Post Office row: Top civil servant denies telling Henry Staunton to delay payments

The senior civil servant former Post Office chairman Henry Staunton claimed told him to delay the Horizon IT compensation payments has denied such a conversation took place.

Sarah Munby, who was in January 2023 the permanent secretary for the Department for Business, Energy and Industrial Strategy (BEIS) has denied telling him to slow pay outs so that the government could “limp into the election” with the lowest possible financial liability.

It comes after Rishi Sunak at Prime Minister’s Questions on Wednesday sidestepped calls to repeat business secretary Kemi Badenoch’s claims that Staunton was lying.

Staunton made the claims in a recent interview with the Sunday Times. He later revealed in a note he said was made at the time that Munby – now leading the Department for Science, Innovation and Technology (DSIT) – said now was “not the time” to tackle long-term issues.

He said she urged him not to “rip off the band aid” on the Post Office’s finances, amid ongoing disputes over compensation payments to the wrongfully convicted postmasters.

The note made no direct reference to the specific issue, but Staunton claimed it was understood to be one of the major financial issues the Post Office was facing at the time.

In response, the now Department for Business and Trade (DBT) released a letter from Munby to Badenoch, in which she denied making the instruction.

“It is not true that I made any instruction, either explicitly or implicitly, to Mr Staunton to in any way delay compensation payments,” she wrote.

“I did not. Neither Mr Staunton’s note, nor the contemporaneous note that my office made, suggest otherwise. In fact, no mention of delaying compensation appears in either note.”

Munby also insisted: “As the notes record, we discussed Post Office operational funding, not compensation funding. 

“These two areas of spend were separately ringfenced, and it is factually wrong to suggest that cuts to compensation would have improved the Post Office’s financial position.”

She added that she could give “the very strongest reassurance” that she did not suggest or imply that postmaster’s compensation should be delayed.

She stressed: “I did not believe they should be delayed and no minister ever asked me to seek delays.”

In a comment alongside Munby’s letter, a government spokesperson said it “set the record straight”.

They added: “Neither of the records taken at the time suggest the government – either at official or ministerial level – wanted to slow down or delay compensation payments.

“Funding for compensation is separately ringfenced expenditure, and is not accessible to the Post Office for any purpose other than compensation payments.

“This is a distraction from the important work to continue to deliver for postmasters, which the Business Secretary is focused on.”