Post Office pays Fujitsu another £21m to try and fix scandal software Horizon

The Post Office has paid Fujitsu £21m to address shortfalls in its Horizon IT software, which led to the wrongful prosecution of hundreds of sub-postmasters and sub-postmistresses.

At least 900 victims of the Post Office scandal were wrongly prosecuted over financial shortfalls caused by the faulty software, which has been used since 1999.

The i Paper revealed in February the Post Office signed a contract with Fujitsu to continue using Horizon until March 2026 at a cost of £40.8m – a move described by victims of the scandal as “a kick in the teeth“.

However, when the contract was made public last month, it included a further £21m that will be paid to Fujitsu to address Horizon’s “additional upgrades to address legacy technical debt issues”, which arise when outdated software no longer receives updates, making it susceptible to technical glitches and cyber attacks.

Despite calls for Horizon to be replaced by a newer, more reliable system, the Post Office has not yet confirmed when it will be ditching the software – nor has it decided what its replacement will be.

Last year, more than £68m was paid to Fujitsu to operate and maintain the system, while a further £11m was paid between January and 12 March 2025, according to data obtained through freedom of information laws.

“The sooner it goes, the better for all involved,” former sub-postmaster and campaigner Sir Alan Bates told The i Paper.

“It’s been cobbled about for years, which is why it has never worked properly, but it was only the incompetence of senior management at the Post Office that kept trying to breathe life into it by throwing taxpayers money at it year after year.

“The ploughing of more money into Fujitsu to get a few extra breaths out of the system has got to be borne in mind when the bill for the cost of the Horizon scandal is eventually presented to Fujitsu.”

While the Post Office has pledged to implement a “lower-risk, better-value new branch IT for postmasters”, it declined to comment on whether its contract with Fujitsu will be extended beyond 2026.

As of 31 March 2025, approximately £892m had been paid to over 6,200 claimants through four compensation schemes for victims of the Post Office scandal.

The Justice for Subpostmasters Alliance, led by Sir Alan, is battling for compensation for 555 former sub-postmasters who took part in pivotal group legal action against the Post Office between 2017 and 2019.

More than five years on from winning an initial court battle, and over a year after the ITV drama Mr Bates vs the Post Office brought the miscarriage of justice into the national spotlight, no deadline has been set for when they will receive redress.

Around 70 of the workers in Sir Alan’s Group Litigation Order (GLO) scheme have died, and the campaigner fears more may not live to see justice served, with a new legal battle brewing over compensation delays.

Christopher Head became a sub-postmaster in West Bolden, near Sunderland, in 2006 at the age of 18 and is believed to be the youngest victim of the Post Office scandal.

He was prosecuted by the Post Office after more than £80,000 was missing from his branch.

“Money is being wasted on dithering and delay,” Mr Head said, reflecting on the Post Office’s continued use of Horizon.

“Yet, since the High Court case ended in 2019, we don’t seem to be any further forward in terms of its replacement structure than we were six years ago,” Mr Head told The i Paper.

“The amount of money that is being spent, not only on legal costs, but the IT infrastructure, is astronomical.

“The longer you have to maintain the Fujitsu system, which we know is not robust, the more money is funnelled into that system, which is all Government money.”

A spokesperson for the Post Office said it has a “five-year plan to deliver a ‘new deal for postmasters’ and put the organisation on a solid footing for future success.

“We are looking at Post Office’s technology and data strategically, to ensure that we reduce central costs and provide postmasters with the tools they need to serve their customers and run profitable businesses into the future.”

A Fujitsu spokesperson said: “We are focused on supporting the Post Office in their plans for a new service delivery model, so branches can continue to deliver key services to the public.”

Under its Overturned Convictions Scheme, the Government offers an immediate £600,000 pay-out to victims of the Post Office scandal whose convictions have been overturned.

Those who seek to claim more than £600,000 are eligible to receive £450,000 in interim payments, with any further compensation they receive being conditional on an assessment of their case.

How are Post Office scandal victims compensated?

As of 31 March 2025, approximately £892 million had been paid to over 6,200 victims of the Post Office scandal through four schemes.

The Group Litigation Order (GLO) scheme 

The GLO scheme was set up to ensure that the cohort involved in the Justice for Subpostmasters Alliance’s High Court proceedings received extra money to reflect the hardship they faced.

The group secured a £42.5 million settlement in 2019, but the costs of the proceedings meant each claimant was paid a relatively low level of compensation.

As of 31 March 2025, £150 million had been paid under the scheme, including interim payments.

Overturned Convictions Scheme (OCS)

This scheme is open to anyone who had their Horizon-related convictions overturned by the courts, regardless of whether they fall within the GLO group.

Through this scheme, claimants can receive a fast-tracked £600,000 settlement.

