts of documents, ask 23 the people within the Post Office "Why aren't we 24 referring to subpostmasters where we should be?" Again, 25 will you deal with that? 68 1 A. I will. 2 Q. Thank you. 3 Now, Mr Railton's evidence was something that was 4 set out so that we understand and we await the result of 5 the review and the discussions with Government, whereby 6 there's going to be this recommitment, rededication of 7 the Post Office towards subpostmasters. We have 8 messages from people we represent who are current 9 subpostmasters to say that they're not feeling the love, 10 Mr Read. Let me read one: 11 "As a person who is still working behind the Post 12 Office Counter, acting postmaster at the same branch, 13 that broke me as an individual. We have had no sight of 14 any increase but only decrease to say that if we do not 15 meet certain targets on services we will lose them. 16 That's all we've had. I'd be extremely concerned of 17 what the Post Office has to offer in this new strategy 18 [the one that's being discussed with Mr Railton], as I'm 19 sure it's any going to be in benefit for Post Office 20 Limited and the staff that actually work for Post 21 Office, rather than people on the actual ground who earn 22 them the money and pay their wages while we get the 23 crumbs." 24 The message goes on to say: 25 "I'd definitely push for this plan to have been seen 69 1 before Government agree, as these people are only pencil 2 pushers sitting behind a desk with a massive income. 3 They have no idea of the struggles we have on the 4 ground." 5 So people in branches are not feeling the love, 6 Mr Read. 7 There are still plans -- as we learnt from the 8 current Chair of the NFSP, the West Linton branch -- to 9 close these Hard to Place branches. 10 Surely, if there is this root and branch review that 11 is ongoing to discuss the future of the Post Office, 12 with a change of polarity for the Post Office to 13 recentre itself towards subpostmasters, surely all of 14 these closures, these branch closures, should stop? 15 Surely there should be a moratorium on actions taken in 16 relation to subpostmasters? Draw a line, Mr Read, to 17 say, "If we're going to be changing, let's make sure 18 that the subpostmasters understand there's going to be 19 a change"; what do you think, Mr Read? 20 A. Well, I think Mr Railton made it very clear yesterday -- 21 sorry, on Tuesday -- that at the core of the Strategic 22 Review is the relationship with postmasters but a new 23 deal, I think, was the expression he used, for 24 postmasters, and a new deal is absolutely central to 25 moving forward. We've talked about that over the last 70 1 three days. 2 I don't recognise your closing of branches notion. 3 It's not something that we have been doing recently, so 4 I don't follow that particular train of thought. We're 5 not seeing churn numbers as dramatic as might be implied 6 and, indeed, the stability of the network and the desire 7 of people to open branches is frankly, given the last 8 nine months, surprisingly robust. 9 Notwithstanding what you're saying, Nigel's 10 commitment to a new deal for postmasters, his words, 11 polarity, I think we've tried, and this is the next 12 phase of that. We have been engaging, and I know that 13 Nigel made that point with the NFSP and with the Voice 14 of the Postmaster, and with other postmaster groups, to 15 discuss the issues that they think need to be addressed, 16 so that we can bring those into our Strategic Review and 17 that's absolutely what has been done and is ongoing. 18 Q. Mr Read, what it appears to be is that there is 19 a considerable and too far distance between the office 20 of the CEO, probably the Board as well, and the 21 individual subpostmasters working perhaps in small 22 branches in small or low density population areas. 23 That's what it appears to be, that this message that you 24 keep on wanting to say -- I understand why and must get 25 out -- it is not getting out. We've seen that from the 71 1 YouGov report, we see it from such correspondence. 2 You need to close that distance. You need to make 3 to sure that the communication is effective; do you 4 accept that? 5 A. Well, as I said, we do need to get closer to it. 6 Q. Let me turn, then, to the schemes, the compensation 7 schemes. I'm just going to describe what they are to 8 make sure that we've got the sheer number of them. 9 There is the Group Litigation scheme, the GLO 10 scheme. That one is run by the Department for Business 11 and Trade. There is the Horizon Convictions Redress 12 Scheme, which the Department for Business and Trade is 13 also administering, which deals with redress for people 14 whose criminal convictions are overturned by 15 legislation. Yes? 16 A. Correct. 17 Q. There is the Overturned Convictions Scheme -- the Post 18 Office runs this one -- dealing with redress for people 19 whose Horizon-related criminal convictions have been 20 overturned by the courts, yes? 21 A. That's correct. 22 Q. There is the Horizon Shortfall Scheme -- Post Office is 23 administering that one -- administering the Horizon 24 shortfalls. That was established in 2020 to provide 25 redress for postmasters who were not claimants in the 72 1 Group Litigation? 2 A. That's correct. 3 Q. Okay. So two schemes being run by the Department of 4 Business and Trade and two being run by the Post Office? 5 A. That's correct. 6 Q. Okay. In addition to that, we also have a Suspension 7 Remuneration Review being run by the Post Office, yes? 8 A. Yes, that's correct. 9 Q. That's for individuals who have been essentially 10 highlighted by Lord Justice Fraser's judgments, those 11 people that have been suspended whilst investigations 12 were carried on and its redress being considered in 13 relation to those suspensions; is that correct? 14 A. That's correct. 15 Q. There is also an Adequacy of Payments under the 16 Shortfall Scheme, a review of the shortfall scheme 17 payments, because it is being considered that some 18 payments were inadequate; do you agree? 19 A. That's correct. 20 Q. Then, unless you're going to tell me there's another 21 one, there is a Stamp Compensation Scheme that is 22 ongoing as well; is that correct? 23 A. That's correct. 24 Q. So the evidence in relation to stamps was given, 25 I think, by the NEDs in part. That was because another 73 1 debacle committed by the Post Office was in relation to 2 stamps, how it was dealt with and interference in branch 3 accounts. Have I missed any schemes? 4 A. Yes, there are other schemes. 5 Q. Right. Are they schemes that are dealing with financial 6 redress to individuals? 7 A. That's correct. 8 Q. What are they? 9 A. There is a Process Scheme that is currently in pilot as 10 well, at the moment and there are, I don't recall off 11 the top -- 12 Q. Help us understand what a Process Scheme means? 13 A. Again, it's a pilot to try and understand if there are 14 other areas of discrepancy that people have come forward 15 and said, "We have areas where we think there may be 16 detriment". So we're looking at all of those. We want 17 to be very open and transparent and, if there are people 18 who come forward and say that they have experienced some 19 form of detriment, we want take sure that we are 20 addressing it head on. 21 Q. Let me give you an example of the experience of one 22 individual we represent. It's Mr Peter Worsfold. He 23 has finally had his offer on his GLO scheme claim last 24 week. Across multiple heads of loss, he has been 25 offered only 70 per cent of what he claimed, and the 74 1 reason he has been given, and I quote, is: 2 "... evidential uncertainty as a result of gaps 3 within the supporting evidence provided." 4 Okay? 5 Now, in the questions being asked yesterday by 6 Mr Beer, he took you to a document whereby one of the 7 ministers at the department was concerned about the 8 question of evidential support and essentially saying, 9 that's Mr Hollinrake, that give the people the benefit 10 of the doubt, in relation to evidence. 11 Do you, Mr Read, believe that subpostmaster 12 claimants should be given the benefit of the doubt 13 across all schemes? 14 A. I don't have the detail to be able to comment across all 15 schemes but I've been very clear that the evidential bar 16 must remain low and the evidential bar must be such that 17 the benefit of the doubt is for postmasters, and I've 18 been very clear about that and I've said that here on -- 19 in this Inquiry and I do believe that. And that is 20 exactly what should happen. That -- 21 Q. It needs to be believed, doesn't it, Mr Read? I'm 22 butting in because of something you said earlier in your 23 evidence. You're explaining about the real difficulties 24 for the Post Office in looking at shortfalls because of 25 the amount of time it goes back through, back through 75 1 into the early 2000s, and indeed, there are questions 2 being asked about another electronic scheme called 3 Capture, so it may go even earlier than that. 4 Those evidential difficulties in trying to analyse 5 shortfalls are the same sorts of problems that some 6 people are also experiencing with trying to get their 7 way through these schemes. 8 A. Mm. 9 Q. So's a common problem that you understand from the Post 10 Office point of view and the subpostmaster point of 11 view, don't you? 12 A. Yes, I do understand that. 13 Q. Which is why the benefit of the doubt should be given, 14 if a subpostmaster -- 15 A. I agree. 16 Q. -- says "This is what's happened, I'm afraid I can't 17 find the document, I buried it, I lost it, I didn't want 18 to think about it", that can affect whether they have 19 the documentation, can't it? 20 A. Of course it can, yes. 21 Q. Now, the Horizon Convictions Redress Scheme, which is 22 there to deal with criminal convictions overturned by 23 legislation, as we understand it, 335 letters have been 24 sent out to roughly a cohort of well over 1,000 people 25 that were convicted over the years through the Post 76 1 Office's prosecutions and the scandal. 335 letters 2 doesn't seem to be the right number, Mr Read? 3 A. Is this the scheme that's run by the Government or is it 4 the scheme that's run by -- 5 Q. That's the Government -- 6 A. Yes. 7 Q. -- and it's a scheme that relates to the convictions 8 that are being quashed through legislation? 9 A. Understood. 