1 Wednesday, 16 October 2024 2 (10.03 am) 3 MR STEVENS: Good morning, sir. Can you see and hear us? 4 SIR WYN WILLIAMS: Yes, thank you very much. 5 MR STEVENS: Sir, we'll be hearing from Tracy Marshall this 6 morning. 7 SIR WYN WILLIAMS: Yes. Can Ms Marshall be sworn, and then 8 I'll raise a very short matter with you. 9 MR STEVENS: Of course. 10 TRACY LOUISE MARSHALL (affirmed) 11 SIR WYN WILLIAMS: Mr Stevens, the issue which I wish to 12 raise with you relates to some questions which Mr Beer 13 asked of Mr Read last week in respect of one or more 14 emails going back to 2010 or 2011, which apparently were 15 emails of which this witness will have knowledge. Let 16 me try and put it as neutrally as possible. 17 My understanding, Mr Stevens, is that Mr Read (sic) 18 did that in order to probe whether Ms Marshall was 19 an appropriate witness to give evidence on behalf of the 20 Post Office in respect of what I'll call current 21 policies and practices, and that was why he was raising 22 issues from many years ago. 23 You have made me aware, quite properly, that you 24 intend to ask some questions about events in the 25 period -- and I'm deliberately choosing a wide period so 1 1 that nobody thinks it's confined -- between, say, 2010 2 and 2013 of this witness and, therefore, I have had to 3 consider whether or not it is appropriate that this 4 witness be given a direction about self-incrimination, 5 that direction having been given to a number of 6 witnesses who gave evidence about that period in time. 7 My current view is that, notwithstanding that there 8 will be some questions about that period, it is not 9 necessary for me to give that direction to Ms Marshall 10 but I wanted you to have the opportunity of making any 11 observations about that current view before you start 12 questioning, so to speak. 13 So is there anything you'd like to say about that? 14 MR STEVENS: I agree, sir, and nothing further. 15 SIR WYN WILLIAMS: Fine. Then we'll proceed but I should 16 make it clear, as I hope is obvious to everyone, that, 17 in respect of something like a direction against 18 self-incrimination, I keep that under review throughout 19 the whole of the witness's evidence, and so it's open to 20 me to change my mind, so to speak, if I think it 21 appropriate. 22 MR STEVENS: Thank you, sir. 23 SIR WYN WILLIAMS: Over to you, Mr Stevens. 24 Questioned by MR STEVENS 25 MR STEVENS: Please can you give your full name? 2 1 A. Tracy Louise Marshall. 2 Q. Thank you for attending today to give evidence and thank 3 you for providing a written statement, to which I want 4 to turn now. You should have a copy in front of you. 5 A. Yes, I do. 6 Q. Is that dated 22 August 2024? 7 A. It is. 8 Q. Now, before I turn to your signature, I understand there 9 are a few minor changes to make, which I will take you 10 through now, given they're minor in nature. If we could 11 have the statement on the screen, please, and page 4. 12 In paragraph 10(a), you are discussing terms that you 13 used throughout the statement and you will see in the 14 third line from the bottom you say, "save for 114 15 Directly Managed Branches". I understand that should 16 read "111"? 17 A. Correct. Thank you. 18 Q. Page 12, please. If we go down to paragraph 30, please. 19 Here you're talking about amendments to terms of 20 contract between the Post Office and subpostmasters, and 21 you say, "Following the CIJ", which is Common Issues 22 Judgment], Post Office made the decision to amend the 23 template NT Terms", referring to Network Transformation 24 terms -- 25 A. Yes. 3 1 Q. -- and I understand and after that should read "and 2 SPSO"? 3 A. Yes, that is correct. 4 Q. That is an abbreviation, SPSO, for the Standard 5 Subpostmaster Contract? 6 A. That's correct. 7 Q. If we can please turn to page 47. In paragraph 108, you 8 describe responsibility for various matters. You say: 9 "... however any changes to the scope of the 10 Postmaster Contract would go through SEG and the Post 11 Office Board for approval." 12 I understand after "Postmaster contract" it should 13 read "or associated policies"? 14 A. Correct. Thank you. 15 Q. Finally, page 60, please. If we could go right to the 16 bottom of the page there's a footnote, which we may need 17 to zoom in to. Given the nature of the correction, I'll 18 just deal with it as a footnote, rather than the 19 context. It says, "Reinstatement refers to the period 20 following suspension, or post-termination decision on 21 appeal", and then I understand where that word "appeal" 22 is, the words thereafter should be struck through and, 23 in the place of those words, it should say "where the 24 postmaster is reinstated in their role"? 25 A. Correct. Thank you. 4 1 Q. Thank you. The statement can come down from the screen. 2 Thank you. 3 Can I ask you, please, to turn to page 78 of the 4 statement. 5 A. Yes. 6 Q. Below paragraph 199, you should see a signature. 7 A. Yes. 8 Q. Is that your signature? 9 A. It is, yes. 10 Q. Can you confirm that the contents of the statement are 11 true to the best of your knowledge and belief? 12 A. They are, yes. 13 Q. Thank you, Ms Marshall. That now stands as your 14 evidence in the Inquiry. It will be published on the 15 website shortly, the Inquiry's website, and for the 16 record, the URN, the unique reference number, is 17 WITN11610100. 18 Now, Ms Marshall your witness statement was provided 19 in response to two Rule 9 Requests to Post Office as 20 a company itself, rather than addressed directly to you. 21 A. That's correct, yes. 22 Q. For reasons I don't need to go into now, you have been 23 put forward as a witness to speak on behalf of Post 24 Office on various matters in your statement? 25 A. I have, yes. 5 1 Q. You are currently the Retail Engagement Director with 2 Post Office Limited? 3 A. Yes, I am. 4 Q. When did you first join the Post Office? 5 A. I joined in 1998, so I've been here for just over 6 25 years/26 years. 7 Q. What was your role upon joining? 8 A. I joined as a graduate trainee, initially, for 18 months 9 and then I've progressed through the organisation 10 through a variety of roles. 11 Q. If we pause there, as a graduate trainee, very brief 12 summary, what sort of work did you do? 13 A. There were three six-month secondments, one of them was 14 working in a directly managed branch, they used to be 15 called Crown branches; one of them was shadowing an Area 16 Manager, I think they were called Retail Line Managers; 17 and the third role was in Head Office, a very 18 administrative role within the finance function, just 19 getting knowledge of Head Office operations. 20 Q. What role did you go into after being a graduate 21 trainee? 22 A. So I then went into being a Branch Manager in one of our 23 Crown branches for just over two years. 24 Q. What was your next role? 25 A. After that, I did a variety of project and programme 6 1 roles, predominantly for the next four or five years, 2 I'd say, working to franchising of our directly managed 3 branches, so converting them from Crown status to being 4 operated by postmasters, working with a number of 5 independent postmasters and larger corporate entities 6 too. 7 Q. What period of time are we discussing when you were 8 doing that role? 9 A. That would be up to 2007. 10 Q. Whilst you were working with franchising and 11 postmasters, were you working with matters such as 12 appeals or suspensions, anything like that, during that 13 period? 14 A. No, nothing like that at all. This was simply working 15 with potential applicants to take on new branches and 16 making sure that the transition from the Crown branch 17 being operated by a new postmaster went smoothly, so 18 nothing at all to do with suspensions or investigations. 19 Q. Then, from 2007, what role did you have? 20 A. So from 2007, I moved to be the Programme Office Manager 21 for a programme called Network Change. Network Change 22 involved the closure of around 2,500 branches, from 23 memory, and the implementation of what we now call 24 Outreach Services, things like mobile vans across the 25 network. That was a Government-funded programme and 7 1 I effectively, for the next three years, ran a programme 2 office effectively making sure that we were on track 3 with budgets, that we had reporting in place to our 4 shareholder and that all the necessary documentation 5 went out to the right postmasters. 6 Q. So that's 2007 to 2010, roughly. Can I just check, you 7 may have been involved with Post Office closures as part 8 of the programme; at that stage, were you involved in 9 any respect in the termination of subpostmasters' 10 contracts because of alleged breaches, such as through 11 discrepancies and the like? 12 A. No, I was not. 13 Q. From 2010, what was your role, please? 14 A. For the next two years, I was Agents Development 15 Manager. I had responsibility in that role working to 16 Kevin Gilliland for postmaster remuneration, and our 17 postmaster contracts, which at that time were being 18 updated in preparation for the next change programme 19 which was Network Transformation. 20 Q. Were you involved in, as part of that, termination or 21 suspension of postmasters as a result of alleged 22 discrepancies? 23 A. I was not, no. 24 Q. Then from 2012, what was your next role? 25 A. From 2012 through to 2017 or '18, I was involved in the 8 1 Network Transformation Programme. So this was the 2 programme to ultimately convert post offices to new 3 models, the main model and the local model. 4 Q. So, again, do I take it from that, not involved in 5 termination/suspension, those sorts of matters? 6 A. I was not involved no. 7 Q. From 2017, please? 8 A. 2017 to now, more senior leadership roles, responsible 9 for initially some of our network strategy, and then, 10 more recently, stepping into more of my current 11 accountabilities around postmaster onboarding and 12 postmaster training and some postmaster engagement. 13 Q. Your roles and responsibilities now, when did you start 14 undertaking those roles? 15 A. So for onboarding and training, which you've seen me 16 talk about in my statement, I'd been doing that for 17 about four years, I would say; my responsibility for the 18 Contract Management and Deployment team, only for the 19 last year. 20 Q. Thank you. I want to look at a particular period, 21 I think it's when you're Agents Development Manager -- 22 A. Yes. 23 Q. -- 2010 to 2012. Did you say you reported to Kevin 24 Gilliland? 25 A. I did. 9 1 Q. In what team or department did you sit in that role? 2 A. Kevin was, I want to say, Director of Network and Sales, 3 so this was -- Kevin had wider accountabilities for the 4 network. He may have had responsibility for some of the 5 field teams. He certainly had a team responsible for 6 the relationship with the National Federation of 7 SubPostmasters, and he had a team focused on sales 8 capability in our branches, so a fairly wide remit. 9 Q. Can we please bring up POL00088956. We see an email on 10 5 December 2010 from John Breeden, it's to Angela van 11 den Bogerd. If we just scroll down slightly, please, to 12 see the email that has been forwarded, we see an email 13 from Lynn Hobbs to John Breeden is being forwarded on. 14 If we can go back to the top, please, we see that 15 Mr Breeden addresses it to Angela van den Bogerd but 16 copies you in. We see you're the second person on the 17 CC line. The subject says, "Follow up" to a meeting 18 with the department with the JFSA, and it attaches some 19 documents regarding that. 20 I know you've seen this email and I'll come to the 21 contents of it shortly, but, firstly, why at this stage 22 would John Breeden copy you in to an email like this? 23 A. Having read the email train, I'm not completely sure why 24 I would have been copied in. I don't recall the email. 25 John Breeden, I remember, had the Contracts team, he had 10 1 accountability for the team of Contract Advisers in the 2 network. From time to time, John or Lin Norbury, who 3 may have been his boss at the time, would often copy me 4 in on emails for information purposes but I don't know 5 why I would have been copied in here, specifically. 6 Q. So, outside of this specific email, what was your 7 working relationship with John Breeden -- not in terms 8 of how did you get on: what substantively did you work 9 on together? 10 A. So because I had accountability for, at this point, 11 postmaster remuneration and the postmaster contracts 12 themselves, sometimes John Breeden would reach out to 13 myself or my team to ask for advice on the content of 14 the contracts, for example, or advice on the structure 15 of remuneration with postmasters. 16 Q. Those issues you just referred to don't appear to be 17 raised in this email. 18 A. Agreed. 19 Q. To what extent, at this time, were you involved with 20 Post Office's response to allegations that had been 21 raised by Justice for Subpostmasters Alliance? 22 A. I don't think I was involved with any of those 23 allegations. 24 Q. If we go to page 2 of the email, please. This is 25 an email that's extremely well known to the Inquiry. It 11 1 says, "My reply to Mike and Rod". It says: 2 "I have found out this week that Fujitsu can 3 actually put an entry into a branch account remotely." 4 It goes on to say how that was found. Final 5 sentence: 6 "One solution, quickly discounted because of the 7 implications around integrity, was for Fujitsu to 8 remotely enter a value into a branch account to 9 reintroduce the missing loss/gain. So [Post Office] 10 can't do this but Fujitsu can." 11 Do you recall whether you read that email at the 12 time? 13 A. No, I don't recall reading the email at the time. I was 14 surprised to see it when it was disclosed to me as part 15 of the Inquiry. It's not something I would have been 16 involved with, to my recollection, as part of the role 17 that I was in at the time. 18 Q. Let's move forward a month, if we can, please. 19 POL00294728. This is an email from you to Kevin 20 Gilliland, who you said earlier was your line manager? 21 A. He was, yes. 22 Q. We see Angela van den Bogerd is also an addressee of 23 this email and Helen Rose is copied in. The subject is 24 "Horizon system issues". It refers to conversations 25 you'd had with Andy McLean and Dave Hulbert yesterday, 12 1 you believe you made progress with the outstanding 2 questions raised. 3 Does this not show that you were involved with Post 4 Office's response to allegations about the Horizon IT 5 System and its integrity? 6 A. No, I don't think it does and, if it would help the 7 Inquiry for me just to provide little bit of context, if 8 that's okay? 9 Q. Yes, please. 10 A. Okay. So, as I've said, during this time I worked Kevin 11 Gilliland and my accountabilities were very specifically 12 on postmaster remuneration and postmaster contracts. 13 Very often, Kevin would ask members of his lead team, of 14 which I was one of them, to go off and find information 15 about other matters that were not relevant to the roll 16 you were doing to assist him in whatever he was doing in 17 his role. From what I've read of this email, this is 18 clearly to me and, whilst I don't recollect it at the 19 time, it is clear to me that he was asking me to go off 20 and find information out to perhaps prepare him for 21 a meeting that he was going to with Angela shortly 22 afterwards. 23 I don't think I would have known -- certainly 24 wouldn't have known, the ins and outs of the Horizon 25 system, I wouldn't have had any involvement in remote 13 1 access. So my view of this email is that I have gone 2 off, found information from the Subject Matter Experts, 3 in this case Andy McLean and Dave Hulbert within the IT 4 Team, and have relayed that information to Kevin 5 Gilliland. 6 Q. If we just scroll down slightly, please. You give some 7 commentary on remote access. You say: 8 "[Post Office] cannot remotely access systems and 9 make changes to specific stock units etc. Fujitsu can 10 remotely access systems and they do this on numerous 11 occasions to a network wide basis in order to remedy 12 glitches in the system created as a result of new 13 software upgrades. 14 "Technically, Fujitsu could access an individual 15 branch remotely and move money around however this has 16 never happened yet." 17 You go on to refer to authority processes that are 18 in place and say: 19 "If a change were made remotely and to an individual 20 branch, it would be flagged on the business data ledgers 21 and would appear as a 'mismatch' in P&BA in 22 Chesterfield. 23 "So although changes can be made remotely, they 24 would be spotted and the person making the change would 25 be identified." 14 1 In the last email I took you to, which referred to 2 remote access, it referred to it not being used due to 3 integrity concerns, but broadly speaking. Did you know 4 why you didn't refer to the integrity concerns that were 5 raised in that email when you reported to Angela and 6 Kevin in this email? 7 A. I don't and, you know, on reflection, I should have 8 joined the dots and, when typing this email to 9 Mr Gilliland, have noted the previous email, assuming of 10 course I read it, and I'm very sorry that I didn't do 11 that, in hindsight. But I would, you know, say again 12 this was an area very much outside of my expertise and 13 comfort zone and it's very clear to me that I wouldn't 14 have written this without very clear direction from 15 experts on what to say. 16 Q. So do I take it that your evidence is, effectively, what 17 you have written down here is what you would have been 18 told by Andy McLean and Dave Hulbert? 19 A. Absolutely. 20 Q. That document can come down. 21 I want to go to a slightly different issue, please. 22 POL00119947. This is an undated letter but we see from 23 the first page that it refers to an appeal hearing on 24 7 December 2010, and then correspondence on 28 February 25 2011, which gives us an indication. If we can just turn 15 1 the page, please, and go towards the bottom, we'll see 2 it was sent by Craig Tuthill. At the time, so early 3 2011, where did Craig Tuthill sit in the organisation to 4 you? 5 A. Craig -- I think at this time, whereas I was in a Head 6 Office function, Craig was in a field role managing the 7 Contract Advisers or certainly working very closely with 8 them. He may have worked to Lynn Hobbs at this period 9 of time. 10 Q. Was there any reporting line to you on that basis? 11 A. No, not at all. 12 Q. Can we turn back to the first page, please, and go down, 13 please. Thank you. It says: 14 "Throughout the appeal hearing and the written 15 submissions you have raised doubts about the integrity 16 of the Horizon accounting system and have offered no 17 other reason for the losses incurred. You are adamant 18 that neither you nor any of your staff acted 19 dishonestly." 20 It goes on to say a few lines down: 21 "I have also sought and received confirmation from 22 Tracy Marshall, Post Office Limited Agents Development 23 Manager, that [Post Office Limited] is fully satisfied 24 that the Horizon system and accounting processes around 25 it are robust and fit for purpose. She confirms the 16 1 system is endorsed by the National Federation of 2 SubPostmasters and has been subjected to independently 3 assured testing processes, information security is 4 accredited to industry standards and the system also 5 meets all payment industry standards." 6 I mean, do you recall Mr Tuthill coming to you about 7 this appeal? 8 A. Not specifically. Again, I saw this in my bundle. 9 I don't remember this specific example. It would have 10 been quite usual for Craig and his team to come to 11 people in the centre, in the Head Office, if you like, 12 to ask for a view on the business's position and, from 13 time to time, I would, in my role here, have gone off to 14 our Communications Team to find lines to send back out 15 to the field teams. 16 Q. So I'll take you to a different document. It's 17 POL00119963, please. We see it's an unusual format but 18 it appears to be an email from you to Craig Tuthill on 19 Monday, 28 February 2011. You say: 20 "Craig/Andy, 21 "This is the formal words used in external 22 communications. I would be happy to circulate this to 23 the contracts community if you think this is fit for 24 purpose?" 25 I think your evidence earlier was that you would 17 1 check with the Communications Team about what the 2 business position was; is that effectively what this is 3 showing? 4 A. I believe so, yes. I believe this is an example of when 5 I've been asked a question, I've conferred with our 6 Communications Team in the Head Office and this form of 7 words here would have been standard -- the standard 8 position lines used in external communications that I've 9 been provided with, via the Comms Team. 10 Q. Did you have any role in or did you take any steps to 11 satisfy yourself that what was said there was accurate? 12 A. I don't think I would have done, no. I think I was 13 relying on the information being provided to me by more 14 senior leaders within the organisation. 15 Q. Thank you. That document can come down. 16 Aside from that type of matter there, where 17 an Appeals Manager is coming to you for a business 18 position on Horizon and you're giving an external 19 communication, during that period of time in 2010 to 20 2012, were you involved in inputting or assisting 21 Appeals Managers with making decisions on termination 22 or, indeed, Contract Managers on making decisions on 23 termination of subpostmasters? 24 A. No, I was not. 25 Q. As we said earlier, you have been put forward as 18 1 a corporate witness. You know that Fujitsu's ability to 2 access branch accounts remotely and Post Office's 3 knowledge of that ability is being considered by this 4 Inquiry? 5 A. I do. 6 Q. From the emails we looked at, would you accept that you 7 were involved, to a certain extent, in the distribution 8 of knowledge on remote access within Post Office? 9 A. I would accept here that there are emails where I've 10 relayed information to people that concern remote 11 access, the very core issue to the purpose of this 12 Inquiry. But I wouldn't say that I was involved or 13 implicit in anything involving remote access. 14 Q. To whatever extent you were involved, do you think that 15 you're an appropriate person to give evidence on behalf 16 of the Post Office because of that even limited extent 17 of involvement? 18 A. I think I am, and my role, particularly over the last 19 three or four years, has focused on delivering 20 improvements and changes for postmasters on a number of 21 core areas, including training and onboarding, 22 et cetera. So I do think I am best placed in the 23 organisation to be able to talk to those improvements 24 and about what the current position is. 25 Q. Can I ask, the matters we've just discussed now, why 19 1 were they not referred to in your witness statement? 2 A. My witness statement was in response to specific Rule 9 3 Requests, two of them, and that is the basis, 4 ultimately, of my witness statement that I've prepared. 5 Q. One further point before we move on to matters in your 6 statement, please could we have POL00448411. It's 7 a letter that's been seen by the Inquiry before, to 8 various people, including, sir, to you and to Mr Beer. 9 It's 28 May 2024, and it says: 10 "We are writing to you as a group of highly 11 disenfranchised [Post Office] employees ..." 12 Have you read this letter before? 13 A. Only when it was provided to me as part of my bundle. 14 Q. If we can go to the bottom of this page, please, it says 15 at the bottom paragraph: 16 "I am sure you have been made aware that we have at 17 least 120 employees who have been in long-term roles who 18 have conflicts of interest, ie they were operating in 19 roles which to a greater or lesser degree were involved 20 in the wrongful prosecution of SPMs. Read has known yet 21 refuses to address the latter situation proactively, 22 despite being asked to. He reacts only to the specific 23 individuals after their names are called out in public. 24 For instance Angela van den Bogerd mentioned in her 25 statement the role of Tracy Marshall; the latter played 20 1 a prominent role in 2010/15 in the unlawful convictions 2 of subpostmasters." 3 Pausing there, what do you have to say to that 4 point? 5 A. I think -- I'm disappointed to see that there are 6 disenfranchised employees in Post Office, firstly, who 7 clearly have concerns about me, in my role. I think 8 there are some confusing facts in here that aren't quite 9 right. I've never played a role, any role, in the 10 unlawful convictions of subpostmasters. Whilst I can't 11 state factually, I suspect that this here is in direct 12 response, clearly, to the emails that we've just gone 13 through being shown in Mrs van den Bogerd's evidence in 14 Phase 5 or 6. But I'm disappointed that they feel that 15 way about me. 16 Q. It says: 17 "Despite this, just 3 years ago, Marshall was 18 appointed as the Postmaster Engagement Director, much to 19 our dismay (and no wonder the trust results plummeted). 20 However, only within the last week, Read has remove 21 Marshall from her role and appointed her into another 22 obscure role." 23 When did you change roles as Postmaster Engagement 24 Director? 25 A. So I've never been Postmaster Engagement Director, 21 1 I think they're referring to Retail Engagement Director, 2 which is my current role. Following the email appearing 3 in Mrs van den Bogerd's evidence, I was asked to step 4 back from some of my role, so in late May/early June 5 this year, I stood down from the postmaster engagement 6 element of my role, effectively, which is a very small 7 team of two individuals, plus the Postmaster Experience 8 Director, Mark Eldridge. 9 So my role hasn't changed; I've just had some of my 10 responsibilities removed from it, and my role includes 11 now -- continues to include onboarding, training and the 12 Contract Management Team. 13 Q. Do you consider yourself to be in an appropriate 14 position to carry out those roles, given your past 15 involvement which we've discussed? 16 A. I think so, yes. I mean, for the last four years 17 particularly, my role has been completely focused on 18 trying to do the right thing by postmasters and making 19 changes to our policies, procedures, processes, and 20 listening to postmasters as much as I can, and trying to 21 make changes. So I do still feel as though I am in 22 a very good position to do my role. 23 Q. Let's look at some of those policies and procedures now. 24 I want to start with the types of contracts, the basis 25 on which Post Office contracts with subpostmasters. 22 1 There was clearly a shift in Post Office's view of what 2 the contract meant following the Common Issues Judgment. 3 Can we have, please, page 5, paragraph 15 of your 4 statement on the screen. You refer to the Standard 5 Subpostmaster Contract, which I think we see in your 6 statement elsewhere as SPSO; is that right? 7 A. Yes, that's correct. 8 Q. You say it's the oldest contract, first introduced 9 between 1991 and 1994. 10 A. Yes, I believe so. 11 Q. Since that was introduced, is it fair to say the 12 majority of postmasters who originally signed on to that 13 contract have been transferred onto a different Network 14 Transformation contract? 15 A. That's correct. 16 Q. How many subpostmasters -- or postmasters, sorry -- 17 remain on the Standard Subpostmaster Contract? 18 A. I don't have the specific figures to hand, I'm afraid, 19 so I can't really comment on that. I think it might be 20 around a thousand but I couldn't be sure. 21 Q. Does Post Office issue the Standard Subpostmaster 22 Contract to any new applicants or new subpostmasters 23 that it onboards? 