Post Office scandal: ‘Hugely significant’ evidence unearthed in computer expert’s garage
A damning report into the faulty Post Office IT system that preceded Horizon has been unearthed after nearly 30 years – and it could help overturn criminal convictions.
The document, known about by the Post Office in 1998, is described as “hugely significant” and a “fundamental piece of evidence” and was found in a garage by a retired computer expert.
Capture was a piece of accounting software, likely to have caused errors, used in more than 2,000 branches between 1992 and 1999.
It came before the infamous faulty Horizon software scandal, which saw hundreds of sub-postmasters wrongfully convicted between 1999 and 2015.
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What is the Capture scandal?
The “lost long” Capture documents were discovered in a garage by a retired computer expert who came forward after a Sky News report into the case of Patricia Owen, a convicted sub-postmistress who used the software.
Adrian Montagu was supposed to be a key witness for Pat’s defence at her trial in 1998 but her family always believed he had never turned up, despite his computer “just sitting there” in court.
Mr Montagu, however, insists he did attend.
He describes being in the courtroom and adds that “at some point into the trial” he was stood down by the barrister for Mrs Owen with “no reason” given.
Adrian Montagu was supposed to be a key witness for Pat’s defence
Sky News has seen contemporaneous notes proving Mr Montagu did go to Canterbury Crown Court for the first one or two days of the trial in June 1998.
“I went to the court and I set up a computer with a big old screen,” he says.
“I remember being there, I remember the judge introducing everybody very properly…but the barrister in question for the defence, he went along and said ‘I am not going to need you so you don’t need to be here any more’.
“I wasn’t asked back.”
The ‘lost long’ Capture documents were discovered in a garage
Sky News has reached out to the barrister in Pat Owen’s case who said he had no recollection of it.
‘An accident waiting to happen’
The report, commissioned by the defence and written by Adrian Montagu and his colleague, describes Capture as “an accident waiting to happen”, and “totally discredited”.
It concludes that “reasonable doubt exists as to whether any criminal offence has taken place”.
It also states that the software “is quite capable of producing absurd gibberish”, and describes “several insidious faults…which would not be necessarily apparent to the user”.
All of which produced “arithmetical or accounting errors”.
Sky News has also seen documents suggesting the jury in Pat Owen’s case may never have seen the report.
What is clear is that they did not hear evidence from its author including his planned “demonstration” of how Capture could produce accounting errors.
But flaws were found within it
Pat Owen was convicted of stealing from her Post Office branch in 1998 and given a suspended prison sentence.
Her family describe how it “wrecked” her life, contributing towards her ill health, and she died in 2003 before the wider Post Office scandal came to light.
Her daughter Juliet said her mother fought with “everything she could”.
“To know that in the background there was Adrian with this (report) that would have changed everything, not just for mum but for every Capture victim after that, I think is shocking and really upsetting – really, really upsetting.”
Pat died before the contents of the report came to light
The report itself was served on the Post Office lawyers – who continued to prosecute sub-postmasters in the months and years after Pat Owen’s trial.
‘My blood is boiling’
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‘They knew software was faulty’
Steve Marston, who used the Capture software in his branch, was one of them – he was convicted of stealing nearly £80,000 in September 1998.
His prosecution took place four months after the Capture report had been served on the Post Office.
Steve says he was persuaded to plead guilty with the “threat of jail” hanging over him and received a suspended sentence.
He describes the discovery of the report as “incredible” and says his “blood is boiling” and he feels “betrayed”.
“So they knew that the software was faulty?,” he says. “It’s in black and white isn’t it? And yet they still pressed on doing what they did.
“They used Capture evidence … as the evidence to get me to plead guilty to avoid jail.
“They kept telling us it was safe…They knew the software should never have been used in 1998, didn’t they?”
Steve says his family’s lives were destroyed and the knowledge of this report could have “changed everything”.
He says he would have fought the case “instead of giving in”.
“How dare they. And no doubt I certainly wasn’t the last one…And yet they knew they were convicting people with faulty software, faulty computers.”
Steve’s prosecution took place four months after the Capture report had been served on the Post Office
The report is now with the Criminal Cases Review Commission, the body investigating potential miscarriages of justice, which is currently looking into 28 Capture cases.
A fundamental piece of evidence
Neil Hudgell, the lawyer representing more than 100 victims, describes the report as “hugely significant”, “seismic” and a “fundamental piece of evidence”.
“I’m as confident as I can be that this is a good day for families like Steve Marston and Mrs Owen’s family,” he says.
“I think (the documents) could be very pivotal in delivering the exoneration that they very badly deserve.”
He also added that “there’s absolutely no doubt” that the “entire contents” of the “damning” report “was under the noses of the Post Office at a very early stage”.
Pat Owen
He describes it as a “massive missed opportunity” and “early red flag” for the Post Office which went on to prosecute hundreds who used Horizon in the years that followed.
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“It is a continuation of a theme that obviously has rolled out over the subsequent 20 plus years in relation to Horizon,” he says.