10 Q. 335 letters only have been sent out. So, essentially, 11 it seems as though there have been identified 335 people 12 to get letters that deal with their convictions, telling 13 them that they've been cleared. More work needs to be 14 done in this area, it is clear; do you accept that? 15 A. This is the Government scheme so it's difficult for me 16 to comment on the detail of -- 17 SIR WYN WILLIAMS: Well, I was going to ask you, Mr Read, 18 does the Post Office have any involvement in 19 administering that scheme, and I use the word "any": for 20 example, is it incumbent upon the Post Office to try and 21 identify people which it prosecuted? 22 A. We obviously -- 23 SIR WYN WILLIAMS: That's just by way of an example. 24 A. I mean, I was about to come on to tracing. I think 25 that's clearly what we're discussing here, is the 77 1 ability to trace and, clearly, we have an accountability 2 for that because many of the records will be held by 3 Post Office. But, as we've already discovered, records 4 aren't, and data isn't, as -- 5 SIR WYN WILLIAMS: But what's interesting me, following 6 Mr Stein's questions, is whether there is a process, as 7 between the Post Office and a government department, and 8 again, I'm using the words "a government department" 9 because there's the possibility that the Department of 10 Trade is involved, there's the possibility that the 11 Ministry of Justice is involved. What is the process 12 for trying to track down all these people? 13 A. I don't have the specific details but you're absolutely 14 right that there is an operational agreement between the 15 Post Office and the Department for Business and Trade 16 because the Department for Business and Trade is 17 obviously responsible for this particular scheme. The 18 mechanics of how that scheme works and what the 19 operational KPIs, in terms of the sort of time it takes 20 to do disclosure, and the time that it takes to do the 21 tracing, and the investigation -- or not the 22 investigation, but the ability to diagnose those 23 databases is obviously something that is part of the 24 operational agreement between the two parties. I don't 25 have the specifics behind that. 78 1 SIR WYN WILLIAMS: Fine. 2 MR STEIN: So what this means, Mr Read, is this: that it 3 seems almost five months from the passing of the Act, 4 which is the Post Office Horizon System Offences Act 5 2024, more than 60 per cent of the victims of this 6 scandal do not know that they've been vindicated. 7 That's what appears to be the current situation. 8 A. If that's what you're telling me. I'm not familiar with 9 those statistics, to be fair. It's a -- 10 Q. On the giving of information, so that the scheme can 11 have its operation, so that people can know that they've 12 been vindicated, so that they know they're entitled to 13 have compensation, you've just answered the questions 14 from the chair in relation to information going from 15 Post Office. That's clearly a job that the Post Office 16 needs to do. 17 Have you considered this with the NFSP because they 18 will also have lists of individuals that have been 19 members over the years? Have you considered that 20 possibility of joint working with the NFSP, get the 21 message out, but also whether they have names that could 22 assist? 23 A. I don't know whether that's been considered. It may 24 well have been considered. This isn't specifically 25 an accountability that I'm particularly close to, to be 79 1 fair. 2 Q. But it's work that needs doing? 3 A. Oh, clearly it is, yes. 4 Q. Would you join with making a request to the Chair that 5 the Chair himself would, if he would be so kind, send 6 a message out to all media outlets -- and I think it's 7 sometimes called a blog these days, I don't know whether 8 we'll do a blog -- but it would assist if this Inquiry 9 set itself out and made a very clear message to all of 10 those people that are being dealt with so harshly by the 11 Post Office, that are being convicted, to come forward, 12 yes? 13 A. I absolutely want that to occur. We've talked to the 14 CCRC, we've talked to the Advisory Board, we've talked 15 to the Inquiry, we've talked to the drama that was 16 played at Christmas, in an attempt to try and get 17 communication out for people to come forward. We have 18 tried numerous and multiple attempts at tracing and 19 we've used Citizens Advice, we've used many other 20 outlets to try and do this. I agree with you, Mr Stein, 21 it's very, very frustrating but we must continue to try 22 and push this. 23 Q. Do you accept that there's more joined-up work to be 24 done in relation to this, with the NFSP. There are 25 three firms of solicitors that represent number of 80 1 people -- 2 A. Absolutely. 3 Q. -- before this Inquiry. They should be tapped for their 4 expertise? 5 A. Absolutely. 6 Q. They're conveniently all starting with the letter H: 7 Howe+Co, Hudgells and Hodge Jones & Allen. 8 A. I agree. 9 Q. Okay, so use their expertise, I respectfully suggest, in 10 making sure that the message goes out? 11 A. I agree. 12 Q. Lastly, as mentioned earlier, you and others within the 13 Post Office have been meeting with our clients -- 14 A. That's correct. 15 Q. -- and taking part in meetings that I know have been 16 difficult for you, obviously incredibly difficult for 17 the people that meet with you? 18 A. Indeed. 19 Q. You're leaving the Post Office, other people that have 20 been taking part in those schemes are also leaving the 21 Post Office. How are you going to make sure that the 22 Post Office keeps its -- the term used is "corporate 23 memory" -- keeps its memory of the effect of what 24 happened to people? 25 What are you going to do to make sure that people 81 1 working in the Executive Team, the Directors that are 2 not postmasters, actually understand the depth of hurt 3 and feeling of this scandal? 4 A. We're doing a number of things. I think, as you 5 mentioned, I've done a number of restorative justice 6 meetings over the past couple of years, I think 37 7 I have attended. I speak at great length to the 8 organisation, at my town halls and at my 10@10 meetings, 9 to try and convey the trauma and the harm -- is the word 10 that I tend to use -- that had been inflicted upon many 11 of the families involved. I have spoken to Government 12 about it and, obviously, encouraged my Board members and 13 my Group Executive members to attend the restorative 14 justice meetings. I think it helps shape the solutions 15 that we should come up with and help people in the 16 organisation to understand the implications of this. 17 We've recently instigated, as Ms McEwan mentioned, 18 online and e-training for all colleagues in the Post 19 Office to help people understand just what the Post 20 Office has put many of your clients through. 21 Q. Let me square a particular circle. You've mentioned 22 families. 23 A. Yes. 24 Q. Mr Patterson, the European Director of Fujitsu, when he 25 gave evidence before this Inquiry, answered my questions 82 1 and I asked him questions about whether Fujitsu, the 2 company, broad shoulders financially, is prepared to 3 support people that have been affected through this 4 scandal. What I mean is the family members, the 5 children who watched their parents go through hell, that 6 have had their education disrupted, that may have been 7 put off an entrepreneurial career through this scandal. 8 There is no scheme that deals with those individuals at 9 the moment whatsoever. 10 Have you had any communication from Fujitsu to the 11 Post Office saying, "What a good idea, let's get 12 something done for the families, those people affected 13 in that way"; have you had any communication from 14 Fujitsu to that line? 15 A. I don't believe I have. I -- 16 Q. Has the Post Office set up any schemes that are looking 17 in the direction of support of providing educational 18 support, bursaries and the like, in relation to those 19 people affected in that way, who are not currently 20 affected by the schemes? 21 A. We are still having conversations with DBT about this. 22 I can assure you, and you'll be able to talk to Simon 23 Recaldin next week, that both of us are absolutely clear 24 that the family of -- the families of victims need to be 25 considered in this process. And there are two lines of 83 1 investigation for us here: one is working with DBT to 2 bring this to life. We do believe it is very important, 3 and I mentioned it in my witness statement, that it's 4 something that I personally am very engaged in. And, 5 secondly, we've obviously discussed, and at the 6 restorative justice meetings as well, just precisely 7 what -- some form of memorial, some form of ability to 8 remember what has occurred, and how do we put that into 9 practice. So those are the two lines of investigation 10 that I am pursuing with DBT. 11 Q. I have asked you on a number of occasions through the 12 questions I asked you within what is, I'm afraid, sadly 13 over an hour, in the remaining post that you have at the 14 Post Office, to take on particular tasks. I ask you one 15 more. 16 There are going to be communications with Fujitsu 17 regarding the question of how they're dealing with the 18 Horizon system. 19 A. Yes. 20 Q. We know that. Mr Railton is committed to that; you have 21 had past communications. In whoever is conducting the 22 communications with Fujitsu, can this topic again be 23 raised: support making good the positive answer that we 24 have from Mr Patterson, that Fujitsu does think it's 25 a good idea to try and assist those people, the family 84 1 members, that are outside all these schemes? 2 Perhaps by working hand in hand with the Post 3 Office, something good can come out of this scandal to 4 support those family members that have also been 5 affected. Do you also commit to that as well? 6 A. I think it's a very good idea, Mr Stein. 7 MR STEIN: Thank you. Excuse me one moment. I just need to 8 check -- thank you. 9 THE WITNESS: Thank you. 10 SIR WYN WILLIAMS: Before the next questioner, Mr Read, can 11 I be clear on the list of schemes that you and Mr Stein 12 agreed were in existence, that the Suspension 13 Remuneration Scheme, that is administered by the Post 14 Office, I take it, and the decisions about how much to 15 offer are made by the Post Office, having taken advice; 16 is that the position? 17 A. That's correct, sir. Just to bring that to life, in 18 Fraser J's judgment, he noted that suspensions had not 19 been on full pay, so there were individuals who were 20 suspended with no pay at all. We're trying to address 21 that particular shortcoming. 