Documents obtained by the BBC reveal that top executives at the Post Office secretly decided to dismiss forensic accountants who discovered bugs in their IT system in April 2014. The decision was made by a sub-committee of the Post Office board, known as “Project Sparrow”, with the knowledge of the government. The accountants, from Second Sight, played a crucial role in uncovering flaws in the Horizon computer system which led to false evidence of cash shortfalls and wrongful prosecutions of sub-postmasters. Despite this, Post Office bosses maintained their systems were robust.
The documents also show that the Post Office planned to pay only £1m in compensation to sub-postmasters in 2014, a significant underestimation of the eventual cost of the scandal, now expected to exceed £1bn. The discussions of Project Sparrow were not disclosed during court proceedings between 2017-2019 when sub-postmasters challenged the Post Office.
The BBC has now obtained unredacted minutes from two Project Sparrow meetings in April 2014, revealing plans to dismiss Second Sight. The committee was led by Post Office chair Alice Perkins and included chief executive Paula Vennells, general counsel Chris Aujard, and Richard Callard, a senior civil servant at UK Government Investments.
The minutes show that the committee planned to bring the investigation of sub-postmasters’ cases under the control of the Post Office, removing Second Sight from its independent investigating role. This decision was kept secret from Parliament and the public, with the Post Office claiming that Second Sight’s independent review supported its approach to sub-postmasters’ complaints.
Nine months before the committee met, Second Sight submitted a report identifying bugs that raised doubts over the reliability of Horizon data used to prosecute sub-postmasters. The review was kept out of the public domain for years. Despite this, the Project Sparrow minutes from April 2014 show committee members planning to pay minimal compensation to sub-postmasters and close or speed up the mediation scheme.
In December 2014, Post Office Minister Jo Swinson referred to the independent role of Second Sight in a parliamentary debate on the scandal. However, in March 2015, Second Sight’s contract was terminated and the Post Office brought investigation of the sub-postmasters’ cases in-house.
The Post Office declined to comment on the allegations, stating that it would be inappropriate to do so outside of the ongoing inquiry.