Otherwise, they can opt for a higher level of compensation, but that implies losing their automatic entitlement to the initial £600,000 pay-out.

Whether claimants are entitled to more than £600,000 will depend on an assessment of “their specific facts and individual circumstances“.

Interim payments of £200,000 are made as soon as possible following the overturning of convictions under this scheme.

For those claiming more than £600,000, an additional £250,000 interim payment is made when the Post Office receives their full claim.

As of 31 March, £67m had been paid out under this scheme, including interim payments.

Horizon Convictions Redress Scheme (HCRS)

The HCRS scheme was opened to provide redress for people whose criminal convictions are overturned by legislation passed into law by the UK and Scottish Governments in 2024.

Recipients are eligible for a fixed total sum of £600,000. This will be made up of a preliminary payment of £200,000, then a second and final payment of £400,000.

Alternatively, claimants can request more than £600,000, but will need to provide “evidence of your losses so you can receive the exact amount you lost”.

Similar to the OCS, whether claimants are entitled to more than £600,000 will depend on an assessment of their case.

A total of £221 million had been paid out through this scheme, including interim payments, as of 31 March.

Horizon Shortfall Scheme (HSS)

The HSS is open to postmasters and postmistresses who had not been part of the GLO action and who did not have a criminal conviction.

Claimants can apply for a £75,000 fixed sum award.

Otherwise, they can apply for a greater amount that would need to be approved by an independent advisory panel.

As of 31 March, £454 million had been paid out through this scheme, which includes interim payments.

As of 31 March, £67m had been paid out under this scheme – broadly equivalent to the amount Horizon cost the Post Office last year alone.

Mr Head said that the “take it or leave it” nature of the scheme means that sub-postmasters and sub-postmistresses settle for the immediate £600,000 payment rather than claiming more – even if the damages they faced exceeded that amount.

Julia, a former sub-postmistress, told The i Paper she spent four-and-a-half months in prison in 2005 after being wrongly prosecuted over £19,000 that appeared to be missing from her Post Office branch in the West Midlands.

“I was audited and the next thing I know the police arrived at the Post Office, took me outside and searched my car.

“They then took me to my house in a big police van and searched my house top to bottom,” the mother-of-three said.

“Bear in mind that it was 2 weeks before Christmas, so my children’s presents were wrapped and they opened them up, presumably to look for any money that I was meant to have taken.

“They took me to the police station and told me I was under suspicion of theft.”

Before appearing in court, Julia said she dropped her children at their grandparents’ house “and told them I was going to go shopping”.

“I went before the judge and he sentenced me to prison. Even now, 20 years later, I will never get over that judge saying that to me.

“If I didn’t have my children, I don’t think I would’ve made it out,” she added.

While knowing she was innocent, Julia, whose name has been withheld to protect her identity, said she hid her prosecution and prison sentence from her current partner, who she has been with for eleven years, as well as colleagues and friends she made after her release.

“I didn’t tell a single soul. Not even my family at the time.

“When you’re in that situation, you’re on your own. I was scared. I had never been so scared in my life.”

Julia only realised more sub-postmasters and sub-postmistress had been wrongly prosecuted after the scandal gained widespread attention through Mr Bates vs the Post Office.

She then applied for compensation through the Government’s Overturned Convictions Scheme, which would entitle her to an immediate £600,000 pay-out, unless she opted for more.

Following an assessment of the damages she sustained, Julia’s solicitors informed her she was eligible for up to £800,000, including the cost of her house, which she was forced to sell after being released from prison.

However, applying for more compensation would involve losing her immediate entitlement to the £600,000 payment – a risk Julia said she is not willing to take.

“To go back down to £450,000 if my claim wasn’t successful would be a bit of a kick in the teeth after everything I’ve been through in the last 20 years.

“I am pressured into taking the £600,000. They put that figure out and said, ‘take it or lose it’.

“They are still ruining my life 20 years later.”

Commenting on the limitations of the compensation scheme, Sir Alan said: “There are many victims who have reported the disparity and arbitrary way in which their claims have been assessed.

“At times it seems to be whatever mood the claims assessor is in as to what is offered.

“And this seems to extend across all the different schemes being run by a Government department that is determined to stay deaf to suggestions from victims and their legal representatives of how to improve and greatly speed up final payments to the victims.

“There is little doubt that the best thing the victims can now do is to ask the courts to review how they have been dealt with and review their claims.”

A Government spokesperson said: “We recognise the immeasurable suffering that victims of the Horizon scandal have endured.

“We have doubled the amount of payments under this Government​ and are settling claims at a faster rate than ever before to provide them with full and fair redress.”

Steve Robson, The i Paper‘s Northern Correspondent, has been shortlisted for the Scoop of the Year at the annual Press Awards for his coverage of a second IT scandal, sparked by the Capture IT system used before Horizon.