22 SIR WYN WILLIAMS: Right. What was described as the 23 adequacy of HSS payments, if that is to be considered 24 a separate scheme from HSS, nonetheless, that is 25 administered by the Post Office, and who is the decision 85 1 maker in relation to that? 2 A. The Remediation Committee oversees the schemes that we 3 manage and, clearly, as I discussed yesterday, the 4 funding will come from Government, and so they will be 5 involved from an operational perspective in terms of 6 what the parameters of those schemes are. 7 SIR WYN WILLIAMS: Yes. But can I take it, if it has been 8 fully formulated -- if it hasn't been fully formulated 9 please tell me -- but is the adequacy of HSS payments 10 effectively being determined -- I'm not saying by the 11 same people -- but by the same process as the HSS 12 payments themselves, namely, that an independent panel 13 look at it, and make a recommendation to the Post 14 Office? 15 A. The scheme itself hasn't been fully formed, sir. We -- 16 SIR WYN WILLIAMS: All right, so stop there. There isn't 17 yet a process which I can say, "Right, that's what 18 they're doing", sort of thing? 19 A. That's correct, sir. 20 SIR WYN WILLIAMS: Fine. Thank you. Next one, please. 21 MR BEER: Yes, due to the operation of Mr Stein's watch, we 22 are going to rejig things slightly for logistical 23 reasons. It's Ms Watt on behalf of the NFSP. 24 SIR WYN WILLIAMS: Right. 25 Questioned by MS WATT 86 1 MS WATT: Good afternoon, Mr Read. I'm over here if you can 2 see me. We do sometimes have a little difficulty with 3 this. 4 I ask questions on behalf of the NFSP. I am here 5 today with Tim Boothman who is the Chair of the NFSP, 6 you may be able to just about see him around the pillar. 7 A. I can't. Hello to you. 8 Q. I want to ask you some questions, a number of different 9 questions. I think you would agree, in the light of the 10 Horizon scandal, that one of the most important 11 initiatives for the Post Office is its replacement, and 12 getting confidence that nothing like Horizon can happen 13 again; would that be right? 14 A. That would be right. 15 Q. At paragraph 11 of your witness statement, you say that 16 the Post Office has been unable yet to deliver a new and 17 bespoke IT system for postmasters. It's understood that 18 that new system to be introduced is called NBIT, New 19 Branch IT; is that right? 20 A. That's correct. 21 Q. Is it the case that the NBIT system was originally due 22 to be in place in 2025, and that those postmasters in, 23 for instance, what we know as the Hard to Place scheme, 24 were scheduled by the Post Office to leave the network 25 before NBIT went live? 87 1 A. That would be logical. I think we certainly, when we 2 set out in March '21, which was the original date for 3 initiating the programme of NBIT, we had envisaged that 4 the replacement for Horizon would be in place by '25. 5 Insofar as your link to the Hard to Place branches, 6 that's obviously a scheme that was established during 7 Network Transformation. It's a scheme that has 8 extended, I think by nearly 10 years in total. So I'm 9 not quite sure the two necessarily dovetail together. 10 I don't think there is a particular link between those 11 two schemes. 12 Q. Is it the case that the Post Office has already 13 purchased at least some of the hardware and that by the 14 time NBIT eventually rolls out, that hardware could be 15 out of date? 16 A. We've certainly purchased some of the hardware. I don't 17 know the specifics of whether it'll be out of date or 18 not out of date but, yes, we have. 19 Q. Are you familiar with and do you agree with the Computer 20 Weekly report that we've heard about which states that 21 the development of NBIT will cost taxpayers over 22 £1 billion, lacks quality, and could be unachievable? 23 A. It's quite a lot to unpack in that particular statement 24 by Computer Weekly. I think it's fair to say that the 25 replacement programme for NBIT has certainly increased 88 1 in cost, in terms of our budget, and is certainly going 2 to take longer to deploy. I don't think, at this stage, 3 that it is realistic to suggest that it's not going to 4 be fit for purpose. Certainly, the 250 postmasters who 5 are involved in the IT forum that helps shape the 6 development of NBIT haven't provided that level of 7 feedback. 8 I would agree, it is definitely slower than we would 9 have anticipated and I would also agree that the 10 difficulty of getting off Horizon in 2015 that was 11 experienced by IBM, which was the first time that we, as 12 I understand it, wanted to get off Horizon, those 13 challenges are just as prevalent today, and I think the 14 level of complexity associated -- the technical 15 complexity associated with getting off Horizon has been 16 underestimated, and that is one of the core reasons why 17 the delays have and the costs have increased. 18 Q. Would you accept that the Post Office has not been fully 19 open and transparent about the development of NBIT as it 20 should be, especially in the light of Horizon? 21 A. No, I don't think that's the case. I think we have 22 wrestled with getting the delivery of the releases out 23 on time. As I mentioned before, we have number of 24 postmasters who are helping us with this in terms of the 25 IT forums, and we believe that we've been as open and 89 1 transparent with them about what's going on and their 2 feedback has been instrumental in terms of trying to 3 shape things. 4 Q. Well, I'm not going to call it up, you may have seen the 5 evidence, but at paragraph 277 of Calum Greenhow's 6 witness statement, that was WITN00370100, he says that 7 on 29 May this year, he met with you and others at the 8 Post Office and the NFSP were asking about NBIT: 9 "... and we were provided with an update. However, 10 the following day Computer Weekly broke the story that 11 NBIT was unachievable. Whilst we knew it was running 12 late and over budget at no point in the meeting of the 13 previous day were we told it lacked quality, according 14 to the auditors for the Department for Business and 15 Trade, or that Post Office had asked for nearly 16 £1 billion to fund the project, or that the 17 Infrastructure and Projects Authority were now involved, 18 or that the project had been brought into the Government 19 major projects portfolio." 20 Would you agree that the Post Office, which failed 21 to be transparent about Horizon, is now failing to be 22 transparent about NBIT? 23 A. No, I don't think that's the case. I do recall that 24 Calum -- and I think Tim did too -- came to the offices. 25 I think, amongst a range of different topics, we talked 90 1 about where we'd got to with NBIT and the progress that 2 we were making. So I don't necessarily agree with that 3 statement, no. 4 Q. I'd like to turn to a different topic now. In 5 paragraph 20 of your witness statement, you state that 6 around 4,000 Post Office's are loss-making and loss 7 making also for the postmasters who operate them, and 8 that is around one-third of the post offices in the UK. 9 I want to ask what you have done during your time, or 10 are you going to do, to reduce the central costs of Post 11 Office to improve the viability of postmasters in the 12 running of their post offices? 13 A. I think the central -- there are two core drivers to 14 increasing remuneration for postmasters. I think one is 15 to drive revenue and, therefore, to be innovative with 16 new products and services, and the second, obviously, is 17 to reduce the operating costs associated with the centre 18 but also, the operating costs associated with running 19 a Post Office in and of itself. 20 So just taking those one at a time, if we think 21 about the introduction of NBIT and the replacement for 22 Horizon, we believe that the operating cost of doing 23 such a thing will reduce by about 60 per cent and that 24 will be both for branches themselves, as well as for the 25 centre. So that will reduce a run rate of around 91 1 60 million a year to Fujitsu to anywhere between sort of 2 20 and 30. So that will be probably the main driver. 3 I think, secondly, we've been on a trajectory of 4 trying to reduce the headcount within the Post Office 5 since about 2016/2017. I think we were at 7,500 heads 6 in 2016/2017, we're now at 3,400. I would fully 7 recognise that we have further to go and I'm sure that 8 the Strategic Review will look closely at the central 9 costs to make sure that we continue to reduce those 10 central costs. So I think that would be my secondary 11 point. 12 The third point, obviously, is the way to increase 13 the revenue for these particular branches is to make 14 sure that we can drive footfall and ensure that the 15 products and services that we are selling in post 16 offices are relevant to today's consumer. So we're 17 spending a lot of time thinking about how we are central 18 to cash and central to financial services, as well as 19 the major strategy that has been deployed by the Post 20 Office over the last 18 months, which is clearly 21 a multichannel, multiproduct strategy, employing the 22 likes of Amazon and DHL and DPD and Evri in our 23 branches. 24 So I think it's a two-pronged strategy, would be the 25 biggest way to describe this. One is to continue to 92 1 innovate and deliver new products and services and 2 indeed allow postmasters to share in some of the digital 3 developments that we've made, particularly with our 4 savings products, but also to make sure we continue to 5 cut costs. It's the crucial way and the most obvious 6 way to drive profitability. 7 Q. Just going back to the Strategic Review that you 8 mentioned in part of that answer, given that Network 9 Urban Reinvention 2003, Network Change 2007, and Network 10 Transformation 2012, did not provide a Post Office that 11 was fit for purpose, nor did it improve viability or 12 security of postmasters' investment, is it not the case 13 that the Strategic Review is just another way of 14 transferring risk and cost from the Post Office onto 15 postmasters? 16 A. I think I said on Wednesday that I had a great concern, 17 when I took over the Post Office in 2019, that 18 postmasters had been left behind in a drive for 19 profitability, commercial sustainability and the agenda 20 associated with both of those two from a Post Office 21 perspective. We've tried to address that. I think 22 Nigel is very, very alive to the desire to have a new 23 deal for postmasters and, as I mentioned earlier, the 24 polarity issue in terms of making sure postmasters are 25 front and centre. 93 1 Given what you've said, I'm not that familiar with 2 the three or four specific strategic reviews that have 3 been conducted since the earlier 2000s. I think the 4 scrutiny and spotlight that this Inquiry has placed on 5 the Post Office is such that it would be impossible for 6 us, even if we wanted to, which we don't, to do anything 7 other than make sure that the Strategic Review is for 8 the benefit of postmasters. That is what the Post 9 Office is all about: serving 10 million customers every 10 single week in our post offices. It's not about the 11 centre. 