Few initiatives are as critical to the future of the Post Office as the overhaul of the contentious Horizon IT system, which played a pivotal role in one of the UK’s most significant miscarriages of justice.
However, recent findings from the public inquiry into the scandal highlight a myriad of issues plaguing the replacement project. There is deep-seated distrust between the project team and company leadership, a lack of effective governance, inadequate technical and agile development skills, and a limited grasp of modern software practices—all of which culminate in a vague objective that merely aims to “replace Horizon.” Consequently, it’s hardly surprising that the project is delayed by many years and over budget by hundreds of millions of pounds.
In May, Computer Weekly reported that a review from the government’s Infrastructure and Projects Authority (IPA) deemed the project “currently unachievable,” with cost estimates soaring from £180 million to £1.1 billion and implementation timelines extending up to five years. Recently, it has emerged that the Post Office is reassessing its approach to replacing Horizon and plans to engage further with the government and other external experts. Acting CEO Neil Brocklehurst informed staff that they would initiate the rollout of new technology in branches over the next year, while also clarifying future relations with Fujitsu.
Nonetheless, reversing the fortunes of this project poses significant challenges, particularly as the Post Office’s contract with Fujitsu for Horizon support expires in March 2025. Should the contract not be renewed, the impact on the branch network could be dire. Fujitsu itself is hesitant, indicating it will only continue working if the Post Office presents a feasible replacement strategy. The Post Office has requested a five-year extension option, which could potentially involve £180 million of additional taxpayer funding. However, witnesses at the inquiry reported that a new contract between the two entities has not yet been finalized, even as the deadline looms.
Former Post Office Chief Transformation Officer Chris Brocklesby stated that, assuming everything goes according to plan, the earliest for the Horizon replacement—termed New Branch IT (NBIT)—to begin rollout would be June 2026, and its shutdown could extend to late 2028. Yet, given the current turmoil at the Post Office surrounding this critical project, even these timelines seem overly optimistic.
Minutes from a board meeting on July 4th, 2024, raised concerns about how the Post Office leadership is addressing the IPA’s critical report. Brocklesby suggested that the IPA team lacked expertise in system building and attributed the IPA’s severe “red” warning rating to the complexity of the program rather than actionable shortcomings. This perspective stands in contrast to the IPA’s findings that numerous issues persist, many of which cannot be resolved internally within the Post Office. The IPA’s report included seven recommendations to improve governance, enhance digital skills, engage more effectively with HM Treasury, and clarify risk parameters.
Additionally, a review from the consultancy Public Digital, which specializes in public sector digital transformations, echoed the IPA’s damning assessment, characterizing the NBIT project as “not currently in a healthy place” despite acknowledging pockets of excellence within the organization. The report highlighted that treating the initiative merely as an “IT replatforming” fails to recognize that it requires comprehensive business transformation, affecting every employee and franchisee.
Challenges are further compounded by a significant skills gap at all levels within the Post Office. The review pointed out a lack of senior leaders with experience in large-scale digital transformation, particularly in modern, agile development practices. For instance, a team previously consisting of 20 user experience designers has dwindled to just four due to project delays, negatively impacting the potential user experience for subpostmasters who will ultimately utilize NBIT.
The report suggested shifting focus to rural franchise branches for user research and design, as these setups typically present the greatest challenges. However, the NBIT development team has conducted limited engagement with branch operators, raising concerns that inadequate communication could lead to a failure in meeting user needs.
Despite a plan to increase the NBIT team size from 327 to 526 by March 2025, the feasibility of this hiring strategy remains in doubt, according to the review. Required skill sets are in high demand, and the Post Office’s recruitment process typically takes three to six months. Additionally, the organization has a history of falling short of ambitious hiring goals, leading to concerns about low morale, mutual distrust within the teams, and an overall negative culture.
A troubling perspective on the situation was provided by an anonymous letter to the inquiry, indicating widespread awareness of NBIT’s shortcomings and an environment of secrecy and silencing within the organization. The author criticized the leadership for allegedly misleading the board regarding project timelines and costs, emphasizing a toxic culture that chokes accountability.
Technical deficiencies are also pervasive, with the letter stating that defects in NBIT were “not under control.” The Public Digital report noted ongoing issues from earlier development phases that did not conform to sound software engineering principles—deficiencies that could jeopardize project outcomes. The choice to build NBIT in-house rather than utilizing existing software solutions is one of several factors contributing to these challenges, raising questions about resource allocation and strategy.
Amidst all these difficulties, the Post Office has received temporary approval for NBIT funding from the Treasury, but the total budget of £1.1 billion awaits official sanction. A Post Office spokesperson asserted their commitment to ensuring that past mistakes are not repeated, emphasizing the importance of implementing a robust IT solution.
However, if the identified issues are not effectively addressed, there remains a cloud of uncertainty surrounding the future of subpostmasters trapped in the flawed Horizon system. The ambition of merely exiting Horizon as a technological transition, without engaging the organization in its overarching goals, will likely perpetuate existing challenges and hinder the rebuilding of trust with postmasters.
The Post Office scandal, first uncovered by Computer Weekly in 2009, revealed the devastating effects of the Horizon software on countless subpostmasters, leading to a significant injustice resonating throughout British history.