Former post office operators who helped to uncover the Horizon IT scandal are to receive £19.5m compensation from the government.
The interim compensation package will be made available by ministers to the eligible members of a group representing postal workers who were the first to take legal action against the Post Office, taking the total compensation made to those wrongly accused of stealing money to about £30m.
Between 2000 and 2014, more than 700 post office operators were prosecuted based on information from the Horizon IT system, which was installed in Post Office branches and maintained by Fujitsu.
The system falsely suggested there were cash shortfalls, leading to 736 unsafe convictions for theft, fraud and false accounting in one of the biggest miscarriages of justice in British legal history.
The government announced in March that the postal workers who uncovered the scandal would be able to apply to a new compensation scheme.
The postal affairs minister told the Commons on Thursday the compensation package was designed to provide support to the postal operators while the scheme is finalised.
“These postmasters and their families have shown immense courage in the face of terrible circumstances,” Paul Scully said.
“I hope this initial step provides some comfort to these pioneering postmasters while reaffirming our commitment to ensuring they receive their fair share in compensation.”
He added that post office operators would be able to claim reasonable legal fees as part of participating in the final compensation scheme.
Scully said postmasters in the group would be contacted shortly by law firm Freeths, which represented them during their legal action, with details of how to apply for compensation. They should receive their payment within a few weeks of their application being processed.
In late 2019 a high court judge ruled that Horizon’s system contained a number of “bugs, errors and defects” and there was a “material risk” that shortfalls in Post Office branch accounts were caused by the system.
The ruling led to the court of appeal quashing the convictions of workers who were wrongly accused of committing crimes, and paved the way for future payouts.
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The group that brought the legal action was awarded nearly £43m in compensation, however they were left financially disadvantaged after having to pay significant legal costs resulting from the “no win, no fee” agreement with the company that funded its litigation.
Each former post office worker received a fraction of the legal settlement, which equated to around £20,000 each.
Their legal action also prevented them from applying to the Historical Shortfall Scheme (HSS), which the Post Office set up in the wake of the scandal to compensate workers who had to personally cover the shortfalls in their branch accounts which were caused by the Horizon IT system.
Scully has given the Post Office the target of making HSS offers to the remaining 35% of affected workers by the end of 2022.