12 Q. Now, my final question -- or it's a series of questions, 13 different topic. I'm going to do some summarising and 14 then I'll ask you some questions. I'm going to call up 15 a couple of documents. 16 You've been asked by Counsel to the Inquiry about 17 the continuing issues with the culture of the Post 18 Office, you've also been asked questions about the Past 19 Roles Project and its failure to conclude within the 20 almost two-year period it's been underway, and that's 21 with regard to those who were involved in the pre-2015 22 Horizon scandal issues. You probably remember those 23 questions. 24 A. Indeed. 25 Q. I think your position is that, following the judgments 94 1 in the GLO, cultural change is important and, from your 2 perspective, has taken place at least in part; is that 3 correct? 4 A. That's correct. 5 Q. I think your position is that the Past Roles Project is 6 an important one -- 7 A. Yes, it is. 8 Q. -- not least to give subpostmasters confidence that the 9 culture and attitude towards them has indeed changed? 10 A. Absolutely. 11 Q. So I would like to ask you about something specific in 12 respect of those two points and to suggest to you that 13 there is actually a direct effect between those two 14 things on subpostmasters and their representative body, 15 the NFSP. Now, in this phase, the Inquiry has heard 16 evidence from the two Postmaster NEDs and from Calum 17 Greenhow, the Chief Executive of the NFSP -- and I think 18 you've said you heard at least some of that evidence, or 19 so -- 20 A. I did, yes. 21 Q. -- as to how near impossible it is to get anything 22 done -- that's done today -- which benefits 23 subpostmasters, such as remuneration. In his evidence, 24 Mr Greenhow put that down in large part to the culture 25 at the Post Office, that it has not, in fact, changed 95 1 and needs to change, in order for there to be a real 2 difference for subpostmasters. 3 Now, under your five-year leadership, there are some 4 people who were there during the peak of the Horizon 5 scandal era and who today deal with postmasters and 6 postmaster issues. I'm just going to give a little list 7 and then I'm going to ask you some questions. 8 So there's Nick Beal, Head of Network, which we 9 understand includes the NBIT project and who gave 10 evidence on behalf of the Post Office to Mr Justice 11 Fraser; Martin Edwards, the former Chief of Staff to 12 Paula Vennells, who is now Network Strategy and Deliver 13 Director; Tracy Marshall, Head of Postmaster Engagement, 14 who we saw in the emails yesterday was providing 15 reassurance on the remote access issue back in 2011 and 16 has a senior and extensive role in relation to 17 postmasters and is, in fact, the very person that the 18 NFSP has had to deal with over a good number of years on 19 almost every aspect of subpostmaster discussions and 20 negotiations. 21 Would you accept that subpostmasters will likely 22 find it incredible that someone who assisted Angela van 23 den Bogerd in 2011 with reassurance on remote access is 24 the very person with whom their representative body has 25 to deal on all of the issues associated with 96 1 subpostmasters? 2 A. First and foremost, as I said yesterday, I'm very clear 3 that we will not walk past allegations of wrongdoing, or 4 misbehaviour and, when they are presented to me, and 5 when they are present to the organisation, we will 6 address them, and that stands firm. And I explained how 7 that process was going, both with Past Roles and with 8 Project Phoenix yesterday, and I still stand by that. 9 Where there is -- and this is materially 10 different -- where there is an issue of confidence, then 11 clearly we need to have sensible conversations with 12 individuals to invite them to step back and to make sure 13 that the confidence of postmasters is sustained. That 14 is the single-most important thing and I absolutely 15 agree with you. 16 However, as I said before, where allegations are 17 made and when they are explicitly made, we will 18 investigate those individuals and make sure that anybody 19 who was involved in any activity in the past is 20 addressed. 21 Q. Now, just to be clear, by questions were about the 22 confidence that subpostmasters and their representative 23 organisation can have, as opposed to any specific 24 allegations of wrongdoing. So just to be clear about 25 that. 97 1 A. I understand. 2 Q. I'd like to call up a document, which is WITN00370106. 3 This is a letter from the NFSP, from Calum Greenhow, 4 to the then Postal Affairs Minister, Kevin Hollinrake, 5 of January. It is following the Mr Bates vs The Post 6 Office ITV drama. If we could control to page 2 and 7 look at the third paragraph, the one that begins "The 8 NFSP has raised concerns internally". So this is 9 a letter to Mr Hollinrake about the various issues 10 arising from the drama: 11 "The NFSP has raised concerns internally with Post 12 Office that there are still employees of Post Office who 13 were involved in internal discussion about bugs, defects 14 or errors, where directions were given for minutes not 15 to be taken, or were part of the Investigation, Audit 16 and Contracts departments who hold roles that are still 17 postmaster facing. We are not confident that the 18 correct review has or will be taken." 19 We can take that down. 20 Would you accept that the NFSP was right to bring 21 this issue to the attention of Minister Hollinrake? 22 I mean, that's a year on from you starting your Past 23 Roles project. 24 A. Of course, it's absolutely in the rights of the NFSP to 25 discuss anything about the Post Office with the 98 1 Minister, and I would encourage them to continue to do 2 so if they felt that we were in some way failing. 3 I think it's important to highlight -- and I said it 4 yesterday -- that we are frustrated that the Past Roles 5 Project has not gone as quickly as possible. 6 I mentioned that we had 1,700 colleagues in the 7 organisation who have been in the organisation for 8 in excess of 10 years. There's a lot of investigative 9 work to do, a lot of data to cover and a lot of people 10 to ensure that we are making the right decisions. 11 This is not something that we can follow some of the 12 practices of the past, should I say. It's very 13 important that we get this right, and that we give 14 people who have employment rights the right level of 15 opportunity to express precisely what it is they may or 16 may not have done. So the investigative work has been 17 slow and I would agree with that and I acknowledged that 18 yesterday. 19 I would have much preferred it to have been quicker 20 but, as I say, I can give you confidence that we will 21 not walk past any allegations, and we will not walk past 22 any wrongdoing by individuals who are in the 23 organisation today that may still be operating. 24 Q. Mr Read, not just slow, too slow, would you not say? 25 A. I did say that, yes. 99 1 Q. I'd like to call up another document, that's 2 NFSP00001471. This is an email from Calum Greenhow to 3 you of 29 April 2024. That's this year. He's sending 4 it on to you so that are you can send it to the Post 5 Office Board. He's saying he doesn't have all the 6 addresses of the Post Office Board, can you pass it on. 7 So he says: 8 "I write to the Post Office Board after watching the 9 events in the Horizon Inquiry over the last few days. 10 It has once again highlighted employees of the Post 11 Office who in the past were part of the obfuscation of 12 the truth in relation to the accuracy and reliability of 13 the Horizon system and its use in the victimisation of 14 postmasters, their assistants and Crown Office employees 15 and the ruining of their lives. 16 "Some of these employees of Post Office involved in 17 the past remain employees of the Post Office today, 18 where their present roles is very much postmaster facing 19 or indeed are in senior management positions. 20 "This information is not unknown to the Board, yet 21 as a group, there has not been any action taken to 22 remedy the situation. How many more current employees 23 will over the remainder of the Horizon Inquiry be 24 revealed to have been aware of the inaccuracy and 25 unreliability of the Horizon system, be involved without 100 1 the Board of Post Office Limited taking the required 2 action ... This is not the first time I have raised this 3 with the Post Office. 4 "I am sure you will appreciate that as a group of 5 postmasters ourselves, we are growing increasingly 6 concerned that we keep having to deal with those 7 individuals who have been involved in the most 8 reprehensible behaviour towards postmasters and indeed, 9 as has been repeatedly stated", and he goes on to talk 10 about what was to said at the Inquiry. 11 "To be clear, it is imperative that the Board takes 12 the required governance remedial action to identify any 13 and all current Post Office employees ..." 14 He goes on to say: 15 "If the ... Board fails to take such governance 16 action, then it will fall to the current Postmaster 17 Non-Executive Directors to resign", on this point. 18 Now, if we take that document down, this is 19 Mr Greenhow raising directly with you in April this year 20 and asking you to take that to the Board. What did you 21 actually do with that email? 22 A. It was circulated to the Board. It certainly formed 23 part of the discussions that we as a Board have had 24 since that time on past roles, and I will refer to the 25 comments that were made by Karen McEwan last week in her 101 1 evidence about how seriously this has been taken at the 2 Board, about how complicated it is and how much debate 3 and discussion is going on at a senior level. 4 As I said earlier, we would like this to be much 5 easier, and you'll have seen emails that have come up in 6 the evidence from me on this particular topic. It would 7 have been much easier if this was a very simple process. 8 It isn't. We're trying to deal with confidence of 9 postmasters, we're trying to deal with individual rights 10 of colleagues, and we're also trying to deal with 11 an investigative work to find out if there are 12 allegations that are substantive to wrong behaviour or 13 past behaviours. So it is a complicated piece of work, 14 I agree, and it's not easy for us to come down on a left 15 or right decision. It's much more nuanced than that, 16 I'm afraid. 