There are few, if any, initiatives more crucial to the Post Office’s future than the replacement of the contentious Horizon IT system, which was at the heart of the scandal that caused the UK’s most pervasive miscarriage of justice.
And yet recent revelations at the public inquiry into the scandal show that the replacement project is riven with problems – a project team that distrusts company leaders and is in return distrusted by those leaders, poor governance, a lack of appropriate professional and efficient development skills, limited understanding of current software development practices, and inadequate clarity of purpose beyond that of merely “replacing Horizon”.
As a result, it might not surprise you that the program is still a long way behind and spending hundreds of millions of pounds over budget.
According to a review by government project management experts at the Infrastructure and Projects Authority ( IPA ) in May of this year, the project has” currently unachievable,” with budgets ballooning from £180m to £1.1bn and implementation being delayed by up to five years.
Computer Weekly has then learned that the Post Office announced internally last week that it is reassessing its approach to the Horizon replacement project, and plans more engagement with government and other external experts. According to acting CEO Neil Brocklehurst,” We will be moving forward with the installation of new technology into branches over the following 12 months.”
He continued,” We will also confirm our future plans for our relationship with Fujitsu.”
But can this reassessment of the project turn it around, considering there are huge challenges ahead to get the project back on track?
Catastrophic effects
As of right now, the Post Office’s agreement to support Horizon with IT provider Fujitsu expires in March 2025, which could have disastrous effects on the branch network. Yet Fujitsu is optimistic about continuing, and has said it will only do so if convinced the Post Office has a practical replacement plan in place.
The Post Office has requested a five-year extension with a three-year suspension. Up to £180 million in more tax money could be given to the IT supplier for the whole five years.
But, according to witnesses at the open inquiry into the Post Office scandal, the two companies have yet to agree a new contract, with less than six months to go.
The earliest the Horizon replacement, dubbed New Branch IT ( NBIT ), would start rolling out, according to former Post Office chief transformation officer Chris Brocklesby, was June 2026, with Horizon finally shut down at the end of 2028, according to Brocklesby.
Yet those timelines seem idealistic in light of the obvious chaos surrounding such a crucial project at the Post Office.
Board meeting
Minutes from a Post Office board meeting on July 4, 2024 raise questions about how seriously the organization’s leadership is handling the very important IPA report.
The IPA giving its highest “red” warning rating for the NBIT programme was “due to the profile of the company and the complexity of the programme,” according to Brocklesby, who claimed in the minutes that” the IPA team were never system building experts.”
This view came despite the IPA team concluding:” There are big issues which, at this stage, do not appear to be reasonable or recoverable wholly within POL]Post Office Limited ]”. Seven recommendations were made by the IPA, including improving governance, enhancing the organization’s modern expertise, improving communication with HM Treasury, and ensuring greater clarity around risk appetite.
But, Brocklesby stated to the board of directors of the Post Office that there were only two items that the Post Office” could do something about” in terms of the seven IPA recommendations. He described the 32-page, in-depth IPA report as “very top down”.
The IPA is the government’s supreme authority for monitoring the progress of crucial open sector initiatives, including large-scale Whitehall IT implementations as well as HS2 to defence procurement. The Treasury recommended NBIT as a condition of providing the nearly £1 billion in additional funds needed to meet the program’s revised budget due to all the continuing issues.
Devastating review
The board meeting minutes from July 4th, along with a independent review conducted by Public Digital, a company that is dedicated to leading public sector modern transformation projects, were mentioned in the minutes.
The review’s findings are just as devastating as those from the IPA, as Computer Weekly has now seen a copy of.
The report, produced in May following interviews with 47 Post Office employees, including board members and CEO Nick Read, describes the NBIT project as” not now in a good place”, while acknowledging “pockets of excellent work and deeply skilled people”.
However, the review concluded that” throwing even more resources at the program wo n’t solve its problems.”
According to the report, a Post Office perspective that is essentially an “IT replatforming” – successfully, a new system that addresses the issues with NBIT. But, it found that “replacing Horizon is not just an IT project, it is a huge business change activity affecting every single one of its employees and franchisees”.
The project’s traditional designation as “exiting Horizon” has resulted in the program being disconnected from a set of program outcomes, which are rooted in rebuilding trust with enabling postmasters and assisting them in carrying out their jobs, according to the statement.
lack of abilities
Achieving that goal is hindered by the lack of important skills and knowledge at all levels of the Post Office.
There are inadequate senior leaders with experience of digital transformation at this scale, according to the report, from the board level through to the program.
The review specifically identified a lack of contemporary, agile development experience:” Despite having met some skilled and highly capable efficient delivery people and making improvements, it was widely acknowledged that this approach is brand-new for the programme.
For example, the report highlighted gaps in resources around user experience design– a originally 20-strong team had been reduced to four in 2023, when large numbers of contractors were let go due to the delays in the project. The subpostmasters who will ultimately use NBIT could be directly affected by the knock-on effect.
This skeletal team is not large enough to embed itself within the product teams, conduct the research required for product decisions to be truly informed by user insight, and balance the risk associated with building the wrong thing by failing to communicate with postmasters straight and regularly, according to the report.
However, development and testing to date has been focused on users in Crown branches – those which are explicitly managed by the Post Office– rather than the more common remote branches owned and run by self-employed subpostmasters.
The experts at Public Digital suggested that this should be changed:” We would suggest that the agrarian franchise branch archetype should be the top priority for research and design, because designing for the most challenging set up makes the rest easier.”
