Fujitsu management paid £26 million during Horizon contract

Fujitsu UK has paid executives more than £26 million in the 25 years since its controversial Horizon contract with the Post Office began.

The company also paid out more than £11 million to former directors for job losses during that period, according to a BBC analysis of its accounts.

While Duncan Tait was England manager, the highest paid manager earned £2.5 million.

Fujitsu apologized to the sub-postmaster general and others and said the money would be used to pay compensation.

At the center of the Post Office scandal is a flawed computer system called Horizon, which has been experiencing unexplained errors since its inception.

And for more than a decade, these were unfairly blamed on subpostmasters, over 900 of whom were prosecuted.

The system was built by a British computer company called ICL, which was renamed in 2002 after its Japanese owner, Fujitsu.

Fujitsu's financial statements do not include the salary of his UK boss. However, the company's two European subsidiaries, Fujitsu Services Ltd. (FSL) and its European holding company, Fujitsu Services Holdings Ltd. (FSHL), do ) reported the highest amount. -Paid Director.

In most cases, the highest paid person is the chief executive officer, although he did not name the individual.

They show how the Director-General received millions of pounds in pay based on false data from Fujitsu's flawed computer system, while the Sub-Postmaster General was chased out of court for tens of thousands of pounds unpaid. ing.

“I think it's absolutely terrible,” said Alison Hall, who ran a post office in River Edge, near Leeds, and whose false accounting conviction was overturned in 2021. If the Horizon system was buggy all along and we knew it was our fault, we could pay for it ourselves. ”

Labor MP Kevan Jones, who campaigns on behalf of subpostmasters and is a member of the Horizon remuneration advisory committee, said: 'It's clear they were being paid millions of pounds for their failures, but the “Failures had consequences. They ended up costing people their lives.” “That's something Fujitsu needs to explain.”

An investigation by the House of Commons Treasury Select Committee found that since 2019, Fujitsu had signed contracts worth £3.4bn with the Treasury, HMRC, Bank of England and the Financial Conduct Authority. Fujitsu has announced that it will no longer bid for public sector contracts unless requested to do so while a statutory inquiry into the scandal, led by Sir Wynne Williams, is ongoing.

Keith Todd was in charge of Fujitsu during the difficult launch of ICL's benefit agency and post office counter IT systems in the late 1990s.

The Welfare Office withdrew, ICL lost £180m, and in 1999 the Post Office alone went live with the Horizon system.

The accounts of ICL (later to become FSHL) report the total salary of the highest paid director. Given that Mr. Todd was the CEO, it is very likely him.

The highest paid director in Mr Todd's last term, the year ending March 2000, received £412,000.

But Mr Todd also held an option to buy 1.75 million shares, which could have been worth millions of pounds if ICL's plans to list on the stock market went ahead.

In 2022, Mr Todd gave evidence to the Horizon Inquiry. In 1999, he heard that the Post Office might cancel the troubled project altogether. In January of that year, Mr Todd warned the British government that if the project was canceled, ICL's refloating and possibly hundreds of jobs at the company were at risk.

Horizon survived, but the float was canceled anyway due to difficult market conditions, and Mr. Todd resigned. The following year, Fujitsu Services Ltd. paid an unnamed director £4.4m in compensation for his loss of employment, but it is very likely that most, if not all, was paid to Mr Todd.

Keith Todd was replaced as UK chief executive by Richard Crist, a Preston-born lawyer turned executive credited with saving ICL. He described winning ICL's post office contract as his “proudest moment.”

“After 25 years, we still have contracts left and these are the most profitable,” he told the IT Archive website in 2019.

In the financial statements, he is listed as FSHL's executive chairman from 2000 to 2004 and again in 2009. Meanwhile, the highest paid directors earned a total of £3.1m.

Mr Crist is expected to appear before the Horizon inquiry later this year.

He was succeeded by David Courtley, who served as chief executive officer of Fujitsu's European services business from 2004 to 2008. Mr Courtley was probably the highest paid director at the time, with his annual salary of £2.36m making him the highest paid director. Total amount: 9.15 million pounds.

