Anger sparked by TV drama forces Fujitsu to put public sector contract bidding on hold

It is not just the UK government that has been forced to act quickly amid public anger, as a wounded Fujitsu stalls government contract bidding

Karl Flinders,
Chief reporter and senior editor EMEA

Published: 18 Jan 2024 13:44

Fujitsu has put bidding for UK public sector contracts on hold during the current public inquiry into the widest miscarriage of justice in UK history, in which the Japanese supplier is implicated.

Under-fire Fujitsu has also confirmed it will contribute to the financial redress for subpostmasters who suffered as a result of being blamed for accounting shortfalls caused by errors in the Fujitsu software they use to run their branches, in what is known as the Post Office Horizon scandal.

Thousands lost significant sums of money and about 900 were convicted of crimes such as theft and false accounting based on evidence from the error-prone system. Nothing new has been revealed in recent weeks concerning the scandal, originally exposed by Computer Weekly, which has been ongoing for two decades.

Some journalists, MPs and campaigners have been pushing the issue for years, but since an ITV drama about the scandal – Mr Bates vs The Post Office – aired in the first week of this year, public anger has grown and the government has acted. It has announced emergency legislation to exonerate about 800 wrongfully convicted subpostmasters, announced new measures to offer financial redress to victims and put pressure on Fujitsu.

In the House of Commons, Alex Burghart MP, parliamentary secretary for the Cabinet Office, said: “This morning, the Cabinet Office received a letter from Fujitsu voluntarily undertaking not to bid for government contracts whilst the inquiry is ongoing, unless, of course, the government asks them to.”

Fujitsu has billions of pounds worth of contracts with the UK public sector. When it acquired British IT firm ICL in the 1990s, it took on a large government customer base, including the Post Office.

Despite its involvement in the scandal, the Japanese IT giant has continued to be awarded lucrative contracts by the UK government. Last year, it was awarded IT services contracts by the Home Office, HM Revenue & Customs (HMRC) and the Foreign, Commonwealth & Development Office (FCDO). It will be paid £250m by HMRC to replace an in-house service, the FCDO has contracted it to provide networking and communications services in a deal worth £184m, and the Home Office is paying Fujitsu £48m to support the technology underpinning the Police National Database.

Earlier this week, Fujitsu’s UK head, Paul Patterson, apologised for the supplier’s role in the scandal and said it would contribute to the huge costs associated with it, including financial redress for thousands of victims. He told MPs in a select committee hearing: “We were involved from the start; we did have bugs and errors in the system, and we did help the Post Office in their prosecutions of subpostmasters. For that, we are truly sorry.”

When asked whether Fujitsu would contribute to the scandal bill, expected to cost up to £1bn, he said Fujitsu was “morally obligated” to contribute to the costs, but said the extent would be determined by the outcome of the Horizon scandal public inquiry.

Fujitsu also released a statement reaffirming its regret over the scandal and confirming it would contribute to the financial redress of victims.

“Fujitsu regards this matter with the utmost seriousness and offers its deepest apologies to the subpostmasters and their families,” it said in the statement.

“The UK statutory public inquiry, to which our UK subsidiary is providing full cooperation, is examining complex events that have unfolded over many years, and we remain steadfast in our commitment to this cooperation,” it added.

“Based on the findings of the inquiry, we will also be working with the UK government on the appropriate actions, including contribution to compensation.”

Earlier this week, business minister Kemi Badenoch wrote to Fujitsu privately to demand talks on the supplier’s contribution towards financial redress.

“I understand that we are awaiting the conclusions of the [statutory public inquiry], but ahead of that I would welcome a discussion with you on the type of response Fujitsu might make and the role you foresee Fujitsu playing towards securing justice for those affected,” she wrote.

Computer Weekly asked to see the contents of the letter, but the government department refused to share a copy, citing it as a “personal” letter. A department spokesperson said: “As you appreciate, ministers send correspondence to a range of individuals and businesses, some of which include information that is commercially sensitive. We’ve been very upfront with the media today about the secretary of state sending a letter asking Fujitsu for a meeting, which has been widely reported. We have nothing further to add at this stage.”

Fujitsu’s Patterson will face the statutory public inquiry tomorrow (19 January 2024).

Computer Weekly first exposed the scandal in 2009, revealing the stories of seven subpostmasters and the problems they suffered as a result of the Horizon system (see timeline of all articles below).