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Fujitsu has agreed to contribute to the compensation of sub-postmasters affected by the Post Office Horizon scandal, according to the head of its European division.
Paul Patterson said Fujitsu was “truly sorry” for its involvement in the affair and acknowledged there was a “moral obligation for the company to contribute” to redress for sub-postmasters prosecuted by the Post Office using data from the Japanese company’s faulty Horizon IT system.
“We were involved from the very start, we did have bugs and errors in the system and we did help the Post Office in the prosecution of sub-postmasters,” he told MPs on Tuesday.
The UK government has set aside £1bn in compensation for the more than 4,000 people affected by the scandal, including at least 700 prosecuted by the Post Office between 2000 and 2014 using Horizon data.
Last week, Prime Minister Rishi Sunak announced unprecedented legislation to exonerate the convicted sub-postmasters en masse.
Fujitsu developed the accounting software at the heart of the Horizon affair and its staff acted as expert witnesses in Post Office prosecutions.
The Post Office has spent more than £2.9bn on the Horizon system since its inception and has paid £95.6mn since 2021 to extend a contract with Fujitsu until April 2025, according to its annual accounts.
The High Court ruled in 2019 that several “bugs, errors and defects” had meant there was a “material risk” that Horizon was to blame for the faulty data used in the Post Office prosecutions.
Fujitsu has remained a leading software supplier to the UK government despite the Post Office scandal. The Financial Times revealed this month that Fujitsu was involved in solo and joint public-sector contracts worth £4.9bn, even after the December 2019 High Court decision.
Patterson told MPs on the House of Commons business and trade select committee that Horizon code was not in other software it supplied to the government.
He said that Fujitsu would continue to submit bids for public contracts, though he acknowledged the affair had affected the brand’s reputation.
“It is very clear that our brand and our value in the UK and to the government is under question . . . we will look at all of those opportunities on the open market,” Patterson said.
The committee took evidence from an array of witnesses, while the public inquiry into the affair is this week taking evidence from several Fujitsu employees, including Patterson.
Earlier on Tuesday, Lord James Arbuthnot, a member of the Horizon Compensation Advisory Board, told MPs he hoped Fujitsu would “accept that they have played a part in the devastation that has been visited on the sub-postmasters”.
He added: “They might also accept that they should play a part in the redress sub-postmasters need now.”
Kevin Hollinrake, the postal affairs minister, said negotiations with Fujitsu would take place following the conclusion of the public inquiry. He added that it was a matter of timing and “maximising the contribution to the taxpayer”.
“It’s a very significant bill, it may end up north of £1bn, our suspicion is it will. We should expect people who contributed to this scandal to contribute financially,” Hollinrake said.
Nick Read, chief executive of the Post Office, told the committee the state-owned business still needed to change its culture to recognise the impact of the affair on sub-postmasters.
Read also confirmed that the Post Office was in discussions with HM Revenue & Customs over the tax treatment of compensation payments. He said the state-owned business had written to the chief secretary to the Treasury about the issue 18 months ago.
The FT reported last week that the Post Office had claimed tax deductions on compensation payments, and was at risk of insolvency if HMRC clawed back funds.
Read, who joined the Post Office in 2019, was among several senior executives to receive unauthorised bonuses for supporting the public inquiry into the scandal.
He returned £54,400 of his £455,000 bonus from 2021-22 after Post Office management were reprimanded by the inquiry chair Sir Wyn Williams.