24 A. Yes, it does, from time to time. There are still some 25 branches who are on an SPSO contract, who continue to 23 1 have the ability, if they wanted to, to sell their 2 branch and premises to a new postmaster on those terms. 3 It doesn't happen that often. I recall a couple of 4 hundred cases that I'm aware of over the last few years, 5 but, yes, it does happen. 6 SIR WYN WILLIAMS: Can I understand that: do you mean that 7 a postmaster on the Standard Subpostmaster Contract will 8 sell the branch to a new subpostmaster and then they 9 will still be on the old -- when I say "the old" -- on 10 the Standard Subpostmaster Contract? 11 A. That's correct, sir, yes. 12 SIR WYN WILLIAMS: Yes, fine. I understand, yes. 13 MR STEVENS: I want to look at what steps Post Office have 14 taken to clarify the written terms to subpostmasters of 15 the contracts following Common Issues. Can we turn to 16 page 12, please, paragraph 30. You say: 17 "Following the [Common Issues Judgment], Post Office 18 made the decision to amend the template NT Terms", and 19 it should say "and SPSO terms" -- 20 A. It should, yes. 21 Q. -- "being issued to new postmasters to reflect the 22 court's determination (as set out in the Contract 23 Restatement Guide) and to focus on making operational 24 improvements and positive changes to the way it works 25 with postmasters, before making widespread changes to 24 1 its standard contractual terms." 2 I understand from your evidence what the Post Office 3 did was to send out a contract restatement document to 4 explain the effect of Common Issues? 5 A. Yes, it did. 6 Q. Can we look at that, please. It's POL00037518. Is this 7 the document to which we were referring, the contract 8 restatement? 9 A. It is, yes. 10 Q. How was this sent to postmasters in the network? 11 A. So from what I can understand, it was sent out to 12 postmasters electronically, via a channel known as the 13 One Communications Channel, this was a tool used by our 14 Communications Team quite regularly to send out messages 15 to postmasters so this was sent electronically. 16 Q. Why wasn't it sent in hard copy as well? 17 A. I honestly do not know. I wasn't involved at the time 18 but I believe it should have been sent out in hard copy. 19 All I can say is that, when we make any changes now to 20 our contract terms, we always make sure that hard copies 21 are sent out to postmasters, first and foremost so that 22 we have a record that it's been delivered and received 23 by the postmaster via Special Delivery. I can't comment 24 on why that wasn't the case here, I'm afraid. 25 Q. In your statement you say that Post Office did not have 25 1 a system for ensuring that subpostmasters had read the 2 Contractual Restatement Guide. 3 A. Yes. 4 Q. Why not? 5 A. I don't know. I don't know and the business should have 6 done. When this -- what should have happened, in my 7 view, here is that this document was sent out in hard 8 copy to every postmaster by Special Delivery, so that we 9 had a record of it being received, first and foremost, 10 and it should have been followed up, in my opinion, with 11 check-ins from our field members to make sure the 12 postmasters had understood the terms and had received 13 them. I can't comment on why that didn't happen, I'm 14 afraid. 15 Q. Is there any plan in Post Office at the moment to 16 correct this issue by taking the steps you've just 17 suggested now? 18 A. So there are two things that we're doing. First of all, 19 it's making sure that this document here is available 20 for all postmasters to view again. That won't be hard 21 copy, for reasons I'll come on to, but it will be made 22 available and is on our Branch Hub tool. 23 The second thing that we are doing is looking at 24 what we call the Contract Reform Project. So we are 25 underway, with making some other changes to our 26 1 contract, suggested changes. 2 Q. If I can pause you there, that's changes to a contract. 3 A. Yes. 4 Q. I'm interested in what Post Office is doing to explain 5 the contractual terms as they are at the moment. You 6 said in your evidence that wasn't a plan to issue this 7 in hard copy: why? 8 A. It's a very good question, something I think we need to 9 think again about as a business. All postmasters should 10 have access to this. 11 Q. Earlier in your evidence, you said previously it should 12 have been sent out in hard copy? 13 A. Yeah. 14 Q. Is there any good reason why it's not sent in hard copy 15 now? 16 A. No, absolutely none. 17 Q. Are you in a position to say the Post Office will at 18 least consider it? 19 A. We will absolutely consider, and I think we should make 20 sure that all postmasters have hard copies of this 21 document. 22 Q. If we look at what the document says, please. If we go 23 to page 2, it refers to the judgment, the Common Issues 24 trial, and then says: 25 "The judgment changes the meaning of the contracts 27 1 ..." 2 Do you know who came up with that wording "changes 3 the meaning of the contracts"? 4 A. I don't, I'm afraid. 5 Q. Do you agree with that? 6 A. I think, from what I know of the implied terms that have 7 been added into the contracts, I do think it changes the 8 meaning of the contracts, in that it's moved them -- 9 it's certainly added more obligations on Post Office and 10 I think it is a fairer contract, particularly in the 11 areas of losses and shortfalls, for example. I'm not 12 sure if it specifically changes the meaning of the 13 contracts, however. 14 Q. Well, as you've noted there, it says: 15 "It implies (adds) some new terms to the contracts." 16 Has Post Office ever communicated to subpostmasters 17 that the terms that were found to be implied into the 18 contract in Common Issues Judgment applied before the 19 judgment was issued and not after it as well; so Post 20 Office was bound by them before the judgment? 21 A. I've not seen anything to suggest that, no. 22 Q. That can come down, thank you. 23 It has been suggested by some postmasters that it is 24 confusing to have a contract and then a separate guide 25 explaining it, such as this; what do you say to that? 28 1 A. I would agree. I think it's very important that every 2 postmaster out there has a contract with those new terms 3 added in to that contract. Again, I can't comment why, 4 at the time, steps weren't taken to amend the contracts 5 and send new contracts out and why it was simply done 6 via a contract restatement guide. 7 Q. That wasn't within your purview? 8 A. No, it wasn't, no. 9 Q. Do you know who made those decisions? 10 A. I can't recall who would have been responsible for 11 contract change at that time. Obviously, our Legal Team 12 would have been very involved with it. It would have, 13 I think, sat within the remit of Julie Thomas, who was 14 one of the Operations Directors within the business but 15 I can't be sure. 16 Q. Just another point on this and how it was communicated. 17 Can we please look at page 45 of your statement, 18 paragraph 107. For context, in the main body of the 19 paragraph, you refer to postmaster contracts and the key 20 policies and guidance relating to contractual liability 21 for postmasters. You then refer to the Contract 22 Restatement Guide; is that the document we were just 23 referring to on the screen? 24 A. It is, yes. 25 Q. You say: 29 1 "This document was published on the One 2 Communication channel on 29 July 2020", which you just 3 said in your evidence. 4 A. (The witness nodded) 5 Q. "As part of this exercise and responding to the Rule 9 6 Requests, the Retail Team have been advised that, due to 7 an archiving exercise, the document is no longer held on 8 Branch Hub and the Retail Team have arranged to 9 reinstate it so that it can be readily accessed by 10 postmasters ..." 11 Is that document now back on the One Communication 12 channel. 13 A. It's back on Branch Hub, yes. 14 Q. Branch Hub, sorry, yes. The Rule 9 Request to which 15 this statement was provided -- well, there were two, 16 sorry: one was 12 June 2024 and one was 2 July 2024. Do 17 you know when it was realised that the document wasn't 18 on Branch Hub? 19 A. Not specifically but it would have been around the time 20 of those Rule 9 Requests coming in and me preparing my 21 witness statement. 22 Q. When you say it was taken down as part of an archiving 23 exercise, when did that archiving exercise take place? 24 A. I don't know, I'm afraid. 25 Q. Is that something that the Post Office can tell the 30 1 Inquiry in due course? 2 A. Quite possibly, yes. 3 Q. Was there any other document which a postmaster could 4 turn to that explained the effect of common issues, 5 other than that contract restatement document? 6 A. No other document specifically on -- that would explain 7 the Common Issues Judgment impact. There are obviously 8 a number of other contractual documents, such as the 9 Operations Manual, which was updated around that time 10 but that didn't specifically address CIJ impact. 11 Q. Do you know why, as part of an archiving exercise, such 12 an important document was taken down from Branch Hub? 13 A. I don't, I'm afraid, no. 14 Q. Can we look, please, at POL00448241. This is a Standard 15 Subpostmaster Contract. If we turn to page 5, please 16 and to the bottom, to paragraph 20, please, it says: 17 "Each party shall: 18 "at all times in the performance of its obligations 19 and exercise of its rights under this contract act in 20 good faith ..." 21 So it looks like this is an amended contract 22 following, or making changes as a result of, Common 23 Issues; is -- 24 A. I agree. I think it is, and it's dated August 2020 in 25 the footer of there. 31 1 Q. Yes, you say that. In your exhibit list to your 2 statement at number 4, we don't need to bring it up, the 3 document description is "SPSO Individual Contract v3 4 December 2023". 5 A. Okay. 6 Q. Are you able to assist with when the changes were made 7 to the subpostmaster contract to reflect what was said 8 in Common Issues? 9 A. So changes were made to the SPSO contract and the two 10 Network Transformation contracts after the Common Issues 11 Judgment was handed down, to the best of my knowledge in 12 2020. There might have been some small iterations/ 13 changes to it since then but, fundamentally, the new 14 implied terms were added in in 2020. 15 Q. Just so we're clear, that applies, does it, to new 16 subpostmasters joining the network. These are the 17 contractual terms they're given upon joining? 18 A. New postmasters joining the contract would get this, 19 yes. 20 Q. Thank you. That document can come down, thank you. 21 Could we look, please, at your statement, page 12, 22 paragraph 31 and 32. That's great, thank you. If you 23 just go down a bit further to have 31 at the top. 24 You give an example of changes made to various 25 policies in the summer of 2020 and it sets out the range 32 1 of support available to postmasters and their staff. 2 Then, if we go further down, thank you: 3 "The Postmaster Support Guide is updated annually to 4 take account of any changes ... The Postmaster Support 5 Guide contains the following key areas ..." 6 We see: general support; training; managing cash; 7 branch balancing; accounting dispute resolution. So 8 quite serious material issues for a subpostmaster, yes? 9 A. Yes, issues that they would absolutely need advice and 10 support on in running their branch. 11 Q. Aside from this being written down as policies, what 12 steps have been taken to ensure that there is 13 appropriate resourcing to implement these policies 14 properly? 15 A. Okay, so just to clarify, the Postmaster Support Guide 16 isn't a policy, as such. That's an overarching document 17 providing advice and support to postmasters. In the 18 back of the Postmaster Support Guide there is 19 an overview of the 12 postmaster policies that we have 20 put in place across all areas of the postmaster 21 lifecycle, to assist internal colleagues and make sure 22 that processes are followed correctly. Part of my role 23 as being accountable for those postmaster policies is to 24 make sure that the various teams can deliver them in 25 their respective teams and, to do that, clearly they do 33 1 need resource to be able to do that effectively. 2 Resourcing is a challenge, in some areas, if I'm 3 honest. I'm very aware of the broader business issues 4 that we have: we're funded by Government; there are cost 5 challenges. I'm confident we do have resources in place 6 to deliver against the policies. We could always do 7 with a little bit more resource though, in some areas. 8 Q. Firstly, the 12 policies you refer to, I think you use 9 the word "internal" -- you do in your statement, 10 I think -- subpostmasters don't have access to those 12 11 policies, do they? 12 A. Not at the moment, no. They don't have access to the 13 full policies but what this is a guide to the postmaster 14 policies, which is a shortened version of each one, 15 effectively, that postmasters can view, which is on 16 Branch Hub. 17 Q. Why are they not given full access to the full policy? 18 A. It's a question that I've debated quite a lot over 19 recent years with various colleagues and our data 20 protection legal teams, et cetera. The policies 21 themselves, which are internally facing, have quite 22 detailed information in them around our Control 23 Framework, our risk appetite as a business and risks, 24 and it wasn't felt appropriate to disclose that 25 information externally, rightly or wrongly, and that was 34 1 the very clear steer that I had. 2 If it helps the Inquiry, though, we are in the 3 process actually, right now, of putting each one of our 4 12 policies onto a new template. That template is being 5 developed by colleagues in Data Protection, the Legal 6 teams and the Assurance teams, and those policies will 7 be made available shortly to postmasters, following 8 agreement, obviously, by our Audit and Risk Committee, 9 and GE. 10 Q. The last point on these policies: with the change in the 11 policies, as they've changed and developed since Common 12 Issues, has that placed more or greater obligations on 13 Post Office than it did before the changes? So is there 14 more to do, effectively, more work to do, to fulfil 15 those policies than before? 16 A. I think that's very true, yes, they have. 17 Q. Has there been any increase in resources to meet those 18 policies? 19 A. There's been some increase in resources, in my own team, 20 for example, who manage the policies. We do now have 21 more people to make sure we are getting them annually 22 reviewed by the right people, that we have group 23 assurance as well in place now, checking our policies, 24 checking our Control Framework and that we have actions 25 in place to mitigate any of the key risks. So yes, 35 1 resource has been put in place. 2 Q. Can we look, please, at your statement page 17, 3 paragraph 36. Thank you. This is coming back to 4 something I cut you off on earlier. You're referring 5 here: 6 "In July 2024 the Retail Engagement Team presented 7 a proposal for the Contract Reform Project to the 8 Strategic Executive Group ..." 9 Why has this Contract Reform Project been started; 10 what's its purpose? 11 A. As a business, we've been talking about doing a more 12 widescale update of our contracts and getting new copies 13 out to everybody for some time. 14 Q. Okay, pausing there, when you say "some time", from 15 roughly -- 16 A. I'd say a few years and, for whatever reason, the 17 business decision has been taken not to do that activity 18 at that particular point in time. To give an example, 19 at one point, obviously, we were anticipating the 20 rollout of our New Branch IT System into branches, and 21 so it was considered that we should perhaps delay some 22 of this work until that system was in and there may be 23 changes that are needed as part of the introduction of 24 that system. For a few years we've been talking about 25 it. 36 1 The Retail Team have been pushing quite strongly, as 2 have our Legal team, to make sure that we do this 3 activity. I feel this is very important for the reasons 4 I said earlier. I think it's important to get contracts 5 out to every postmaster, new contracts that do have the 6 implied terms in them, from the Common Issues Judgment. 7 We are now doing that. So we are -- we've already 8 made some proposed -- and I stress the word 9 "proposed" -- changes to the contracts with external 10 Legal, and our next stage, which will we'll be doing 11 later in October or November, is to go to our Strategic 12 Executive Group and take them through them, and the next 13 step will be then to engage with the postmasters; the 14 NFSP, obviously will need to be consulted with as part 15 of that process; look at what we're proposing to do; and 16 then, hopefully, we can get in a position where we send 17 contracts out. 18 Q. It might be said that a reason for not bringing these 19 contract proposals sooner and enacting them more 20 quickly, is to avoid the proposals being scrutinised by 21 this Inquiry; what would you say to that? 22 A. I don't think that's the case. 23 Q. Paragraph 36(b). You refer to "removing specific 24 rights". What right, at the moment, in the proposals, 25 are being envisaged to be removed? 37 1 A. I can't think of any specific rights, if I'm honest. 2 I can give some examples of other outdated terms and 3 references that might be removed, if that would be 4 helpful? 5 Q. Are there any rights, obligations or terms that could be 6 perceived to be beneficial to a subpostmaster that are 7 being proposed to be removed? 8 A. I don't believe so, no. In fact, I think the changes 9 are much more favourable to postmasters and more 10 obligations on Post Office. 11 MR STEVENS: Thank you. That can come down. 12 Sir, that's probably a good time to take our morning 13 break. 14 SIR WYN WILLIAMS: All right. So -- 15 MR STEVENS: If we could say 11.15? Thank you. 16 (11.05 am) 17 (A short break) 18 (11.25 am) 19 MR STEVENS: Sir, can you see and hear us? 20 SIR WYN WILLIAMS: Yes, thank you. 21 MR STEVENS: Firstly, I'll apologise to the transcriber for 22 initial only undercooking our 15-minute break and then, 23 sir, I apologise to you for overcompensating by giving 24 a 20-minute one. 25 SIR WYN WILLIAMS: Mr Stevens, I did wonder about your 11.15 38 1 but, by the time I thought I would revisit that with 2 you, my connection had been broken. So one way or 3 another we got ourselves an extra five minutes. That's 4 what it boils down to. 5 MR STEVENS: Thank you, sir. 6 Right, I want to move on to training, please, and, 7 as Retail Engagement Director, you are accountable to 8 the Post Office Board for the design and implementation 9 of postmaster training? 10 A. That's correct. 11 Q. You are supported in that role by the Head of Training? 12 A. I am. 13 Q. I want to look at the job description, please, for Head 14 of Training. It's POL00448046. 15 So, job title, Head of Training. The Head of 16 Training obviously involves training for postmasters. 17 Are there any other types of worker -- I don't use that 18 in the technical sense -- for whom the Head of Training 19 is responsible for their training? 20 A. No, it's the development and delivery of training for 21 postmasters and those operating our branches. So it 22 would also be those working in our DMBs, for example. 23 Q. If we look, please, at page 3, and we've got the 24 "Knowledge, Experience and Skills": the leadership 25 first; second, experience or background of training; 39 1 third, knowledge of training related models; various 2 other matters including a good understanding of business 3 strategy, policies and operations. 4 There doesn't appear to be any need for knowledge or 5 experience of IT or Horizon; is that fair? 6 A. That is fair, yes. 7 Q. Why is that? 8 A. So I think, as the Head of the Training Team, the 9 individual's job is to provide leadership and make sure 10 that a good quality of training is being delivered. 11 Those working into the Head of Training and who are 12 delivering classroom training, for example, do 13 absolutely have to have a good knowledge about the 14 Horizon system, but I don't believe it's essential for 15 this particular role, providing leadership to that team. 16 Q. So who is responsible for the content of the training on 17 Horizon itself? 18 A. So ultimately, that would be me being accountable and 19 the Head of Training being responsible for the 20 production of all the content. 21 Q. To whom can you turn for advice on whether the aspects 22 of training relating to Horizon are appropriate or 23 sufficient for subpostmasters? 24 A. When we're developing our training content, be it 25 classroom courses or e-learning modules or Work Aids, we 40 1 are reliant on discussions with the various Subject 2 Matter Experts within the business. So, for example, if 3 there's something around cash and stock management, for 4 argument's sake, we would go to our Cash and Stock 5 Management Team. If there's something there around 6 discrepancies, we would confer with Mel Parks team. 7 Q. Many of the policy documents on training say that Post 8 Office is committed to providing comprehensive training 9 to postmasters. 10 A. Yes. 11 Q. What, if any, funding is there for postmasters to engage 12 in training? 13 A. So there's no particular funding provided to postmasters 14 or anybody operating our branches, to go to training. 15 So we don't, for example, pay for postmasters or their 16 assistants to go to a training course. Over the last 17 few years, many of our training has moved to being more 18 digital in format and that's as a result of postmaster 19 feedback and, of course, that collateral, which is on 20 Branch Hub or our Learning Management System, is freely 21 available to anybody working in a branch to access, free 22 of charge. 23 Q. It still requires them to commit hours to it? 24 A. It does. 25 Q. The hours they're committing to the training is hours 41 1 they're not committing to their profitable business? 2 A. That's true. It does require commitment, yes. 3 Q. Presumably, for assistants, the hours that they have to 4 commit to training, the postmaster has to pay them while 5 they're doing that training? 6 A. They would have to, yes. 7 Q. Can we look, please, at your statement, page 22, 8 paragraph 47. You say these some of the training 9 courses that have been introduced since the Common 10 Issues Judgment, and at (d) you refer to "Investigating 11 discrepancies", and that's a half-day classroom course 12 and Work Aid. That sounds like quite a significant or 13 important piece of training that is available to 14 postmasters; do you agree? 15 A. It's proved to be very useful for postmasters, yes. And 16 many of them who have attended it have said that it's 17 been, you know, very positive, well received, with good 18 levels of confidence, shall we say, after attending, 19 yes. 20 Q. Because it's a half-day classroom, that requires 21 a postmaster or assistant to be out of the post office 22 for at least half a day, yes? 23 A. It does, yes. 24 Q. Do you think the fact that postmasters aren't paid or 25 remunerated for doing that course is a significant 42 1 barrier preventing them from engaging with it? 2 A. It could be. I've got no evidence to suggest that it is 3 a barrier to them attending but it could be. 4 Q. Do you have any data to understand how many people want 5 to attend that course against, in fact, how many people 6 in fact attended? 7 A. No, I don't, we only have statistics on how many people 8 do attend the course. 9 Q. Is it fair to say that one of the purposes of training 10 on matters like investigating discrepancies is to reduce 11 discrepancies overall or at least reduce the need for 12 Post Office to investigate them? 13 A. I agree that there is -- the requirement for training on 14 investigating discrepancies is ultimately to get to the 15 root cause of the issue and prevent discrepancies from 16 taking place in the first place. So the concept of 17 investigating discrepancies is something that's very 18 important. This classroom course here, the half-day 19 classroom course, is just one aspect of that but, in 20 addition, there's a variety of other material that has 21 been developed and is available digitally, which will 22 assist postmasters or members of their team, in helping 23 them to investigate those discrepancies. 24 The digital format of training is something that we 25 as a business, and I, want to explore more of. From 43 1 what I hear from postmasters, you know, they're busy 2 people running retail businesses as well, alongside 3 their post office, and for many the preference is not to 4 have to travel to a classroom, irrespective of costs. 5 It is to be able to do training in the comfort of their 6 own premises, their own home, perhaps in the evening as 7 well. So that's something that we want to explore more 8 of. 9 Q. Is there any plan within the Post Office to consider or 10 assess the impact of any proposals to fund 11 subpostmasters or their assistants to do training? 12 A. There's no proposals at the moment but, obviously, 13 that's something that I can absolutely take back and 14 consider in the wider business. 15 Q. I want to look to at some of the training guides and -- 16 we don't need to bring it up -- in your statement you 17 refer to, at paragraph 77, the Operational Training 18 Guide being a fundamental tool for both new and existing 19 postmasters? 20 A. Yes. 21 Q. Who is responsible for keeping that material up to date? 22 A. That's the Training Team. 23 Q. Could we look, please, at POL00448131. This is about 24 monthly accounting for trading period balance; is this 25 taken from the Operational Training Guide? 44 1 A. Yes, it is. 2 Q. It covers, as I say, monthly accounting and balancing. 3 Please could we go to page 3. 4 You've got "Settling discrepancies", and these are 5 options that are given to postmasters when there's 6 a discrepancy prior to rolling into the next trading 7 period. One is "Review Dispute CALL [Business Support 8 Centre]"; another is "Make good cash". 9 I'll be exploring that in more detail with 10 a different witness but I want to look at the content of 11 this document with you. Under "Make good cash", it 12 says: 13 "This is optional if you would like to settle the 14 discrepancy without disputing it. You can select this 15 option, then physically add or remove cash to balance 16 without a discrepancy." 17 Do you think that is a satisfactory description of 18 when subpostmasters -- or the guidance for 19 subpostmasters in using the "Make good cash"? 20 A. I do not think it's satisfactory. 21 Q. Why isn't it satisfactory? 22 A. I don't think that that is clear enough that, if any 23 postmaster or officer in charge chooses to put cash in 24 from their own pocket, effectively, they should do so 25 only if they are absolutely sure that it's due to 45 1 something that has happened in branch that is an error 2 of some sort, not with the system, but where you might 3 have, for example, given the customer £20 more, 4 et cetera. 5 We are in the process, actually, of updating this 6 section of the Operational Training Guide and any other 7 documentation that refers to something similar, to make 8 that message very clear. 9 Q. Just pausing there: you say "in the process", the date 10 on this document is July 2023 -- 11 A. Yes. 12 Q. -- why has it taken so long to make what appears to be 13 a clear position of Post Office evident in the training 14 guide? 