The Post Office has spent more than £250m on legal fees linked to the Horizon IT scandal, a sum almost equivalent to the compensation paid out to the victims.
Data obtained under the Freedom of Information Act revealed that the company had paid £256.9m to law firms and barristers’ chambers in the last decade, specifically in relation to the Horizon scandal.
Meanwhile, £261m in total compensation was paid out to victims as of July, according to government statistics.
The Post Office’s legal bill includes the costs to defend the group litigation brought by 555 subpostmasters, led by Sir Alan Bates, at the High Court.
Keith Macaldowie, who was also part of the civil group action, called the disclosure of the large legal bill “disgusting”.
The fees cover the costs of launching a compensation scheme and legal advice relating to compliance with the High Court’s ruling on the faulty Horizon software.
The bill covers legal representation for the Post Office at the ongoing public inquiry into the scandal and wrongful prosecution of subpostmasters.
Tracey Merritt, one of the original group of subpostmasters who is still waiting on compensation, said: “The figure doesn’t surprise me.”
“It just shows where their priorities are because if we were important people, they would make sure that we got fair, just compensation, instead of paying solicitors huge fees to keep knocking us down.”
The fees were paid out to 15 law firms and two barrister’s chambers between September 2014 and March 2024, The Lawyer magazine first reported.
The majority of the fees was paid to City law firm Herbert Smith Freehills (HSF), which received £163.5m for its work.
The Post Office hired HSF to help reach a settlement with subpostmasters in 2019. The international law firm has since advised on the compensation schemes and the statutory inquiry.
A spokesman for the firm said: “Herbert Smith Freehills’ work has been complex and wide-ranging, involving hundreds of our staff over a number of years, and working with millions of documents in relation to the inquiry.
“As a firm, we have immense sympathy for the postmasters affected by the Horizon IT system, and what they and their families have endured. As one of several advisers on the compensation schemes, we will continue to support the Post Office in its efforts to deliver fair compensation as swiftly as possible.”
The fees paid to law firms include expenses for external experts and individual barristers.
A Post Office spokesman said: “Today’s Post Office is focused on paying redress to those affected as quickly as possible and supporting the inquiry to establish the truth.
“The Post Office and the Government have so far paid over £260m to 2,800 postmasters. We are truly sorry for the suffering caused by the Post Office’s past actions and the amount of money spent with legal firms reflects the huge scale of the scandal.
“The inquiry has brought to light the scale of Post Office’s past failings and their devastating consequences. We are doing all we can to help victims get answers and to put things right, as far as that can ever be possible.”
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