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Rishi Sunak has refused to repeat Kemi Badenoch’s claim that the former Post Office boss was lying when he said he was told to delay compensation to Horizon scandal victims.

Sir Keir Starmer asked the prime minister if he is prepared to personally repeat the allegation made by his business secretary regarding Henry Staunton.

Mr Staunton, who was sacked last month, has claimed he was told to stall pay-outs to sub-postmasters due to financial concerns ahead of the general election – something Ms Badenoch has strongly denied.

Mr Sunak did not answer the Labour leader’s question directly, simply saying Mr Staunton was fired because of “serious concerns” about his conduct.

He added: “We have taken up steps to ensure victims of the Horizon scandal receive compensation as swiftly as possible… that remains our priority.”

Sir Keir, speaking at PMQs, pressed him on Ms Badenoch’s statement on Monday that Mr Staunton was “at no point told to delay compensation payments by either an official or a minister from any government department; at no point was it suggested that a delay would be a benefit to the Treasury.”

Asked if he will investigate if that statement is correct, the prime minister repeated that Mr Staunton was asked to step down “after serious concerns were raised”.

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The exchange comes after an unearthed memo from Mr Staunton which raises questions about Ms Badenoch’s claims.

It has emerged that Mr Staunton wrote a note on 5 January last year which said that Sarah Munby, the then permanent secretary at the business department, had warned him during a meeting that day not to “rip off the band aid” in terms of government finances in the run up to the election.

Henry Staunton
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Henry Staunton

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According to the note, seen by Sky News, Mr Staunton said that the Post Office board had identified a financial shortfall of £160m as of September 2022 and that “there was a likelihood of a significant reduction in post offices” if more government funding was not made available.

He wrote: “Sarah was sympathetic to all of the above. She understood the ‘huge commercial challenge’ and the ‘seriousness’ of the financial position. She described ‘all the options as unattractive’. However, ‘politicians do not necessarily like to confront reality’. This particularly applied when there was no obvious ‘route to profitability’.

“She said we needed to know that in the run-up to the election there was no appetite to ‘rip off the band aid’. ‘Now was not the time for dealing with long-term issues.’ We needed a plan to ‘hobble’ up to the election.”

Kemi Badenoch MP denies she is in an 'evil plotters' Whatsapp group
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Kemi Badenoch

Labour MP Liam Byrne, who is chair of parliament’s Business Committee, said the note is “a go slow order, without a doubt”. He said his committee will attempt to “flush out the truth” on Tuesday, when Mr Staunton will appear before MPs.

The note has sparked demands from the Lib Dems for Mr Sunak’s ethics adviser to investigate whether Ms Badenoch misled parliament with her accusation that Mr Staunton was lying.

Labour said there needs to be a cabinet office investigation to establish the veracity of Mr Staunton’s claims.

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Row over disputed memo

Earlier, a government source was dismissive of the memo and suggested Mr Staunton was either “confused or deliberately mixing up” long-standing issues around Post Office finances with the payouts to wrongfully convicted sub-postmasters.

They added: “Even if we trust the veracity of a memo he wrote himself, and there’s not much to suggest we can, given the false accusations he made about the Secretary of State in his original interview, it’s time for Henry Staunton to admit his interview on Sunday was a misrepresentation of his conversations with ministers and officials and to apologise to the government and the postmasters.”

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Who is Henry Staunton?
The story behind the victims

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Did the government delay Post Office compensation?

Was ousted boss asked to delay compensation payments?

In his original interview with the Sunday Times, Mr Staunton claimed that he was ordered by a senior civil servant to stall spending on compensation for Horizon victims to allow the government to “limp into the election”.

He said it “was not an anti-postmaster thing, it was just straight financials”.

He also claimed that when he was sacked he was told someone had to “take the rap” for the Horizon scandal, which came under renewed public scrutiny following the ITV drama series Mr Bates Vs The Post Office.

Mr Staunton has stood by his claims in the face of government denials, insisting that there was “no real movement” on the payouts until the airing of the ITV drama.

