Post Office scandal: Government would not have accepted ending Horizon software, David Mills says
The government would not have accepted faulty accounting software Horizon being phased out, a former Post Office chief executive told the inquiry into the wrongful prosecution of sub-postmasters.
The inquiry seeks to find out who knew what and when about the accounting computer programme that falsely generated financial losses at Post Office branches across the UK and led to the conviction of hundreds of sub-postmasters who ran branches for theft and false accounting.
As a result of Horizon’s errors, many other sub-postmasters lost homes, moved out of their communities, and became unwell having wracked up significant debts and had their reputations ruined.
‘Loosing £1m a day’
But it was the state of Post Office’s finances in the early to mid-2000s that was the focus for the company and government who owned it, former chief executive David Mills told the inquiry on Tuesday.
When he took on the job in 2002, “Post Office Limited was insolvent. It was a crisis”, he said.
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Ex-Post Office boss under fire
“It didn’t take me very long to realise that we had a burning ship. It was losing £1m every single day it operated”.
As a result of the financial situation, there was no way Horizon would be phased out, despite it “not being fit for purpose”, Mr Mills said.
“It would have been a massive write-off for the government, just a huge hit on the bottom line of a company that was already insolvent.
“It was pretty obvious that Horizon was not going to be written off, nor was it going to be closed down. No one would have accepted that in government or indeed in the wider surroundings,” he added.
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Post Office Scandal: Davey ‘Sorry’
‘More focus on solvency than prosecutions’
Issues with Horizon were already being raised with shortfalls at the time.
The Post Office, however, “certainly had more focus on solvency than it did on prosecutions”, Mr Mills said.
“It took me at least six months to really understand what was going on… I didn’t have any briefing whatsoever about it. I had no papers, no people telling me what was going on. I had to try and discover all these things myself,” he said.
“Even the building security team was not expecting me. On my first day I arrived to an empty open plan office”.
By the time he exited in 2005, Mr Mills had received more than £2m in pay and bonuses.
It would be another 10 years before prosecutions based on Horizon data would end and another 14 before an apology came for sub-postmaster victims.
Budget fears and unseasonably warm weather led to consumers spending far less than expected last month, according to official figures.
In a sign of a slowing economy, retail sales fell a sharp 0.7%, the Office for National Statistics (ONS) said.
The fall was larger than expected. A drop of 0.3% was forecasted by economists polled by the Reuters news agency.
Money blog: Energy bills to rise in January
Clothing stores were particularly affected, where sales fell by 3.1% over the month as October temperatures remained high, putting shoppers off winter purchases.
Retailers across the board, however, reported consumers held back on spending ahead of the budget, the ONS added.
Just a month earlier, in September, spending rose by 0.1%.
Despite the October fall, the ONS pointed out that the trend is for sales increases on a yearly and three-monthly basis and for them to be lower than before the COVID-19 pandemic.
Retail sales figures are significant as household consumption measured by the data is the largest expenditure across the UK economy.
The data can also help track how consumers feel about their financial position and the economy more broadly.
Another signal of a slowing economy was the latest growth figures which showed a smaller-than-expected GDP (gross domestic product) measurement.
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Business owners worried after budget
Consumer confidence could be bouncing back
Also released on Friday was news of a rise in consumer confidence in the weeks following the budget and the US election.
Market research company GfK’s long-running consumer confidence index “jumped” in November, the company said, as people intended to make Black Friday purchases.
It noted that inflation has yet to be tamed with people still feeling acute cost-of-living pressures.
It will take time for the UK’s new government to deliver on its promise of change, it added.
A quirk in the figures
Economic research firm Pantheon Macro said the dates included in the ONS’s retail sales figures could have distorted the headline figure.
The half-term break, during which spending typically increases, was excluded from the monthly statistics as the cut-off point was 26 October.
With cold weather gripping the UK this week clothing sales are likely to rise as delayed winter clothing purchases are made, Pantheon added.
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