17 Q. Did you know that after that email of 29 April, that the 18 Post Office intended to send those same people to the 19 NFSP's annual conference on behalf of the Post Office 20 until Mr Greenhow asked the Post Office not to send 21 them? 22 A. I wasn't aware of that, no. 23 Q. Just a final question, then. So would you agree that, 24 given the Past Roles Project, which you have said 25 started almost two years ago, it is, in fact, a disgrace 102 1 and disrespectful to subpostmasters that those involved 2 in the past, not about wrongdoing, but in front-facing 3 postmaster roles, are involved in so many matters that 4 affect the postmasters today? 5 A. No, I don't think it's a disgrace. As I said before, we 6 are not going to have a witch hunt unless allegations 7 are made very clearly, and that is still my position. 8 I've been very open and said that we will remove 9 individuals where there is a lack of confidence and that 10 is something that we are obviously working through and 11 Karen, as she mentioned last week, was doing exactly 12 that. 13 MS WATT: Thank you, Mr Read. 14 MR BEER: Sir, we've got two sets of questions to come now: 15 45 minutes from Mr Moloney and ten minutes from Ms Allan 16 on behalf of Susan Sinclair. 17 SIR WYN WILLIAMS: Yes. 18 MR BEER: There are two options, one we could take 19 a ten-minute second break now, ie a second break for the 20 morning and then do those 55 minutes of questions and 21 not have lunch or we could do Ms Allan's questions for 22 now for ten minutes, take lunch and come back after 23 lunch for Mr Moloney's questions. 24 SIR WYN WILLIAMS: I am content with either course. Is 25 there a consensus amongst people present in the hall as 103 1 to what we should do? 2 MR BEER: I'm looking at the shorthand writer in particular. 3 She said option 2, so I think Ms Allan now, lunch -- 4 SIR WYN WILLIAMS: Then lunch. 5 MR BEER: -- and then Mr Moloney. 6 SIR WYN WILLIAMS: Fine. 7 MR BEER: Over to Ms Allan, then. 8 Questioned by MS ALLAN 9 MS ALLAN: Good afternoon, Mr Read. I'll stand up so you 10 can see me. Obviously, I'll sit to do my questions. 11 My name is Christie Allan and I represent Core 12 Participant Susan Sinclair who is a wrongfully convicted 13 postmaster. She was the first to successfully appeal 14 her conviction in Scotland, which only happen as 15 recently as September last year, despite her being 16 convicted in 2024. 17 You've provided evidence yesterday about the Post 18 Office's engagement with the CCRC, that being the 19 Criminal Cases Review Commission in England, and, 20 indeed, Mr Henry put it to you that, as soon as it came 21 to pass that there were serious problems with Horizon 22 and certainly upon receipt of the Horizon Issues 23 Judgment in 2019, the Post Office ought to have been 24 banging on the door of the CCRC and Crown Prosecution 25 Service in England and Wales, begging for them to come 104 1 and review these cases as the convictions were unsafe, 2 to which you answered "Yes, I see where you're coming 3 from". 4 Notwithstanding this, you refer in your first 5 witness statement to a number of meetings with Post 6 Office's Board, which did eventually occur with the 7 CCRC, albeit two years later, regarding the criminal 8 appeals in England and Wales, and Post Office's role as 9 a prosecutor. 10 In response to Mr Beer's question to your earlier 11 today, you confirmed that, as far as you're aware, the 12 Board of Post Office has not engaged with the Scottish 13 Criminal Cases Review Commission or Crown Office, albeit 14 the Remediation Subcommittee was potentially overseeing 15 those matters. 16 Can you therefore tell me about any proactive steps 17 that Post Office took, particularly in light of the 18 Horizon Issues Judgment in 2019, to immediately seek to 19 rectify the miscarriages of justice which occurred in 20 Scotland as a result of Post Office's failings in its 21 duties of disclosure? 22 A. I am not close enough to that particular issue that 23 you're describing. As you rightly point out, the 24 Remediation Committee has been engaged in those matters, 25 I don't sit on the Remediation Committee. Again, I am 105 1 fairly certain that Simon Recaldin, who is a Subject 2 Matter Expert in this area, will be providing evidence 3 next week. I know -- I think it's on November 4, in 4 fact. He's obviously going to be much better placed to 5 comment. I don't want to sort of muddy that water. 6 Q. But to be clear, the Post Office's Board didn't engage 7 with the Scottish Criminal Cases Review Commission or 8 Crown Office -- 9 A. Not as a Board. It may well have been the case that the 10 Remediation Committee did or indeed that the Remediation 11 Unit did. I'm afraid I don't have that detail. 12 Q. You've repeated over the course of three days the fact 13 that, since before 2015, and indeed before your 14 appointment, the Post Office ceased to privately 15 prosecute postmasters in England and Wales. Remind me 16 again the reasons for this? 17 A. Sorry, do you want to repeat the question? Sorry. 18 Q. Before 2015 and before your appointment, the Post Office 19 ceased to privately prosecute subpostmasters in England 20 and Wales; what were the reasons for that again? 21 A. Why did they cease to -- 22 Q. Yes. 23 A. -- to prosecute? I mean, clearly -- 24 SIR WYN WILLIAMS: Can you answer that, Mr -- 25 A. I'm not sure I can, specifically. 106 1 SIR WYN WILLIAMS: I think there's quite a -- probably quite 2 a complex answer to that and it all occurred before 3 Mr Read was in post. So I think that I have as much 4 information as I am likely to get on that from the 5 previous phases of the Inquiry. 6 MS ALLAN: Thank you, sir. I will move on. 7 In your evidence on Wednesday, when asked by Mr Beer 8 whether Post Office's current investigative function is 9 fully compliant with all relevant legal standards, you 10 confirmed, "As far as I'm aware"; is that correct? 11 A. As far as I'm aware, yes, that's correct. 12 Q. You are aware, Mr Read, that Mr Beer asked you what your 13 response was to the Lord Advocate -- Scotland's most 14 senior law officer -- stripping the Post Office of its 15 role as a Specialist Reporting Agency in Scotland 16 earlier this year, and you confirmed that it's not 17 an enormous surprise that this decision has been made. 18 Why does that not come as a surprise? 19 A. Well, I think it's in keeping with the direction of 20 travel of the last five years, since the HIJ and CIJ 21 were handed down. I don't think that would come as 22 a great surprise to me. That's my point. 23 Q. Prior to this, Post Office in its role as a Specialist 24 Reporting Agency was an organisation who could 25 investigate and report crimes directly to the Crown 107 1 Office and Procurator Fiscal Service, the independent 2 Public Prosecutor in Scotland, as opposed to having to 3 first report this to other law enforcement agencies to 4 investigate, such as the police; is that your 5 understanding? 6 A. I'm afraid I don't have the level of detail that you're 7 suggesting. Prosecutions haven't occurred since 2019, 8 since I've been in position. In fact, they haven't 9 occurred since 2015. So forgive me, but this level of 10 detail is not something that I am aware of. 11 Q. Well, that would be what a Specialist Reporting Agency 12 does and that was Post Office's role prior to May 13 earlier this year, when it was stripped of that role. 14 The Lord Advocate, in deeming that the Post Office 15 is no longer fit to be a Specialist Reporting Agency, 16 also confirmed that, in light of the Post Office's 17 failures, work is now underway to strengthen the 18 guidance and safeguards that exist to ensure that all 19 Specialist Reporting Agencies abide by the essential 20 duties of disclosure and candour in Scotland, thus 21 inferring -- and she went on to confirm -- that the Post 22 Office did not. 23 Mr Read, is it really correct that Post Office does 24 not have an official response to being stripped of its 25 role as a Specialist Reporting Agency in Scotland? 108 1 A. I'm afraid I'm unable to answer that question. I don't 2 follow your train of thought in what you're trying to 3 ask me to answer. It's a little bit too nuanced for me, 4 I'm afraid. 5 Q. So there's not been any discussions in light of the Lord 6 Advocate's stripping -- 7 A. No, there hasn't. Not that I'm aware of -- 8 Q. Not at Board level -- 9 A. -- at Board level. 10 Q. No, and there's no review work planned by the Post 11 Office to review this? 12 A. It's nothing that's come to the Board that I'm aware of. 13 As I mentioned before, Simon Recaldin is probably best 14 placed to discuss this when he comes on 4 November. 15 Q. On the basis that, due to a failure in candour in 16 reporting by the Post Office to the Crown Office and 17 Procurator Fiscal Service, how, therefore, if there's no 18 review and no discussion taking place, will Post Office 19 now ensure that it acts with candour, in providing 20 evidence of suspected criminality to other law 21 enforcement agencies, such as the police, if not now 22 directly to the Crown Office in Scotland? 23 A. I think Mr Bartlett, when he comes next week to 24 articulate and describe the role of the new 25 investigative function, which he will do, the Assurance 109 1 & Complex Investigations Team, he will be able to 2 articulate very clearly how the team is constructed, who 3 is in that team and what their objectives are, 4 particularly without engagement with law enforcement 5 agencies and I'm sure, as part of that, he will be 6 talking about the jurisdictions that you are referring 7 to. 8 Q. Mr Read, I would say it's not just those jurisdictions, 9 it's reporting criminality to any law enforcement agency 10 in any jurisdiction. Can the Post Office now be trusted 11 to do that with candour, despite the fact it didn't do 12 that in Scotland? 13 A. Yes, I believe they can and, as I mentioned yesterday, 14 we are liaising with law enforcement agencies on 15 specific elements of organised crime and the like, and 16 clearly tying to support those agencies wherever we can, 17 in terms of the level of detail that we support and 18 supply. 19 MS ALLAN: Thank you. 20 SIR WYN WILLIAMS: So we'll break off for lunch now and 21 resume when, Mr Beer? 22 MR BEER: Sir, could I say 1.40? 23 SIR WYN WILLIAMS: Yes, certainly. 24 (12.47 pm) 25 (The Short Adjournment) 110 1 (1.40 pm) 2 Questioned by MR MOLONEY 3 MR MOLONEY: Good afternoon, sir, can you see and hear us, 4 as is the usual question? 5 SIR WYN WILLIAMS: Yes, I can thank you. 6 MR MOLONEY: Thank you, sir. 7 Good afternoon, my name is Tim Moloney, and I ask 8 questions on behalf of a number of Core Participants, 9 essentially postmasters, all of whom have been 10 prosecuted to conviction by Post Office and subsequently 11 have had their convictions quashed. 