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On Monday, Ms Badenoch said the claims are “completely false” and accused Mr Staunton of seeking “revenge” after he was sacked.

She also claimed he was being investigated over bullying allegations before he was dismissed from his short-lived post – something he has denied.

He has said he decided to go public “out of a desire to ensure that the public were fully aware of the facts surrounding the multiple failures that have led to postmasters in this country being badly let down”.

The Horizon scandal saw hundreds of sub-postmasters prosecuted because of discrepancies in the Fujitsu-developed IT system between 1999 and 2015, in what has been called the biggest miscarriage of justice in UK history.

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PM could lift controversial benefit cap in budget – as Farage makes two big election promises

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PM could lift controversial benefit cap in budget - as Farage makes two big election promises

Sir Keir Starmer could decide to lift the two-child benefit cap in the autumn budget, amid further pressure from Nigel Farage to appeal to traditional Labour voters.

The Reform leader will use a speech this week to commit his party to scrapping the two-child cap, as well as reinstating winter fuel payments in full.

The prime minister – who took Westminster by surprise at PMQs by revealing his intention to row back on the winter fuel cut – has previously said he would like to lift the two-child cap if the government could afford it.

There are now mounting suggestions an easing of the controversial benefit restriction may be unveiled when the chancellor delivers the budget later this year.

According to The Observer, Sir Keir told cabinet ministers he wanted to axe the measure – and asked the Treasury to look for ways to fund the move.

It comes after the government delayed the release of its child poverty strategy, which is expected to recommend the divisive cap – introduced by former Tory chancellor George Osborne – is scrapped.

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Why did Labour delay their child poverty strategy?

Ministers have already said any changes to winter fuel payments, triggered by mounting political pressure, would only be made when the government’s next fiscal event rolls round.

The Financial Times reported it may be done by restoring the benefit to all pensioners, with the cash needed being clawed back from the wealthy through the tax system.

The payment was taken from more than 10 million pensioners this winter after it became means-tested, and its unpopularity was a big factor in Labour’s battering at recent elections.

Before Wednesday’s PMQs, the prime minister and chancellor had insisted there would be no U-turn.

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Will winter fuel U-turn happen?

Many Labour MPs have called for the government to do more to help the poorest in society, amid mounting concern over the impact of wider benefit reforms.

Former prime minister Gordon Brown this week told Sky News the two-child cap was “pretty discriminatory” and could be scrapped by raising money through a tax on the gambling industry.

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Brown questioned over winter fuel U-turn

Mr Farage, who believes Reform UK can win the next election, will this week accuse Sir Keir of being “out of touch with working people”.

In a speech first reported by The Sunday Telegraph, he is expected to say: “It’s going to be these very same working people that will vote Reform at the next election and kick Labour out of government.”

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First renationalised train service starts today – but not how you’d have hoped…

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First renationalised train service starts today - but not how you'd have hoped…

South Western Railway (SWR) has been renationalised this weekend as part of the government’s transition towards Great British Railways.

The train operator officially came under public ownership at around 2am on Sunday – and the first journey, the 5.36am from Woking, was partly a rail replacement bus service due to engineering works.

So what difference will renationalisation make to passengers and will journeys be cheaper?

Pic: PA
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Pic: PA

What is nationalisation?

Nationalisation means the government taking control of industries or companies, taking them from private to public ownership.

Britain’s railway lines are currently run by train operating companies as franchises under fixed-term contracts, but Labour have said they want to take control of the lines when those fixed terms end.

In its manifesto, the party vowed to return rail journeys to public ownership within five years by establishing Great British Railways (GBR) to run both the network tracks and trains.

Transport Secretary Heidi Alexander said renationalising SWR was “a watershed moment in our work to return the railways to the service of passengers”.

“But I know that most users of the railway don’t spend much time thinking about who runs the trains – they just want them to work,” she added. “That’s why operators will have to meet rigorous performance standards and earn the right to be called Great British Railways.”

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How reliable are UK trains?

How will ticket prices be affected?

Labour have argued cutting off payments flowing into the private sector could save the taxpayer £150m a year.

But the government has not explicitly promised the savings made from nationalisation will be used to subsidise fees.