15 A. And that's a very good point. I think whilst people 16 within Post Office, myself, our teams, are very aware 17 ourselves of what should happen, ie you should only put 18 cash in if you're absolutely certain that it's something 19 that's been done in the branch, not related to an issue 20 with Horizon or something that needs to be investigated 21 further, it's one thing for us to think that. I don't 22 think we've quite got that message across to 23 postmasters. There's no excuse. It should have been 24 done quicker but I'm comforted by the fact that we're 25 now doing it and taking the opportunity to review all of 46 1 our operational training materials. 2 Q. When will this be corrected? 3 A. I think if it's not out there already now, it's imminent 4 by the end of October. 5 Q. Further down, it says, "How to dispute a discrepancy" -- 6 we don't need to worry about Strategic Partner 7 branches -- it says: 8 "All other branches: Whichever option you use to 9 settle a discrepancy at the end of the trading period, 10 you can still dispute the discrepancy with Post Office. 11 To do this contract the Branch Support Centre. 12 "If you can demonstrate the reason for the 13 discrepancy or if you firmly believe the discrepancy 14 will be resolved through a Transaction Correction, 15 please call the Branch Support Centre with all the 16 details you have." 17 Is that not putting the burden on the postmaster to 18 show that the discrepancy is not the postmaster's fault, 19 rather than the investigative obligation being on the 20 Post Office? 21 A. Reading it back now, it could give that impression, yes. 22 And, again, that's something we should look at. 23 Q. Pausing there, you say "we should look at"; is this 24 currently not proposed to be amended as part of the 25 changes you were describing before? 47 1 A. Not currently, to the best of my knowledge. However, 2 I will absolutely make this away to be amended and 3 looked at. But you're right: the onus is on Post Office 4 to investigate any discrepancies, should the postmaster 5 wish us to. 6 Q. Over the page, please, page 4. There's more guidance, 7 it says at the top, "Guidance on disputing a discrepancy 8 or Transaction Correction". So "What happens at the end 9 of the investigation?", and the second paragraph: 10 "If a discrepancy amount has been investigated by 11 Post Office, or agreed by the Postmaster, and is found 12 to be a genuine loss to Post Office, the discrepancy 13 will be passed to the Postmaster Account Support Team to 14 support you through the options regarding settling the 15 amount." 16 Should that also say, "and is found to be a genuine 17 also to the Post Office and caused by your negligence, 18 carelessness or error"? 19 A. Perhaps, yes, as that would be more aligned to the 20 wording in our contracts. 21 Q. Do you know if this wording is being considered to be 22 changed as part of the review? 23 A. I don't think so but, again, very happy to take that 24 away and make sure it's implemented quickly. 25 Q. It might be said that this guidance isn't clear in the 48 1 training because Post Office are seeking to downplay 2 their investigative obligations or when the "Make good 3 with cash" button should be used; what would you say to 4 that? 5 A. I don't think that's true at all. I accept the fact 6 that the wording could be better but Post Office, to the 7 best of my knowledge and from my work with other teams, 8 are absolutely not trying to downplay two fundamental 9 issues here: the first of which is that it is upon Post 10 Office to work with the postmasters, support them, in 11 thoroughly investigating any discrepancies; and the 12 second point, as you've mentioned, is we're very clear 13 that postmasters should only put their hand in their 14 purse and put money in the till if they are absolutely 15 sure that it is a genuine mistake that's been made in 16 branch, that they can recall. So I'm very clear on 17 that. 18 Q. What we saw there in the Operational Training Guide, 19 does that reflect what's taught in classrooms and on the 20 various online resources? 21 A. The wording in that guide that you've just showed me, 22 I'm sure would be consistent with the other materials 23 used, you know, very -- the team do take steps to make 24 sure that wording across all of our learning materials 25 is consistent for good reason. So when I'm going back 49 1 and making some changes to those documents, I will need 2 to look at the wider training collateral there, which 3 will include classroom content too. 4 Q. Please can we look at page 36 of your statement, 5 paragraph 83. You give a description there of how 6 members of the Training Team are trained. You say 7 they're trained internally. I don't need to read the 8 rest of that out, it can be read. 9 How many of the trainers working now in the Training 10 Team were in post as Trainers before the Common Issues 11 Judgment? 12 A. I don't know that number off the top of my head, I'm 13 afraid. There is quite a high churn rate in our 14 Training Team, so a good proportion are, you know, over 15 the last five or six years definitely but I can't say 16 for sure. 17 Q. We've heard evidence of Post Office's previous view of 18 the obligations on subpostmasters, in respect of 19 settling discrepancies. What steps is Post Office 20 taking to ensure that those who were giving training on 21 the pre-Common Issues training course, they're not 22 carrying over that institutional understanding of how 23 the contract used to work into today's training 24 programme? 25 A. Sure. Well, I think, for anybody working in Post 50 1 Office, not just the Training Team -- and you may have 2 heard our People Director talk about that -- Chief 3 People Officer -- Karen McEwan, last week -- we do have 4 structured training in place now for all new starters, 5 which involves, you know, understanding the Horizon 6 issues of the past, the findings from the Common Issues 7 Judgment, the Horizon Issues Judgment and, actually, you 8 know, watching excerpts from this Inquiry to understand 9 the previous issues that we had and the need to change, 10 both culturally and operationally. 11 So specifically to the Trainers, they would have 12 any -- any new people joining the team would have that 13 level of training. 14 Q. Just pausing there, I'm not interested, really, in the 15 new people -- 16 A. Okay. 17 Q. -- it's the people who used to train before Common 18 Issues? 19 A. So for existing Trainers, who might have been in post 20 prior to Common Issues Judgment, they will have also 21 gone through various modules to get an understanding of 22 what happened in the past, what needs to change. They 23 will also, of course, have been able to view our 24 training policy, they have to look at our training 25 policy, and we have records annually that they've looked 51 1 at that and understood that and been trained out on it. 2 And, of course, our Trainers, as well, are all 3 quality assured, they're observed on a regular basis by 4 the leaders in the team to make sure that they are 5 delivering in the very best possible way and to the 6 standards that we expect. 7 So I'm confident that, if there were any -- anything 8 being trained out that wasn't -- you know, was pre-CIJ 9 and shouldn't be, in terms of approach to shortfalls, 10 for example, that if that did happen, it would have been 11 stamped out very quickly. I'm not aware of any examples 12 of that, though. 13 Q. I should also clarify, sorry, I should have said my 14 question wasn't aimed at new trainees, not that I'm not 15 interested in it. 16 A. Thank you. 17 Q. Clearly, we are looking at that as well. 18 A. Apologies. 19 Q. My question wasn't aimed at that. 20 We don't need to bring it up but at page 42 of your 21 statement, paragraph 100, you refer to a Feedback 22 Committee being established in June 2024, to collate 23 feedback received on training, analyse it for patterns 24 and trends, and take any steps you deem necessary. 25 A. Yes. 52 1 Q. What was done with feedback prior to June 2024? 2 A. So I think, prior to June 2024, we received feedback 3 from postmasters or people going on training at the 4 various stages of the learning cycle. So we'd have 5 feedback provided after e-learning had been completed 6 online; feedback after attendance at classroom; feedback 7 after an onsite Trainer had been out to support 8 postmasters; and then feedback from new postmasters 9 after the first few months of them being in operation; 10 as well as getting feedback from those who use our 11 materials on our Learning Management System, et cetera. 12 But I think it's fair to say that, within the 13 respective teams, that data was being analysed and 14 looked at, perhaps in a slightly siloed way, so what 15 this has tried to do is bring all of those component 16 parts together. So everybody responsible for all of 17 those elements are meeting now regularly, looking at the 18 data holistically and understanding what needs to be 19 done in response to that feedback. It's very early 20 days, the first one was only in June, but I think it's 21 working well. 22 Q. Could we please bring up EXPG0000007. This is the 23 YouGov survey that was produced for the Inquiry. Have 24 you had a chance to read this? 25 A. Yes, I have. 53 1 Q. Can I ask to turn, please, to page 16, and if we could 2 go to the table at the bottom, please. We have 3 satisfaction responses in relation to the Horizon 4 training by length of time working as a postmaster, 5 which obviously will be relevant to the types of 6 training it's engaged at. Looking at the "2 years or 7 less" and the "3-5 years", the levels of satisfaction 8 and dissatisfaction, is that consistent with the 9 feedback Post Office had been receiving through its own 10 feedback forms? 11 A. It's not and it was very disappointing to see these 12 statistics, if I'm honest. 13 Q. I take it from you saying it was disappointing, your 14 feedback you received directly from subpostmasters is 15 better than what is shown here? 16 A. It is, it is much better than is shown here. A short 17 while ago I just illustrated some of the feedback we get 18 at the various stages of the postmaster lifecycle, after 19 e-learning, after classroom, after onsite training and 20 then post a branch going live, and of course that's for 21 new postmasters coming in and their onboarding journey. 22 And at every one of those stages we ask the 23 postmasters to rate how confident they are with 24 progressing as one metric, and it's a score out of 10, 25 a scale of 1 to 10, and across all of those component 54 1 parts of training we've consistently seen levels of plus 2 90 per cent. So that's why I was very disappointed to 3 see these results because there is quite a stark 4 difference there. 5 Q. Is there any proposal to investigate the cause of the 6 difference between the feedback you receive and the 7 feedback that's been found in this YouGov survey? 8 A. I think with all of the statistics and feedback in this 9 YouGov report overall, absolutely. You know, the 10 business are, and I am, for my areas, looking at these 11 results and understanding what more we need to do, given 12 this feedback. I think it's very hard, obviously, when 13 you don't know, quite rightly, who these postmasters are 14 who have experienced this, but we take this very 15 seriously and, if people feel like this, we need to do 16 more. 17 Q. Thank you. That can come down. 18 I want to move on to a very brief point on branch 19 assurance/audit. 20 SIR WYN WILLIAMS: While it's on my mind, there are two 21 things that I'd like a bit more information about. 22 First of all, on surveying people's satisfaction, so 23 to speak, with training, in effect, you were saying that 24 your feedback to the Post Office directly reports much 25 higher numbers of people who are satisfied with the 55 1 training they received. 2 In respect of your surveys, do a high proportion of 3 the people undergoing the training actually provide 4 feedback as well? 5 A. It varies depend on the stage, sir. It's a very good 6 question. I believe that after classroom, for example, 7 the feedback forms are provided to the delegates after 8 the classroom. So, in person, if you like. So there's 9 obviously a very good response rate there. For onsite 10 Trainers and post-Go Live, I'd have to check the details 11 but I think it's more on a voluntary basis, if you like, 12 from the postmaster, so response rates might be fairly 13 low there. 14 SIR WYN WILLIAMS: Yes, that's what's I'm struggling with 15 and I'm making that admission openly, about the survey 16 information I'm getting because, obviously, the 17 percentage of people completing the YouGov survey is 18 comparatively low, compared with the whole number of 19 postmasters. So I wanted to know whether the same 20 applied to your surveys or something different, if you 21 see what I mean. 22 A. I see exactly what you mean, sir. It's a very good 23 question and, you know, completion of surveys and 24 response rates is something that plays on not just my 25 mind but I'm sure many of my colleagues' minds. We 56 1 would love to get more people responding to surveys 2 generally, across the organisation. Response rates 3 are -- aside from our annual postmaster survey that we 4 do which, you know, earlier on this year had over 1,900 5 responses, the surveys that we do within the respective 6 business units, on operational issues, they're quite low 7 and we'd love to encourage more feedback but, sadly, 8 that's not materialised yet. 9 SIR WYN WILLIAMS: Anyway, I think you've answered my 10 question in the sense that, if I summarise it in this 11 way: apart from those instances where people are 12 completing a survey following a classroom exercise, the 13 Post Office struggles to get a substantial number of its 14 cohort answering the surveys in a similar way to the 15 struggle that YouGov had to get people to respond; is 16 that fair? 17 A. That's fair, sir. Yes. 18 SIR WYN WILLIAMS: Okay. That was that. 19 Then I had just a point of detail. Could we go 20 back, please, to paragraph 47 of your statement. It's 21 WITN11610100. That's where you describe the training 22 that continues to be available, if I can put it in that 23 way, for subpostmasters. 24 A. Yes. 25 SIR WYN WILLIAMS: I wanted to focus on the subparagraph 57 1 (d), "Investigating discrepancies", all right? Two 2 points I wanted clarification of: is investigating 3 discrepancies part of the mandatory training that people 4 who are newly joining as postmasters undergo, post-CIJ? 5 A. So, in part, yes, it is, sir. In the initial classroom 6 training, e-learning and onsite support, new postmasters 7 and their assistants, as well, in branch, will be taken 8 through ways in which they can help themselves in branch 9 with operational procedures to minimise discrepancies 10 and what steps to be taken, if there is a discrepancy, 11 to try to get to the bottom of it. So it is in there 12 across the various approaches. 13 SIR WYN WILLIAMS: Right. So I think you describe in detail 14 the -- what I'll call onboarding training from, I think, 15 paragraph 50 onwards of your statement. But, anyway, 16 there's a whole section on the training received right 17 at the start and I must have missed it because 18 I couldn't find in that specific reference to part of 19 the training being investigating discrepancies. But you 20 tell me that it is part of the training, yes? 21 A. It is part at various stages, there is a lot of material 22 and it is covered as part of our classroom and onsite 23 too. The investigating discrepancies half-day classroom 24 course is, you know, just by the length of time, more 25 detailed and is available not on a mandatory basis but 58 1 for anybody who wants to go along to have more training 2 to help them in their branch. 3 SIR WYN WILLIAMS: Right. That leads me to my second point 4 of detail. In respect of that specific half-day 5 classroom course on investigating discrepancies, do you 6 find that you've got more people who want to attend it 7 than you can supply, or what, or is there not very much 8 of a take-up from subpostmasters or postmasters; can you 9 give me some feel for that? 10 A. Sure. I don't think there's as much take-up as I would 11 like, sir, if I'm honest. I think over the last six 12 months or so, I think we've had around 200 delegates on 13 that particular course, although I'm not entirely sure 14 of my facts there. I think what I find, sir, is 15 a general lack of awareness, still, from postmasters and 16 their teams about what training is available to us and 17 that's one thing, again, that we're exploring at the 18 moment: how we can better advocate the range of training 19 materials that are out there, and get more postmasters 20 to take us up on them. 21 SIR WYN WILLIAMS: All right. Thank you very much. 22 Sorry, Mr Stevens, over to you again now. 23 MR STEVENS: Thank you, sir. 24 A brief point on branch assurance/audit. The 25 Inquiry has heard evidence about Post Office Auditors 59 1 logging onto branch terminals and making adjustments to 2 stamps without postmasters' knowledge. I just want to 3 explore one element of that with you. Please can we 4 bring up NFSP00001468. There's an email at the bottom 5 from Calum Greenhow to you on 10 May 2023, and it says: 6 "Tracy, 7 "It has come to my attention that [Post Office] 8 personnel are visiting postmasters, including audits 9 (Putney PO), where Area Managers/Auditors are entering 10 stock values onto Horizon without either consultation or 11 agreement with the postmaster." 12 It says: 13 "If these facts are correct, then the NFSP would 14 like to know who has authorised this policy within [Post 15 Office] and why it has not been discussed with the NFSP 16 in advance?" 17 It goes on to set out some various other matters. 18 Firstly, were you involved in investigating this 19 issue following this email? 20 A. I wasn't specifically involved in investigating the 21 issue. The reason I got the email is because, at the 22 time, I was accountable for the relationship with the 23 NFSP but the issue was investigated, yes. 24 Q. Do you know what happened as a result of that 25 investigation? 60 1 A. I do. So, as a result of the investigation, I believe 2 Post Office held its hands up and said, "Absolutely, 3 this shouldn't be happening" and, as a result of that, 4 that practice has absolutely stopped now in branches. 5 There was a follow-up call with Mr Greenhow and, 6 I think, Keith Richards from the NFSP as well, a short 7 time after this, to update them on the outcome of our 8 investigation and assure them that that wasn't now 9 happening. 10 Q. Are you aware of how this practice began or whether 11 there was a policy in place? 12 A. I'm not, I'm afraid. I mean, I've never had any 13 accountability for the Branch Assurance Team and it's 14 certainly not something that's in our postmaster policy. 15 Q. That can come down. Thank you. 16 I want to turn to suspension, reinstatement and 17 termination. You've given figures in your witness 18 statement, which I'll turn to in a moment, about the 19 number of branches -- I think it's number of branches 20 rather than subpostmasters -- where there has been 21 a termination, suspension or reinstatement since 22 financial year 2017. 23 A. Yes, that's correct. 24 Q. You say that Post Office doesn't hold a central record 25 of that data, so it's likely that the record or the 61 1 information you provided is incomplete. 2 A. For prior to '17/'18 financial year I think, yes. 3 Q. But post-'17, is that -- 4 A. I'd just have to get up the relevant part of my witness 5 statement, if I can. 6 Q. Page 60, paragraph 143, please. You say: 7 "For financial years 2017/18 and 2018/19, Post 8 Office did not keep records that identified whether the 9 SRT was based on Horizon data." 10 So that's in relation to -- 11 A. Correct. 12 Q. -- 2017 and '18. If we go to paragraph 140, please, you 13 say: 14 "Post Office does not hold a complete record of 15 historical data in relation to postmaster suspensions, 16 reinstatements or terminations. Prior to financial year 17 2017/18, the Contracts Team was managed as two separate 18 teams ... with each team holding their own data. It may 19 be possible that some additional data from pre-2017 20 exists that could be derived from a manual review of 21 individual branch files." 22 So that first sentence, "Post Office does not hold 23 a complete record of historical data in relation to 24 postmaster suspensions", et cetera, is that aimed at 25 years before the financial year 2017/18? 62 1 A. Yes, the way it is written in here, yes. It should be 2 before, prior -- prior to that year. 3 Q. So we can be confident, can we, that if we turn the page 4 to page 61, the figures given here are -- 5 A. The figures of the numbers of them are accurate to the 6 best of my knowledge, absolutely. 7 Q. But in the brackets, where there are asterisks? 8 A. Yes. 9 Q. Sorry, I should say brackets relate to where Horizon 10 data was used or thought to be used? 11 A. Exactly. 12 Q. Where there are asterisks, that's been done on, as 13 I understand it, a look-back review of available data 14 and that's the best estimation of a case that's based on 15 Horizon data? 16 A. Correct. 17 Q. Could you expand on what you mean by where the 18 suspension, reinstatement or termination was based on 19 Horizon data? 20 A. Yes. So if suspensions or terminations were based on -- 21 as a result of discrepancies or shortfalls occurring in 22 branch, ultimately, that would be what I'm referring to 23 here as "based on Horizon data". 24 Q. So we see financial year 2019/2020, Common Issues 25 Judgment would have just been handed down at the start. 63 1 A. Yes. 2 Q. December 2019, you have Horizon Issues Judgment, and we 3 see there there's a drop in cases of both suspensions 4 and terminations. Are you able to say if the drop is 5 because of the judgments in the Group Litigation or 6 something else? 7 A. I think that the drop in those cases, and over 8 subsequent years, is as a result of the findings from 9 the Common Issues Judgment/Horizon Issues Judgment, but 10 as well as Post Office introducing its policies, which 11 we've talked about previously, which I think provide 12 greater clarity on the circumstances in which suspension 13 or ultimately termination should be enacted. 14 Q. We see that, in the subsequent years, and noting that 15 the 2024/25 year is only to 24 June, there are still 16 contract suspensions and terminations based on Horizon 17 data? 18 A. Correct. 19 Q. What is Post Office's basis for terminating contracts 20 using data generated by the Horizon IT system? 21 A. So we will -- our Contracts team will take a decision to 22 suspended or terminate someone's contract. If 23 discrepancies are involved, which is the use of Horizon 24 data, then we would obviously only be suspending or 25 ultimately terminating contracts once a very thorough 64 1 investigation has happened into that discrepancy. The 2 teams in our central operations function, which are 3 managed by Mel Park, undertake those investigations into 4 discrepancies, and I am assured that -- and we've heard 5 a lot about Horizon data and the integrity of Horizon 6 data. 7 As part of their investigations, they will obviously 8 be looking to make sure and check whether Horizon could 9 be at play, looking at any known errors, for example, 10 but only when that determination has happened and we're 11 sure that the discrepancy is as a result of the 12 negligence, carelessness or error of a postmaster, would 13 we possibly enact a suspension or termination. 14 Q. One thing we'll come to with a different witness is Post 15 Office's position is it's not pursuing civil claims for 16 discrepancies based on Horizon data -- 17 A. That's my understanding, yes. 18 Q. -- and Post Office's position is it only seeks repayment 19 without going to civil enforcement where the postmaster 20 agrees to pay? 21 A. Correct. 22 Q. In these cases, where we see terminations or 23 suspensions, can you assist with, on the bracketed 24 numbers, whether, within those groups, the postmaster 25 disputed the discrepancy or suggested that Horizon was 65 1 at fault? 2 A. I'm not entirely sure whether, in each of these cases, 3 the link to discrepancies, the postmaster would have 4 disputed it or would have claimed that Horizon was at 5 fault. What I can say, of course, is that each of them 6 would have been investigated very thoroughly. Where we 7 suspend a postmaster or terminate their contract, what 8 we're not doing is suspending or terminating on the 9 basis of them having discrepancies. We are suspending 10 or terminating based on the fact that there have been 11 contract performance issues. 12 So, to give you an example, in the majority of our 13 cases, there are discrepancies that will have been 14 caused by operational procedures in branch not perhaps 15 being followed. Too much excess cash is a key one. 16 Failure to rem in cash and stock, for example, or not 17 undertaking daily cash declarations or your monthly 18 balancing, which have all led up to the accumulation of 19 discrepancies. 20 But I'm confident that the discrepancies are 21 investigated thoroughly. 22 Q. Just on these numbers finally, I read this as the 23 contract is terminated, in that the Post Office itself 24 is making the decision to terminate the contract. Am 25 I right in reading this that it doesn't include 66 1 situations where a postmaster resigns? 2 A. That's correct. 3 Q. That can come down. Thank you. 4 The decision on suspension and termination is taken 5 by Contract Advisers; do they report to you? 6 A. No. The Contract Advisers report to their Head of 7 Contract Performance and Deployment, and they report in 8 to me. 9 Q. You say in paragraph -- we don't need to turn it up -- 10 150 of your statement that the Contract Advisers used to 11 sit under the Branch Assurance Team? 12 A. The Contract Advisers used to sit within the same 13 function as the Branch Assurance Team, yes. 14 Q. That's been changed recently, has it? 15 A. It was changed in August last year. 16 Q. Why was that? 17 A. Following a review of our procedures and processes by 18 Group Assurance, who are looking at, you know, how we 19 have delivered improvements following the Common Issues 20 Judgment, they identified a potential conflict with the 21 Branch Assurance Team sitting in the same time as the 22 Contracts team and, hence, the decision was taken to 23 move the Contracts team under me. 24 Q. Please can we look at page 64 of your statement, 25 paragraph 154. You refer to the four current Contract 67 1 Advisers. 2 One joined Post Office in 2005. Area Manager for 3 nine years, now acting as a Contract Adviser. 4 2012, another joined then, (b), worked in various 5 roles in the business, now a Contract Adviser. 6 If you go down, please, (c), another joined 1981, 7 started in the role of Contract Adviser in 2006. 8 (d), the fourth, is more recent. 9 If you then go down please, 155. We see the Head of 10 Contract Management and Deployment, employed by the Post 11 Office since 2003, took a role of Contract Adviser in 12 2011. 13 The Inquiry has heard evidence about during the 14 period -- we're looking at 2000 to 2012 and 15 thereafter -- where the process for termination has been 16 criticised, in particular that there was an expectation 17 to respond to discrepancies robustly in the appeal 18 process and the decision process. What steps has Post 19 Office taken to ensure that the Contract Advisers who 20 were involved in those decisions have learnt from those 21 criticisms that have been made? 22 A. So I think I touched on some of this when we were 23 talking about our Training Team, as well, and people who 24 were in post prior to the Common Issues Judgment. 