However, the NBIT development team only spoke with branch operators occasionally, and they were left with the following statement:” Current engagement with postmasters is considered inadequate and engagement too late, which creates the risk that the program wo n’t meet user needs and will require significant remediation. The focus of replicating what currently exists within Horizon is limiting”.
A dash of realism
The report cited a Post Office plan to increase the number of NBIT employees from 327 to 526 by March 2025, but added that the program’s “recruitment profile” required” a large dose of realism” and that the plan was “unachievable,” which was” a view that interviewees frequently shared.”
The reviewers noted that the type of skills required are in great demand, usually take three to six months to recruit, and that Post Office salaries are not aggressive.
POL has a history of meeting optimistic recruitment goals, and the necessary velocity of hiring is extremely ambitious. The report stated that” some people within the business have raised this as a risk.”
The consultants who reviewed NBIT found low morale within the team, a common lack of trust between the NBIT team and Post Office leadership, and a bad culture.
The lack of trust between the NBIT program and POL business functions was a pretty popular theme in interviews, according to the report.
Delivery is being affected by the lack of trust between the program and wider U business functions, it continued.  ,
We have observed a reluctance for individuals to hold accountable, and committee decisions are made without justification. Process malfunction and an intrinsic lack of trust between the business and the program are frequently the causes of delays.
John Doe letter
A letter that was revealed to the inquiry, which was sent to then-Post Office chair Henry Staunton in secret as far back as June 2023, reinforced this lack of trust. Someone from the NBIT team appears to have sent the letter, according to the NBIT team.
” The disaster of NBIT is well known across different levels within the business”, the” John Doe” letter began, going on to cite” secretive” teams working in silos and” told not to share updates or information with anyone from the wider business”.
Even though they are only trying to do the right thing and point out mistakes made, “anyone who questions the CIO or programme director are labeled as hard and troublemakers,” said the unnamed author.
The way some of the people who have tried to intervene in the situation are treated is nothing short of disgraceful, with the majority of them looking to leave because they do n’t want to see history repeat itself.
The letter claimed that the CIO, who was not named by the author, “is empty about misleading the board with misleading dates and costs for NBIT”. The business culture is revolting, and this starts at the top, it added.
Staunton claimed during his inquiry that the board just learned of the ballooning budgets after receiving this letter during his investigation. ” You ca n’t have a project go from over £300m to over £800m without some intention to hold back that information”, he said.
issues with code quality
At the time of writing last year, the John Doe letter stated that NBIT defects were” not under control.” The Public Digital report suggested that this problem has never been resolved.
It stated that “historical code quality issues remain prevalent.” The low level of test coverage, incomplete integration and deployment pipeline, and patchy consideration for non-functional requirements like security, performance, scalability, operability, and thoughtful design patterns are all indications that good software development practices do not appear to have been in place during [the ] early build.
The report quotes one unknown interviewee during the review, who said:” In an urgency to demonstrate to paymasters that we can do this, we’ve rushed to show you a beautiful red car, but under the bonnet there’s a lot of technical debt”.
The Post Office’s decision to essentially develop NBIT internally rather than to invest in already-existing software partially accounts for the report’s technical issues. It should have taken into account the use of commodity technology, for example, because it is unclear why the [ Post Office ] would want to create an electronic point of sale system from scratch, it said.
As previously revealed by Computer Weekly, the NBIT project has previously bought substantial amounts of hardware and equipment, even though it cannot yet be rolled out to branches and the kit remains sitting in a warehouse.
More alarmingly, the report suggested that IT security was n’t receiving the appropriate priority; Brocklesby also mentioned the lack of security functionality as a reason for delays during his inquiry session.
Despite best efforts of security professionals, the Public Digital report stated that” Secure-by-design principles and assurance processes are in place, but culturally, POL struggles to incorporate cyber security practices into digital delivery as a “delivery first, security later” practice seems to be the prevailing approach.
A unsettling picture
Together, the IPA report, the most recent piece of evidence to the inquiry, the Public Digital review, and the John Doe letter paint a harmful and deeply troubling picture of the Post Office’s attempts to replace Horizon. The Treasury has approved the short-term funding for the NBIT project, but the whole £1.1 billion cost has not yet been approved.
A Post Office spokesperson said:” Today’s Post Office is working to ensure that the mistakes of the past can never be repeated and getting the appropriate IT solution is essential to that. Since April, we have collaborated with Public Digital to provide additional feedback on the creation of our innovative branch IT solution. Working with a variety of stakeholders, we are looking into all options to make sure our branches have a better online infrastructure.
But, if the findings of the consultants at Public Digital are not addressed, subpostmasters will continue to be worried about ever getting off the hated Horizon system.
The report stated that the aim of “getting off Horizon,” which is seen simply through a technology lens, is not to fully engage the wider organization in the need to work together to achieve certain goals, such as rebuilding trust with postmasters and providing excellent services to postmasters and their customers.
Moving away from the current technology platform is, in any case, a false Nirvana, especially since the current program generally reflects the Horizon scope. Yet having exited Horizon the organisation will continue to face changing needs and will require the ongoing muscle, and will, to do so”.
The Post Office scandal, which was first exposed by Computer Weekly in 2009, revealed the accounts of seven subpostmasters and the issues they encountered as a result of Horizon accounting software, which caused the most widespread miscarriage of justice in British history ( see below list of Computer Weekly articles about the scandal since 2009 ).
• Read likewise: What you need to know about the Horizon scandal
• Even watch:  , ITV’s documentary – , Mr Bates vs The Post Office: The true story , •
• Even read:  , Post Office, and Fujitsu incompetence mean a big taxpayers ‘ bill;
