Fujitsu’s Horizon system continues to produce erratic figures in branch accounts, which the Post Office can’t explain, with millions of pounds being written off.
As the publication of an independent report into the system at the centre of the Post Office scandal approaches, Computer Weekly reveals there is chaos in the system.
According to a freedom of information response from the Post Office, in the past two years, subpostmasters identified more than 16,000 discrepancies, including both account shortfalls and surpluses.
The taxpayer-owned business wrote off £11.6m in unidentified shortfalls recorded on the Horizon system as a loss in its most recent financial results, for 2023/24. In the previous financial year, it wrote off £10.4m as losses for the same reason.
These are shortfalls where the Post Office cannot identify the cause.
Numbers from the 11,500 branches reveal there were 6,137 shortfalls reported in the Post Office’s most recent figures, worth over £17m. In the previous financial year, there were 5,812, which added up to about £19m.
Major account surpluses were also reported. In 2022/23, some 2,239 account surpluses were called in by subpostmasters, worth over £22m. In the most recent figures, 2,085 surpluses were reported, totalling £17.6m.
One source said: “The Post Office doesn’t know if the discrepancies are real or not.
“The Post Office has a very bad record of keeping track of misbalances if not made good by subpostmasters. Misbalances or discrepancies have not been chased to make good for years, and these have been amassing to the tune of millions of pounds, which will either be written off using taxpayers’ money or paid by Fujitsu. It is not known which, but my guess is the former.”
The Post Office said: “Like any retail business, discrepancies can and do sometimes occur in branches. If a loss arose as the result of a bug, error or defect in the Horizon system, we do not seek to recover the loss from the subpostmaster. It is important to underline that if the discrepancy review process is unable to establish the cause of the discrepancy, then we would also write it off.”
Before 2019, subpostmasters were forced to make good any account shortfalls that could not be explained or, in many cases, face suspension or prosecution.
Thousands of subpostmasters were blamed for accounting shortfalls that were caused by errors in the Horizon computer system they use in branches. About 900 were convicted of financial crimes based on evidence from the faulty system, with many serving custodial sentences. Many more lives were destroyed through bankruptcy and business failures, after subpostmasters were forced to pay back unexplained shortfalls.
If the Post Office was still chasing repayment of unexplained shortfalls, we would be in a real mess – half the branches in the country would be closed Richard Trinder, subpostmaster
Richard Trinder, a subpostmaster of three branches in Yorkshire and Derbyshire, and a member of the Voice of the Postmaster campaign group, said the figures fill him with “absolutely no confidence”.
“If the Post Office was still chasing repayment of unexplained shortfalls, we would be in a real mess – half the branches in the country would be closed,” he told Computer Weekly. “Fortunately, they are not chasing shortfalls as long as we settle centrally and make a phone call.”
He said there can only be three reasons for unexplained shortfalls: “Either Horizon is faulty, there was inadequate training, or people are stealing.”
A September 2024 survey by the public inquiry raised concerns about the current version of the controversial system. It found that 57% of current subpostmasters had experienced unexplained shortfalls.
Of those surveyed, almost all 92% had encountered an issue with the Horizon IT system in the 12 months prior to the survey, with screen freezes and lost connectivity being the most common problems.
Three-quarters said they had used their own branch money to cover discrepancies or resolved the issue themselves.
During a public inquiry hearing in November last year, Fujitsu’s European boss, Paul Patterson, admitted there are bugs and errors in the Horizon software, but said blaming the application for all issues is the result of too “narrow” a definition of Horizon. He said screen freezes could be caused by multiple things, and connectivity is provided by other suppliers.
He also said systems that connect to Horizon, such as POLSAP, the Post Office’s SAP platform, should also be examined when issues occur.
The findings of an independent investigation into the current Horizon system are imminent. The investigation was revealed in November 2024 by Lorna Gratton, the civil servant who sits as a non-executive director of the Post Office on behalf of the government, when giving evidence during a Post Office scandal public inquiry hearing.
The Post Office said it would include an assessment of the integrity of the data in Horizon and a review of the Post Office’s discrepancy identification and resolution process.
Computer Weekly revealed the review was being carried out by investigation firm Kroll, with the results expected to be available in the autumn.
Regardless of the outcome, the Horizon system is set to remain for years to come, although the government has confirmed that the system will be replaced.
According to a public sector procurement notice in May, the Post Office will finally replace Horizon with an off-the-shelf alternative, but the current system could remain until 2033.
The Post Office is also looking for a new supplier to support Horizon when the current Fujitsu contract expires in March next year. In total, the tenders are worth £492m.
The Post Office scandal was first exposed by Computer Weekly in 2009, revealing the stories of seven subpostmasters and the problems they suffered due to Horizon accounting software, which led to the most widespread miscarriage of justice in British history (see below timeline of Computer Weekly articles about the scandal since 2009).