25 The -- all of the Contract Advisers, whether they were 68 1 in the business or since they've come in since, have all 2 had training, quite structured training, delivered on 3 the implications of the Horizon IT Inquiry, the findings 4 from the Common Issues Judgment. 5 They've also had clearly training on the new terms 6 that have been added to the contracts as well, the 7 implied terms, which clearly do give a focus on our 8 approach to suspensions and terminations and it gives 9 a focus as well on the management of discrepancies and 10 how we will support postmasters more. 11 So they have all had training on the implications 12 and, again, they will have reviewed the policies 13 associated with their role on an annual basis to make 14 sure that they're doing their job in line with those 15 policies and procedures. 16 Q. I want to look shortly at some of the review mechanisms 17 that are in place as well but can I look at suspensions 18 in a bit more detail briefly. It's POL00448254. So 19 this is the Postmaster Support Policy on contract 20 suspension. 21 A. Yes. 22 Q. If we can turn, please, to page 17, down to the bottom 23 of the page, it says: 24 "Suspension will only be applied where absolutely 25 necessary to review the cause of a potential contractual 69 1 breach identified by the Contract Adviser and where all 2 alternative options have been considered." 3 Is that the test that is to be applied, then, by 4 Contract Advisers when considering whether or not to 5 suspend a postmaster? 6 A. Yes, and they are absolutely trained and given 7 instruction that suspension should be the last resort 8 and only when, you know, issues aren't capable of being 9 remedied. 10 Q. We've heard a lot of evidence about some policies being 11 under review. Is that test being considered for review 12 or change or is that a settled test? 13 A. I think we're always up to getting feedback and changing 14 things if we need to. These are reviewed on a very 15 regular basis and are reviewed by RCC and ARC, our two 16 governance forums. So at the moment that is the 17 position, that suspension is absolutely the last resort. 18 Q. I appreciate that these things are reviewed but is there 19 any indication that that test will be lowered or 20 weakened in future? 21 A. No. Not in my view. 22 Q. Could we please look at your statement, page 72, 23 paragraph 176. You say that: 24 "The Contract Adviser can make a recommendation to 25 the Head of Contract ... and Deployment on suspension, 70 1 who then makes the final decision. That decision is 2 then reviewed at the next Postmaster Suspension Decision 3 Governance Committee meeting." 4 You set out the membership of that meeting there. 5 Why are there no either former postmasters or NFSP 6 representatives on that panel? 7 A. It's a very good question and something that we're 8 looking to address because the other panel, the 9 Termination Committee and the Decision Review Committee, 10 do now have postmasters or postmaster representatives on 11 those panels. I'd be very keen to have a postmaster 12 representative on this panel; and it's something that we 13 are looking at. 14 Q. So that's something you're currently -- 15 A. Currently looking at, yes. 16 Q. Is it in consultation with the NFSP over that matter? 17 A. It will absolutely need to be in consultation with the 18 NFSP, and the NFSP do input to and approve all of our 19 policies, actually, before they go to our Audit and Risk 20 Committee. 21 Q. At paragraph 177, just below, you say: 22 "To date, no decision has been overturned by the 23 Postmaster Suspension Decision Governance Committee." 24 Do you think that's a good or a bad thing? 25 A. I think it's a good thing because I think it genuinely 71 1 shows that we have followed the processes and procedures 2 and been fair and transparent to postmasters when making 3 suspension decisions. 4 Q. It might be said that it shows that the Governance 5 Committee is not properly overseeing it and challenging 6 the decisions that were made; what would you say to 7 that? 8 A. It could show that. I don't think that's the case. 9 I think the members of the Suspension Decision 10 Governance Committee have all had training, they've all 11 had training on the contracts, they've all had training 12 on the CIJ judgment handed down, and I'm confident in 13 the decisions that they are making, and we've got some 14 good representatives there from across the business. 15 Q. Has there ever been consideration for any independent 16 review or input to ensure that the Decision Governance 17 Committee is doing its job properly? 18 A. So the Decision Governance Committee, as with our other 19 committees, have been looked at by our group assurance 20 function, who are reviewing much of what we do across 21 the Retail function. I believe that they think it's fit 22 for purpose at the moment, as there have been other 23 conversations more generally, not just about Suspension 24 Decision Governance Committees, around the possible use 25 of independent external organisations to further assure 72 1 our work. So that, again, is something that's ongoing. 2 SIR WYN WILLIAMS: What sort of numbers are we talking about 3 to get to the Governance Committee, of the people who 4 are suspended? Roughly at least, can you tell me how 5 many take the decision to the Committee? 6 A. So this Committee here, sir, is our internal Suspension 7 Decision Committee and every suspension decision, every 8 one of them, is ratified by this committee. 9 SIR WYN WILLIAMS: Right. I'm sorry, I misunderstood that. 10 Fine. 11 A. Thank you, sir. 12 MR STEVENS: Can we please look at POL00448206. This is the 13 equivalent support policy but for contract termination. 14 Could we please look at page 18, if we go down to 15 "Repudiatory breach", please. So we have examples here 16 of a repudiatory breach and we see in the middle: 17 "Where discrepancies of a significant value have 18 been caused by the negligence, carelessness or error of 19 the postmaster, resulting in a loss to Post Office, and 20 which have been fully investigated by Post Office ..." 21 Firstly, what is significant value in this context? 22 A. I don't think we actually have a definition of what 23 a significant value is. We're certainly talking here 24 about values over -- you know, certainly over £10,000/ 25 £20,000, I would have thought, but we don't have 73 1 a definition of a significant value. 2 Q. But is it still the case, then, that it appears that, if 3 there are discrepancies of a significant value, that the 4 Post Office considers was caused by negligence, 5 carelessness or error of the postmaster, that is in and 6 of itself a ground for terminating the contract? 7 A. That, in itself, is grounds for terminating the 8 contract. But I would add that, of course, before we 9 get to that point, those discrepancies, whatever their 10 value, would have been thoroughly investigated, using 11 the process I've described earlier, before we settled on 12 the fact that they were caused by negligence, 13 carelessness or error. 14 Q. In paragraph 163 of your statement -- we don't need to 15 turn it up -- you say: 16 "Contract Advisers do not investigate branch 17 discrepancies or deal with the recovery of outstanding 18 branch accounts." 19 Is it the case that they rely on another team in 20 Post Office to do that for them? 21 A. That's correct. 22 Q. Which team is that? 23 A. So that would be the Central Operations Team and the 24 Postmaster Account Support Team. 25 Q. You don't oversee that? 74 1 A. I do not. 2 Q. Actually, sorry, can we move to page 20, please, 4.11. 3 It says: 4 "Post Office will need to consider whether different 5 has complied with its own contractual duties in relation 6 to matters relevant to the reason for termination." 7 It goes on to say: 8 "If Post Office has materially failed to comply with 9 its own contractual duties in relation to the matters 10 relevant to the reason for termination, it is not 11 entitled to terminate on notice." 12 Are Contract Advisers giving any legal assistance to 13 determine whether Post Office has materially failed to 14 comply with its own contractual duties? 15 A. Yes, they are. So the important point here is that the 16 Contract Advisers are not lawyers, they're not legal 17 experts, so any proposed decision to terminate 18 a postmaster's contract, we would have external legal 19 assurance on that decision. Only when that assurance 20 has been given to us and that we've acted in line with 21 the terms of the CIJ, we've acted, you know, under our 22 duty of good faith, not arbitrarily, irrationally, 23 capriciously, et cetera, would we then take that 24 decision to the Termination Decision Governance 25 Committee, for final ratification. 75 1 Q. That can come down. Thank you. 2 If a decision to terminate has been made, there's 3 then the Postmaster Contract Termination Decisions 4 Committee. Can you explain what the role of that 5 Committee is? 6 A. Yes. So we've got the -- if a termination decision has 7 been proposed by the Head of Contract Management and 8 Deployment, we've got the external legal assurance 9 advice, we then go to that committee, who, very much 10 like the Suspension Committee that we talked about 11 earlier, is senior leaders within the organisation, 12 ultimately, with some legal input too, to review the 13 rationale document, review the legal advice, and 14 ultimately ensure that the teams have been working in 15 line with its contract, it's policies and its 16 procedures. 17 Q. If we look at POL00448205, page 14, please. 18 A. Apologies, can I ask for some clarity here? 19 Q. Yes. 20 A. We've just talked about the Termination Decision 21 Governance Committee, which is the internal committee, 22 and this document is now a separate review panel. 23 Q. Is this the panel? 24 A. This is the panel if a postmaster chooses to appeal 25 a suspension or termination. 76 1 Q. So is that called the Postmaster Contract Termination 2 Decisions Panel? 3 A. This is the Postmaster Decision Review Panel. 4 Q. Review Panel? 5 A. Yes, apologies. 6 Q. So this is a separate body that's dealt with for 7 appeals? 8 A. Yes. 9 Q. This the body that comprised of -- we see two Senior 10 Leadership Group members, one former postmaster and one 11 non-voting panel chair -- 12 A. Correct. 13 Q. Why is the panel chair non-voting, so there's a majority 14 in favour of the Senior Leadership Group? 15 A. That's a very good question, I think that the initial 16 thoughts around the panel chair not being -- voting is 17 so that they can more effectively provide independence 18 and effectively chair the meeting. That's the case for 19 a lot of our decision committees, that the Chair would 20 be a non-voting member. 21 Looking at this again now, that does clearly skew, 22 slightly, the postmasters versus senior leaders piece, 23 so I think, again, that's something that we should 24 absolutely look at. 25 Q. In looking at something like that, would you liaise with 77 1 the NFSP? 2 A. Absolutely. Again, this is something integral to our 3 policy. 4 Q. Thank you. That can come down. 5 You mentioned earlier a review about I think 6 considering whether independent input into these 7 decisions or reviewing them is being considered. When 8 will that review be complete or when will there be 9 proposals available? 10 A. I don't think I have any concrete dates on that but it 11 is an outstanding action that we have following feedback 12 from group assurance, so we will need to work on that 13 quickly. I would very much hope to have an updated view 14 within this financial year. 15 MR STEVENS: Sir, unless you have any questions on 16 termination, I'm going to move to a different topic. 17 SIR WYN WILLIAMS: That's fine, then, Mr Stevens. 18 MR STEVENS: The last topic I have, it's very brief. Can we 19 look at POL00460000, please. This is an investigation 20 report on Project Pineapple. I don't need to go through 21 all of it but can you turn to page 10, please. 22 In the middle, it says: 23 "Martin denied that there was consideration of 24 cancelling the [postmaster] survey. He said there had 25 been nervousness in the Executive discussions because of 78 1 the Bates programme but never a discussion to cancel. 2 However, Tracy Marshall confirmed that there had been 3 discussion about cancelling the survey and that she and 4 others from within the team had pushed to ensure it went 5 ahead -- which ultimately it did." 6 Can you provide some background to: (1) the 7 discussions on cancelling the survey; and why it was 8 continued? 9 A. So this is in relation to -- normally, we do an annual 10 postmaster survey which tends to happen January/February 11 time of each year, and we've done that since 2021. 12 Following the Mr Bates vs The Post Office programme in 13 January of this year, clearly there was lots of external 14 media attention, lots of, quite rightly, focus on the 15 Post Office and the awful impact that the Horizon 16 scandal has had on many postmasters. 17 There were, therefore, some discussions around the 18 timing of the postmaster survey, which could have 19 resulted in perhaps more negative feelings being given 20 in that survey. 21 This is a survey, sir, where we're talking about 22 general postmaster sentiment. 23 So there were some discussions. I don't think this 24 is quite a true reflection of my conversation and my 25 interview here. I don't recall there being a discussion 79 1 about cancelling, full stop, the survey, but there was 2 certainly a discussion around potentially just 3 postponing it by a month or so, before it went ahead. 4 The survey did take place this year and I think it was 5 March time it went ahead. 6 MR STEVENS: Thank you. 7 Sir, those are all the questions I have. Unless you 8 have any questions now, I'll check if there are 9 questions from the Core Participants. 10 SIR WYN WILLIAMS: Check with the Core Participants, please. 11 MR STEVENS: Yes, there's two sets of questions, sir. 12 I don't know who wants to go first. I think Ms Page 13 first. 14 SIR WYN WILLIAMS: Fine. 15 Questioned by MS PAGE 16 MS PAGE: Ms Marshall, hello. 17 A. Hi. 18 Q. Have you downplayed your involvement in disputes with 19 postmasters over the years? 20 A. I really don't think I have, and I still maintain my 21 position that, whilst on the face of it, it looks as 22 though I've -- and I have sent emails which do talk 23 about remote access, for example, I was very much 24 passing on information from Subject Matter Experts to my 25 bosses at the time. I've never had any involvement with 80 1 IT, with prosecutions, with investigations, over my 2 career history. But I do want to say I'm very sorry 3 that it gives that opinion of me and want to assure 4 everybody that that is absolutely not the case. 5 Q. Let's have another look at a different section of your 6 email to Ms van den Bogerd and Mr Gilliland. It's 7 POL00294728 and, as it comes up, you'll appreciate now, 8 if not, you say, at the time, that this related to 9 a dispute with the Ferndown branch. The postmaster and 10 her husband were saying that there were integrity 11 problems with Horizon; you appreciate that now, do you? 12 A. I appreciate that now, yes. 13 Q. If we could scroll down to the bit that wasn't read out, 14 it's got the heading "Independent review of Horizon 15 system integrity": 16 "Post Office Limited has allowed an independent 17 review of our Horizon system in the past, on one 18 occasion." 19 Then it refers to that occasion. It was to do with 20 the trial of Mrs Misra. It says this about the trial: 21 "The case made it to court on 11 November and after 22 reviewing all the evidence the judge exonerated Post 23 Office Limited in full, finding the Horizon system to be 24 robust." 25 That appears to be in bold; do you see that? 81 1 A. I do. 2 Q. "During the course of the independent review, the 3 defence legal team were provided with representatives 4 from Fujitsu and the knowledge and experience of using 5 the Horizon system. Fujitsu experts helped the defence 6 team complete their investigation." 7 "The jury in the case of Misra v Post Office Limited 8 voted unanimously that she was guilty and as such, she 9 is now serving time in prison. This has been a high 10 profile case due to the fact that Mrs Misra is pregnant. 11 Mr Misra has made allegations that the defence team were 12 not allowed access to all the information they required 13 regarding the Horizon system but the judge made no such 14 accusation." 15 If we could just go a little further down, as well. 16 The final paragraph on the page: 17 "In addition to the independent review above, the 18 robustness of the Horizon system is audited on an annual 19 basis by Ernst & Young. Never before has the quality 20 and accuracy of the system been doubted here." 21 Now, it appears that all of that information came 22 from conversations that you'd had with Dave Hulbert and 23 Andy McLean the day before; is that right? 24 A. I think the conversations with -- in this email, because 25 I don't remember it but having read it -- that certainly 82 1 the issues around Horizon system remote access would 2 have come from Dave Hulbert and Andy McLean. 3 I don't think they would have been in a position, as 4 IT people, to talked length about the particular case of 5 Mrs Misra, here. 6 Q. So where did you get that information from? 7 A. Well, I can't remember who I would have gone to, but 8 that wouldn't have been something that I would have 9 known about or been involved in, so I would have been 10 relying on, I'm guessing, some of my legal colleagues at 11 the time, to provide me with that information. It was 12 not something I was ever involved in. 13 Q. Given that the trusted subpostmaster at Ferndown had 14 raised the issue of Horizon integrity, why do you think 15 it was that you and apparently Ms van den Bogerd and 16 Mr Gilliland, were prepared to take these assertions 17 from you, relayed via others, from various unknown 18 people, rather than considering what the subpostmaster 19 and her husband were saying? 20 A. I honestly can't comment on why Angela and Kevin, who 21 I think attended the Ferndown meeting, they didn't talk 22 about any of the information that I relayed, I don't 23 think. Hindsight's a wonderful thing, isn't it? They 24 should have been a little bit more upfront, I think, at 25 that meeting and asked for the perspective of the 83 1 postmaster. 2 I think at the time, here, in 2010/11, the business 3 position was incorrectly and wrongly that Horizon was 4 very much a robust system. 5 Q. Was it part of the culture that, when there was a one 6 word versus another word, a subpostmaster versus someone 7 else, the someone else was always believed and the 8 subpostmaster was not; part of the culture of believing 9 that postmasters were incompetent or dishonest, not 10 worthy of belief? 11 A. I don't recognise that in the roles that I was doing, in 12 so far as feeling as though postmasters were incompetent 13 and shouldn't be relied on and that Post Office were 14 always right. I don't recognise that in the jobs that 15 I was doing and, in fact, of course, at the time here, 16 my job involved a lot of involvement with the NFSP and 17 hearing firsthand about the issues affecting 18 postmasters. Whether others had that view, I can't say, 19 but it was not something that I experienced. 20 Q. Were others like Mr Gilliland and Mr Tuthill coming to 21 you for this sort of activity, which you say wasn't part 22 of your role, because you were willing? 23 A. No, I don't think so. I wasn't willing. I don't think 24 I was complicit in any of this at all. I think they 25 were coming to me, particularly Mr Gilliland, being my 84 1 boss -- as I've said, he did so on numerous occasions -- 2 asking me to go outside the remit of my role to find out 3 information for him to, you know, assist him in visiting 4 branches or whatever that might have been. 5 Q. Evidently, as a result of what you were told by unknown 6 persons, you must have believed that Mrs Misra was 7 guilty of theft at the time? 8 A. I would have taken on face value, from what my 9 colleagues had told me. I assume so, yes. Clearly 10 now -- 11 Q. Do you accept that you were wrong about that? 12 A. Absolutely. 13 Q. When did come to accept that you were wrong? 14 A. I think there was a widely held position in Post Office, 15 until the handing down of the various judgments, that 16 Post Office were not at fault and that was a message 17 that was given consistently in our communications. 18 Q. Can you pinpoint a time when you recognised that 19 postmasters had been wrongly convicted? 20 A. On the handing down of the Common Issues and Horizon 21 Issues Judgments, yes absolutely. 22 Q. Would you say that was about convictions? Can I just 23 press you on that because, of course, there was 24 a subsequent judgment about convictions. Did you 25 connect it with convictions when the Common Issues 85 1 Judgment and the Horizon Issues Judgment came out? 2 A. I don't think I would have done, no. 3 Q. So when do you think you did recognise that convictions 4 were wrongful? 5 A. I can't pinpoint it specifically. I mean, clearly since 6 the Inquiry has been going on now for some years, and 7 I have, you know, read and heard a lot of the horrific 8 stories experienced by postmasters, I have now become 9 very clear that those convictions were wrong but I'm 10 sorry, I can't pinpoint specifically when I would have 11 been aware of that. 12 Q. Is it possibly not until Bates vs The Post Office? 13 A. It was absolutely before then. 14 Q. Just returning back in time, if I may briefly. The 15 email that you sent to Mr Gilliland and Ms van den 16 Bogerd was part of the myth making in Post Office, we've 17 seen a lot of it, using sort of wisps of truth and 18 spinning them to support what was of the falsehood that 19 Horizon was robust. Whether you were relying on others 20 or not, you were part of that, part of that myth making, 21 that chain of lies and fabrications. When did you 22 personally stop spreading those sorts of myths? 23 A. I can't think of other occasions when I have spread 24 those myths or lies. In this particular instance, 25 I was, as you said, very heavily relying on what other 86 1 experts in the business had provided me with. I don't 2 think I've ever been spreading lies or myths in the 3 business. 4 Q. Do you have anything to say about your failure to raise 5 your knowledge based on these email chains over the many 6 years where Post Office was claiming not to have any 7 remote access into branch accounts? 8 A. So whilst I still absolutely maintain that I wasn't 9 involved in the particular issues here and I'm, you 10 know, getting the information from other people, I am 11 incredibly sorry that I sent any emails with any 12 relevance whatsoever to remote access or convictions and 13 I am hugely sorry for any -- for the horrific things 14 that postmasters and their families and children and 15 communities have gone through over the last few years. 16 Q. Can I bring up, please, POL00416991, and this dates from 17 2011. If we just note that this is an email from Nigel 18 Allen to Andrew Winn with you on copy. If we go to the 19 first three paragraphs -- before we do that, the subject 20 "Ferndown ... Loss settled by [cheque] -- SPMR dispute": 21 "Thanks for this. 22 "I have discussed this with Tracy Marshall and she 23 has asked whether you can draft a letter to Mrs Rachel 24 Athwal, SPMR, explaining in as simple terms as possible 25 what happened and why it is now necessary for her to 87 1 send us another cheque. Mrs Athwal is arguing that she 2 did what the helpline told her to do and as she has 3 already settled the shortage by cheque which has cleared 4 from her bank account, doesn't see now why she should 5 send another one despite the surplus in the branch." 6 Then this: 7 "Mrs Athwal and her husband have already challenged 8 the integrity of the Horizon system so it needs to be 9 explained that she has not been disadvantaged by any 10 software problems and that POL took the necessary steps 11 to rectify this as soon as possible. 12 "In view of the sensitive situation at this branch, 13 could you please send the letter to Tracy first and cc 14 to me." 15 So you weren't just investigating to help 16 Mr Gilliland with his interview. You were involved in 17 how to resolve the dispute, weren't you? 18 A. It would appear that from this letter, yes, but that was 19 not part of my role at all at the time. Although, yes, 20 that's what it looks like from this email. 21 Q. What this email tells us is that you were well aware 22 that the dispute involved the integrity of Horizon and 23 that it was seen as important to assert that the branch 24 had not been disadvantaged by a "software problem". You 25 understood, presumably, what this was about. This was 88 1 about the need to keep the edifice up so that SPMs and 2 clients didn't lose confidence in the Horizon system. 3 You must have understood that, mustn't you? 4 A. As I've said, I should have understood that. I don't 5 know whether I did understand that at the time. It 6 wasn't something that was in my remit. But, yes, I'm -- 7 what I'm certainly doing is maintaining the business 8 position here, that the issue with Horizon integrity 9 should not be challenged, which, as I've said, was 10 a position that was maintained for a long time, 11 incorrectly, in Post Office. 12 Q. You were sufficiently worried about the sensitivities 13 that you wanted to review the letter before it went out? 14 A. Well, that's very unlike me in that role to have to do 15 that, I have to say. 16 SIR WYN WILLIAMS: Just a minute. Do we know that, Ms Page? 17 This is a letter from Mr Allen, who is suggesting that 18 it be sent to Ms Marshall. We don't, actually -- or 19 I don't at the moment at least -- know whether it did go 20 to her, what she did about it, et cetera. 21 MS PAGE: This is the only email that I have about that, 22 sir. 23 SIR WYN WILLIAMS: Well, I think we ought to be careful 24 about making five from one and one, if you see what 25 I mean. 89 1 MS PAGE: Certainly. 2 If we can move forward in time to 2015 and, if we 3 could bring up, please, POL00117439. This first page 4 makes it quite plain that there are a very large number 5 of people on copy and, hopefully, you'll take it from me 6 that you're one of them. Indeed, you may be on page 2, 7 which I'll ask to scroll to now. Yes, there you are 8 actually towards the end of the long list. 9 This comes from Mark Davies, and he says: 10 "Thanks for taking part in the conference call on 11 Horizon this week." 12 He then forwards a note and we can perhaps just have 13 a look at a little bit of the content of that note. If 14 we go down to page 3, we can see reference there to the 15 BBC Panorama programme, which is maybe going to go out. 16 We can also see that there's reference to 17 a Parliamentary debate about the issue, ie the Horizon 18 issue, and the talk about the fact that this may lead to 19 further media coverage. 