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Should the Post Office be put out of its misery?

The latest revelations about the use of racial identification codes - including "negroid types" - are just the tip of the iceberg.

June 01 2023, 12.38pm

I’ve been reporting on the Post Office Horizon scandal since 2010 and have recently begun to wonder if we are in the process of watching a national institution in its death throes. The Post Office has been around since the 1600s. The attempt to turn it from an arm of the state into a forward-thinking government-owned business began in the 1990s. It has been an unmitigated disaster. Three years ago the Post Office admitted that between 2000 and 2013 it may have criminally prosecuted more than 600 innocent people using IT evidence from its own faulty system. It has apologised and promised to turn over a new leaf. 

Yet in recent weeks, the Post Office has been found putting falsehoods in its annual report, misleading victims seeking compensation and harbouring a document which required its investigators to categorise Black Subpostmasters as “negroid types”.

Let’s start with the most jaw-dropping revelation. In 2008 - not 1908 - but 2008, members of the Post Office security team were told in a compliance document to describe suspects using racial identification codes. Subpostmasters (who run Post Office branches) and Post Office staff suspected of misappropriating public funds were given a number. “Dark-skinned European Types” were a Code Two. “Japanese/Chinese Types” were a Code Five. “Negroid Types” were a Three. The racial identifiers were similar to those used by the police in the 1970s but long after the police dropped the offensive terms they were being used by the Post Office. We don’t know when the use of the terms was discontinued.

The compliance document surfaced via a Freedom of Information request by the campaigner Eleanor Shaikh. Shaikh has become an expert at using the Freedom of Information Act to grub up information the Post Office would rather stayed unseen. The racial identification codes brought her up short.“I wanted to try to uncover something of the Post Office Security Team mindset,” she told me, “but I certainly wasn’t expecting to find what I did. The terminology in this document leaves me utterly speechless. I’m saddened its revelation will have caused distress to some extraordinary former Subpostmasters who’ve already been exposed to the most appalling injustice.”

“The Post Office just want to get rid of me. They've given me peanuts, just to go away”

The Post Office has apologised for the racist language, describing its use in 2008 as “completely unacceptable” and, er, “historical”. It is also looking at how the codes “came to be included in our guidance.” 

In the last seven days, the Post Office Chief Executive Nick Read has sent two rather desperate all-staff emails to his racially-diverse cohort of 7,000 Subpostmasters. The second bleats: “I know that you will not only be upset but also very concerned that such language was being used within Post Office… While a lot of progress has been made in ensuring that our culture is inclusive and where everyone can thrive, we know there is still a lot more for us to do and we must continue our efforts.”

While describing its Subpostmasters as “negroid types” the Post Office was also prosecuting and criminalising them on an industrial scale, using evidence from its Fujitsu-supplied Horizon IT accounting system. The system and the numbers it produced was faulty, but the Post Office chose to believe Fujitsu’s assurances over the complaints of Subpostmasters, demanding they prove their losses were due to IT error to avoid criminal prosecution. In 2021 the Court of Appeal ruled that Post Office attempts to “reverse the burden of proof” in this manner was unconscionable and made “a fair trial impossible.” Convictions were quashed and the government convened a public inquiry. The Post Office apologised, but then took steps to bamboozle victims with complicated compensation schemes while minimising the payouts awarded in redress.

Parmod Kalia, who was convicted of theft in 2002 and sent to prison, lived a life of penury and shame until his conviction was quashed nineteen years later. Parmod now has diabetes and is registered blind. Last year he was diagnosed with cancer. In distress, he accepted a settlement offer from the Post Office of around £170,000. “The Post Office just want to get rid of me,” he said. “They've given me peanuts, just to go away.”

I wonder how long this can go on before someone starts asking whether the Post Office should be put out of its misery

This week, Dan Neidle, the lawyer who exposed Nadhim Zahawi MP’s attempts to avoid his tax liabilities, turned his attention to the fairness of the Post Office compensation schemes. He noted the Post Office’s assertion its compensation offers were confidential are “misleading and wrong in law”. He believes the false claim of confidentiality is an “attempt by the Post Office to intimidate postmasters into silence” and a breach of professional ethics by the lawyers who drafted it. He has made a formal complaint to the Solicitors Regulation Authority.

In May, it emerged that Post Office executives had adopted a bonus scheme to reward themselves with thousands of pounds of taxpayer’s money for complying with Sir Wyn Williams’ formal public inquiry into the scandal - a legal obligation. It then asserted in its annual report (laid before parliament) that the bonus metric had been 100% achieved “with confirmation from Sir Wyn Williams and team”. It transpired that Sir Wyn and his team had not confirmed anything about the scheme, nor were they aware it existed. Putting false statements in an annual report is a potential criminal offence. Nick Read issued yet another grovelling apology, commissioned yet another investigation and voluntarily handed back part of his £455,000 bonus. He will soon appear before the Business and Trade Select Committee to explain how his organisation came to mislead parliament. 

The Post Office’s rampant prosecution spree was symptomatic of an organisation which had completely lost its grip on reality. The desperation to cover up what had happened when the truth finally began to come out is craven. To date, no one has been held responsible for this scandal. And nothing has apparently changed. Recent weeks have shown the willingness of Post Office executives to mislead victims and trouser outlandish bonuses despite failing to maintain basic standards of corporate governance. I wonder how long this can go on before someone starts asking whether the Post Office, in its current form, should be put out of its misery. The Post Office minister Kevin Hollinrake has already indicated he might consider mutualisation - that is, giving ownership of the network to its long-suffering Subpostmasters. They couldn’t be more badly served than they are now.

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