In 2009, the FSHL paid Mr Courtley £1.59m, presumably as compensation for the loss of his job.

Richard Crist has temporarily returned to the top job until a replacement can be found.

David Courtley left Fujitsu to lead a company called Phoenix IT. Within months, the company was embroiled in an accounting scandal, and he resigned after 14 months, although the company said his departure was unrelated to the accounting issue.

Courtley currently runs a small IT consultancy called Mozaic.

Roger Gilbert was appointed in 2009. This was the year that the first major media articles about the Post Office scandal began to appear, including an article in Computer Weekly.

The FSHL's highest paid director received £917,000 in his first year in charge and £725,000 the following year, but Gilbert told the BBC that he was the highest paid director. The director said he did not receive such an amount.

He became chairman in 2011 and retired the following year.

“I am shocked by the Post Office's actions in prosecuting so many innocent people,” he told the BBC. “It is right that a public inquiry be held to investigate what happened, and the report which I am confident will provide much more insight than the very limited information on Operation Horizon. I’m looking forward to it.”

Duncan Tait was appointed as Fujitsu's Chief Executive Officer for the UK and Ireland in 2011 and was promoted to Fujitsu's Chief Executive Officer for Europe, the Middle East, India and Africa in 2014. The following year, he was promoted to director of Fujitsu's main Japanese company.

The promotion comes at the same time as a significant increase in the salary of the FSHL's highest-paid director, increasing from £1.46 million in 2015 to £1.68 million in 2018 and £2.45 million in 2019.

Mr. Tate's time at the top of the company covered the period when the Horizon scandal evolved from several media articles and documentaries into a national scandal.

In-house legal advice warned the Post Office that Fujitsu employees were giving false evidence in court, and subpostmasters and others began legal action.

Mr Tate was identified as the Fujitsu official who told Post Office CEO Paula Vennels that Horizon was “like Fort Knox”. She reiterated this claim in her letter to Congress in 2020. Tate later claimed that her remark was in reference to her ability to withstand cyber-attacks.

He resigned in 2019, and the deputy postmaster general and others won a High Court case in the same year. Tite said the events were unrelated.

The year after he resigned, FSHL paid an unnamed director £2.61m as compensation for his loss. This appears to have been to Mr. Tate.

The following year, he took up a new role as group chief executive of car dealer Inchcape, receiving a remuneration of more than £4 million in 2022. He will also give evidence to the next stage of the Horizon investigation.

Mr Tait said: “I am appalled by the harsh treatment of the Sub-Postmaster General and Postmaster General and will do everything I can to assist the investigation.''This is a terrible miscarriage of justice and I hope that other Fujitsu and other “Like our employees, I regret this incident.” The damage inflicted on the lives of the subpostmaster and postmaster general, and the role Fujitsu played in that. ”

He was replaced by current chief executive Paul Patterson, who held the position during the Horizon investigation. He gave evidence last month and is expected to give evidence again later this year.

Earlier this year, he admitted to MPs on the Business Select Committee that Horizon had “bugs, errors and flaws” from the beginning and apologized for the company's role in the scandal.

He said Fujitsu, which now faces the prospect of being required to contribute to a compensation fund for victims, had a “moral obligation”.

Arguably the highest paid director at the FSHL, Mr Patterson's remuneration has fallen from £890,000 in 2019 to £408,000 in 2023.

However, FSL's highest paid director was paid £1.3m in 2022. This would probably be Anwen Owen, head of Great Britain and Ireland, who was the only person who was a director of the FSL rather than the FSHL that year.

Richard Crist, David Courtley, Anwen Owen, Paul Patterson and Keith Todd declined to comment for this article.

Fujitsu declined to comment on the salaries of former and current employees, but issued the following statement:

“The Fujitsu Group takes this matter seriously and would like to offer our deepest apologies to the postmaster and his family.”

“Based on the findings of the investigation, we will cooperate with the British government and take appropriate measures, including the provision of compensation. The Fujitsu Group looks forward to a swift resolution that will ensure a just outcome for the victims. .”