20 If we could go down to page 4, please. We can see 21 that he's set out various key points and messaging and, 22 if we could go to a little further down -- sorry, just 23 a little further up from there -- there's the paragraph, 24 second bullet point down, which has the sort of classic 25 line, if you like: 90 1 "There is no evidence that the Horizon system does 2 not work as it should. This is the finding of 3 independent investigators. It has been shown to be 4 robust and effective in dealing with six million 5 transactions", et cetera. 6 So those were key messages sent to you amongst many 7 other people in 2015 and this was, essentially, a script 8 for fending off concerns about Horizon, would you accept 9 that? 10 A. I think it was a script for us to cascade to the wider 11 teams, from what I can make of the email, to use, if 12 approached by the media, if approached and asked 13 questions by postmasters, yes, it has to be that. 14 Q. How many times do you think you would have adhered to 15 that sort of a script when dealing with concerns about 16 Horizon? 17 A. Probably -- it's hard to say. I don't remember how many 18 times I had those conversations. I certainly never 19 spoke to the media about it. At the time of this -- 20 sorry, is it 2015, did you say? 21 Q. Yes. 22 A. At 2015, or from 2012 through -- well, all the way 23 through to my current position, I've been working on 24 programmes -- I was on the Network Transformation 25 Programme at this point, so I wouldn't have been 91 1 interfacing actually directly with postmasters or the 2 media. So I don't know how often I would have used it 3 but it wouldn't have been frequently. 4 Q. I won't take you to it, to save time but we can also see 5 that in 2019, reference POL00268061, you were again part 6 of a group Mark Davies copied in following the Common 7 Issues Judgment and how to handle the media fallout from 8 that. There was a summary of the Common Issues Judgment 9 attached and some tips on how to handle the media. 10 Do you remember receiving the Common Issues 11 Judgment, the summary of it? 12 A. Do you mean the media summary, the tips, as you call it? 13 Q. Yes. Let me put it in a different way. When did you 14 first appreciate what was said in the Common Issues 15 Judgment? 16 A. I only when it was -- probably after it was handed down. 17 I think when it was handed down, there was certainly 18 shock across the Post Office that that was the outcome. 19 Q. Can you tell us about your own personal reaction, 20 please? 21 SIR WYN WILLIAMS: Well, Ms Page, I'm sorry to sound 22 difficult but I'm not sure that this is actually going 23 to help me in terms of what I have to really decide on 24 my terms of reference. I mean, it's clear, is it not, 25 from everything that I've heard already, that everybody 92 1 in the Post Office expected to win but they lost, so 2 then they had to come to terms with it. 3 MS PAGE: What I'm trying to get at, sir, and I hope that it 4 won't take very long and that it, I would suggest, is 5 relevant to this phase, is when did it really dawn on 6 Ms Marshall that Post Office had got it wrong for all 7 those years and there was a need to really change, and 8 it's the change I'm really driving at. 9 SIR WYN WILLIAMS: I think you can all safely conclude that 10 everybody in senior positions realised they needed to 11 change once they read and digested that judgment. 12 MS PAGE: Well, sir, that's what I'm exploring. 13 SIR WYN WILLIAMS: Yes, well, I don't think you need to. 14 I think I've got that point, whatever Ms Marshall says. 15 All I'm saying is it's self-evident, is it not, 16 Ms Page? 17 MS PAGE: Well, I'm not sure that it is. That's exactly my 18 point, sir. I think that there's reason to think that 19 it may have taken some time before people realised the 20 need for change. 21 SIR WYN WILLIAMS: Well, that might be right as well but 22 I have to look at it objectively, don't I? 23 Anyway, sorry. Go on. 24 A. I'm happy to answer if you want me to? 25 MS PAGE: When did you think there was going to be a need 93 1 for serious change? 2 A. I think I was in quite a fortunate position at the time, 3 personally, that, by the time the Common Issues Judgment 4 was handed down, I was already very much in a role 5 focused on postmasters and making improvements. So, 6 whilst there was some shock at the fact that the Post 7 Office had lost both of the trials, the Common Issues 8 and the Horizon Issues Judgment, and there was a shock 9 at the extent of our failings as an organisation, I was 10 personally, I think, very quick -- very quick -- because 11 I was already focusing on the things that weren't 12 working for postmasters and that's kind of the role I've 13 had ever since. 14 Q. You've told us about the people that you work with in 15 Contract Management who are mostly -- the Contract 16 Managers and their boss are mostly people like you, who 17 have grown up in Post Office, if I can put it in that 18 way: people with very long careers in Post Office? 19 A. Some of them are, yes. 20 Q. You've told us that the structured training on the 21 Common Issues Judgment and the Inquiry, and so forth, is 22 something that they've all had to go through? 23 A. Yes. 24 Q. Did you have conversations with people afterwards about 25 what that meant? 94 1 A. I've had conversations with many people across Post 2 Office, and my wider teams, ever since 2019, about the 3 impact of Common Issues Judgment; I've had many 4 conversations with postmasters about it; I've had many 5 conversations with the NFSP about it. 6 Q. Have you spoken to them about the sort of activity we 7 can see you were involved with, albeit you say 8 tangentially, of spinning myths, of perpetrating myths. 9 Have you talked to them about that and their own conduct 10 of that sort of behaviour and how they feel about it and 11 whether they see they need to change? 12 A. The first I saw -- I remembered of any of the details 13 you've shown me today was when they were disclosed to 14 the Inquiry. So before to that no, I hadn't because 15 I couldn't recollect being involved. Since they've been 16 disclosed, yes, I have had conversations with my own 17 team and other colleagues across the business, about 18 those emails, about my perceived role in those, and 19 I think that certainly the emails that you've shown me 20 point to, culturally, a Post Office that was very flawed 21 in the past. 22 What I can say is that, you know, in the roles that 23 I've been doing, and from my perception of the wider 24 business now, we've got more work to do, of course, but 25 we have significantly changed, culturally. That's what 95 1 I see. Prior to 2019, I don't think we've really put 2 postmasters at the heart of very much. Nowadays, we 3 absolutely do, and that's right. That's got to be right 4 and we've got to continue to do that. 5 Q. Only today, through questioning, have you identified, 6 for example, the need to review the guidance which puts 7 the burden of proof on postmasters to demonstrate why 8 they're disputing a discrepancy. Do you think that your 9 past and the culture that you grew up in has played 10 a part in that failure to fully change the mindset? 11 A. I don't. I don't. My focus is very much on making 12 improvements for postmasters. 13 Q. Has it got anything to do with why you hadn't 14 identified, for example, that problem before? 15 A. No, it hasn't. 16 MS PAGE: Thank you, sir. 17 SIR WYN WILLIAMS: Thank you, Ms Page. 18 MR STEVENS: Sir, sorry -- 19 SIR WYN WILLIAMS: I'm sorry, I can't hear you. 20 MR STEVENS: Ah, can you hear me now, sir? 21 SIR WYN WILLIAMS: Yes. 22 MR STEVENS: I think that's the first time that question has 23 had any actual effect! 24 I may be being over cautious here. I was reviewing 25 the [draft] transcript and at LiveNote 86/18, 96 1 Ms Marshall was asked about "So when do you think you 2 did recognise that convictions were wrongful?", and 3 there was a long answer but it was "couldn't pinpoint it 4 specifically". Then, as it's on the page, Ms Page's 5 next question was: 6 "Is it possibly not until 'Bates vs The Post 7 Office?" 8 "Answer: It was absolutely before then." 9 I just think for clarity, can I ask, when you refer 10 to Bates vs The Post Office, were you referring to the 11 Group Litigation or to the ITV drama, Mr Bates vs the 12 Post Office? 13 A. That may be a question for -- I was thinking it was the 14 drama, the ITV drama; is that correct? 15 MS PAGE: So was I. 16 MR STEVENS: Yes. It's just how it reads is slightly -- 17 months down the line. 18 A. Understood. 19 MR STEVENS: We're just checking that that was what you were 20 answering. Thank you. 21 Apologies, sir. 22 I think Mr Jacobs has some questions. 23 SIR WYN WILLIAMS: Right, fine. 24 MR JACOBS: I do, sir, I'm conscious of the time. I'll try 25 to and be quick. 97 1 Questioned by MR JACOBS 2 MR JACOBS: Ms Marshall, Simon Oldnall gave evidence 3 yesterday and he said that Post Office doesn't recover 4 losses from subpostmasters, except where a postmaster 5 agrees the reason for the shortfall. 6 A. I that's my understanding at the moment, yes. 7 Q. You've confirmed that's your understanding in your 8 evidence today. Now, Mr Stevens took you in your 9 evidence to the Contracts Termination Policy? 10 A. Yes. 11 Q. Do you remember -- we don't need to turn it up because 12 it's fresh in our minds, I hope -- paragraph 4.6, 13 "Repudiatory breaches"? 14 A. Yes. 15 Q. Do you remember that it said that, where there are 16 discrepancies of significant value that have been caused 17 by negligence, carelessness or error of the postmaster, 18 that resulted in a loss to the Post Office, and have 19 been fully investigated by the Post Office, that is 20 grounds for suspension and grounds for termination? 21 A. Yes. 22 Q. Do you accept that there is therefore scope within this 23 policy for suspension based on a Horizon shortfall? 24 A. There is, yes. 25 Q. Yes. This is my question for you: why is it that the 98 1 Post Office does not recover shortfalls -- recover 2 shortfalls -- unless the subpostmaster agrees but 3 applies a different approach in relation to suspending 4 and terminating on the basis of shortfalls? 5 Do you see that there's a disconnect there, 6 Ms Marshall? 7 A. I do, and I can't comment on why we don't recover 8 shortfalls apart from where the postmaster agrees. 9 That's not my area. I think, in the cases of 10 suspensions or terminations, where there are 11 discrepancies and where the postmaster might not agree 12 with the reason for those discrepancies, I'd refer to my 13 earlier point that, where we're taking decisions to 14 suspend or terminate contracts, the team aren't basing 15 those decisions on discrepancies as such. 16 They're making the decisions based on that being the 17 outcome, as in it's due to operational performance 18 issues in branch, such as having lots of excess cash or 19 not doing monthly/weekly trading, et cetera. 20 But I appreciate there is a slight disconnect there 21 in the language. 22 Q. I think our point, which I ought to, in fairness, put to 23 you, is: don't you think that the policy should reflect 24 that, should reflect that suspensions and terminations 25 will not be pursued in relation to Horizon generated 99 1 shortfalls? 2 A. I think we need to tighten up our wording. Of course, 3 having a discrepancy in a branch and having shortfalls 4 is, by definition, a reason for an investigation to 5 happen by the Central Operations Team, but we can 6 tighten up our wording, absolutely. 7 Q. It's more about wording, isn't it? Our clients tell us 8 that they are concerned that the wording of the policies 9 does not reflect the express intentions given by you and 10 other witnesses from Post Office who are giving evidence 11 in this phase; do you see that? 12 A. I do, and I think it's very clear to me that the 13 position that we take in our policies should be the 14 position that myself, others, our teams, are all 15 adhering to. I also hope that, with the publication of 16 these external-facing policies that I've talked about 17 and on a new template, that will hopefully provide 18 clarity to postmasters too. A key thing for me is that 19 we do want to include postmasters much more in 20 day-to-day operational matters such as that. So I would 21 welcome any feedback that they have on the wording of 22 such policies, et cetera. 23 Q. So are these policies likely to be reworded or reviewed? 24 A. All of the policies, as I've said, are always reviewed 25 on an ongoing basis. We're putting them on 100 1 externally-facing templates, which are going to be 2 looked at by the NFSP. We're very happy to bring other 3 postmasters into the fold there too before they're 4 published. 5 Q. You've anticipated my next question: will subpostmasters 6 be allowed to be or be permitted to see these policies 7 in draft before they're published and be consulted? 8 A. We certainly want to include other postmasters in the 9 consultation of those policies, and our Postmaster NED 10 looks as those policies as well, Elliot Jacobs, and as 11 well as Mark Eldridge, our Postmaster Experience 12 Director. 13 Q. I have one final quick series of questions for you and 14 this is in relation to the Fujitsu letter, are you aware 15 of that, from Mr Patterson to Mr Read? 16 A. I'm aware from previous evidence, yes. 17 Q. I'll quote from it, it's 17 May 2024: 18 "To be clear SFL will not support the Post Office to 19 act against subpostmasters. We will not provide support 20 for any enforcement actions taken by Post Office against 21 subpostmasters, whether civil, criminal, for alleged 22 shortfalls, fraud or false accounting." 23 When did you first see this letter; when were you 24 first made aware of it? 25 A. Only in the Inquiry. 101 1 Q. Okay. The Contracts Termination Policy that we've 2 talked about requires a full investigation, doesn't it? 3 A. Into discrepancies, yes. 4 Q. How can Post Office fully investigate discrepancies 5 without assistance from Fujitsu; that's a real problem, 6 isn't it? 7 A. I think it is and I think I'm very confused, personally, 8 by the letter. 9 Q. Fujitsu doesn't consider that the Horizon system should 10 be used to evidence shortfalls. Do you accept that the 11 Horizon system should not be used to support suspensions 12 of terminations based on shortfalls? 13 A. As I'll go back to my previous comment, I'm quite 14 confused with the letter from Paul Patterson and why 15 Fujitsu won't stand behind their data. I'm not a data 16 expert or an IT expert but it's fascinating that they 17 can't stand behind the data when the data is fundamental 18 to everything that we do in our operations, quite 19 frankly, across our network. 20 Q. Well, you say it's fascinating, but it's because of what 21 happened in the scandal, isn't it? 22 A. Sure. 23 Q. The effect of that letter makes many of Post Office's 24 policies unworkable, doesn't it? 25 A. I understand. 102 1 MR JACOBS: I don't need to ask you any more questions. 2 THE WITNESS: Thank you. 3 MR JACOBS: That's all from me, thank you. 4 Questioned by SIR WYN WILLIAMS 5 SIR WYN WILLIAMS: In the light of those questions, can we 6 just revisit paragraphs 143 of your witness statement, 7 Ms Marshall -- I'm sure that it's WITN11610100 -- 8 because I want to be sure I'm fully understanding the 9 table, all right -- 10 A. Yes. Yes, sir. 11 SIR WYN WILLIAMS: -- once it's up. Just a little further 12 on, please. It's actually on page 61, that's what I'm 13 looking for. That's it. That table. 14 Now, as I've understood it -- and I'm concerned only 15 with the most recent period, all right. So let's start 16 in 2021/22. So in that year, there were 25 branches 17 where suspensions occurred, yes? 18 A. That's correct, sir. 19 SIR WYN WILLIAMS: That may or may not mean 25 postmasters, 20 some postmasters may have had more than one branch, so 21 we should focus on branches, yes? 22 A. Correct. 23 SIR WYN WILLIAMS: The figure in brackets, 13, as I've 24 understood what follows under figure 1, means that they 25 were cases which relied on Horizon data? 103 1 A. That's correct, sir. 2 SIR WYN WILLIAMS: Fine. So what I want to know is, was the 3 reason for the suspension that Horizon demonstrated 4 a shortfall or was the reason something different? 5 A. Without knowing the specifics of each case, sir, I would 6 say that the majority of them -- in brackets, the 13 7 there that's highlighted -- would have been following 8 the result of an investigation into discrepancies or 9 shortfalls, which would have been down to Horizon data 10 and the suspension would have been enacted as a result 11 of that, yes. 12 SIR WYN WILLIAMS: But you also seem to be saying, in parts 13 of your evidence, that there wouldn't be a suspension 14 simply because Horizon showed a shortfall: there would 15 only be a suspension if there was an established reason, 16 after an investigation, which justified a suspension. 17 So do I take it that what you're telling me is that the 18 starting point is that Horizon shows a shortfall, there 19 is then an investigation into how that shortfall came to 20 be caused, and it is only if that investigation 21 demonstrates, in effect, some fault on the part of the 22 postmaster that a suspension would follow? 23 A. That's correct. 24 SIR WYN WILLIAMS: So that's the process that I should 25 understand, is it, when I interpret this table: in that 104 1 year there were 25 suspensions, 13 of which, in effect, 2 commenced by reason of Horizon showing a shortfall but 3 they only occurred because, following an investigation, 4 a suspension was thought to be justified because of the 5 activities or actions of the postmaster? 6 A. That's correct. The figures in brackets there, the 13, 7 would have been based on Horizon data, discrepancies or 8 shortfalls identified, but there would have been a full 9 and proper and thorough investigation into the cause of 10 those shortfalls, which would have then led to the 11 determination to suspend the contract, sir. Yes. 12 SIR WYN WILLIAMS: In the years that we are talking about, 13 2021/22 onwards, whether or not the suspension actually 14 occurs goes through the process that you described in 15 evidence when Mr Stevens was asking you questions? 16 A. Yes, sir. 17 SIR WYN WILLIAMS: Fine, all right. Then that deals with 18 that. 19 Then the final point I want to ask you about is the 20 years 2021/22 and 2023/24, and the footnotes to the 21 cases in progress, all right? 22 A. Mm-hm, yes. 23 SIR WYN WILLIAMS: There are still, from 2021/22, two cases 24 in progress; that's right, is it not? 25 A. Yes. Could we go to the footnote, please, sir? 105 1 SIR WYN WILLIAMS: Neither of which depend upon a Horizon 2 shortfall, as I understand it. 3 A. The footnote 18, which we've just looked at, relates to 4 postmasters having been arrested and charged with 5 offences, yes. 6 SIR WYN WILLIAMS: Yes. I'll get to 18. There's a "0" in 7 brackets after the "2", you see? If we go back to the 8 table, sorry, you see there's two cases in progress. 9 A. Yes. 10 SIR WYN WILLIAMS: But in brackets "0", which to me says 11 that neither of these were dependent, even as a starting 12 point, on Horizon showing a shortfall. 13 A. That's correct, sir, because these were both cases where 14 the police had intervened and the postmaster had been 15 charged with offences. 16 SIR WYN WILLIAMS: Fine. So I needn't bother with those, 17 now that I've got that, fine. 18 It's the next one, 2023/24, where there are still 19 four cases in progress, but two cases start life, if you 20 like, with Horizon demonstrating a shortfall. 21 A. Yes. 22 SIR WYN WILLIAMS: Now, are those two cases the two cases 23 which are referred to in footnote 19? 24 A. Can we scroll down to footnote 19, please? That's 25 correct, sir. So the two -- if we look at footnote 19, 106 1 we are referring here -- the ones in brackets are the 2 suspensions that have been prolonged due to issues in 3 arranging postmaster meetings. One is now at the final 4 stage and with external professional advisers. 5 SIR WYN WILLIAMS: So that deals with the long suspension 6 but my question was, and perhaps you don't know, whether 7 the two cases in brackets in the table are also the two 8 cases where the postmasters have been arrested and 9 charged? 10 A. No, they're not, sir. 11 SIR WYN WILLIAMS: Right. So in none of the cases -- this 12 is the point -- in the table which we've been looking 13 at, are they what I'll call Horizon cases? 14 A. Correct. 15 SIR WYN WILLIAMS: Fine. Thank you very much. I just 16 wanted to be absolutely clear as to where we were on 17 that. 18 THE WITNESS: Thank you, sir. 19 SIR WYN WILLIAMS: Right, good. 20 Well, thank you very much, Ms Marshall, for coming 21 to give oral evidence today and for making your witness 22 statement on behalf of the Post Office. I'm very 23 grateful to you for doing that. 24 So what time shall we resume, Mr Stevens? 25 MR STEVENS: Sir, I'm in your hands. We can either do 2.00 107 1 or 2.10. I don't think we should have problems with 2 time to start at 2.10, if you prefer. 3 SIR WYN WILLIAMS: Well, then, I do prefer. 4 MR STEVENS: Thank you, sir. 5 SIR WYN WILLIAMS: Yes. 6 (1.12 pm) 7 (The Short Adjournment) 8 (2.10 pm) 9 MR STEVENS: Good afternoon, sir. Can you see and hear us? 10 SIR WYN WILLIAMS: Yes, thank you. 11 MR STEVENS: We are hearing from Ms Park. 12 SIR WYN WILLIAMS: Yes. 13 MELANIE JANE PARK (affirmed) 14 Questioned by MR STEVENS 15 MR STEVENS: Please can you state your full name? 16 A. Melanie Jane Park. 17 Q. Ms Park, as you know, my name is Sam Stevens and I ask 18 questions on behalf of the Inquiry. First, can I thank 19 you for producing a written statement today and, 20 secondly, for attending the Inquiry to give oral 21 evidence. I want to turn first to that statement which 22 should be in front of you in a bundle of documents. Can 23 I ask you to turn that up, please -- 24 A. Mm-hm. 25 Q. -- and just confirm that's your statement of 22 August 108 1 2024. 2 A. Yes, it is. 3 Q. Now, before we go any further, there's one correction 4 I understand you wish to make. That's at paragraph 162, 5 please, which is page 71 of the statement. That will 6 come up on the screen, as well. I'll just wait for it. 7 What I'll do is provide a summary of what I think the 8 correction is and you can tell me if you think I'm right 9 or wrong. 10 Five lines down, there's a sentence that reads: 11 "The cost of a given ARQ request corresponds with 12 the length of period being requested, for example ARQ 13 data for a 6-month period will cost more than a request 14 for a 3-month period." 15 My understanding is that, when you signed that, you 16 understood that to be correct on the basis of 17 information from Subject Matter Experts. You now 18 understand that that isn't correct, you wish to strike 19 it out of the statement and it is dealt with by the 20 evidence of another Post Office witness? 21 A. That's correct, yes. 22 MR STEVENS: So, sir, the highlighted text should be struck 23 out of the witness statement, effectively. 24 SIR WYN WILLIAMS: Yes, thanks very much. 25 MR STEVENS: The statement can come down from the screen but 109 1 could we please turn to page 101 of the statement; do 2 you see a signature? 3 A. I do, yes. 4 Q. Is it your signature? 5 A. It is. 6 Q. Are the contents of that statement true to the best of 7 your knowledge and belief? 8 A. They are, yes. 9 Q. Thank you, Ms Park. That statement now stands as your 10 evidence in this Inquiry. It will be published on the 11 Inquiry website shortly. For the record, the unique 12 reference number is WITN11600100. I'm going to ask you 13 some questions about it but not every aspect of what is 14 a very detailed statement. 15 I'll start with similar questions to what I did this 16 morning. You have been chosen by Post Office to act as 17 a witness to give evidence on its behalf in response to 18 parts of two Rule 9 Requests sent to it; is that right? 19 A. That's correct. 20 Q. You are the Central Operations Director to the Post 21 Office? 22 A. I am. 23 Q. When did you join the Post Office? 24 A. 17 October 2022, so two years tomorrow. 25 Q. Have you had any other role at the Post Office? 110 1 A. No, I haven't. 2 Q. Very briefly, could I just ask you to give an overview 3 of your career before joining the Post Office? 4 A. Mm-hm. I qualified as a chartered accountant in 1997 5 with KPMG, following which I moved to Boots the Chemist 6 in December 1997, where I stayed for 24 years. So 7 I started out doing various financial roles, both pure 8 financial accounting and more business partnering 9 latterly, and then moved into a more operational role 10 and then was Head of Retail Operations before I left. 11 Q. In terms of your reporting line, I understand you report 12 to Neil Brocklehurst, the Interim Chief Operating 13 Officer? 14 A. I do, yes. 15 Q. In broad terms, could you summarise your roles and 16 responsibilities at the Post Office? 17 A. Yes, I have a number of quite different 18 responsibilities: the first of which is I have 19 responsibility for the Branch Support Centre, so the 20 team up in Chesterfield that are responsible for 21 supporting postmasters with a number of different 22 matters, we have a team of about 50 people up there. 23 That's the Branch Support Centre. I also have 24 responsibility for the network reconciliation and 25 support team, and they're responsible for understanding 111 1 any discrepancies, as a result of proactive comparison 2 of third-party data and issuing transaction corrections, 3 should they need to, once they've been investigated. 4 They also have the Network Monitoring Team as well 5 and their role is to again proactively look for branches 6 that might not be following operational processes as we 7 would like, and that which may suggest they are 8 struggling with those processes and try and intervene 9 before those processes lead to potential discrepancies, 10 as we've heard this morning. 11 I'm also responsible for the Network Support and 12 Resolution Team, and they are the team that help 13 postmasters with the review of discrepancies. So should 14 a postmaster use "Review or Dispute", and it can't be 15 call into the Branch Support Centre, they will be the 16 team that review the discrepancy and ultimately agree 17 the resolution with the postmaster. 18 Q. Presumably you received a formal induction when you 19 joined the Post Office? 20 A. Yes, I did. I had a very -- I had six weeks where 21 I wasn't part of my role, I was travelling around the 22 various functions within Post Office, so the commercial 23 functions, the rest of the retail functions, to really 24 try and understand the rest of the role that I was being 25 brought in to do. 112 1 Q. Was there any discussion as part of your induction on 2 the findings by Mr Justice Fraser, as he then was, in 3 the Group Litigation? 4 A. Not formally. I think when I knew I'd taken a role at 5 Post Office, I made it by business to start doing some 6 research and looking into it and then I did get a number 7 of documents, when I first came, to read through and 8 then I've attended the Inquiry on a number of occasions 9 to try and understand in a bit more detail the impact 10 that -- on postmasters, such that it would help me do my 11 role more effectively. 12 Q. I want to look at branch assurance and audits. Could we 13 look, please, at your statement, page 14, paragraph 38. 14 You say: 15 "The Inquiry has used the term 'audits' in relation 16 to [a set of questions]. Post Office does not carry out 17 audits on branches. The Branch Assurance Team attend 18 a branch to count physical cash and stock and establish 19 whether that agrees with what is record in Horizon." 20 That process before was known as an audit in Post 21 Office, wasn't it? 22 A. It was, yes. 23 Q. Is it not effectively describing what an audit is, in 24 any event? 