It is unlikely rail fares will fall as a result of nationalisation, rail analyst William Barter told Sky News.

“The government could mandate fare cuts if it wanted to, but there’s no sign it wants to,” he said.

“At the moment, I’m sure they would want to keep the money rather than give it back to passengers. The current operator aims to maximise revenue, and there’s no reason the government would want them to do anything differently under government control.”

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UK has most expensive train tickets in Europe

What difference will it make for passengers?

Britain’s railways are frequently plagued by delays, cuts to services and timetable issues, but Mr Barter said nationalisation will make very little day-to-day difference to passengers.

There was “no reason to think” the move would improve issues around delays and cancellation of services, he said.

“It’s going to be the same people, the same management,” he explained.

“The facts of what the operator has to deal with in terms of revenue, infrastructure, reliability, all the rest of it – they haven’t changed.”

Pic: PA
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Pic: PA

Which services are being next to be nationalised?

In the longer term, the move is likely to bring “a degree of certainty compared with relatively short-term franchises”, Mr Barter said, noting the government would only want to renationalise a franchise “because in one way or another something very bad is going on in that franchise, so in a way it can only get better”.

It also means the government will have greater accountability for fixing problems with punctuality and cancellations.

Mr Barter said: “If this is the government’s baby, then they’re going to do their best to make sure it doesn’t fail. So rather than having a franchise holder they can use as a political scapegoat, it’s theirs now.”

He added: “In the short term, I don’t think you’d expect to see any sort of change. Long term, you’ll see stability and integration bringing about gradual benefits. There’s not a silver bullet of that sort here.”

Next to be renationalised later this year will be c2c and Greater Anglia, while seven more companies will transfer over when their franchises end in the future.

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Sir Alan Bates attacks ‘kangaroo court’ Post Office scheme after ‘take it or leave it’ offer

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Sir Alan Bates attacks 'kangaroo court' Post Office scheme after 'take it or leave it' offer

Sir Alan Bates has accused the government of presiding over a “quasi kangaroo court” for Post Office compensation.

Writing in The Sunday Times, the campaigner, who led a years-long effort for justice for sub-postmasters, revealed he had been given a “take it or leave it” offer that was less than half of his original claim.

“The sub-postmaster compensation schemes have been turned into quasi-kangaroo courts in which the Department for Business and Trade sits in judgement of the claims and alters the goal posts as and when it chooses,” he said.

“Claims are, and have been, knocked back on the basis that legally you would not be able to make them, or that the parameters of the scheme do not extend to certain items.”

More than 900 sub-postmasters were prosecuted between 1999 and 2015 after faulty Horizon accounting software made it look as if money was missing from their accounts.

Many are still waiting for compensation despite the previous government saying those who had their convictions quashed were eligible for £600,000 payouts.

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‘It still gives me nightmares’

After the Post Office terminated his contract over a false shortfall in 2003, Sir Alan began seeking out other sub-postmasters and eventually took the Post Office to court.

More on Post Office Scandal

A group litigation order (GLO) scheme was set up to achieve redress for 555 claimants who took the Post Office to the High Court between 2017 and 2019.

Sir Alan, who was portrayed by actor Toby Jones in ITV drama Mr Bates Vs The Post Office, has called for an independent body to be created to deliver compensation.

He added that promises the compensation schemes would be “non-legalistic” had turned out to be “worthless”.

It is understood around 80% of postmasters in Sir Alan’s group have accepted a full and final redress, or been paid most of their offer.

Read more:
Post Office scandal explained

Who are the key figures in the scandal?

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‘Lives were destroyed’

A Department for Business and Trade spokesperson told Sky News: “We pay tribute to all the postmasters who’ve suffered from this scandal, including Sir Alan for his tireless campaign for justice, and we have quadrupled the total amount paid to postmasters since entering government.

“We recognise there will be an absence of evidence given the length of time which has passed, and we therefore aim to give the benefit of the doubt to postmasters as far as possible.

“Anyone unhappy with their offer can have their case reviewed by a panel of experts, which is independent of the government.”

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