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Post Office Executives: Bonuses
10 May 2023
Lead MP
Kevin Hollinrake
Debate Type
Ministerial Statement
Tags
Business & TradeParliamentary ProcedureStandards & Ethics
Other Contributors: 24
At a Glance
Kevin Hollinrake raised concerns about post office executives: bonuses in the House of Commons. A government minister responded. Other MPs also contributed.
How the Debate Unfolded
MPs spoke in turn to share their views and ask questions. Here's what each person said:
Government Statement
The right hon. Gentleman for tabling this urgent question, Minister Kevin Hollinrake expresses his deep concern over the recent Post Office incident where a mistake in remuneration was made. He states that the Post Office has rightly apologised and issued a clarification on its website. The CEO of the Post Office and chief finance officer have returned their remuneration associated with the inquiry, and the new chair of the remuneration committee will lead an investigation within two weeks. Additionally, the Department is commissioning an independent review to assess governance issues around remuneration decisions. Minister Hollinrake reiterates the Government's commitment to ensure swift and fair compensation for postmasters affected by the Horizon scandal.
Kevan Jones
Lab
North Durham
Question
Asks about when the Minister was made aware, the role of Tom Cooper, publication of bonuses, criteria clarity, and calls for a wider inquiry. He also demands that the CEO should resign or be sacked due to lack of trust.
Minister reply
The Minister confirms he was informed on May 6th, Saturday. Tom Cooper’s role is being reassigned with Lorna Gratton taking over. The criteria are published in the annual report but will be detailed further upon inquiry findings. The Minister commits to a full disclosure and supports radical reform for fair compensation.
Edward Leigh
Con
Gainsborough
Question
Argues that mutualisation is needed for better governance and treatment of sub-postmasters, given past issues with working conditions and pay.
Minister reply
The Minister acknowledges mutuals’ potential benefits and agrees to further discuss this idea with Edward Leigh.
Seema Malhotra
Lab Co-op
Feltham and Heston
Question
I, too, thank my right hon. Friend the Member for North Durham (Mr Jones) for his ongoing work, and for securing this urgent question. Here we are again. Just when we thought we had reached a low in the ongoing saga that is the Post Office’s Horizon scandal, a new low is reached. The Minister is right that the situation is concerning, but it is much more than that: it is a disgrace. After years of fighting compensation claims against honest sub-postmasters, using every trick in the book to draw things out for as long as possible, the Post Office somehow found it appropriate to hand out bonuses for co-operating with Sir Wyn Williams’s inquiry, which executives had a statutory obligation to do anyway.
Minister reply
As I said earlier, I became aware of the matter on Saturday, and my officials became aware of it the previous day. I understand that the UKGI representative was made aware in the early part of April. We asked why we were not made aware at that point, and there are questions about information that is restricted to the inquiry.
Question
It is an absolute scandal that Post Office executives are being paid a bonus for co-operating with an inquiry into a scandal to which they all turned a blind eye. Another scandal is that Fujitsu, the author of the software, has never been held fully to account for its role. Why not? Can the Minister tell us why Fujitsu is still being given Government contracts, most recently the emergency alert?
Minister reply
My hon. Friend and I discussed this yesterday, and he takes a great interest in such matters given his background, including as a former sub-postmaster. I understand his concerns about why such a metric was used in the first place. Some time ago, there was an attempt to move away from purely financial considerations in bonuses.
Question
I declare an interest as chair of the all-party parliamentary group on post offices. I have no idea how I will cram everything into a minute, but I will try. The Post Office was right to apologise, but it should not have had to apologise in the first place. The rotten core of what is still happening in Post Office Ltd needs to be exposed to daylight and be completely cleansed.
Minister reply
I thank the hon. Lady for all the work she does as chair of the all-party parliamentary group and for engaging with me on many different issues, not least this one. I agree that this should never have happened, which makes it all the more concerning.
Question
The Post Office came to this place a few weeks ago to try to influence many of us to say how great it is. I met the chief executive, Nick Read, who is clearly a liar, because what he told me was untrue. The Post Office is awarding enormous bonuses, or tried to award enormous bonuses, but the postmaster in Dorchester, the county town of Dorset, is so screwed down on transaction fees that he is now personally subsidising the county town’s post office in order to survive.
Minister reply
I am not aware of the circumstances to which my hon. Friend refers, but I am happy to engage with him separately on the matter.
Andy McDonald
Lab
Middlesbrough and Thornaby East
Question
Putting aside the cheating and lying, let us get back to the basic question of why on earth people were awarded bonuses for going to work and doing their job. Some sub-postmasters have lost their lives and others have lost their livelihoods or spent years in jail, yet some people are trying to clean up on this.