25 A. I don't believe so. So, in my experience as both 113 1 an external auditor and an internal auditor, 2 particularly external audit, you're looking at accounts 3 trying to understand the validity of the data in those 4 accounts. This is different -- this is simply 5 a stocktake, in effect. So what we're doing is ensuring 6 the physical value of the cash and stock and cash 7 equivalents in that branch and comparing it to what the 8 system thinks, as any other retailer would do on their 9 annual stock takes. 10 Q. So your view, this is just correcting, essentially, 11 incorrect terminology? 12 A. Yes, it's ensuring the physical value, as it stands at 13 that point in time. 14 Q. Page 20, please, of your statement, paragraph 53. It's 15 a point on feedback about branch audits. You say that: 16 "During a visit, the Lead Assurance Advisor will 17 give the postmaster a Branch Assurance Visit findings 18 letter ..." 19 You go on to say: 20 "The form also gives postmasters an opportunity to 21 give feedback on the Branch Assurance Visit and their 22 experience with the team. In July 2024, 34 Branch 23 Assurance Visits were completed, and 14 responses were 24 received to that feedback request. Of these 14 25 responses, 12 were ranked as 'excellent', one was ranked 114 1 as 'very good', and one was ranked as 'good'." 2 That was July 2024. From your experience, how does 3 that stack up to other months: is that about average for 4 the results or better or worse? 5 A. I think given that this feedback form was only 6 introduced in June this year, I believe, I think it's 7 actually probably a better response than we would 8 generally see when we -- 9 Q. Sorry, can I just check -- it's my fault for asking the 10 question. When you say "better response", do you mean 11 the number of responses you get back to the question or 12 whether this is satisfactory -- 13 A. In terms of the number of responses that we've had 14 since, and we've had some updated figures, and they 15 actually show a much improved response rate. So we are 16 getting a significantly increased response rate, if we 17 look -- versus what we see in other areas. And I think 18 it is important, because this could be quite an emotive 19 area, if -- and it's important that we seek feedback and 20 get feedback, and act on that feedback. 21 Q. So you've noticed more responses. Is there any 22 difference to the ranking? So here it's 12 ranked as 23 "excellent", one as "very good", one as "good"; is it 24 about the same proportions or are they different? 25 A. I think they've slightly improved. From my 115 1 recollection, I think we've received more "excellent" 2 and then probably one or two "good" and "very good", but 3 there are definitely more "excellents" than this data. 4 Q. Could we look, please, at EXPG0000007. This is the 5 YouGov survey that was commissioned by the Inquiry. 6 Have you had the chance to review this? 7 A. I have, yes. 8 Q. Can we turn please to page 32. We see it says, "Branch 9 audits", its referring to the same thing: the Branch 10 Assurance. Since January 2020, just over 3 in 4 11 postmasters surveyed said that their branch has not 12 received an audit; 12 per cent reported that they have 13 received an audit: 14 "Those who have received an audit [this is the third 15 paragraph] since January 2020 were more likely to be 16 satisfied than dissatisfied with how it was conducted. 17 Over half ... were satisfied compared with around one in 18 five ... who were dissatisfied." 19 So there appears to be a difference here in that 20 there are some people expressing through the YouGov 21 survey dissatisfaction with branch assurance; would you 22 agree? 23 A. Yes. 24 Q. Are there in place any plans within Post Office to 25 investigate why there might be a difference between the 116 1 results of the YouGov survey and results you're 2 obtaining through the feedback forms? 3 A. I think we have to look at the current process. I think 4 Ms Marshall referred earlier, without understanding the 5 detail of the people who completed this survey, it's 6 really difficult to go and ask questions about 7 historical assurance visits. I think what we have to do 8 is take the feedback for the -- again, for the assurance 9 visits that we're doing now and, where we see 10 dissatisfaction, we seek to understand why those 11 postmasters might have been dissatisfied with that visit 12 and take appropriate actions, either across the 13 assurance visit piece, or with the individuals that have 14 conducted that assurance visit. 15 Q. Do I take it from your evidence earlier that Post Office 16 is seeking to increase the rate of return on those 17 feedback forms, so the number of people returning either 18 positive or negative feedback results? 19 A. Yes, I think the latest data, I think about 35 per cent 20 of visits conducted since June have received a feedback 21 form, so it is higher than we would normally see across 22 Post Office but we would always look to try to encourage 23 postmasters to feed back following a visit. 24 Q. Could we look, please, I want to look at the Branch 25 Assurance Team, please. Could we look at POL00448256. 117 1 This is a "Branch Assurance Advisor -- Induction & 2 Training", I think policy or report. At paragraph 60 of 3 your statement you say: 4 "There have been no new joiners since this was last 5 updated." 6 Is that correct? 7 A. That's my understanding, yes. 8 Q. How many currently within the Branch Assurance Team were 9 in post before the Common Issues Judgment? 10 A. I've been advised by the head of that team that I think 11 it's 12 of the 18. I couldn't be quite sure but I did 12 ask that myself and my understanding is it's 12, or 13 around that number. A lot of -- most of them have been 14 in role for a significant length of time. 15 Q. Could we look, please, at page 5. It's not 16 a particularly thrilling question about version control 17 but it will help us understand the document. If we 18 could go down, please, we see here the version controls 19 for this training document and, on 1 September 2021, 20 this version 0.1 is a draft version, and we've got 21 decimal point figures to 4, then 3.1 and 4.0. At what 22 point in this version control did this become a policy 23 that was implemented and not just a draft policy? 24 A. So this isn't a policy; I believe this is a training 25 guide. 118 1 Q. Apologies, training guide? 2 A. So it doesn't sit in the policy that is the Postmaster 3 Support Policies. In answer to your question: I'm not 4 sure. I joined in 2022 and this team don't line report 5 into me, so I'm not sure when this actual training guide 6 will have been enacted and taught through the teams that 7 exist. 8 Q. Would the people in the Branch Assurance Team who were 9 in post before Common Issues, have been given training 10 on their role or how the policies have been updated 11 since Common Issues? 12 A. I couldn't say for certain. My understanding is they 13 would all have been given training on the policy that 14 stands and I think we've heard that the postmaster 15 policies -- that we have annual training on the 16 postmaster policies with the relevant teams. I couldn't 17 say on that particular piece of training material. I do 18 know that, shortly after I joined, the Branch Assurance 19 Advisors were all taken through additional training, and 20 of the Head of Operational Support, who they now line 21 into, has done a lot of work with them to show that, 22 actually, the role of the stock check, it's just as 23 important how you do it and how you conduct yourself and 24 how you make the postmaster feel when doing that stock 25 check, and that's just as important as making sure you 119 1 do an accurate count. And I know that training has 2 been -- that all of the advisors have been through that 3 training since I joined. 4 Q. Some current and former postmasters have suggested that 5 Branch Assurance Visits should be conducted by a body 6 independent of the Post Office. What would you say to 7 that suggestion? 8 A. I understand why they would suggest that, and I know 9 a lot of retailers would use third parties to do those 10 stocktakes. I think having a knowledge of the Horizon 11 system and how you update that system, once you've done 12 your stock count, is really important. And having the 13 knowledge -- we run quite a complicated business, if you 14 look at the number of the stamps we sell, the currency, 15 the foreign currency, having that background knowledge, 16 will, I believe, make that stock count much more 17 accurate than employing an outside body to come in and 18 do that count on our behalf. But that's my opinion 19 rather than fact. 20 Q. Can we bring up your statement, please, page 17, 21 paragraph 47. This is looking to the future of branch 22 assurance. You say: 23 "Post Office is currently reviewing the 24 circumstances where an announced visit may not be the 25 most appropriate cause [sic] of action." 120 1 Should that be "course of action"? 2 A. "Course", yes, sorry. 3 Q. "The intention is for there to be a three-tier process: 4 (i) announced visits (as is current practice); (ii) 5 notified visits whereby postmasters are informed that 6 a visit will be taking place on a specified date ..." 7 Just pausing there, is the difference between 8 an announced visit and a notified visit that the 9 subpostmaster agrees the date of the visit on the former 10 but not the latter? 11 A. That's right, yes. 12 Q. Then there's: 13 "... unannounced visits, with a clear governance 14 protocol as to how and when these may be required." 15 If we look at paragraph 46, you say: 16 "In the past year there have been two unannounced 17 visits which took place in exceptional circumstances 18 with sign off from the Chief Executive Officer, Nick 19 Read." 20 At present, if there's an unannounced visit, does 21 that have to sanctioned by the Chief Executive? 22 A. That is under review at the moment. I can't remember if 23 I wrote in my witness statement that the circumstances 24 between these three tiers of announced, notified and 25 unannounced has been reviewed, and I believe there's 121 1 a paper, a recommendation paper, going to the SEG at the 2 end of next month, if not next month. But we would 3 definitely seek approval if we wanted to do 4 an unannounced visit. 5 Q. On the current proposal, from whom will you be seeking 6 approval to do an unannounced visit? 7 A. I think, as it stands at the moment, it would be the 8 Interim CEO. 9 Q. In what circumstances is it envisaged that 10 an unannounced visit would be used? 11 A. I think where we believe there have been serious 12 breaches of contract and we've failed to engage the 13 postmaster through all of the support mechanisms that we 14 try and intervene with those postmasters prior to this, 15 and they've failed to engage in any of that and we are 16 concerned as to the assurance of those assets in that 17 branch, and that the notified would impact the outcome 18 of that. 19 Q. I want to look now at, I think, the most substantial 20 topic I'll deal with, which is investigating and 21 resolving discrepancies. As I understand it, the 22 dispute resolution system, as it were, has three primary 23 teams involved: the Branch Support Centre; the Network 24 Support and Resolution Team; and the Postmaster Agent 25 Support Team; is that correct? 122 1 A. The Postmaster Account Support Team. 2 Q. Sorry, Account; and do they all report to you? 3 A. They do, through their head of, the BSC reports through 4 a different head of; the Network Support and Resolution 5 reports through a different head of. 6 Q. Are there systems in place to ensure that relevant 7 knowledge of dispute resolution issues is communicated 8 between those teams? 9 A. Yes, absolutely. The case management system that we use 10 allows a case to be created and then, as it's handled 11 through each of those processes, details of that, how 12 the -- the details of the case will be logged and, if it 13 can't be resolved at each initial stage, all of those 14 details will be passed through to the next stage, so 15 they will be aware of all the checks and balances that 16 have already happened, before they start with their bit 17 of the process. 18 Q. I think, as I understand it, that's on one particular 19 case: someone is dealing here within one team, it gets 20 passed over to another. I more meant are there any 21 systems in place that the people in different teams 22 could spot if there were themes or trends in dispute 23 resolution issues? 24 A. Yes, so the branch support centre, part of their role is 25 to understand if there are systemic issues and 123 1 particularly short-term issues that have arisen. We 2 sometimes have IT issues with some of our third parties, 3 and they would immediately understand that there's 4 a problem and raise that with the relevant functions if, 5 indeed, those functions hadn't already spotted it and 6 informed the Branch Support Centre. 7 In terms of the transaction correction team, so I'll 8 take, if I -- there are other investigations that we do 9 through the Network Reconciliation Team, and we do look 10 at themes. So, for example, we know that 80 per cent of 11 our transaction corrections are issued due to cash pouch 12 errors. So, again, we look at the thematics and try and 13 understand how we stop it at source, rather than deal 14 with it once it's happened. A good example of that is 15 the issuing of note counters and the operational 16 excellence incentive. 17 If I come back to the network support and resolution 18 side of things, through the monthly meetings, they also 19 look at the root cause of the investigations that they 20 have reviewed into discrepancies and understand the 21 cause of those, and they are reported through. 22 Q. I want to look at ways into that resolution system. 23 Before I do, it's probably helpful just to set out what 24 it is. There's a Tier 1 investigation, or support, 25 which is handled by the Branch Support Centre; is that 124 1 right? 2 A. That's right yes. 3 Q. If Tier 1 can't deal with it or resolve the matter, it 4 goes to Tier 2, which is handled by Tier 2 analysts in 5 the Network Support and Resolution Team? 6 A. That's right. There's an intermediate step, which is 7 a triage. So there is a triage case and the triage will 8 understand if there are any initial resolutions before 9 it goes into the full Tier 2 investigation. So there's 10 an intermediate stage. 11 Q. Then, on top of that, there's a Tier 3, handled by 12 Tier 3 analysts in the same team? 13 A. That's correct, yes. 14 Q. The ways into the system: one is to dispute 15 a discrepancy at the end of a trading period -- 16 A. That's right yes. 17 Q. -- and one is to dispute a transaction correction? 18 A. That's right yes. 19 Q. You say in your statement that a postmaster can call the 20 Branch Support Centre for assistance with a discrepancy 21 at any stage. 22 A. That's correct, yes. 23 Q. If a postmaster rings the Branch Support Centre not at 24 the end of a trading period, so midway through, 25 regarding a discrepancy, will the Branch Support Centre 125 1 follow the Tier 1 procedure? 2 A. They absolutely will. So I think you referred to them 3 earlier today. We have a number of checks and balances 4 that we ask postmasters to do on a daily, weekly and 5 monthly basis and, at any point in the processes, if 6 a postmaster experience -- or any of their assistants 7 experience a discrepancy in that balancing, they should 8 ring the Branch Support Centre if they're not able to 9 identify the cause themselves. 10 Q. Can we look, please, at your statement page 52, 11 paragraph 113. I just want to clarify one point. You 12 say: 13 "A postmaster wishing to dispute a branch 14 discrepancy must await trading period end to use the 15 [that's 'Review or Dispute'] function but can seek BSC 16 support earlier than that." 17 Now, just for clarity, if a postmaster raises 18 a discrepancy with the BSC mid-month, so not at the end 19 of the trading period, they can't resolve it at Tier 1, 20 does that go to Tier 2 at that point or do they have to 21 wait for the end of the trading period? 22 A. No, if they can't resolve it, generally the Branch 23 Support Centre will say, "If you can wait, if you can do 24 a balancing period, so do a full balance, and if it 25 still exists, call us back", and they will do the checks 126 1 again because it may have been a couple of days, they 2 might have spotted that a transfer hasn't happened 3 correctly between counters. 4 I think what this I referring to is the formal -- 5 the formalisation of a discrepancy only happens at 6 trading period end and that's when the postmasters get 7 the opportunity to use the Review or Dispute function. 8 However, if the daily or weeklies don't balance in 9 between that, they can ring the Branch Support Centre 10 and, if it's significant -- and I think just for 11 context -- if it's significant and the Branch Support 12 Centre can't identify the cause, they do have the 13 opportunity to push it into the Tier 2 process prior to 14 the trading period end. 15 Q. Thank you. Can we look, please, at the screens that 16 a postmaster sees, and it's POL00448048. I hope you can 17 help us with some of these screenshots that you've 18 provided. So we have on the first page, it says, 19 "Screenshots of trading period end process", it says: 20 "Confirm Loss/Gain, One or more declaration totals 21 do not match the system derived figure. 22 "Press Continue to see a list of discrepancies for 23 confirmation." 24 So is this the screen that pops up after a balance 25 has been attempted and Horizon is saying there's 127 1 a discrepancy, but it doesn't say what it is yet? 2 A. Yes. So for context, my understanding -- and I haven't 3 worked in a branch but I have seen this process in 4 operation in our model office -- if you have more than 5 one counter, you have to do a declaration of each 6 counter and, if any of those counters has a discrepancy, 7 it moves into an account and you then move to the next 8 counter. Again, if that has a discrepancy, it goes 9 into -- I think we refer to it as the local suspense 10 account because it may be, if you've not done the 11 transfer correctly, you might have a surplus in one 12 counter and then a shortfall in the other, and they 13 match off. 14 If, when you come to roll your last counter and 15 there is still a balance in your local suspense, that is 16 in effect the start of that discrepancy process, where 17 you will then get given a choice of how you deal with 18 that discrepancy. 19 Q. Okay, so we get this screen. On the next page, we have, 20 "Confirm Rollover Type": 21 "Do you wish to rollover into the next [trading 22 period] or into the next [balancing period] in this 23 [trading period]?" 24 I don't think that's relevant because it's just 25 whether or not you're rolling over or into a trading 128 1 period or balancing period? 2 A. That is correct. 3 Q. But that's correct. Thank you. 4 A. Yeah. 5 Q. If we turn over then please, this says, "Outstanding 6 Discrepancies": 7 "You have outstanding discrepancies of £9.99. 8 "Press Continue to transfer this to local suspense 9 and continue to rollover. 10 "Press Cancel to cancel the rollover." 11 So at this point, is what it's saying that you can 12 continue and go to rollover and deal with the 13 discrepancies or you can come out altogether and 14 effectively do the count again or anything like that? 15 A. That's correct, yes. This is the individual stock unit 16 rollover. 17 Q. So that's the stock unit. We then turn the page again. 18 So is this the rollover, so once you've done all the 19 stock units, you're then asking to roll over, and it 20 says: 21 "Branch Local Suspense amount is [minus] £9.99 which 22 must be resolved prior to rollover of stock unit, AA. 23 "Press Settle Local Suspense to resolve this and 24 continue to rollover. 25 "Press Cancel to cancel the rollover." 129 1 A. That's correct, yes. 2 Q. So, again, at this point, the discrepancy's been 3 highlighted, the postmaster can go forward to the next 4 screen or can come out and perhaps recheck the cash or 5 do anything like that? 6 A. That's correct, yes. 7 Q. We then get the next one, which is two buttons "Make 8 good -- cash" and "Review Dispute CALL BSC". 9 I want to start with the "Make good -- cash", 10 please, and if we look at your statement at page 55, 11 paragraph 121 -- 12 A. Is that going to be replaced on screen? Yeah. 13 Q. Yeah, sorry. You say: 14 "During preparations for Phase 7 of the Inquiry, 15 Post Office identified that before a postmaster elects 16 to settle to cash or cheque there is currently no 17 reminder in Horizon that the postmaster should only use 18 this function if certain that the issue has been caused 19 by the Postmaster's (or the Postmaster's assistant's) 20 negligence, carelessness or error. Post Office is 21 investigating if such a reminder could be implemented in 22 the Horizon system before completing settle to [cash] 23 process." 24 So, firstly, I take it from this that Post Office's 25 position is that a postmaster should only press the cash 130 1 button if certain that the discrepancy has been caused 2 by the postmaster's negligence, carelessness or error; 3 is that correct? 4 A. It's correct but, if I can add to that: and they're 5 comfortable putting their own cash in. There could be 6 a situation where they may know the cause but it may be 7 of a value that they can't put that value in all at 8 once -- 9 Q. Right. 10 A. -- in which case they have a choice to then settle it to 11 Review or Dispute and discuss the next steps for that. 12 Q. Yes, I'm not going to get involved with that but look 13 just at the circumstances in which -- because we 14 wouldn't even get to that if the first bit wasn't 15 fulfilled -- 16 A. No. 17 Q. -- so there has to be that. 18 A. Yes. 19 Q. Are we any further on with whether or not there will be 20 a warning on Horizon? 21 A. Yes, we are, in two ways. So my preference would be 22 that there is a pop-up box if a postmaster chooses to 23 select "Make good -- cash" and, at that point, they get 24 a reminder. There isn't currently a pop-up box at that 25 point in the trading period end process and that 131 1 involves Accenture and Fujitsu. So the timescales for 2 that are much longer. So what I've asked to happen is 3 in the pop-up that you saw there, that says, "You have 4 a balance in your local suspense, do you want to settle 5 or cancel", we're going to expand that pop-up box to 6 have that message in to say, "Only do this if you're 7 really clear that that discrepancy was as a result of 8 a mistake in branch and that you are comfortable putting 9 cash in to balance this", and we can do that ourselves 10 within our IT function, so it's a lot quicker. 11 Q. Just for clarity, can we go back to POL00448048. Just 12 if we go to page 4, please, are you saying it will be at 13 this stage the message is displayed? 14 A. That's correct, yes. 15 Q. Will that have the other benefit of -- because 16 presumably at this stage, a postmaster could see the 17 discrepancy, decide to cancel, recount the cash and then 18 decide to put the money in at that point, without 19 going -- without actually pressing the "Make good -- 20 cash" button? 21 A. Absolutely, that would have that impact. 22 Q. So the warning will be sufficiently clear to postmasters 23 that they should only correct the cash if they are 24 certain of the circumstances, as you said? 25 A. That's correct, yes. 132 1 Q. That can come down. Thank you. 2 When people do weekly balances and those sorts of 3 matters, will there be equivalent warnings if 4 a discrepancy is ever noticed when rolling into 5 a balancing period or not? 6 A. No, I don't believe so because the processes that we 7 follow, or we ask postmasters to follow as part of their 8 daily cash declarations or weekly balance wouldn't 9 formalise a discrepancy. So we wouldn't ask them to 10 action it, other than to call the Branch Support Centre 11 if they need support to try and resolve it before 12 trading period end. 13 Q. I want to look now, please, at the other button, which 14 was the "Review Dispute". Can we go to page 49 of your 15 statement, please, paragraph 102. 16 It says here that, initially, what was previously 17 termed "Settle Centrally", it was, you say, 13 May 2021 18 changed to "Review Dispute", and then in February 2023, 19 the onscreen display was changed from "Review dispute" 20 to "Review dispute CALL BSC". Why was the "CALL BSC" 21 added? 22 A. The process that we ask postmasters to follow, following 23 use of Review or Dispute is to call the Branch Support 24 Centre because the sooner we are engaged, the sooner we 25 can start to understand the circumstances that that 133 1 discrepancy might have occurred. 2 What we were seeing was number of postmasters using 3 the Review or Dispute functionality and not calling the 4 Branch Support Centre and asking for assistance to 5 understand and resolve that discrepancy. 6 Q. Has this had an effect; did you notice more calls 7 following the change? 8 A. We did, but what we've done since then -- and I don't 9 know whether you'll come to it later in my witness 10 statement -- we, following use of Review or Dispute, we 11 relied on the postmaster to call us, so to create the 12 case. And we had an outbound calling process through 13 our Postmaster Account Support Team to try and contact 14 that postmaster to discuss the discrepancy. What we 15 have now is an automatic case create. So we have a link 16 between the use of Review or Dispute directly into 17 Dynamics. So we are able to see straight away where 18 a postmaster's used Review or Dispute, understand if 19 they've already called the Branch Support Centre, and 20 then immediately start that outbound calling, if they 21 haven't. So it allows us to intervene much quicker. 22 Q. Thank you. I want to look at the Network Support 23 Resolution Team so dealing with Tier 2 And Tier 3 24 investigations. Can I look, please, at POL00039629. 25 I think this is a generic job description for 134 1 Support Advisor. If we turn the page, we see the job 2 title at the bottom "Support Advisor". Then if we turn 3 the page again, there's "Principal accountabilities", 4 which are quite generic, and it says: 5 "You will also have role specific bolt-on 6 accountabilities. These are ..." 7 At then over the page, the "Tier 2 Resolution 8 Support Advisor", bolt-on. It says: 9 "You will be an expert in Post Office branch 10 operations, particularly branch accounting processes, 11 and be able to use would be data sources to support 12 postmasters and branches to find the causes of branch 13 discrepancies." 14 If we look at the Tier 3 Analyst one, as well, 15 please. That's POL00448081. The Tier 3 Analyst and the 16 second paragraph, the "purpose of the role", we see: 17 "This is a specialist role that requires a high 18 level of understanding of Post Office Operations to 19 include extensive knowledge of Horizon and branch office 20 accounting transactions ..." 21 Then over the page, "Knowledge, experience and 22 skills". If we go down, there's: 23 "Excellent knowledge of Horizon, interpretation of 24 branch logs ..." 25 Why does the Tier 2 analyst's job description not 135 1 require expressly knowledge of or detailed knowledge of 2 Horizon? 3 A. I think the level of review that our Tier 2 4 investigators, the checklists that they follow, they 5 know where to get the data that they need to get to for 6 that particular bit of the checklist. So knowing in 7 detail the kind of inner workings of Horizon isn't as 8 important than the Tier 3 team, who are reviewing much 9 more complex cases but, also, overseeing the quality of 10 those -- all of those Tier 2 cases. 