12 A. I understand. 13 Q. Quite close to the beginning of your evidence, Mr Beer 14 asked you about the appreciation at senior levels in 15 Post Office of the seriousness of the implications of 16 the Common Issues Judgment and the Horizon Issues 17 Judgment, and what that was not long after you took up 18 your post. 19 A. Yes, he did. 20 Q. Yeah, and you agreed to his term that the leadership 21 team was living in a dream world, some of them, and 22 didn't seem to appreciate the implications of the 23 judgments? 24 A. Yes, I qualified that by saying that some were in denial 25 and some were in paralysis of the judgment that was made 111 1 and limited contingency had been put in place for the 2 prospect of losing the litigation. 3 Q. But the primary focus was on looking to the future, 4 without there being a real emphasis on rigorously 5 examining what had gone on in the past at that stage? 6 A. I think that's a fair conclusion, yes. 7 Q. So, for example, you weren't directed towards the 8 examination of the propriety of previous convictions? 9 A. No, I wasn't, no. 10 Q. But you went on to say that the negotiation and 11 settlement process around the Common Issues Judgment in 12 the Horizon Issues Judgment gave you an opportunity to 13 more fully understand the implications of the judgments? 14 A. Yes, unquestionably, that that was my genuine 15 introduction to the victims, first and foremost, and 16 also, therefore, the understanding of the behaviours, 17 rather than necessarily the system, if that makes sense. 18 I think that was my introduction to behaviours of the 19 past. 20 Q. Yes. Can I just focus on your introduction to the 21 victims -- 22 A. Yes. 23 Q. -- for these purposes. You were able to listen to 24 postmasters and hear the accounts of what had happened 25 to them? 112 1 A. That's precisely how that process worked, yes. 2 Q. Just as one example of that, did you take part in 3 a mediation meeting in respect of the GLO at which 4 postmasters were present? 5 A. Yes, the four or five days of mediation/settlement, that 6 process, I did speak and listen quite extensively. 7 I think there were five or six who brought their 8 narrative to life for me, yes, which was very helpful. 9 Q. How that narrative was brought to life, Mr Read, was 10 that you, was it with Jane Davies, went into a room with 11 those five or six, just to hear their stories? 12 A. Yes, no, it wasn't with Jane but, yes, that is correct, 13 yes. 14 Q. One of them was Jo Hamilton? 15 A. That's correct. 16 Q. Another was a Scottish woman who'd been one of the lead 17 claimants in the GLO, a lady by the name of Louise Dar; 18 do you remember her? 19 A. Yes, I do. Yeah. 20 Q. She'd been cross-examined during the course of the GLO? 21 A. Yes. 22 Q. In that meeting, you told the postmasters that you would 23 do everything to transform the future of Post Office? 24 A. Yes, that was my commitment. 25 Q. Yes. Importantly, Ms Dar -- and she broke down as she 113 1 told you this -- told you what had happened to her and 2 said -- and this may have been important to you in 3 appreciating what was needed -- that you needed to fix 4 the wrongs that had been done in the past, as well as 5 looking to the future; do you remember that? 6 A. I do, that's correct. 7 Q. Was that an important meeting for you, in terms of the 8 understanding of, to use your term, the harm that 9 postmasters had suffered? 10 A. Yes, it was and, as I say and as I said a couple of 11 minutes ago, it brought to life the behaviours of the 12 Post Office, as opposed to necessarily my understanding 13 at that stage, which was it was purely system led. 14 Q. Now, one of the people who had suffered harm a number of 15 years prior to that meeting was a woman by the name of 16 Jackie McDonald from Preston in Lancashire? 17 A. Okay. 18 Q. Now, I have to just give a little bit of detail of 19 Jackie McDonald's case, in order to ask the question 20 that I'd like to ask about her case, if I may, Mr Read. 21 A. Understood. 22 Q. So Jackie McDonald had encountered shortfalls in her 23 Post Office. She reported them to management. She was 24 ultimately suspended after an audit, some £90,000 or so 25 shortfall, and her assistant Katie took over as the 114 1 manager. The shortfalls continued. Katie had to stop 2 work because she was suffering from anxiety and 3 depression, as a result of the continuing shortfalls 4 and, ultimately, Mrs McDonald was prosecuted. Are you 5 aware of her being prosecuted as one of the people who 6 was prosecuted? 7 A. I don't remember the specific case. When was this, what 8 date was this? 9 Q. It was in 2010/2011. So some time before the GLO, some 10 eight years before the CIJ and the HIJ. 11 A. I understand. 12 Q. Now, she was 47 years old and the mother of teenage 13 children when she went to prison. She was sent to 14 prison for 18 months after pleading guilty to theft. 15 She went to Styal Prison to start with, which is near 16 Manchester, and then she was sent to Durham Prison, and 17 she spent her daughter's 18th birthday in Durham Prison. 18 Then she later went to a prison near York called Askham 19 Grange. 20 You may have seen during the evidence of 21 Mr Bradshaw, because Mr Bradshaw investigated 22 Mrs McDonald, that he recorded in a self-appraisal form, 23 after her conviction, how ensuring that a plea of guilty 24 to false accounting was not accepted but insisting on 25 a plea of guilty to theft was essentially one of his key 115 1 achievements of the year; did you see that? 2 A. Don't recall it specifically but yes. 3 Q. He recorded on the form that he had persuaded the 4 prosecution barrister to proceed with the allegation of 5 theft and not accept a plea of false accounting. Okay. 6 Mrs McDonald has explained her experience, described 7 her experiences, in a statement to this Inquiry. She 8 explained how traumatic the audit and investigation 9 process was and the Auditors asked her "What have you 10 done with the money? What tree have you squirrelled it 11 away in?", and her house was searched, and in front of 12 her, the searchers were asked, "Is she cooperating? Is 13 she answering questions?" 14 One of the people about whose behaviour Mrs McDonald 15 complained was a woman by the name of Caroline Richards. 16 Caroline Richards was a Business Development Manager, 17 who had called in the Auditors and attended the audit, 18 and she's the person that Mrs McDonald had been liaising 19 with. 20 As long as go as 2013 in her application to the 21 Mediation Scheme, Mrs McDonald said the following, 22 Mr Read: 23 "The Investigators for the Post Office were bullies 24 and intimidated me the first time they came in with 25 their lies about my individual case being unique and 116 1 uncommon. They returned once again when I was forced to 2 step down and Katie was running the Post Office under 3 someone else's name, and intimidated her with wage 4 deductions from monies missing and jail time. My 5 husband eventually came downstairs after he heard the 6 news of the threats Katie was receiving, and told them 7 both, Steve Bradshaw and Caroline Richards, to get out 8 of the shop immediately and never come back. 9 "Katie had to leave early and had to take a leave of 10 absence because of anxiety and depression because of the 11 bullying that she took from those Post Office 12 Investigators." 13 So the Post Office Investigators being Steve 14 Bradshaw and Caroline Richards. 15 You told the Inquiry -- and in fact, in answer to 16 questions from Ms Watt, you've reiterated this just 17 before lunch, Mr Read -- that you've been very clear 18 that "At no stage will we walk past allegations of 19 wrongdoing in the organisation", and you've made that 20 very clear publicly to all colleagues and postmasters 21 themselves. 22 You said specifically, on Wednesday -- and it's at 23 page 48 of the transcript -- and you've repeated it this 24 morning, to be fair to you, Mr Read: 25 "With regard to the Remediation Unit, I'm very clear 117 1 that we've conducted a piece of work which you've heard 2 a lot about at this Inquiry which is referred to as the 3 Past Roles piece of work. And, once again, I'm 4 confident that there are not individuals involved in 5 postmaster-facing activity that had roles in the past 6 where allegations of any wrongdoing has been brought to 7 my attention." 8 Is Caroline Richards still employed in the 9 Remediation Unit, Mr Read? 10 A. This is quite a difficult question because -- and I'm 11 looking to Sir Wyn -- I'm not sure I'm at liberty to 12 discuss some of the specifics about these individuals. 13 If you recall a couple of days ago we talked about 14 external agencies supporting us and there are a number 15 of individuals that I think it would be inappropriate 16 for me to mention and to give any insight into what is 17 specifically happening. I know that doesn't sound 18 particularly helpful but I -- 19 Q. No, I understand, Mr Read, and I think it would be 20 unfair on all individuals if I were to not understand. 21 A. Yes. 22 Q. Plainly there have to be parameters. 23 A. Correct. 24 Q. Can I ask you some more general questions -- 25 A. Yes. 118 1 Q. -- about that, then. 2 SIR WYN WILLIAMS: Can I take it, Mr Moloney, that you don't 3 wish to pursue that specific question? 4 MR MOLONEY: Sir, I think the question has been answered, to 5 be honest, and so -- 6 SIR WYN WILLIAMS: I see -- 7 MR MOLONEY: I think there are -- there are obviously -- we 8 have to be responsible with questioning, sir, and -- 9 SIR WYN WILLIAMS: I only asked you so that you didn't feel 10 inhibited on behalf of your client in going any further 11 if you thought that it was appropriate to go further. 12 If you're content with where we've got to, that's fine 13 by me. 14 MR MOLONEY: If I'm being told by a witness that he has real 15 reticence about going here, that there are particular 16 reasons why they can't go there, then I think it is only 17 responsible, because I can deal with this generally. 18 I've asked my question, I've received an answer and 19 I can deal with this generally now, without causing 20 undue difficulties which may not be necessary at all in 21 order to make the points I need to make. 22 SIR WYN WILLIAMS: Fine. Thank you, Mr Moloney. 23 MR MOLONEY: Mr Read, without descending to the specifics 24 and recognising your qualification as to 25 postmaster-facing activity, would you accept that, as 119 1 a general principle, somebody about whom complaints had 2 been made of the nature that were made against 3 Ms Richards, should not be involved in the remediation 4 process? 