“…if this had seen the light of day in its proper sense, and poor Mrs Owen had not been convicted, the domino effect of what followed may not have happened.”
What the Post Office said
Sky News approached the former Chief Executive of the Post Office during the Capture years, John Roberts, who said: “I can’t recall any discussion at my level, or that of the board, about Capture at any time while I was CEO.”
A statement from the Post Office said: “We have been very concerned about the reported problems relating to the use of the Capture software and are sincerely sorry for past failings that have caused suffering to postmasters.
“We are determined that past wrongs are put right and are continuing to support the government’s work and fully co-operating with the Criminal Cases Review Commission as it investigates several cases which may be Capture related.”
A Department for Business and Trade spokesperson said: “Postmasters including Patricia Owen endured immeasurable suffering, and we continue to listen to those who have been sharing their stories on the Capture system.
“Government officials met with postmasters recently as part of our commitment to develop an effective and fair redress process for those affected by Capture, and we will continue to keep them updated.”
The UK economy unexpectedly shrank in May, even after the worst of Donald Trump’s tariffs were paused, official figures showed.
A standard measure of economic growth, gross domestic product (GDP), contracted 0.1% in May, according to the Office for National Statistics (ONS).
Rather than a fall being anticipated, growth of 0.1% was forecast by economists polled by Reuters as big falls in production and construction were seen.
It followed a 0.3% contraction in April, when Mr Trump announced his country-specific tariffs and sparked a global trade war.
A 90-day pause on these import taxes, which has been extended, allowed more normality to resume.
This was borne out by other figures released by the ONS on Friday.
Exports to the United States rose £300m but “remained relatively low” following a “substantial decrease” in April, the data said.
Overall, there was a “large rise in goods imports and a fall in goods exports”.
A ‘disappointing’ but mixed picture
It’s “disappointing” news, Chancellor Rachel Reeves said. She and the government as a whole have repeatedly said growing the economy was their number one priority.
“I am determined to kickstart economic growth and deliver on that promise”, she added.
But the picture was not all bad.
Growth recorded in March was revised upwards, further indicating that companies invested to prepare for tariffs. Rather than GDP of 0.2%, the ONS said on Friday the figure was actually 0.4%.
It showed businesses moved forward activity to be ready for the extra taxes. Businesses were hit with higher employer national insurance contributions in April.
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The expansion in March means the economy still grew when the three months are looked at together.
While an interest rate cut in August had already been expected, investors upped their bets of a 0.25 percentage point fall in the Bank of England’s base interest rate.
Such a cut would bring down the rate to 4% and make borrowing cheaper.
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Is Britain going bankrupt?
Analysts from economic research firm Pantheon Macro said the data was not as bad as it looked.
“The size of the manufacturing drop looks erratic to us and should partly unwind… There are signs that GDP growth can rebound in June”, said Pantheon’s chief UK economist, Rob Wood.
Why did the economy shrink?
The drops in manufacturing came mostly due to slowed car-making, less oil and gas extraction and the pharmaceutical industry.
The fall was not larger because the services industry – the largest part of the economy – expanded, with law firms and computer programmers having a good month.
It made up for a “very weak” month for retailers, the ONS said.
Monthly Gross Domestic Product (GDP) figures are volatile and, on their own, don’t tell us much.
However, the picture emerging a year since the election of the Labour government is not hugely comforting.
This is a government that promised to turbocharge economic growth, the key to improving livelihoods and the public finances. Instead, the economy is mainly flatlining.
Output shrank in May by 0.1%. That followed a 0.3% drop in April.
Ministers were celebrating a few months ago as data showed the economy grew by 0.7% in the first quarter.
Hangover from artificial growth
However, the subsequent data has shown us that much of that growth was artificial, with businesses racing to get orders out of the door to beat the possible introduction of tariffs. Property transactions were also brought forward to beat stamp duty changes.
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In April, we experienced the hangover as orders and industrial output dropped. Services also struggled as demand for legal and conveyancing services dropped after the stamp duty changes.
Many of those distortions have now been smoothed out, but the manufacturing sector still struggled in May.
Signs of recovery
Manufacturing output fell by 1% in May, but more up-to-date data suggests the sector is recovering.
“We expect both cars and pharma output to improve as the UK-US trade deal comes into force and the volatility unwinds,” economists at Pantheon Macroeconomics said.
Meanwhile, the services sector eked out growth of 0.1%.
A 2.7% month-to-month fall in retail sales suppressed growth in the sector, but that should improve with hot weather likely to boost demand at restaurants and pubs.
Struggles ahead
It is unlikely, however, to massively shift the dial for the economy, the kind of shift the Labour government has promised and needs in order to give it some breathing room against its fiscal rules.
The economy remains fragile, and there are risks and traps lurking around the corner.
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Is Britain going bankrupt?
Concerns that the chancellor, Rachel Reeves, is considering tax hikes could weigh on consumer confidence, at a time when businesses are already scaling back hiring because of national insurance tax hikes.
Inflation is also expected to climb in the second half of the year, further weighing on consumers and businesses.
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