11 That said, many of our Tier 2 Support Advisors will 12 come from Branch Support Centre or from internal roles, 13 where they are taken through that Horizon training as 14 part of that induction. 15 Q. If we look at the Tier 2 role, please, if we look at 16 POL00448229. 17 This is a Postmaster Support Policy for accounting 18 dispute resolution, and can we look, please, at page 15. 19 If we can go down to show Tier 2, please. It says: 20 "These investigations are fully detailed 21 investigations after being assigned by Triage." 22 The second bullet point is: 23 "Undertaking a check of the Horizon system 24 information to ascertain whether Horizon was 25 a contributory factor to the Discrepancy ..." 136 1 Bearing in mind the level of expertise with Horizon 2 you just discussed for Tier 2 analysts, what does that 3 check actually involve? 4 A. It involves a number of things. So I think we talked 5 about the branch impacting problem process that IT own, 6 we have knowledge articles for all of the known branch 7 impacting problems and screenshots of how those branch 8 impacting problems might impact a branch. So one of the 9 first things we do is check that the discrepancy hasn't, 10 or the branch hasn't exhibited any of those branch 11 impacting problems. We look at calls into the IT 12 support desk as well as the Branch Support Centre to 13 understand if the branch has logged any issues with 14 their either hardware or software from a Horizon 15 perspective, and then we recalculate a cash flow. 16 So we take the opening balance from a set period and 17 that's the period under review for the discrepancy. We, 18 through HORice and Credence, the databases that hold the 19 Horizon transaction data, we look at all the input -- 20 deposits and withdrawals and all of the cash flows 21 through that branch, and recreate almost a closing 22 balance, and we check that that is actually the closing 23 balance that Horizon is showing us. 24 So we try and recreate that balance to understand 25 whether we've got missing transactions that don't flow 137 1 through to the bottom line from Horizon by taking that 2 data out and recalculating it. 3 Q. You just mentioned the branch impacting problems. 4 I think that's -- you say it's maintained by the IT Team 5 within Post Office. 6 A. That's right, yes. 7 Q. So is it that the IT Team draft the copy that goes into 8 the branch impacting problem database for your team to 9 read when doing investigations? 10 A. Yes, so they create knowledge articles, and they're the 11 Subject Matter Experts, so they will create the 12 knowledge articles but a member of my team will review 13 them to make sure they can be easily understood and they 14 reflect the actual issue before they're published on the 15 Knowledge Base that can be used by a number of different 16 teams. 17 Q. Is there -- so there is some sort of assurance checking 18 on that, but is there any checks to be done at Tier 3, 19 so if Tier 2 can't resolve a matter, it goes to Tier 3, 20 and they say, "Well, actually, this is a known problem 21 in the branch impacting problem". Is there feedback to 22 the IT Team to change the way the branch impacting 23 problem database is worded, so that the Tier 2 team can 24 understand it? 25 A. Yes, there absolutely would be. 138 1 Q. You say "absolutely would be"; does that mean it hasn't 2 happened today? 3 A. It's unusual. 4 Q. Are Fujitsu involved at all in the Tier 2 process? 5 A. No, they're not, other than requesting ARC data where 6 required. 7 Q. Forgive me, sorry. I had a reference. If you could go 8 to page 60, please. So you're here talking about after 9 this Tier 2 process and you say: 10 "If there are no suspected issues, the investigation 11 will continue and that might lead to a conclusion that 12 Horizon was not a contributory factor in the 13 discrepancy. However, if the data suggests that there 14 could be an issue, the IT Team would do further 15 analysis." 16 Is it fair to say, then, that the team, when 17 resolving this, are -- once the investigation has been 18 done, if they haven't found a problem or haven't 19 identified a problem, they are still content to rely on 20 the data produced by Horizon to satisfy themselves that 21 there has been a loss to Post Office? 22 A. I think the data that sits from Horizon in HORice and 23 Credence is the start of that investigation but the 24 investigation looks at a whole raft of other things. So 25 it looks at the operational strength of that branch; 139 1 have they been doing daily cash checks; have they been 2 doing weekly balances; it looks at outstanding 3 transaction corrections; it may look to see if all of 4 the transaction acknowledgements have been processed. 5 So it's part of a wider review that is then used to 6 come to a fair outcome and discuss that with the 7 postmaster. 8 Q. That can come down. Thank you. 9 Could we look, please, at POL00448072. The document 10 is entitled "Escalation process" on the left. On the 11 right, the "Process Summary" says: 12 "If a discrepancy has been investigated, this 13 process shows how it can be escalated if the 14 [postmaster] does not agree with the decision, or if the 15 loss cannot established." 16 Then if we go to page 2, please. It says: 17 "The Weekly Case Review will assess the case and 18 based on the success rate value will make the decision 19 to escalate the case to Tier 3 or clear the account." 20 What is the "success rate value"? 21 A. I think what that's referring to is the fact that there 22 is a cost, both in resource and time, to escalating and, 23 if we believe that, actually, as a result of that 24 escalation, it won't change the outcome of a case, then 25 we might choose to write that off, rather than take 140 1 a postmaster through a further process that we might not 2 get a different outcome. So we do have the opportunity, 3 subject to value limits, and also the history of that 4 branch and, potentially, previous write-offs, just to 5 take that and, on that occasion, not to progress with 6 the discrepancy but simply write it off. 7 Q. Just so I am clear, if the postmaster's disputing it and 8 wants to go to Tier 3, is it the case that it could be 9 refused to be escalated but not written off? 10 A. I don't believe -- no, I don't think that's the case. 11 I think if a postmaster is escalating it, we will always 12 review the case. We always review all cases, from 13 a Tier 3 perspective, to make sure that that case has 14 been carried out consistently and transparently. Once 15 we've reviewed that, we then make a decision on the next 16 steps for that case. 17 Q. So this escalation policy is, in essence, if the 18 subpostmaster disputes it, it's going to be escalated? 19 A. Absolutely. 20 Q. But this is: should it be written off, rather than be 21 escalated? 22 A. Yes, it will go for a review. 23 Q. Please could we look at page 63, paragraph 140 of your 24 statement. You say: 25 "If a Postmaster disagrees with the outcome of the 141 1 Tier 3 review, then the postmaster can challenge the 2 decision by email or phone call to their ... Analyst who 3 will present the case to the Dispute Resolution 4 Committee for review ..." 5 At 141, you say: 6 "If a postmaster disagrees with the outcome of the 7 Dispute Resolution Committee, there is currently no 8 further or independent review forum (Post Office is 9 currently considering the use of an independent panel as 10 part of reviewing its model for recovering shortfalls 11 outlined in paragraphs 35 and 36 above)." 12 Has there been any progress with that review in 13 terms of whether there will be an independent review of 14 the dispute resolution process at any point? 15 A. I think the review is currently underway, so a Working 16 Group that has been established, and we are looking at 17 all of the things that need to be true, as part of that 18 potential recovery process. And an independent review, 19 or a body that has independent people, maybe postmasters 20 or former postmasters, whether that should be created to 21 review these, yes. 22 Q. We're going to come to, in a moment, civil recoveries. 23 At the minute, your evidence is that Post Office isn't 24 pursuing civil proceedings to recover discrepancies from 25 postmasters. The inclusion of an independent review, or 142 1 whether that's -- the review as to whether that's going 2 to happen, will that be complete before a decision is 3 made on whether or not Post Office pursues civil 4 litigation in future against postmasters? 5 A. It has to be part of that process, I believe. 6 Q. Part of the same process? 7 A. Yes. 8 Q. Thank you. The NFSP have suggested a three-stage test 9 for dispute resolution. The first is to ask if the 10 discrepancy is caused by Horizon; I may be paraphrasing 11 slightly but the second is, is it a mistake by the 12 postmaster or assistant; and only then, finally, ask 13 have Post Office's assets been used in an unintended 14 manner? 15 What's your view on that as a framework for dispute 16 resolution? 17 A. I don't think that's dissimilar to the framework that we 18 operate in now. Part of the review process is to 19 understand if Horizon has contributed, then we talk to 20 the postmaster to understand the circumstances, and only 21 then, with the cooperation of the postmaster, will we 22 look to resolution of that discrepancy. So I don't 23 think we're disagreeing there at all. 24 Q. I just want to briefly look at another point on types of 25 escalation, please. It's POL00447943. This document is 143 1 titled "Identifying postmaster support needs", on the 2 left, but the "Process Summary" says: 3 "During an investigation the advisor may behave 4 [I think that should be 'the advisor may have'] 5 a suspicion that financial crime may have occurred. 6 This is the process for referring any such suspicions to 7 the Central Investigations Unit." 8 So there's a bit of a mismatch between the process 9 and aim and what the process describes. 10 What instructions are there in place to 11 an investigator, in circumstances where they suspect 12 that there is financial crime; what instructions are 13 there in place for what the investigator says to the 14 postmaster before referring it to the Central 15 Investigations Unit? 16 A. So I don't think -- I think the initial triage and the 17 data collection and analysis would provide evidence that 18 may be in misappropriation or financial crime. At that 19 point, the triage form would be completed and it would 20 be referred to the A&CI team. I don't think at that 21 point we would have had a conversation with the 22 postmaster, unless the postmaster has spoken to us, and 23 suggested that one of their colleagues may have been 24 involved in the discrepancy. 25 Q. I see. So this is done purely to triage and then it's 144 1 off to another department -- 2 A. Absolutely. 3 Q. -- who will deal with it from there. That document can 4 come down. Thank you. 5 Please could we look at page 61 of your statement, 6 paragraph 133. I'm just looking at the time taken for 7 investigations. You say that: 8 "The NSRT aims to complete Tier 2 investigation 9 within 20 working days", and go on to say that some take 10 longer. 11 If we look, please, at POL00448229, page 16. Sorry, 12 it's the accounting disputing resolution document again. 13 Page 16, please. If we go to the bottom, please. Here, 14 it says that the Tier 2 investigation is to aim to 15 investigate within ten working days. 16 Has this been overtaken now and it's a 20 working 17 day limit based on your evidence? 18 A. I think, if you look at the total time, so all of Tier 2 19 investigations will be quality assessed by either a team 20 manager or a Tier 3 analyst and I think that's part of 21 the process. So I think 20 days is the end-to-end 22 ambition for discrepancy reviews. 23 Q. Can we look, please, at POL00448231. This is a paper 24 that you authored on 31 January 2024 for the Group 25 Executive report. If we look at page 3, paragraph 9, 145 1 please, "Network Support and Resolution Case Backlog": 2 "The additional Network Support resource has made 3 good progress in reducing the number of outstanding 4 discrepancy cases, with period 9 ending at 588, the 5 lowest for 12 months. The number of cases awaiting 6 triage has also reduced to just over 1,200, the target 7 being to have no case older than the 12 week process." 8 Is there still an issue with the backlog of cases? 9 A. I think -- so the backlog is building again, so it's 10 higher than it was then. I think that's caused by 11 a couple of things. So the "auto case create" that 12 I described earlier is really important in identifying 13 those cases a lot quicker. So the cases are getting 14 through the system into that Tier 2 world a lot quicker, 15 and I'd like to think that postmasters are also becoming 16 more aware of their option to review or dispute, and 17 therefore using that button more, and asking for help. 18 I guess what comes with that is, from a resource 19 perspective, there's a lag and we need to understand how 20 we address that. 21 Q. In terms of there's a backlog, what impact is that 22 having on the time it takes to complete investigations? 23 A. The backlog was historic discrepancies when I first 24 joined. So it wasn't necessarily impacting the new 25 discrepancies that we were pushing through the new 146 1 process and being able to resolve where we could. These 2 were a mixture of discrepancies that it was right to 3 take more than 20 days. Because what we shouldn't do is 4 rush discrepancies, and come to an incorrect conclusion. 5 So it's right that some do take longer than 20 days but 6 some were also very historic. 7 My ambition was to -- and I asked for additional 8 resource -- to clear those, and we are getting through 9 and resolving those, as we speak. 10 Q. Were you given the resource? 11 A. Yes, I was. 12 Q. So now, if someone has a case come in to Tier 2, is it 13 likely that it will be resolved within 20 working days? 14 A. We're not at the 70 per cent, which is our ambition but 15 we are not far off. But I guess, back to my first 16 point: it's really important that we don't try and chase 17 a service level agreement at the detriment of that 18 investigation, and the outcome for the postmaster. 19 MR STEVENS: Sir, that's probably a good time to take our 20 break. We're making good progress, I don't envisage any 21 difficulty finishing. 22 SIR WYN WILLIAMS: Fine. Resumption time this afternoon, 23 Mr Stevens? 24 MR STEVENS: I'll probably get it wrong again. Shall we say 25 3.35. I just listened to what I heard -- or misheard, 147 1 I should say, to my right. 3.35, please. 2 SIR WYN WILLIAMS: Fine. 3 MR STEVENS: Thank you. 4 (3.18 pm) 5 (A short break) 6 (3.35 pm) 7 MR STEVENS: Sir, can you see and hear us? 8 SIR WYN WILLIAMS: Yes, thank you. 9 MR STEVENS: I'll continue. 10 We'll have a look now at the postmaster accounts 11 support team. Could we have page 48 of your statement, 12 please, subparagraph (e). You say: 13 "The PAST [which is the Postmaster Account Support 14 Team], which is responsible for initiating contact with 15 postmasters who have escalated disputes using the 16 [Review or Dispute] function but have not contacted the 17 BSC and, following investigation by the BSC and/or NSRT, 18 for arranging repayment plans and write-offs where 19 appropriate with Postmasters." 20 Just a point of clarification. Should the "and" 21 after "BSC" be "or"? So the team is responsible for (a) 22 contacting postmasters who haven't escalated disputes to 23 the BSC but use the Review or Dispute function, and 24 separately, they are also tasked with initiating contact 25 with people who, following an investigation, it's been 148 1 found there's a discrepancy? 2 A. No, it's "and/or" because if, following a conversation 3 with the BSC, we've been able to resolve a discrepancy 4 at the Tier 1 stage and the postmaster then says, "Oh 5 yes, I understand, how do I settle?", they may then 6 close the case and point them in the direction of the 7 PAST team. Because they've resolved the discrepancy and 8 the postmaster then wants to understand how to resolve 9 that. 10 Q. Okay, so "and/or" -- 11 A. "And/or" is the right one, yes. 12 Q. That can come down. Thank you. 13 Why is it that the Postmaster Account Support Team 14 calls the subpostmaster, if they haven't -- if the 15 subpostmaster themselves haven't called the BSC, rather 16 than the BSC or Network Support Resolution Team? 17 A. So the BSC doesn't operate an outbound call facility and 18 that is something that we are going to look at because 19 it may be that they are better placed, given that the 20 knowledge they have of that Tier 1 checklist to do that. 21 So it's part of an ongoing review. I think where we 22 don't -- where a branch doesn't call following use of 23 Review and Dispute, it's really important that we do get 24 the details from the postmaster or their colleagues 25 about that discrepancy and, therefore, that -- currently 149 1 the Postmaster Account Support Team, that take that role 2 in trying to contact the postmasters. 3 Q. Could we look, please, at POL00448322. This is 4 described in your witness statement as a January 2023 5 audit report. Could we look, please, at page 3. If we 6 go to the bottom, this is an "Executive Summary" partway 7 through. We see this is authored by you. Back to the 8 top, please. It says: 9 "The increase in the use of the Review and Dispute 10 button by postmasters (an increase of 60% [year on 11 year]) is affecting the work load of the teams and is 12 having an impact on their ability to respond and resolve 13 within the desired 10-day time frame ([year to date] at 14 [period 8] 76% of cases are completed within 10 days)." 15 You then say later on: 16 "Whilst the Service and Support teams are adhering 17 to the redesigned process and control framework and 18 closing 93% of cases (not all of which are resolved), 19 achievement of their desired 10-day investigation 20 completion time frame and ability to recover established 21 losses is being hindered by PM behaviour and a lack of 22 business appetite to recover losses." 23 What do you mean by "hindered by postmaster 24 behaviour"? 25 A. Can I, sorry, correct something. The "Management 150 1 Comment" written by myself, the "Executive Summary" 2 would have been the summary created from the internal 3 Audit Team. 4 Q. Right, so this isn't your words? 5 A. That's their observations following the internal audit, 6 yes, and then my response is underneath in the 7 "Management Comment". 8 Q. So you're not speaking to these? Do you not agree with 9 that terminology? 10 A. No, I think "hindered" is probably a harsh word. 11 I think the inability to contact postmasters to discuss 12 the circumstances that the discrepancy might have arisen 13 in does hinder the investigation process, and that's why 14 we've looked at the auto case create and starting to 15 talk to postmasters a lot sooner. 16 Q. Can we please look at POL00448295. I don't propose to 17 bring up the statement on the screen but, sir, for you 18 it's paragraph 123(a), so page 57. 19 You say that: 20 "The PAST [the support team we were discussing] will 21 make an outbound call to the postmaster and send them 22 a letter and statement of their account." 23 This is in circumstances where a postmaster has 24 pressed the Review and Dispute button but not called the 25 BSC. You say, "the call script", and you exhibit them, 151 1 the call script being here. 2 When we look at this document, it says: 3 "This script is for outbound calls for 4 subpostmasters who have settled a negative discrepancy 5 (or several discrepancies that result in a negative 6 amount) at Branch Trading." 7 So is this call script used for subpostmasters who 8 haven't contacted the BSC as well? So the postmaster 9 presses the Review and Dispute button, they don't call 10 the BSC, the Postmaster Account Support Team calls them 11 and your statement suggests this is the script that's 12 used; is that correct? 13 A. That's right, yes. 14 Q. Right. If we look, please, at page 2, and if we go 15 down, please, to "Main conversation", it says "Main 16 Conversation": 17 "We need to find out if the postmaster/person in 18 charge is aware of the reasons for the discrepancies. 19 "'Do you understand the reasons for this/these 20 discrepancy/ies [then the person's name]?' 21 "1. If they need more information: 22 "Talk through their account entries with them, 23 giving as much information and detail as you can. 24 "2. If they understand the reason for the 25 discrepancy: 152 1 "'I'm glad you understand what happened here [Mr So 2 And So]. We just want to make sure that you were aware, 3 comfortable with the reason for the discrepancy and 4 offer our support if not. 5 "'What will happen next is that we will send you 6 a letter with a statement next week so you can see it 7 all for yourself. Give us a call back if you have any 8 questions when you receive it.'" 9 Now, do you think this is sufficient in the script 10 in directing people for the circumstances in which 11 a postmaster should be asked by Post Office to settle 12 a discrepancy? 13 A. I think, on review, no, and I think this needs to be 14 included in the work we're doing to give postmasters 15 greater clarity on what their options are, and how we 16 will support them with any discrepancy that they may 17 experience as part of their trading period end or 18 outside of that. So I think we definitely have work to 19 do on being clearer. 20 Q. So at the minute this document isn't being reviewed for 21 the issues we discussed before, about making it clear 22 the circumstances in which Post Office thinks 23 a subpostmaster should accept a discrepancy, but your 24 evidence is that you will review this? 25 A. Absolutely, yes. 153 1 Q. And similar scripts with similar teams? 2 A. Absolutely. 3 Q. In the part of your statement I went to, you also 4 referred to a letter, please, a letter that's sent out. 5 Can I look at that. It's POL00448197. So I think this 6 is an example of an initial letter that's sent out by 7 the team. Over the page, please. We have "Accepting 8 the discrepancy": 9 "If, however, you understand and accept the 10 discrepancy, please contact my team on ..." 11 It goes on from there. 12 Again, is this something that is being reviewed by 13 Post Office at the moment? 14 A. Absolutely. So discrepancy letter 1 and then second 15 follow-up, I have had a complete overall, they've been 16 signed off and I believe are currently with Accenture 17 because these are auto created as part of our IT 18 systems. So we have to go through Accenture to get them 19 updated and changed but, yes, I appreciate that these 20 aren't as clear or as helpful as they should be and the 21 new ones are much more helpful, give more information 22 around the reasons and the different categories and also 23 where to go for support for each of those. 24 Q. I asked this question this morning: why is it that these 25 letters and scripts aren't explicitly clear on what Post 154 1 Office expects of postmasters? 2 A. So I can't talk about historically. I think the work 3 that myself and my team have done to date have probably 4 focused on the bigger initiatives that will improve 5 support to postmasters in order to try and stop 6 discrepancies happening. I think, as part of my 7 preparation for this Inquiry, looking at these letters, 8 the knowledge articles, the pop-up box that we talked 9 about earlier, it became clear to me that we don't do 10 a good job in talking to postmasters about the 11 circumstances of a discrepancy and what support we have 12 available and how we help them and, as part of that, 13 we're looking at all of these documents and what's 14 available via the training -- I think Ms Marshall talked 15 earlier -- to give better clarity. It's part of our 16 ongoing review and continuous improvement that we should 17 never stop doing. 18 Q. I wanted to look at another part of this letter, which 19 you yourself, in your witness statement, raise. 20 Sir, for you -- we don't need to go there -- it's 21 page 81, paragraph 198, if you wish to review it. Could 22 we look at page 3 of the document on screen. So this 23 appears to be a statement of account. It says it's not 24 a demand for payment at the top, and it gives four 25 different types of discrepancy, which I think you 155 1 acknowledge in your witness statement, the 2 classification and type of discrepancy isn't explained 3 to a postmaster receiving this letter. 4 A. That's right, yes. 5 Q. In broad terms, an outstanding discrepancy is 6 a discrepancy that the postmaster has previously 7 received a letter about? 8 A. That's right. 9 Q. A new discrepancy is a brand new one that's arisen, 10 first letter. A previously agreed discrepancy is where 11 the subpostmaster has agreed that that is a discrepancy 12 for which they are responsible? 13 A. That's right, yes. 14 Q. And a disputed discrepancy is where there's an ongoing 15 investigation? 16 A. Or the investigation has been completed and the 17 postmaster has disputed it. 18 Q. We see at the bottom there's a statement total, which 19 says £88.13. So the total doesn't distinguish between 20 different types of discrepancies but am I right in 21 saying that, in Post Office's view, the only one that it 22 would seek for subpostmasters to pay back is the 23 previously agreed discrepancy? 24 A. That's right, yes. 25 Q. Now, in your statement, you referred that this was under 156 1 review and you, just in your evidence earlier, said this 2 is now with Accenture. Can you help us with how this 3 has been corrected in new form of the letter? 4 A. Absolutely. So the descriptions that you've just talked 5 about for each of those four categories will be written 6 at the side of those. So that will help explain what we 7 mean by each of those. The statement total will be 8 removed, because you're right, it shouldn't be on there. 9 It bears no reference to the individual discrepancy 10 categories and, actually, if we scroll up, so we can see 11 the top, we've had feedback previously from, I believe, 12 the NFSP, but a number of postmaster forums that, whilst 13 we say this is not a demand for payment, when you open 14 a letter and see "demand for payment" that is quite 15 alarming, so what we're also doing is removing that 16 statement from this account. 17 Q. So it will no longer say at all, "This is not a demand 18 for payment"? 19 A. And we'll talk what it is in the front covering letters, 20 which we've just talked about. 21 Q. So the front covering letter, will that explain that it 22 isn't a demand for payment? 23 A. It will absolutely explain that. 24 Q. That can come down. Thank you. 25 I want to move to civil recovery, please. Could we 157 1 look at page 9 of your witness statement, paragraph 21. 2 You say that: 3 "... Post Office does not currently have a team (or 4 any individuals) taking civil enforcement action against 5 postmasters to recover shortfalls shown by Horizon and, 6 for the avoidance of doubt, at present no civil 7 enforcement action relating to any shortfalls is being 8 carried out against [subpostmasters]." 9 When was that decision taken? 10 A. My understanding is it was sometime around 2018/19 but 11 I've had to rely on that fact from other people. 12 Q. Could we look, please, at page 24 of your statement -- 13 sorry I have an incorrect reference there it might be 14 paragraph 24. My apologies. 