Labour government said Horizon system was ‘nothing to do with them’

The Labour government dismissed concerns about the Post Office’s Horizon IT system as “nothing to do with them”, Lord Arbuthnot has said.

The inquiry was shown a letter sent by the Tory peer to Lord Mandelson –  then secretary of state for business, innovation and skills (BIS) in November 2009.

Lord Arbuthnot, then an MP, wrote that “there does appear to be a significant number of postmasters and postmistresses accused of fraud who claim that the Horizon system is responsible including, at least two in my constituents”.

After receiving no response, Lord Arbuthnot sent another letter the following month.

He the received a reply from Pat McFadden, then a BIS minister, who explained the government had “assumed an arm’s length relationship” with the Post Office as its only shareholder in order to give the organisation “commercial freedom” and that the issued he had raised were “operational and contractual matters for POL [Post Office Ltd] and not for Government”.

When asked how he felt about this response, Lord Arbuthnot told the inquiry: “I was frustrated and annoyed, but it was clear that the government was saying that it was nothing to do with them and I didn’t see at that stage where I could take it.”

He added: “What this arm’s length arrangement essentially means is that the government is refusing to take the responsibilities that go with ownership and I don’t think it’s right to do that for various reasons.”

Comparing the issue to owning a dangerous dog, he said: “You cannot say that the dangerous dog has an arm’s length relationship with you if you – if the dangerous dog behaves badly.”

Lord Arbuthnot, whose role in supporting Horizon victims including Alan Bates and Jo Hamilton was portrayed in Mr Bates vs The Post Office, first became aware of concerns about the Fujitsu software, in April 2009.

The Tory peer had two constituents – Ms Hamilton and David Bristow – who had been blamed for shortfalls.

When asked why he felt frustrated by Mr McFadden’s response, Lord Arbuthnot said: “Because I’d wanted what had seemed to be to be something what was potentially an injustice to be sorted out and since the government owned the Post Office, I assumed the government would be in a position to sort it out, but they were saying ‘No, not me Guv’.”