Minister reply
I am keen to deal with the matters I have referred to in my statement and in answers to questions. I understand the intent to move away from purely financial considerations, which were one thing that drove inappropriate behaviour in the Post Office before.
Question
I popped into a leaving party last week, where a Post Office worker was taking early retirement because he had been, in effect, fitted with a tracker, having done a round for 25 years, and because after a two-week holiday he had come back to find that all of his mail had not been delivered. My constituents are also writing to me about mail that is not arriving.
Minister reply
I am grateful to my hon. Friend for his question, and I certainly agree with that last point.
Tim Farron
Lib Dem
Westmorland and Lonsdale
Question
Along with the victims of this miscarriage of justice, I am outraged at these bonuses. While the Post Office executives get these huge bonuses, dozens of post office branches around Cumbria are struggling to survive, with many facing closure as they cannot even break even.
Minister reply
I am grateful to the hon. Gentleman for his points.
Jerome Mayhew
Con
Broadland and Fakenham
Question
This scandal upon a scandal highlights yet again that there is something fundamentally wrong with the governance of the Post Office. This is happening at a time when Fakenham, the largest town in my area, has not had a permanent post office for more than three years. So I have an idea: how about linking bonuses to actually providing the services we need on the ground?
Minister reply
My hon. Friend raises a number of good points and an interesting way of looking at how we can incentivise management to make sure we have a sustainable network of post offices in the future. I am happy to engage with him further on that.
Clive Efford
Lab
Eltham and Chislehurst
Question
It is difficult to know where to begin, but let me say that my constituent went to prison as a result of this scandal, as the Minister knows. Let us just consider the very idea that these people should be rewarding themselves with bonuses for co-operating with this inquiry and then letting the Minister know on 6 May, the day of the coronation. It does not take us long to work what was going on there; they were trying to hide this bad news. I know that the Minister takes this matter very seriously, and we have commended him for his actions on it on many occasions, but he really has to make sure that these bonuses do not stand.
Minister reply
I spent much of the coronation day dealing with this matter, as the hon. Gentleman might imagine, although I had the TV on in the background. It is disappointing that this took so long; as I said earlier, Tom Cooper found out about this matter in early April and we should have been made aware earlier, either through the Post Office or by other means. I am sorry about what has happened to the hon. Gentleman’s constituent, and the hon. Gentleman and I have talked about it previously. We want all people who have suffered as a consequence of the Post Office scandal to come forward and make sure that they submit a claim for compensation. That is the most important thing now. We have set aside £1 billion to compensate postmasters for various different detriments that they have suffered, and our message to all postmasters affected by this scandal is: please come forward, you will be treated fairly.
Question
This is a scandal from top to bottom. Yet again, we seem to be in a position where the Post Office is apologising only after the fact, when it has been found to have done something wrong. One of my local sub-postmistresses, Isabella Wall, died without having got the compensation she deserved; she lost her shop, her post office and the flat above it, and her family are still dealing with this injustice. I am glad that the Post Office is getting back the bonus payments it gave out, but would it not be more fitting if it were to put that money into a pot for the sub-postmasters and sub-postmistresses who are still awaiting compensation, so that some of their legal fees could be covered by it?
Minister reply
I am sorry to hear the tragic case of my hon. Friend’s constituent; sadly, too many people have died waiting for justice and compensation. Of course, a claim for compensation can still be made and it would go to the family, and people will get reasonable legal fees paid as part of the compensation process.
Question
I have listened to the Minister’s answers carefully. On Post Office executives’ pay and bonuses, can he confirm that he is looking at docking them even further, on the basis that these executives signed off false accounts?
Minister reply
That matter needs to be determined by the different inquiries that will be taking place. I think the hon. Gentleman would agree that we have to follow due process; there are employment processes and laws associated with this. I cannot stand up here and say now what I would do on the payment of bonuses, but he can be assured that we are looking at the situation carefully, and I am sure that what he sets out will be one of the considerations made as part of these investigations.
James Wild
Con
North West Norfolk
Question
An apology and the repayment of bonuses that should never have been awarded in the first place is, frankly, the minimum we should expect. Will my hon. Friend ensure that all necessary steps are taken, including personnel changes, following the report he is due to receive?
Minister reply
As I say, we should wait for the outcome of the inquiry, but these are serious matters and we should take them seriously. I have great sympathy with my hon. Friend’s points. A lot of these matters are governed by employment law, and it is important that we respect due process.