15 Paragraph 24, it's page 10. You're answering 16 a question about the number of civil claims pursued by 17 Post Office, and you say you've, I think, completed this 18 with assistance from people from the Post Office 19 Remediation Unit. You say: 20 "... I understand owing to the incompleteness of 21 records, changes over the years to relevant team(s) 22 involved in civil enforcement activity and the fact that 23 many of those individuals no longer work at Post Office, 24 those informing me have been unable to establish and 25 assure the source(s), completeness and accuracy of this 158 1 data." 2 You go on to say that: 3 "The data that has been identified indicates that 4 Post Office was successful in obtaining civil remedies 5 ... against postmasters in fewer than 100 instances 6 since the Rule 9 start date." 7 What degree of confidence can you put in that figure 8 of fewer than 100? 9 A. That information was given to me -- provided to me by 10 the Remediation Team, so I have no accountability for 11 any of those existing civil remedies. So I have to take 12 it on the authority through which it was provided to me. 13 Q. Presumably, then, you're not able to speak to why the 14 data is in such a way that it can only be said that 15 fewer than 100 instances have been pursued; is that 16 correct? 17 A. That's correct. 18 SIR WYN WILLIAMS: I'm sorry, can you remind me what the 19 Rule 9 start date was, so I've got some idea of the 20 period? 21 MR STEVENS: Yes. Just so I don't get it wrong, I'll just 22 double check the Rule 9. It was defined as, "Since Post 23 Office ceased carrying out prosecutions due to concerns 24 with the Horizon system". 25 SIR WYN WILLIAMS: So approximately earliest 2013, maybe 159 1 a little bit later? 2 MR STEVENS: Yes. 3 SIR WYN WILLIAMS: Fine. 4 MR STEVENS: That can come down, thank you, for the time 5 being. 6 Who would be best placed to provide that information 7 then, if we wanted to -- 8 A. My understanding is there has been a witness statement 9 to confirm that. 10 Q. Can we look, please, at the future status of civil 11 proceedings. POL00448362. This is described as loss 12 recovery update. It's exhibited to your statement. Can 13 you assist for what purpose this document was created? 14 A. This document was created by our interim CEO to talk to 15 SEG about our current position on loss recovery. 16 Q. So if we turn, please, to page 4, "Options and 17 Recommendation", we see there's several options listed. 18 At the top, "Maintain current [position]". If we go 19 down to 4, please: 20 "Seek recovery of established losses via a civil 21 means/deduction from remuneration, following an agreed, 22 defined process with an external review board that will 23 take final recovery decision." 24 The recommendation there is "Yes". 25 Is that still a current recommendation? 160 1 A. I think the recommendation was more around proceeding to 2 understand what options we would have to seek recovery. 3 What circumstances we would use those options and, as 4 a result of that, we've set up a working group to review 5 just that. This isn't necessarily a carte blanche to go 6 ahead and say, "Right, seek recovery". This is signal 7 of an intent that we need to do more work on. 8 Q. Can we look, please, at POL00460458. This is 9 a Strategic Executive Group report. I think earlier in 10 your evidence you mentioned SEG; is that -- 11 A. Yes. 12 Q. We see you are the author, 20 May 2024. The title is, 13 "Postmaster Losses Overview/Branch Discrepancies". Was 14 this the proposal that's led to the Working Group or was 15 it a paper that led to a proposal to lead to the Working 16 Group? 17 A. This was an earlier paper. So the discussion about the 18 extent of losses on our profit and loss account and how 19 we addressed those losses has been ongoing since 20 I joined, and this was a paper that I wrote to move that 21 understanding and that discussion on. It wasn't 22 necessarily what drove the conversation that that paper 23 was written for at a later SEG. 24 Q. Can we go down, please, to page 2, and down to 25 paragraph 11, please. It says: 161 1 "The table below summarises the key drivers of loss, 2 what additional activity is required to improve 3 prevention of the loss and also recommendations on 4 whether [Post Office] should start recovery activity on 5 any of these losses." 6 We see "Loss Driver", at they top, "Current 7 [postmaster] discrepancies post-April '21". It says, 8 "Recommendations for prevention", and then we have 9 "Recommendations for recovery". 10 Is that referring to civil recovery as in issuing 11 civil proceedings? 12 A. Not necessarily, no. It was that we have, I guess, 13 a number of options to seek recovery from postmasters. 14 So, again, that was looking at those options by which we 15 would recover other than voluntarily. 16 Q. So that would include attachment of earnings, would it? 17 A. Yes, an auto deduction from rem, if that was one of the 18 options that we choose to -- 19 Q. So it's recovery but not necessarily civil proceedings 20 but some form of non-voluntary recovery from the 21 postmaster? 22 A. Absolutely, and having options to do that. 23 Q. If we can zoom in on that recommendation for recovery 24 part. It says, the first bullet point, "Do not start 25 recovery" -- that doesn't assist, I don't think. Leave 162 1 it zoomed out, please, if we can. It says: 2 "Do not start recovery until clarified Horizon data 3 used in discrepancy/review process is robust." 4 Could you just expand on what you meant by that? 5 A. I can't remember the timing of it and whether it was 6 before or after the letter but, obviously, as we've seen 7 the Inquiry progress, there was -- and based on 8 conversations that were ongoing with certain criminal 9 proceedings that I think we've talked about. As one of 10 the options being civil recovery, I think we'd need to 11 assure ourselves and anybody else that was involved in 12 that as to the reliability of the data in Horizon. So 13 it wasn't just an internal assurance; it was to be able 14 to go to external bodies and go, "No, we can rely on 15 that data, and should". 16 Q. When it says, "Clarified Horizon data used in 17 discrepancy/review process if robust", what sort of 18 assurance would Post Office need on that before it 19 commences civil recovery in future or, indeed, any 20 non-voluntary recovery? 21 A. In my opinion, and I know this has been looked at, we 22 need to make sure we've got external expert assurance as 23 to that data. Given where we've been, and all of the 24 conversations we've had as part of the Inquiry, I think 25 it would be important to get some external expert 163 1 assurance for everyone. 2 Q. Could we look, please, at POL00448520. This describes 3 a SEG tactical meeting on 17 July 2024. Does that have 4 any special meaning, that it's a tactical meaning? 5 A. I think it's just the different types of Strategic 6 Executive Group meeting. I think they had strategic 7 ones and tactical ones, but ... 8 Q. So the paper we just saw before, that was dated May 9 2024. Was that too old to be considered at this meeting 10 in 17 July 2024? 11 A. I can't recall but this would have been an update on 12 that position with a view to -- I think that was the -- 13 the May paper was quite a rounded paper, talking about 14 discrepancies, how they arise, trying to get all of SEG 15 to a level of understanding, so that they are making 16 more informed decisions when we come with proposals and 17 recommendations, and I think, from recollection, 18 although I can't recall the paper that went with this, 19 that would have been a more detailed next steps versus 20 a Teach-In session. 21 Q. We see you're not in the "present" line at the very top 22 but, if we just scroll down slightly, when it comes to 23 branch grapes, you join the meeting and, if we go 24 please -- we don't need to read all of it but, if we go 25 to page 2, there's a discussion about recovering 164 1 discrepancies and, towards the bottom of the page, it 2 says: 3 "SEG discussed a number of other alternatives, 4 including: 5 "Some form of 'losses' pool, to which all 6 postmasters contributed and from which repayments would 7 be made." 8 Could you just describe what that proposal was? 9 A. So that was something suggested by one of our Legal 10 Team, and -- 11 Q. Do you know who in the Legal team? 12 A. Neil Wallace(?). So he -- I think his opinion -- and 13 again, this is something that we need to look at all 14 options -- was to, if we had a budget for losses and 15 that budget wasn't achieved during any one year, then 16 however much we were short or the benefit we created 17 from not spending all that money on losses would go back 18 to postmasters to try to encourage postmasters to, 19 I guess, run operationally kind of robust branches and 20 seek support for discrepancies when they first saw them. 21 And, as a result of that, our cost in our profit and 22 loss account would be less, which means, ultimately, we 23 would be able to give more remuneration to all our 24 postmasters. 25 Q. This reads like the proposal is to say postmasters 165 1 contribute to a general pool to make up for losses or 2 discrepancies in Horizon. 3 A. That's not my understanding but, again, this will form 4 part of the Working Group conversations and look at what 5 options and alternatives we have. 6 Q. So is this losses pool a matter that is actually being 7 still -- sorry, start again. Is the losses pool 8 suggestion under active consideration still? 9 A. I couldn't say for certain because I've not been 10 involved in those working groups over the last month or 11 so, so I don't know. 12 Q. In summary terms, can you assist at all where the 13 Working Group has got to with next steps, in terms of 14 civil recoveries? 15 A. I can't, no, sorry. I've not been involved. I will 16 pick up my involvement again over the next couple of 17 weeks. 18 MR STEVENS: Sir, that's all the questions I have. I will 19 look around the room. 20 There's questions from Howe+Co and NFSP. 21 SIR WYN WILLIAMS: Right. 22 Questioned by MR JACOBS 23 MR JACOBS: Hello, Ms Park, I have some questions for you. 24 Simon Oldnall gave evidence yesterday and Tracy 25 Marshall this afternoon gave evidence and confirmed that 166 1 it's Post Office's position that it does not recover 2 losses, except where a postmaster agrees the reasons for 3 the shortfall, and now witnesses have said that's Post 4 Office's position; do you accept that? 5 A. Absolutely, yes. 6 Q. At paragraph 15 of your statement you set out 7 12 postmaster policies, I think you call them a suite of 8 policies, which you say set out the guidelines of how 9 postmasters are supported, and their assistance across 10 number of key areas by Post Office -- 11 A. That's right. 12 Q. -- and it sets out minimum operating standards for Post 13 Office. Are you familiar with these policies, Ms Park? 14 A. I'm familiar with all of the policies in general but 15 more familiar with the ones that sit in my area. 16 Q. Okay, could we then go very quickly to a section of the 17 policy that Mr Stein took Mr Read to last week, and it's 18 POL00448000. This is the Postmaster Account Support 19 Policy and it's page 8 of 25, section 2.5 "The risk". 20 It's just coming up on the page now. Page 8, please. 21 We can see the second paragraph there, and it says: 22 "Post Office can recover losses from a postmaster 23 when such losses are caused through negligence, 24 carelessness or error and Post Office has carried out 25 a reasonable and fair investigation, as set out in the 167 1 Postmaster Accounting Dispute Resolution Policy ..." 2 Just pausing there, Mr Stevens took you to that 3 policy earlier on this afternoon, just before 3.00 and 4 this is the Tier 2 investigation and the Tier 3 5 investigation? 6 A. That's the fair -- reasonable and fair investigation 7 that that piece refers to. 8 Q. In Tier 2, one of nine actions that can be taken within 9 an investigation is to undertake a check on the Horizon 10 system information to ascertain whether Horizon was 11 a contributory factor in the discrepancy; is that right? 12 A. That's right, yes. 13 Q. Tier 3 sets out five contractual thresholds, and one of 14 those, one of those five, is that the Horizon system 15 information has been checked to ascertain whether the 16 Horizon system was a contributory factor to the 17 discrepancy. So part of the investigation but there is 18 an investigation into a shortfall? 19 A. That's correct, yes. 20 Q. So going back to the text of the policy, so Post Office 21 can recover the losses, carry out a reasonable 22 investigation, as set out in the other policy, the 23 resolution policy, as to the cause and reason for the 24 loss, and going over the page: 25 "... whether it was properly attributed to the 168 1 postmaster. Postmasters are also responsible for losses 2 caused by their assistants." 3 So we can take that off the screen now. Thank you. 4 Do you accept, in principle, there is scope within 5 the policy, this policy, for recovery based on Horizon 6 shortfall? 7 A. I think that, if we're talking about a shortfall, it 8 will be linked -- the way a shortfall is identified is 9 by doing a full count of cash and cash equivalents in 10 a branch and comparing that to Horizon data. So if we 11 are -- what Horizon expects the value to be in that 12 branch. So I think if we're talking about shortfalls, 13 they will all be linked back to Horizon because that's 14 the operating system that we check back to. 15 Q. Okay. So you do accept, I think, is your answer, that 16 there can be recovery based on a Horizon shortfall under 17 the policy? 18 A. Yes. 19 Q. The concern that our clients have -- and we represent 20 some current subpostmasters, as well as many, many 21 subpostmasters who were affected by the scandal and 22 their concern is -- and we put this to Ms Marshall 23 earlier -- that the Post Office's policies do not 24 reflect Post Office's expressed intent and the evidence 25 that the witnesses have given in this Inquiry. If it's 169 1 the position that Post Office does not recover Horizon 2 shortfall losses, except for when a subpostmaster agrees 3 to repay those losses and starts to repay, why doesn't 4 the policy say that? The policy seems to say something 5 completely different and opposite. 6 A. I think my understanding is that the policies, as well 7 as the contract, should include the opportunity, such 8 that, if the circumstances are shown that the shortfall 9 is a result of negligence, carelessness or error and we 10 do have situations where, actually, Horizon data isn't 11 involved, where we've spoken to the postmaster and, for 12 example, a safe has been left open, or they haven't been 13 doing regular cash decs and couldn't identify -- and 14 haven't been running their branches in an operationally, 15 I guess, sound way, where cash has fallen into the bin. 16 So we should have that opportunity in our policies 17 and contracts such that, when we're confident that all 18 of the support is in place and we're doing all of the 19 things we should be doing -- we're doing the right 20 training the right interventions -- we should have that 21 opportunity and, therefore, I do believe it's right to 22 have it in there, but I understand why, at the moment, 23 we're not necessarily fulfilling that opportunity to its 24 full extent. 25 Q. Of course. Yes, if someone leaves a safe open or leaves 170 1 the door open and goes out for the day, perhaps that's 2 different. 3 But the position that the Post Office has accepted 4 in this Inquiry is that post offices do not recover 5 shortfalls unless the postmaster agrees with the reasons 6 for the shortfalls. That's not what is said in the 7 policy. Do you accept that the policy should reflect 8 Post Office's position, the position I've just 9 articulated -- and you can say something about other 10 extraneous factors, like leaving safe doors open and 11 going out for the day, but you're not being clear in the 12 policy, are you? 13 A. I think we could be more overt with our current position 14 in the policy and in some of the communications that we 15 have with postmasters during the investigation process. 16 You're right. 17 Q. Our position is that the policy should be reviewed; do 18 you accept that it should be reviewed -- 19 A. Absolutely -- 20 Q. -- and changed? 21 A. -- and we will take that, definitely. 22 Q. Will subpostmasters be entitled to comment on the 23 Postmaster Account Support Policy and Accounting Dispute 24 Resolution Policies before they're finalised? 25 A. I think we referred to that -- Ms Marshall referred to 171 1 that earlier. So absolutely. 2 Q. Super. I've now got one other line of questioning for 3 you. We asked Ms Marshall this morning about 4 Mr Patterson's letter to Mr Read, dated 17 May 2024. 5 Are you familiar with that letter? 6 A. I am, yes. 7 Q. It's well known to the Inquiry now. It's worth saying 8 that it says in the second paragraph: 9 "To be clear, Fujitsu will not support the Post 10 Office to act against subpostmasters. We will not 11 provide support for any enforcement actions taken by 12 Post Office against subpostmasters, whether civil, 13 criminal, for alleged shortfalls, fraud or false 14 accounting." 15 Now, I should say at this stage, before I ask you 16 a question, that I have looked at the fifth corporate 17 statement of Mr Patterson, and the reference -- we don't 18 need to call it up for the Inquiry -- is WITN06650500. 19 At paragraph 66 and 67 of that statement, Mr Patterson 20 states that Fujitsu does continue, when contractually 21 bound to do so, to provide ARQ data but Fujitsu has 22 sought to put in place processes to ensure that any ARQ 23 data it provides is not used in enforcement action 24 against postmasters, and one of the things that Fujitsu 25 is seeking to do is require Post Office to confirm, when 172 1 requesting ARQ data, whether it is to be used for 2 redress of subpostmasters or investigation into or 3 actions against a postmaster or member of a branch 4 staff. 5 So with that caveat, it's right, isn't it, that 6 Fujitsu are not going to cooperate by assisting or do 7 not intend to cooperate to assist Post Office in taking 8 any sort of enforcement action against postmasters; do 9 you accept that? 10 A. I accept that that's the letter, but -- 11 SIR WYN WILLIAMS: Well -- 12 MR JACOBS: Sir, I see that you're -- 13 SIR WYN WILLIAMS: The letter speaks for itself. I think 14 this witness is incapable of giving an answer other 15 than, "The letter speaks for itself." 16 MR JACOBS: Indeed. I'll move on. I just wanted to clarify 17 that point with her. 18 My question to you is: how can Post Office fully 19 investigate without this assistance, without this data? 20 A. So, I -- the data, as it exists at the moment sits in 21 HORice and Credence, and that's the data we used to 22 investigate. I find it quite alarming that the provider 23 of an EPOS operating system is not assured of the 24 reliability of the data that is in that system. But we 25 don't need Fujitsu's cooperation because the data exists 173 1 in our systems and that we -- we use that data as part 2 of the investigation. 3 Q. My final question for you then is that Fujitsu doesn't 4 consider that the Horizon system should be used to 5 evidence shortfalls. Do you accept that that is right: 6 the Horizon system should not be used to support 7 recovery action against subpostmasters? 8 A. I don't accept that but I understand we should seek to 9 do some external assurance on that and I find it quite 10 confusing that that data could be used for remediation 11 but not to support a review of how a discrepancy might 12 have arisen. 13 Q. Well, I put this to Ms Marshall. The confusion 14 shouldn't really be confusing, it's because of the great 15 scandal that's taken place, isn't it? It's because of 16 what's happened in the past and how Post Office have 17 used Horizon data to oppress subpostmasters; that's why 18 things have changed. 19 A. And things have changed, so my opinion is that how we 20 support and review discrepancies with postmasters now is 21 not the same as what we -- how we did in the past, which 22 was awful. So I don't see the data being called into 23 question, because of the processes that we follow, to 24 assure ourselves but I do understand. I think we get -- 25 that external assurance would help everyone in this 174 1 conversation. 2 MR JACOBS: Thank you. I'm just going to ask if I have any 3 more questions for you. No, I haven't. 4 That's all I have, sir. 5 THE WITNESS: Thank you. 6 SIR WYN WILLIAMS: Yes. Ms Watt. 7 Questioned by MS WATT 8 MS WATT: Thank you, sir. 9 Good afternoon, Ms Park, we have this perennial 10 issue of just being able to see each other. Thank you, 11 it's just the location of the desks. 12 I just want to ask you a couple of questions to 13 check in with some of the matters you raise in your 14 witness statement. 15 I'm asking questions on behalf of the NFSP. Sorry, 16 I should have said that at the beginning. 17 I'm not going to call up these documents; I'm just 18 going to make some general summaries and ask some 19 questions. At paragraph 17 of your witness statement 20 you say, in relation to the 12 postmaster policies: 21 "Prior to submission to ARC [that's the Audit and 22 Risk Committee] each policy is reviewed and agreed with 23 the National Federation of SubPostmasters, NFSP, with 24 feedback also obtained from the Postmaster Experience 25 Director, who is a serving postmaster working within the 175 1 Post Office. One of Post Office's Postmaster 2 Non-Executive Directors will also approve new policies 3 as a core member of ARC." 4 In his witness statement -- and I'm not calling it 5 up but for the Inquiry's record, WITN003700100 -- Calum 6 Greenhow of the NFSP says, at paragraph 326 that the 7 NFSP raised concerns about the audit reporting script, 8 suggested an alternative script. He also says that the 9 NFSP suggested a checklist for the postmaster and the 10 officer in charge to follow, given the potential 11 stressful situation that may be being dealt with at the 12 time but he says these suggestions were rejected by the 13 Post Office. 14 So the first question I wanted to ask you was: would 15 you agree that the policies you've been referring to 16 are, therefore, reviewed by the NFSP but are not always 17 agreed in full by them and that changes proposed by the 18 NFSP are not always taken on board? 19 A. I couldn't comment on that because that's not part of 20 the process that I'm then accountable for. 21 Q. Okay. It might be that the following question you can't 22 answer either, and that's fine. Just say if you can't. 23 But in that paragraph 17 of your witness statement, 24 where you are setting all of this out, you list three 25 potential sources of postmaster feedback on Post Office 176 1 policies: that that's the Postmaster Experience 2 Director; the Postmaster Non-Executive Director; and the 3 NFSP. So if I think about an example, you've got three 4 different sources of feedback and approval. Let's say, 5 for example, the Postmaster Experience Director agrees 6 with the policy that's being brought forward but the 7 NFSP and the Postmaster Non-Executive Directors don't 8 agree in full with it. Is it the case that the 9 agreement of the Postmaster Experience Director allows 10 the Post Office to say they've received postmaster 11 feedback and approved the policy? 12 A. Again, because I'm not accountable for that review 13 process, I'm sorry, I can't comment. 14 Q. Okay. I think, just picking up on that, this may also 15 not be -- you can tell me if it's not -- but would you 16 agree that what I've just described actually suggests 17 that the Post Office effectively has a number of bites 18 at the cherry to get the answer it needs on approval? 19 A. Again, I can't comment. 20 Q. Okay. At paragraph 80 and 81 of your witness statement 21 you discuss the Operational Excellence Project; is that 22 something you are familiar with? 23 A. That's something I'm familiar with, yes. 24 Q. Okay. You say the objective of the policy is to review 25 and improve the operational support provided to 177 1 postmasters during each stage of their journey with the 2 Post Office. 3 A. Absolutely. 4 Q. You have a number of subparagraphs in that, but 5 subparagraph 81(d) is about operational excellence 6 incentive to encourage improvements in back office 7 processes in sub post offices and you talk about 8 a financial incentive for the subpostmaster meeting 9 targets on, for example, daily cash declarations and 10 completing monthly trading within a certain period. 11 That financial incentive is a payment of 5 per cent of 12 the postmaster's total variable remuneration for the 13 month. 14 Now, I wanted to ask if you were aware that the NFSP 15 did not agree that 5 per cent of a postmaster's total 16 variable remuneration was sufficient? 17 A. So whilst I have responsibility for the overall 18 Operational Excellence Programme, postmaster 19 remuneration isn't part of my accountabilities and that 20 sits with another member of the retail leadership team? 21 Q. So you're not aware specifically of the NFSP -- 22 A. (The witness shook her head) 23 Q. However, I think you said earlier you were 24 an accountant, if that's correct -- 25 A. Yes. 178 1 Q. -- so perhaps you might be able to comment on my 2 follow-up questions. 3 Would you agree that it is not sufficient, 4 ie 5 per cent of this remuneration is not sufficient, 5 when postmasters across the UK report in the NFSP 6 surveys and the postmaster surveys, or the Post Office 7 surveys and the YouGov survey for this Inquiry, that low 8 remuneration is the biggest issue they face, and that 9 5 per cent of not very much is, in fact, not very much? 10 A. I understand the feedback about low remuneration, 11 absolutely. With relation to the Operational Excellence 12 Incentive, my understanding was that that 5 per cent 13 wasn't intended to cover the full costs of all of those 14 back office processes, my understanding is there's 15 an element of the admin process fed into each of the 16 individual rem payments for the products, and this was 17 simply a way to encourage postmasters to complete the 18 back office processes that we asked them to do as part 19 of the contract in running their branches. But 20 I understand the feedback about the rem in general, yes. 21 MS WATT: Thank you. Those are my questions. 22 SIR WYN WILLIAMS: Thank you, Ms Watt. 23 Is that it, Mr Stevens? 24 MR STEVENS: Yes, sir. That is it. 25 SIR WYN WILLIAMS: Well, then, thank you very much, Ms Park, 179 1 for making a witness statement on behalf of the Post 2 Office which is very detailed, and thank you very much 3 for expanding upon it in your oral evidence this 4 afternoon. I'm grateful to you. 5 THE WITNESS: Thank you, sir. 6 SIR WYN WILLIAMS: Right. We'll resume again at 10.00 7 tomorrow morning. 8 MR STEVENS: Yes, sir. Thank you. 9 (4.28 pm) 10 (The hearing adjourned until 10.00 am the following day) 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 180 I N D E X TRACY LOUISE MARSHALL (affirmed) ..............1 Questioned by MR STEVENS ......................2 Questioned by MS PAGE ........................80 Questioned by MR JACOBS ......................98 Questioned by SIR WYN WILLIAMS ..............103 MELANIE JANE PARK (affirmed) ................108 Questioned by MR STEVENS ....................108 Questioned by MR JACOBS .....................166 Questioned by MS WATT .......................175 181