5 A. I agree with that and I'll just bring a little colour, 6 if I may? 7 Q. Yes. 8 A. The Project Phoenix work, which is ostensibly feedback 9 and narratives that we've received during Phase 1 of the 10 Inquiry, in terms of the Human Impact Hearings, as well 11 as what I have experienced through my restorative 12 justice meetings, and I received direct feedback during 13 those meetings on individuals, that was the genesis of 14 the Project Phoenix work. 47 particular cases, I think 15 as I mentioned previously -- not 47 individuals but 47 16 cases -- six individuals who were involved in those 17 meetings. 18 We have interviewed many of the individuals again, 19 through their legal representatives, and sought to be 20 able to discuss with those individuals the names and the 21 issues that emerged during the Human Impact Hearings and 22 that emerged during the restorative justice meetings. 23 We've examined over 130,000 documents associated 24 with those particular case studies. The number of 25 individuals impacted is six, of which, as I mentioned 120 1 I think on Wednesday, three are specific cases that 2 we've just touched on now that I would say we've got 3 external agencies helping have a look at that. 4 Q. Can you understand that for postmasters who are making 5 a claim for compensation, the idea that the unit that is 6 dealing with claims for compensation might be somebody 7 who was involved in previous misbehaviour, would be 8 something that would concern them? 9 A. I think that would be very concerning for them, yes. 10 Q. Because you have said, and it's perhaps likely that 11 Mr Recaldin will say, that, even as a first principle, 12 perhaps Post Office should not have been responsible for 13 administering the HSS? 14 A. I have said that and I'm sure Mr Recaldin will say the 15 same. 16 Q. So to compound that with having a member of staff -- and 17 I'm speaking in general terms now -- against whom 18 complaints had been made for misbehaviour during the 19 investigation process, would be to add insult to injury, 20 in a sense, wouldn't it? 21 A. I understand that. 22 Q. You talked this morning of rebuilding trust. It would 23 be integral to rebuilding trust to ensure that that 24 didn't happen, wouldn't it? 25 A. It would be essential, yes. 121 1 Q. That's all I'd like to ask you about that. 2 I'd now like to ask you about the Strategic Platform 3 Modernisation, SPM, and NBIT, and this is the only other 4 topic I'll ask you about, Mr Read. 5 A. I understand. 6 Q. You understood from your early meetings, during the 7 mediation of GLO, the harm that had been caused, and 8 Horizon software lies at the root of all of that harm, 9 doesn't it? 10 A. Indeed. 11 Q. Postmasters suffered enormous harm because of it? 12 A. That's correct. 13 Q. For many other reasons as well but, at the core of it, 14 is the Horizon software and its unreliability? 15 A. That's right. 16 Q. Plainly, you'd accept that dealing efficiently, dealing 17 with alacrity with the Horizon issue is something that 18 Post Office should face, given the harm that it has 19 caused to postmasters? 20 A. Yes. 21 Q. I'd like to ask you, if I may, about the progress that 22 has been made with that, and I'd just like to look at 23 two documents, as please. One is a readout of 24 a minister with Minister Hollinrake in April 2023, and 25 I'll take you to it. 122 1 Then the second document is the Board minutes from 2 4 June this year. 3 A. Okay. 4 Q. So if I could first go to the readout of the meeting 5 with Mr Hollinrake, and that's BEIS0000653. Thank you 6 very much. This is, we can see, the introductions. We 7 don't need to go there but we can see the attendees, if 8 we scroll up, please. Thank you. We can see that 9 you're there, Mr Read, as is Mr McInnes from Post Office 10 and Lorna Gratton and also Minister Hollinrake. 11 A. Yeah. 12 Q. Can I just go to some of the detail of this and, if we 13 could scroll up further now, please, so that we can get 14 the main body. That's great. That's spot on, thank 15 you. 16 We see at the start that you raise the fact that the 17 Permanent Secretary had made the decision to withhold 18 the funding and asked for Mr Hollinrake's opinion. 19 Mr Hollinrake said that he, the Treasury and Permanent 20 Secretary are keen to see a plan from Post Office about 21 its funding ask, and know that the Horizon replacement 22 is a concern. 23 You said that the funding ask won't be ready/ 24 approved by the Board until June and main issues are 25 Horizon replacement, POL underestimated the cost of 123 1 this, and then the Inquiry costs and the compensation 2 costs. 3 Then I'll go onto the rest of it. Did you, at this 4 stage, not have a firm plan as to what to do with 5 Horizon? 6 A. Yes, we did have a plan but, as we were overrunning, it 7 was important that we come back to Government, who 8 wanted to understand what they thought our revised plan 9 for Horizon was, in terms of the overall funding for 10 Horizon. 11 Q. Then if we go down further, we see that, in the 12 penultimate bullet point of this, which is on the second 13 page, but we can see it here: 14 "[Nick Read] said that another pressure was the 15 Inquiry, which is going to scrutinise the rollout of the 16 Horizon replacement; POL needs to ring-fence/ 17 compartmentalise this piece of work." 18 What did you mean by the Inquiry is going to 19 scrutinise the rollout of the Horizon replacement? 20 A. I think exactly that. I'd obviously made a commitment 21 in 2019 that we would get off Horizon, and there was 22 a twofold reason for that: one because Horizon was 23 30 years old, it was expensive to run, expensive to 24 manage and clearly had been associated with appalling 25 issues of the past. 124 1 And the second reason -- so that was the first 2 reason -- the second reason was it was clearly a system 3 that was tarnished as a consequence of the past and 4 I wanted to make sure that we moved across -- we got off 5 it. 6 My point to talk about ring-fencing and 7 compartmentalising was that we submitted our funding 8 requests to the Department and the investment that was 9 required for the next phase of the Horizon work needed 10 to be very clearly understood by BEIS, and I wanted to 11 make sure that when we made that submission they 12 understood the extent and the necessity to get off 13 Horizon and what that looked like and, more importantly, 14 that they understood specifically why it was late and 15 why it would cost more. 16 Q. You had had really quite significant delays in relation 17 to the replacement for Horizon? 18 A. We had at that stage, and I think what had happened 19 by -- I think we said it was May '23, this meeting, 20 I seem to recall. 21 Q. April '23. 22 A. April '23. 23 Q. Yes. 24 A. So by April '23 we had embarked on two very clear 25 streams of work: one was around the design and build of 125 1 the system; and the second piece of work, which was 2 initiated in January that year, was around the 3 deployment, training and rollout of the system. And 4 they were two very distinct pieces of work and so that 5 was the point I was trying to draw to the attention of 6 the Department. 7 Q. So by April 2023, was the design and build of the system 8 pretty much set in stone or were there decisions still 9 to be taken? 10 A. We -- it's a difficult question to answer. I think we 11 had not got to the stage (unclear), we hadn't, at that 12 stage, developed the banking and total mail 13 functionality of NBIT, and so there was still a long way 14 to go, so it was still quite early in terms of its 15 evolution. We were still having conversations about is 16 this a replacement for Horizon or is this a modern 17 system development that is going to ensure that 18 postmasters are in a very different -- are put in a very 19 different place? 20 And I think, if I look back to 2019, it was very 21 much we are replacing Horizon, as opposed to "This is 22 going to be a full-scale transformation of the 23 underlying EPOS system", which is very much the attitude 24 today. And I think that's one of the core distinctions 25 between why, when we set out on this journey, the 126 1 replacement was 180 million or there or thereabouts, and 2 why that cost has obviously increased as a consequence 3 of what we have learnt through the Inquiry. But, more 4 importantly, that we want a system that more than just 5 a replacement, but actually is a wholescale 6 transformation of the way we do business in the Post 7 Office. 8 Q. Can I just take you to the final paragraph on page 1 of 9 this document that I've brought up. It reads: 10 "[Kevin Hollinrake] asked how [Post Office] is going 11 to try to find a number that they are comfortable with 12 for the cost of replacing Horizon. [Nick Read] said 13 that they are considering more of a modest approach 14 rather than something transformative [for example] not 15 rolling it out to all 11,500 branches, and opting for 16 the minimum viable product. Another issue is that we 17 don't know what the future of [Post Office] will be and 18 designing a system that will work for POL in decades to 19 come is difficult." 20 Is that reflective, Mr Read, of there being very 21 firm decisions about what this was going to look like in 22 April 2023? 23 A. I think the issue here is that the Department had 24 decided to withhold funding. They were concerned about 25 the potential cost of the replacement system, and they 127 1 wanted us to consider other options and all options, in 2 fact and it was at this stage that we came back and had 3 a broader conversation around, well, what are those 4 options? 5 Q. So there isn't any certainty here, is there; and you 6 were essentially considering something less than 7 transformative? 8 A. Yes, I mean that is -- that was one of the options that 9 was on the table. 10 Q. Yes. So there was no certainty in April 2023 about what 11 the replacement for Horizon was going to look like? 12 A. Well, we thought we were on a particular journey, and 13 the Government were concerned about the increasing cost 14 and they wanted us to -- and they wanted to get 15 assurance from that, which is obviously why we've had 16 two external parties assure for the Government on their 17 behalf what exactly is being developed. 18 Q. Can we go to the second document I'd like to look at, 19 please, which is POL00448648. Before I ask you 20 questions about this document, Mr Read, we heard 21 evidence from Mr Railton on Tuesday that you've already 22 referred to. 23 A. Yes. 24 Q. You were present when Mr Railton gave his evidence? 