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September 18, 2023updated 19 Sep 2023 10:00am

UK government to pay £600,000 to each victim of Post Office Horizon IT scandal

Faults in accounting software saw some Post Office staff jailed. Now they are receiving fresh compensation.

By Matthew Gooding

The UK government has announced it will pay £600,000 to each victim of the Horizon IT scandal, which saw hundreds of Post Office workers wrongly accused of theft, fraud and false accounting because of misfunctioning software.

Post Office workers wrongly accused of theft will receive £600,000 in compensation. (Photo by AlmacUK/Shutterstock)

The incident saw more than 700 Post Office staff prosecuted between 1999–2015 because of errors in the Horizon software, which was used by the Post Office for accountancy services. So far, 86 convictions have been overturned, with more than £21m paid in compensation to these victims.

Ministers to pay Horizon IT scandal victims £600,000 each

Those impacted were offered £100,000 interim payments by the government in 2021, which were increased to £163,000 a year later. Now the Department for Business and Trade says it will now offer each of those whose conviction has been overturned because it relied on Horizon evidence a total of £600,000, topping up payments already awarded and handing a fresh award to anyone who has yet to claim.

It will continue to cover “reasonable legal costs” for victims, and those who do not want to accept this offer will be free to continue with court action.

Post Office Minister Kevin Hollinrake said: “This is about righting a wrong and providing some form of relief to those wrongfully caught up in this scandal.

“Too many postmasters have suffered and for too long, which is why the government remains committed to seeing this through to the end until it is resolved and ensuring this cannot ever happen again.”

How the Horizon IT scandal unfolded at the Post Office

Horizon was installed on the Post Office network in 1999 and designed to handle transactions, accounting and stocktaking. Postmasters reported bugs from day one, some of which were showing significant shortfalls.

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Between 2000–14, some 736 managers were prosecuted based on information on shortfalls shared with the Post Office through Horizon. A number of these people ended up with prison sentences for false accounting and theft.

Following a 20-year legal battle, campaigners proved that the accusations stemmed from errors in the Horizon software, rather than any action from those involved. This led to many of the convictions being overturned, and the government set up an inquiry into the incident.

The Post Office itself settled civil claims from 555 people in December 2019, marking the end of a series of cases. It admitted it “got things wrong in dealings with a number of postmasters” and had to pay £58m in damages.

A High Court judgement on the same issue found that the Horizon system was not “remotely robust” for its first decade of operation and still had problems after that point as it contained “bugs, errors and defects” posing a “material risk” of shortfalls in branch accounts.

As reported by Tech Monitor, earlier this year a new compensation scheme was set up to help those who first revealed the scandal, but who ended up with hefty legal bills as a result.

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