Question
I understand that the chief executive’s full bonus is approximately half a million pounds and that he has offered to pay back just a few thousand. Does the Minister understand that members of the public watching this will be asking how come, if the Post Office is a Government-owned entity, the Minister cannot simply decide to suspend all bonuses for executives until the Horizon compensation claims are settled?
Minister reply
The sub-metric referred to here is an element of the bonus, and the total bonus of £400,000 does not relate to this particular sub-metric in its entirety—the hon. Gentleman is right to say that. I have sympathy with what he says. It would be wrong for me to stand here and comment on a matter that is clearly subject to employment law.
Question
I question the competence and leadership qualities of any Post Office executive who thinks it is right to take a bonus at this time. Does the Minister agree that if there is any spare money or hundreds of thousands of pounds available at the moment, it should be going into the compensation fund for the victims of the Horizon scandal and it should also be used to support our fragile post office network, where our sub-postmasters and sub-postmistresses are working so hard to preserve services for our local communities?
Minister reply
It is important that we have a remuneration package that attracts the right kind of person—many people will question whether that is the case today. On the compensation fund, the Government are prepared to fund compensation up to £1 billion.
Alistair Carmichael
Lib Dem
Orkney and Shetland
Question
It is surely apparent that the culture within the Post Office that allowed people at the top to spend millions of pounds of taxpayers’ money to pursue an indefensible case has not changed. Although, of course, those who were victims of Horizon will be angry, so, too, will the thousands of sub-postmasters and sub-postmistresses across the country whose remuneration package is wholly inadequate. So here is an idea: why not set a cap on the maximum gap between the money paid to the sub-postmaster or sub-postmistress delivering the service on which our public rely and that paid to the chief executive?
Minister reply
By whatever means, I am very happy to have a further discussion with the right hon. Gentleman. We want to make sure that we have a sustainable network, which must mean that postmasters can run sustainable businesses.
Question
I recently spent a Saturday morning with Chris Borroughs, the sub-postmaster of a small post office in Latchford. It was very clear to me that the post office is the first port of call for many people who are vulnerable in society and is increasingly important because of the reduction in the number of banks on our high streets. It is also clear is that the economics of running a small sub-post office just do not work anymore. I was interested to hear the Minister say that he was looking to introduce a review of payments to executives. Will he consider extending that to look at how sub-postmasters are renumerated so that we do not lose any more post offices from the high street?
Minister reply
I thank my hon. Friend for his question and Mr Borroughs for the work that he does for the community. My hon. Friend is right to say that post offices and postmasters are at the heart of our community—that is absolutely right. As I have said, they are needed now more than ever with the demise of many banks on our high streets.
Newcastle upon Tyne North
Question
Speaks for constituents facing stress and misery due to Post Office issues. Asks the Minister to clearly accept responsibility for this situation and outline steps to address it, including future sustainability of the Post Office.
Minister reply
Acknowledges the need for proper compensation and a sustainable business model. Highlights that taxpayer support over the past 10 years has been £2.5 billion. Emphasises finding ways to increase footfall in post offices.
Question
Tributes postmasters and asks about timeline for report on steps following Horizon scandal. Also raises concerns about high compensation at one end and inadequate funding for frontline workers.
Minister reply
Agrees with the point, wants to ensure right package is given for the job. Acknowledges need for sustainable future and willingness to engage in discussions.
Sammy Wilson
DUP
East Antrim
Question
Questions bonuses based on misleading information when network is falling apart. Asks for criteria for bonuses to be based on level of service across the community.
Minister reply
Agrees with many points, wants sustainable future and fair remuneration. Acknowledges difficulties in rural areas and importance of network viability.
Question
Asks if bonuses based on misleading information could be illegal under the Theft Act 1968. Suggests referring matter to police and Crown Prosecution Service.
Minister reply
Says first step is looking at evidence, then taking appropriate action. Two parallel inquiries underway: one by remuneration committee due in two weeks, another independent review timeline yet to be set.
Jim Shannon
DUP
Strangford
Question
Commemorates right hon. Member for North Durham for bringing urgent question and commends his actions. Raises concerns about bonuses paid despite ongoing errors affecting postmasters' health.
Minister reply
Pays tribute to the right hon. Member, acknowledges points made, emphasises need for scrutiny and transparency in review process.
Shadow Comment
Kevan Jones
Shadow Comment
Shadows are deeply concerned about the Post Office’s remuneration committee error, particularly given the context of ongoing issues with the Horizon scandal. Kevan Jones criticises the CEO's bonus and highlights a lack of transparency in board roles and decision-making processes. He calls for immediate action, including publishing who has received bonuses and detailing compensation criteria. The shadow demands answers on the roles of government representatives within the Post Office governance structures and urges for full public disclosure.
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