Emma SimpsonBusiness correspondent and
Emer MoreauBusiness reporter
PA Media
All victims of the Post Office Horizon IT scandal who are claiming compensation will now be entitled to free legal advice to help them with their offers, the government has announced.
The change could potentially have a major effect on the size of the payouts some victims are able to achieve.
It is one of a number of improvements to the compensation schemes available to victims, made in response to the first report from the public inquiry into the scandal, widely described as one of the UK’s worst ever miscarriages of justice.
In July, the chair of the inquiry, Sir Wyn Williams, delivered his findings into the human impact of the scandal and called for urgent action.
The government said it has accepted all but one of the recommendations relating specifically to Horizon.
More than 900 sub-postmasters were prosecuted after the faulty Horizon computer system made it look like money was missing from their branch accounts.
Hundreds of others poured their own savings into their branch to make up apparent shortfalls in order to avoid prosecution.
Making the announcement, Business Secretary Peter Kyle said there was “clearly more to do to bring justice to those affected” and accepting the recommendations was a “crucial step” towards doing this.
There are now three compensation schemes for victims in various circumstances, but they have been criticised for being too slow and complicated with many of the worst affected victims receiving offers for far less than they’d originally claimed for.
Victims who have sought compensation through the Horizon Shortfall Scheme (HSS) – which accounts for more than half of the compensation claims paid out so far – are now eligible for government-funded legal advice to help them decide whether to accept a fixed sum offer, in changes announced by the government on Thursday.
This brings it in line with the other schemes.
Post Office Horizon scandal: Why hundreds were wrongly prosecutedThe government has also committed to setting up a new appeals process for postmasters who accepted a fixed payout under the HSS scheme, which also includes funded legal advice.
Many victims have previously complained about being forced to accept low offers of compensation, without the benefit of legal help.
Action taken in response to other recommendations included:
the government extending the date for the closure of the HSS schemegiving greater clarity on the definition of “full and fair redress”starting work on a restorative justice project for postmastersSo far, more than £1.2bn has been paid out to more than 9,000 claimants across all of the compensation schemes.
The Post Office said it had been working closely with the Government to respond to the inquiry’s report and had agreed a deadline of the end of January 2026 for accepting new applications to the Horizon Shortfall Scheme, saying it would give potential applicants more time to consider their case.
“I encourage any current or former postmaster who thinks they might be eligible for the Horizon Shortfall Scheme to get in touch ahead of the closure date. We have a dedicated claimant support team available on the phone to discuss your options, provide support, and answer any questions so we can begin to process your claim right away,” said Post Office Chair, Nigel Railton.
Reacting, a spokesperson for Fujitsu – who provided the Horizon IT system – said the company had “apologised for, and deeply regret, our role in sub-postmasters’ suffering”.
‘Battling all the time’
Tony Downey
Tony Downey and his wife Caroline were victims of the Post Office scandal
Tony Downey bought the Hawkshead Post Office in the Lake District in 2001.
He and his wife Caroline were forced to put in £35,000 of their own savings to make up for “losses” created by the faulty software.
He lost his home, his livelihood and went bankrupt as a result. His health has also suffered.
Mr Downey is still waiting for full compensation nearly three years after submitting his claim.
“It just seems to be battling, all the time, to get a little bit more, and a little bit more, and a little bit more,” he said. “We’re just exhausted with it.”
Responding to Mr Downey’s testimony, a government spokesperson said: “While we do not comment on individual cases, we take every effort to make full and fair offers to all claimants and only request information that will enable us to do so.”
Neil Hudgell of Hudgell Solicitors, which represents hundreds of victims, said it is “proper that applicants are entitled to have their cases fully assessed before electing to accept a fixed sum”.
He said there would likely be “an upturn in numbers” seeking compensation as deadlines for applying are set.
“There are clearly going to be a lot more claims in the system,” he said.
Mr Hudgell added that claims were still being processed slowly, and said that unless more resources were invested to speed up claims handling, “we will still be needing to talk about compensation claims in three to five years’ time.”
