My Lords, it is a privilege and an honour to follow the noble Lord, Lord Arbuthnot, particularly on the Second Reading of a Bill which, whether he likes it or not, is already referred to as the Arbuthnot Bill, and if I have anything to do with it, will continue to be.
On 7 September last year, the noble and gallant Lord, Lord Houghton of Richmond, began his contribution to an Armed Forces debate with the following sentence:
“I suppose that one of the many benefits of being a Member of this House is that you get a free copy of the New Statesman every week”.—[Official Report, 7/9/23; col. 570.]
I never thought that I would use this phrase, but I opened my New Statesman this week to discover that the editorial, headed “A very British scandal”, is about the very subject that has led to the necessity of this legislation. With your Lordships’ permission, I will read the peroration—for a very good purpose:
“The malaise that the Post Office scandal has exposed in British life is that of unaccountable power. Its executives obfuscated and denied errors despite being confronted by innumerable injustices. Institutions such as the Post Office and the Royal Mail—diminished by its botched privatisation—should exemplify the common good. All too often they become self-serving bureaucracies, with customers and workers bamboozled should they complain. Yet this affair is also a reminder of the best of public life: crusading journalists and MPs (such as staff at Computer Weekly and the Conservative peer James Arbuthnot); gifted screenwriters and actors; and, most of all, tenacious campaigners such as Mr Bates who will not cease until justice is done”.
My noble friend Lord Arbuthnot is an example of the best of public life.
The Post Office Horizon scandal exemplified many of the trends that have led to anger and political apathy among the public. Political indifference and delay, exacerbated by a defensive posture among the legal profession and others, have resulted in ruinous, life-altering outcomes for thousands of innocent people. To add insult to considerable injury, Fujitsu—the company responsible for this debacle—has won 150 government contracts since the details of the Post Office scandal began to emerge. Since December 2019, when the Appeal Court ruled that the Horizon system contained bugs and errors that resulted in miscarriages of justice, the Government have awarded contracts worth more than £4 billion either solely to Fujitsu or as part of joint public sector contracts. For those affected, there could be no greater evidence of a thumb on the scales of justice than this asymmetry of consequences. Postmasters have faced financial hardship and ongoing legal limbo, while those responsible have received implicit government endorsement in the shape of new lucrative contracts.
This is bad enough, but recent evidence has suggested that the Post Office has also treated the limited compensation it grudgingly offered to sub-postmasters as tax deductible. Dan Neidle, the head of Tax Policy Associates, has outlined why these claims are illegitimate, stating that you cannot
“claim a tax deduction for things which are unlawful, illegal or outside the trade”,
such as wrongly prosecuting 4,000 postmasters. We must also ask why, given that the £934 million they claim as deductible relates to historic periods, it is only this year that the Post Office has made a designedly oblique reference to this practice in the small print of page 101 of its accounts. I am pleased that HMRC last week confirmed that this matter—one of five where Tax Policy Associates believes that the Post Office has materially underpaid its tax—is under active investigation.
Mr Neidle is also campaigning openly for better compensation in the present scheme, for the element of damage that reflects destruction of reputation and stress. As I heard him explain only the other day, in the context of employment tribunal awards that component
of the calculus of the total sum of compensation attracts awards of between £1,000 and £11,000 for the lowest levels of damage to reputation and emotional damage. For the more severe, awards are between £11,000 and £34,000. For the worst examples—I venture to suggest that the vast majority, if not all, the wronged postmasters must have suffered reputational damage and stress of the worst kind—employment tribunals are awarding between £34,000 and £56,000, whereas most postmasters are getting no more than £5,000 from the current compensation scheme.
Alongside today’s Bill, I am also pleased that a brief Act of Parliament providing for exoneration of all those affected is now being considered, which is something I first suggested in your Lordships’ House in June 2020. Given that three and a half years have elapsed between that date and this, such a glacial pace in providing redress may be another useful exemplification of a problem that saps confidence in the political process among the public.
At the heart of this miscarriage of justice is the fundamental unreliability of the Horizon software, upon which the original prosecutions depended. It is equally clear that, without the group litigation brought by the 555 sub-postmasters, the flaws and glitches in the software would not have been uncovered. Here, I return to a question which I raised in your Lordships’ House last Wednesday: where does, and where should, the burden of proof lie in respect of computer-derived evidence? The Police and Criminal Evidence Act 1984 placed that burden upon those who rely on such evidence. But, in response to lobbying from the Post Office, among others, we saw that change, because of a Law Commission recommendation. There is now a presumption in favour of the reliability of such evidence unless a defendant can prove why it may be compromised. How can we possibly expect an individual unversed in the complexities of computer programming or algorithmic, sequential decision-making to provide such proof? This is a further asymmetry that needs urgent action. I would be grateful if the Minister could give an undertaking, maybe not today, that this will form part of the follow-up to the Williams review.
Finally, I turn to the broader issue that my noble friend Lady Chakrabarti alluded to, and which is an obsession of mine: artificial intelligence and its integration into our public services. If the Horizon system—far more rudimentary than any AI-infused technology—can precipitate such confusion, misery and frustration, there is a risk that a far more complex system could produce more apparently coherent, though equally unjust, outcomes. In such a case, the pursuit of justice in the case of error would be more tortuous than that endured by the sub-postmasters we are discussing today. Noble Lords may recall a scandal that hit the Netherlands in 2019, whereby a self-learning algorithm falsely labelled thousands of people in receipt of child benefit as perpetrators of fraud. What was the result of that? Poverty, a wave of suicides among those affected, and children taken into foster care. Perhaps most worryingly, the algorithm disproportionately—and, to reiterate, falsely—targeted those from ethnic minorities.
I realise this is well outside the Minister’s purview, but, as we learn lessons from the Horizon scandal, what plans do the Government have to review the
integration of AI into the work of the DWP in this country? Perhaps more importantly—I have asked this question and it has not yet been answered—what is the statutory basis for the use of AI in public services at all? Surely the use of AI in this way risks violating the Blackstone principle, of which the noble Lord, Lord Arbuthnot, reminded your Lordships last week. I will not repeat it, because my noble friend has already dealt with this. In this respect, I return to the Dutch case to which I referred. The victims had no way of knowing why their cases had been identified as potentially fraudulent, and officials claimed they had no way of accessing the algorithmic inputs and could therefore not describe why they were under suspicion. This echoes the Kafkaesque nightmare of the sub-postmasters—accused by faulty technology, denied access to the very information that could exonerate them and forced, in the meantime, to endure penury and stigmatisation.
I will support this Bill, as my party will, as it passes your Lordships’ House with, I trust, the utmost rapidity. I keenly anticipate further measures, not merely to provide full restitution to those affected by the Horizon scandal but to strengthen scrutiny and ministerial oversight over arm’s-length agencies. Nothing adequately can compensate the sub-postmasters and sub-postmistresses who have lost years of their lives to this injustice, but I believe that ensuring such a tragedy cannot happen again may at least console them with the thought that their suffering has not been entirely in vain.
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