I thought Vince Cable came across as I expected, nice man but not engaged in the issue at all, which to be fair is what you would expect of a Secretary of State with a wide portfolio and a big team of junior ministers.
Greg Clark, who I don’t know at all, was much more engaged and I was quite impressed, except that he was certainly one to never knowingly use one word when you could use ten.
Just caught up with GC’s testimony. As you say, he was guided by the ‘adult view’ IMHO. So, not only did we have POL acting like a recalcitrant teenager in managing their legal defence and reluctance cum refusal to face facts, you have UKGI running interference, effectively hobbling the flow of information to Ministers, when the latter are effectively the shareholders by proxy within the overall construct. Worse, the Ministers were guided to stay out of things (as matters were ‘operational’). which completely misses the point that POL was 100% reliant on HMG funding. While lawyers will point to the dangers of interference and ‘shadow director’ considerations, I would argue the trumping aspect is that the Board of POL serve to act in the interests of the shareholder – and it would have done well to reflect the concerns expressed. When the concept of ‘shadow directors’ was introduced in to legislation, it was more driven by malfeasance and the need to avoid disqualified directors operating businesses via hollow proxies.
I’ve seen issues in the business world where constructs (e.g. JV agreements/partnership governance agreements) have generated serious issues when events have arisen which either weren’t considered at the outset and/or exceptional events arose, which could never be accommodated in any suite of words…and, invariably, sensible heads have prevailed.
Sense and sensibility seem totally removed , you can see the causes emerging, weak management, poor shareholder oversight , a failure to admit the glitches, and a paranoia that it is the post masters and not the system
This is just totally not true. The sell off didn’t even get discussed until a year or so before the end of the Brown administration, so about 2009. The whole scandal becoming embedded predates that by many years.
Thank you for the correction I have removed the sentence about the sell off
Ian
Sounds like every company I worked in during my career.
Summary, so far -
Frightening reading, I followed the link to what SC had said. For a law firm to say that it had been given false instructions by its client , is quite something. Almost Pilate like in washing it’s hands
The legal profession (inc. some luminaries) is also under question in all this e.g. at a moral level, not searching for the truth (as a Crown body) as the primary goal, instead trying to play clever and protect POL from adverse disclosure. One also thinks that if Cartwright King had been on their mettle earlier doors, some of the prosecutions wouldn’t have been progressed and the basis of prosecution severely questioned.
Of course, the great misdirect here, was continually citing the SPM issues were all ‘operational’, when nothing, absolutely nothing, should ever be outside the gaze of the shareholder(s), as the Board serves at the latter’s pleasure. Here, of course, there were political considerations (e.g. HMG getting directly involved - perhaps revealed by FOI requests), but as Greg Clark stated, POL had to own-up to the SPM issue, not hide from it.
Excellent…!!!
The Inquiry has reopened its public activity. “Phase 7 will examine how the Post Office operates today. It will also investigate whether the Post Office has lived up to its commitment of “full and fair compensation.””
Starting with a YouGov survey, the respondents (18% of existing sub-postmasters) are largely still negative about PO, and 98% have experienced shortfall issues with Horizon, 34% had also has surpluses.
POL has appointed 2 serving SPMs as non-exec directors. The first is just starting his evidence about how he sees the Post Office changing.
(Update on stuff that happened between sittings of the inquiry, if my memory is correct. Nick Read, POL CEO, announced he was stepping back from running the company to focus full time on preparing for the inquiry. And then in the last week or two he has announced he is leaving POL.)
Summary of the last 2 days.
YouGov ran a survey of sub-postmasters and generally the results were poor.
The 2 postmaster reps (for clarity they are full board members as Non Executive Directors) on the board feel that the board is 2-tier with a subset who make decisions without the others, that legal are “untouchables” with too much power, that the Exec team do not accurately and completely brief the board, that people who were involved in the original scandal are still working on the historical analysis which they feel is a conflict of interest, that their input from a postmaster perspective is seen as unhelpful (supported by an unpleasant email from the Government NED suggesting they behaved as union reps).
One spent a year under investigation before being cleared, the other is under investigation at the moment.
(One of the three things that the first was investigated for was not declaring a conflict of interest at each board meeting, the conflict being that he was a postmaster. He’d assumed that his official title of Postmaster NED would be enough to indicate that he was a Postmaster, but now at every board meeting he dutifully tells them that he is a postmaster.)
They also read in the reference to a witness statement from Penny Thomas.
She wrote the boiler plate text used in Fujitsu’s witness statements (on one occasion removing a statement of confidence when they found a bug that made it untrue without admitting to the bug), she was the main analyst of the audit records and she gave evidence in court.
The statement just says she had 2 mini-strokes in 2013 and has severe memory loss, she was asked to do the work of auditing and writing witness statements by her boss and thinks his name was Bill, she thinks that she was there to explain how the data went through the system and how she audited it, beyond that she has no memory.
I watched some of the testimony from this morning, and just when you thought things couldn’t get any worse, the bar has once again been lowered. I must say, I am amazed the postmasters were allowed anywhere near board positions, as the CoI is so obvious, and it could have so many faces – and you can never unsee/unknow, what you’ve seen/been briefed on.
Scapegoats will always be provided
Reported in the Times this morning, the Post Office tried to use Horizon date in a prosecution earlier this year.
You couldn’t make these guys up……
ATB, J
In some ways it was even worse. The PO passed a case to the City of London Police, who liaised with Fujitsu. When Fujitsu refused to confirm to the police that Horizon data was fit for purpose to support a criminal case POL’s head of investigations wrote to his opposite number complaining that as a potential “victim” of crime POL needed Fujitsu to support their case.
This ended in a very nasty exchange of mails between the CEOs concluding with Paul Patterson telling Nick Read that POL’s culture hadn’t changed.
The U.K. Corporate Governance guide supports the appointment of employee shareholders, yes SPMs are independent traders providing a service to the Post Office, but I don’t see any greater CoI than with an employee.
Except obviously that in most companies there hasn’t been a history of destroying the lives of employees with incompetent and malicious prosecutions.
I’m aware of employee participations, often borne from workers’ councils and alike – IIRC the Germans use this model a lot. But, here. as you say, with the underlying SPM issues still being ‘live’ (and dangerous!) for POL, it strikes me as being very odd – a move for moves’ sake?
As per many of the testimonies given around the operation of POL’s board there are times when ‘people have to leave the room’.
I was questioning some of the testimony I heard which indicated the board were pursuing things with an eye to triggering exec bonuses — this is where a strong chair should step in, as an independent party. Again, another very muddy puddle.