The Post Office is facing a government investigation after paying bonuses to executives for supplying evidence to the public inquiry into the Horizon computer system scandal.
Kevin Hollinrake, the business minister, has demanded an “immediate explanation” from the Post Office after parts of chief executive Nick Read’s £450,000 bonus were linked to providing “all required evidence and information on time”.
Mr Read wrote to Sir Wyn Williams, the Horizon inquiry chairman, saying that he had paid back the amount of bonus that was linked to this metric.
He also offered Sir Wyn a “personal apology” for implying that he had signed off the payout.
Responding to an urgent question on the bonuses, Mr Hollinrake told the Commons: “The situation is extremely concerning and deeply regrettable and the Post Office is right to apologise.”
Amanda Burton, the Post Office’s incoming remuneration committee chairman, will lead an “immediate investigation into this incident” and is expected to report back to the business minister within two weeks.
Mr Hollinrake continued: “This is a very serious issue, particularly considering it comes at a time when it is essential that the public should have confidence that the culture and processes at the Post Office have been improved.”
He added: “The Post Office’s CEO and CFO have returned the remuneration associated with a sub metric relating to the Post Office’s support for the inquiry.
“Post Office’s CEO has also apologised to DBT [Department for Business and Trade] ministers, but more needs to be done.”
The Post Office’s defective Horizon system led to hundreds of subpostmasters being prosecuted for theft, fraud and false accounting.
Several have since had their convictions overturned. Others have died before receiving compensation for being implicated in the scandal.
The Post Office’s annual report for last year stated that executives had met all their obligations to support the inquiry into the Horizon system. The inquiry is yet to be completed, however.
Corporate filings stated that the Post Office had received “confirmation from Sir Wyn and his team that Post Office’s performance supported and enabled the Inquiry to finish in line with expectations”.
This triggered bonuses to executives.
Responding to Mr Hollinrake’s remarks, Duncan Baker, Conservative MP for North Norfolk and a former postmaster, said: “It’s clearly an absolute scandal that Post Office executives are being paid a bonus for co-operating with a scandal that they all turned a blind eye to.”
Conservative former minister Sir Edward Leigh urged the minister to consider mutualisation of the Post Office, adding: “We should pass control of this body to the people who do all the work who are in the front line. Now I hope the minister won’t dismiss that idea.”
Mr Hollinrake replied: “I’m a big fan of mutuals, I’ve spoken up in favour of mutuals many times on this side of the House as a backbench [MP]. Very happy to keep those conversations going with him and certainly it’s not something I would dismiss out of hand.”
Labour’s Kevan Jones (North Durham) said Post Office chief executive Mr Read “needs to resign or he needs to be sacked”, adding of the company: “Frankly it is rotten to the core still. It needs to change.”
Alan Bates, head of the Justice for Subpostmasters Alliance, called for executives to step down.
He said: “Post Office has long been a business that is out of control and needs dismantling and rebuilding from the ground up.
“The bosses, like all the ‘great and good’ in this scandal are getting away not only with pots of money, but free from ever being held liable for their incompetence and arrogance.”