25 A. I was indeed, yes. 128 1 Q. Mr Railton has been Interim Chair since 24 May 2024? 2 A. That's correct. 3 Q. These are Board minutes from 4 June 2024. So just over 4 a week after Mr Railton became Interim Chair. You're 5 present, obviously, as "NR", and Mr Railton is "NR" with 6 a lower case "a" -- "NRa"? 7 A. That's correct. 8 Q. Now, page 5 of 21, I'd like to look at please, because 9 this deals with the Strategic Platform Modernisation. 10 Mr Blake took Mr Railton to a different section of this 11 document, the minutes, where Mr Railton was asked about 12 how he was the first to suggest a break clause in the 13 continuing contract with Fujitsu; do you remember that? 14 A. I do remember that, yes. 15 Q. That can be seen at page 11 of this document -- 16 A. Okay. 17 Q. -- but page 5 is the Strategic Platform Modernisation 18 and we can see here, and it should be under "Investment 19 Committee", so it should be down the page, yeah, there 20 it is. 3.5, "Investment Committee": 21 "Key points advised ... 22 "the [Investment Committee] met on 16 May and 23 focused on SPM [the Strategic Platform Modernisation]. 24 There were uncertainties in respect of this project 25 across number of issues including funding." 129 1 So this was June 2024, Mr Read, only some five 2 months ago -- four months ago, in fact. 3 A. Four. 4 Q. "Two external reviews had been completed in respect of 5 the project and both concluded red ratings. The build/ 6 buy point had been considered, although the build 7 approach without the necessary inhouse expertise seemed 8 flawed. [Mr Railton] shared his view that the 9 conversation on buy/build was the wrong question and 10 thought that the question was build/build and then the 11 question was whether to build internally or externally. 12 There needed to be a number of conditions met for 13 a successful internal build however such as a stable 14 business, good governance and quick decision making. 15 With the Company not fulfilling this conditions the view 16 of [Mr Railton] was that a third party should be 17 commissioned to build. [Mr Railton] advised that he saw 18 3 options, firstly SPM could carry on as was, secondly 19 a third party could be engaged to build the new system, 20 and thirdly that Horizon could be brought in house. All 21 of these options needed to be carefully considered; 22 "the dashboard reporting to the [Investment 23 Committee] showed 17 red platinum projects. A number of 24 these were outside appetite although there was a lack of 25 clarity around the definition and terms were not used 130 1 consistently throughout the business. [It was] noted 2 issues in respect of the copper stop project including 3 management of the contractor and communications." 4 There's still really quite a lot of uncertainty 5 around SPM, even in June 2024, isn't there? 6 A. Different uncertainty but, yes, there is uncertainty. 7 Q. That's the new chair coming in essentially suggesting 8 there needs to be root and branch consideration of this? 9 A. That is correct. Yes. 10 Q. That's only four months ago? 11 A. Four months ago. 12 Q. Yeah. Mr Railton was asked by Mr Blake, when he gave 13 evidence, the following, and this is at page 164 of his 14 evidence: 15 "We've seen in the YouGov report, for example, and 16 in evidence the Inquiry has heard, of issues still being 17 experienced by subpostmasters in relation to their use 18 of Horizon." 19 That's the importance of it, Mr Read, isn't it? 20 A. Yes. 21 Q. It's still ongoing. 22 "Is it possible, is it likely, that subpostmasters 23 are going to be using that same system into 2030?" 24 Mr Railton replied: 25 "It is possible. I don't think it's likely and 131 1 certainly our intention and the intention of the new 2 team is to move away from Horizon to a new system that 3 can deliver -- I'm sorry to go back to the strategic 4 review, but a system that's fit for the future as soon 5 as possible but to do that in a way that doesn't disrupt 6 postmasters' activities." 7 So that was the answer as to whether or not, 8 essentially in 2030 -- which is when the Fujitsu 9 contract is due to run out, isn't it? 10 A. Well, we haven't got agreement to a five-year 11 commitment, yes, but that was the plan. 12 Q. Yes. That's the possibility. Is there a firm decision, 13 in the Strategic Review, as to how to do this? I'm not 14 asking you what the decision is. Is there a firm plan 15 now in respect of all of the replacement for Horizon in 16 the Strategic Review? 17 A. I have not yet seen the specifics of this. As you're 18 probably aware, for the last six weeks I've stepped back 19 to focus on the corporate statements associated with the 20 Inquiry, and that is something that I'm sure by the end 21 of this particular session I will be back involved in 22 that activity. So I can't give you that assurance at 23 the moment, Mr Moloney. 24 Q. Has it taken too long to find a replacement for Horizon? 25 A. Yes, it has. 132 1 Q. Do you bear any responsibility in how long it has taken, 2 Mr Read? 3 A. Yes, I mean, if you go back to my last statement that 4 I made, the very last pages on that statement, I have 5 number of regrets, I think, in my five years in the 6 business, and one of those regrets is the inability to 7 have the bandwidth to get involved in the SPM programme 8 and project, as much as I would have liked, having been 9 spread a bit too thinly. And that is a big regret of 10 mine and I wish that I'd had more time to do that -- one 11 of number of regrets but that was certainly one of them 12 which I expressed in my statement. 13 MR MOLONEY: That's all I ask, Mr Read, thank you. 14 THE WITNESS: Thank you. 15 MR BEER: Sir, unusually, I've just got couple of questions 16 to ask which I've been asked to put to Mr Read, one by 17 way of correction of something that I said, and then 18 some supplementals that follow it. 19 SIR WYN WILLIAMS: Sure, Mr Beer. 20 MR BEER: It will be less than five minutes. 21 Further questioned by MR BEER 22 MR BEER: Can we look please at POL00448701. 23 Thank you. You remember I showed you this letter, 24 it's Mr Vamos' letter, the "Dear all" letter? 25 A. Yes, indeed. 133 1 Q. I drew your attention to the third paragraph, the fourth 2 line, in which it was said: 3 "In reality, it is highly likely the vast majority 4 of people who have not yet appealed were, in fact, 5 guilty as charged and were safely convicted." 6 Yes? 7 A. You did, yes. 8 Q. I'd suggested that this was put up on the Post Office's 9 website -- 10 A. Yes, you did. 11 Q. -- but it was no longer on the website. In fact, it has 12 been drawn to my attention that it is still on the Post 13 Office's website. The website, which I'm looking at 14 now, contains some text alongside it, ie the publication 15 of Mr Vamos' letter. It says: 16 "The Post Office has published, on 22 February 2024, 17 correspondence from 9 January [that's your letter to the 18 Lord Chancellor] sent by the Post Office to the Ministry 19 of Justice, copied to the Department for Business and 20 Trade. The purpose of the correspondence was to explain 21 the work that the Post Office had requested its legal 22 counsel, Peters & Peters, undertake to proactively 23 identify on the papers available any convictions that 24 could be unsafe. This was primarily to offer the 25 Government any support that might assist them as they 134 1 consider relevant issues in advance of passing 2 legislation, without any value judgement on what the 3 correct course of action might be. 4 "The letter references a note provided by Post 5 Office's legal counsel. This note was not solicited by 6 the Post Office and, as can be seen, was sent to express 7 the personal views of its author. 8 "Post Office was in no way seeking to persuade 9 Government against mass exoneration. Post Office are 10 fully supportive of any steps taken by Government to 11 speed up the exoneration of those with wrongful 12 convictions and to provide redress to the victims with 13 the information having been provided to them to inform 14 that consideration." 15 So your letter of the 9th is published, Mr Vamos' 16 "Dear all" letter is published and then there is this 17 explanatory text alongside it, which says: 18 "Post Office was in no way seeking to persuade 19 Government against mass exoneration." 20 Can we look, please, at your letter of the 9th, 21 POL00448381. I drew your attention to the fourth 22 paragraph of this, if we scroll down, "A natural 23 corollary", et cetera, yes? We looked at that this 24 morning. 25 A. We did, yes. 135 1 Q. What I didn't do is go over the page. If we go over the 2 page, please, you wrote in the penultimate paragraph: 3 "In the meantime, I attach a note prepared by Peters 4 & Peters which covers this and other issues you may find 5 helpful in your deliberations." 6 That's the Vamos "Dear all" letter. So whoever the 7 "Dear all" was sent to, it had certainly got to you by 8 this time, hadn't it? 9 A. It looks like it, yes. 10 Q. The covering text on the Post Office website, when it 11 speaks about the Peters & Peters note, essentially takes 12 two points: it says, firstly, Mr Vamos' note was not 13 solicited. 14 A. Yes. 15 Q. Secondly, it says it expresses the personal views of its 16 author. Was that the Post Office distancing itself from 17 the content of Mr Vamos' letter? 18 A. I think it was just trying to explain the letter. 19 That's my understanding. 20 Q. You, in your letter, attached Mr Vamos' "Dear all" 21 letter, didn't you? 22 A. Indeed. 23 Q. Were you allying yourself with the contents of it by 24 doing so? 25 A. No, I'd been very clear that we weren't making any value 136 1 judgements. We felt obliged to alert the Ministry of 2 Justice to exactly what work had been done and to aid 3 them in their deliberations. 4 MR BEER: Thank you. 5 SIR WYN WILLIAMS: Thank you, Mr Beer. 6 Thank you, Mr Read, for four witness statements, two 7 of which are very long and detailed, and for giving 8 evidence over three days before this Inquiry. I'm very 9 grateful to you. 10 THE WITNESS: Thank you, sir. 11 SIR WYN WILLIAMS: Right, we'll adjourn now and resume on 12 Tuesday morning at 10.00. 13 MR BEER: Thank you very much, sir. 14 (2.21 pm) 15 (The hearing adjourned until 10.00 am 16 on Tuesday 15 October 2024) 17 18 19 20 21 22 23 24 25 137 I N D E X NICHOLAS JAMES READ (continued) ...............1 Questioned by MR BEER (continued) .............1 Questioned by MR STEIN .......................31 Questioned by MS WATT ........................86 Questioned by MS ALLAN ......................104 Questioned by MR MOLONEY ....................111 Further questioned by MR BEER ...............133 138