Jeremy Hunt shot down Post Office payouts earlier than ITV drama made public indignant

Former Tory Chancellor Jeremy Hunt shot down an attempt to find a call to award shift payouts to Post Office scandal victims, it has emerged.

Kemi Badenoch, who was Business Secretary at the time, it was “extremely disappointing” that it took ITV drama Mr Bates Vs The Post Office to finally bring some urgency to the issue. She said she grew “frustrated” with Government delays and demanded swift £100,000 payments in August 2023.

But this was rejected as it could have cost taxpayers more, an inquiry into the scandal heard. Hundreds of postmasters were wrongly convicted and lost their livelihoods after faulty software made it look like money was missing from their branches.

Ms Badenoch told the inquiry that she wanted to skip procedures designed to ensure value for money – as they were slowing the compensation payouts down. In a letter to Mr Hunt on August 9 last year she said: “The scandal ruined many postmasters’ lives. The longer compensation goes unpaid, the more criticism we shall face.”

She urged the Treasury to authorise £100,000 payouts to victims on the Group Litigation Order (GLO) scheme. But this was rebuffed by the Chancellor, who warned the move would “incur significant repercussive risk and cost”.

Ms Badenoch told the inquiry: “This letter was an expression of my frustration that things are still not happening.” She said she accepted that the swift approach could result in those affected receiving thousands of pounds more or less than they would get after a full process.

But she said: “The worst risk was someone not getting any money at all rather than them not getting the exact money right down to the penny.” Ms Badenoch went on: “I felt that given how long this had been taking it was better that we overpay but make sure people get their money quickly than make sure we derive the perfect amount and they not be there to receive the money at all.”

And she told the inquiry civil servants were too “risk averse”, worried that swift decisions would lead to higher costs in the future. “I am more interested in making sure that we get things done, rather than every single box is ticked,” the former Cabinet minister stated.

After public anger grew as a result of the ITV series, Ms Badenoch said, things finally started to change. “It sadly turned from a value for money question to a public perception question,” the Tory leader said.

In a witness statement to the inquiry she said: “There is a cautious, risk-averse culture within the civil service, which is systemic and baked-in.”

And lashing out at the culture under the Tories she said: “There is far too much going round and round in circles and avoiding taking serious, real decisions because everybody is worried about getting into trouble later.

“This is something which I tend not to worry about. Maybe I should do but I do trust my judgment.”

Labour has previously accused the Tories of failing to put aside compensation cash for victims of the IT scandal. In the Budget last month, £1.8billion was announced for payouts.

Ms Badenoch said that she delegated the day-to-day response to the scandal to junior minister Kevin Hollinrake. She said: “I believe that all ministers should have the capacity to take decisions without constantly being micromanaged by the Secretary of State.”

Earlier current Business Secretary Jonathan Reynolds told the Inquiry he has had he “couldn’t have asked for more” support from the Treasury. Quizzed on whether he’s had any pushback in his efforts to get justice for victims he said: “I’ve had exactly what I needed.”

He went on to say that the Post Office has a crucial role to play in communities going forward. “I think there’s fundamentally a need for Post Offices on our high streets providing the services they currently do and potentially further ones in the future,” he said.