Post Office discussed Horizon replacement with IBM in 2015

Abandoned the plan due to concerns over cost and scale

The Post Office attempted to replace Fujitsu's contentious Horizon retail and accounting system with a competitor product seven years ago, but abandoned the project due to worries regarding its cost and scale.

During this week's statutory public inquiry into the Horizon scandal Shaun Turner, a former analyst at Post Office National Business Support Centre (NBSC), admitted that the Post Office had started working with IBM to replace Horizon in 2015 - a full 10 years before the contract was scheduled to finish.

The Post Office had been in talks with IBM in 2015, but this is the first time the company has revealed that work was actually underway.

When asked about the reason behind the attempted replacement, Turner said he believed Horizon was "outdated technology," and that replacement was necessary to transition to a more efficient and streamlined system that would enable faster and simpler product development.

He added that he had no knowledge of any alternative suppliers being considered.

"I wasn't party to those sort of contractual discussions," he said, as reported by Computer Weekly

"I don't remember anybody talking to me about what the options were and whether there were other alternatives that we'd looked at."

Turner said the project with IBM was cancelled due to apprehensions about the cost and feasibility of delivery.

He added that it was not just a simple transition; the project involved hardware, datacentre and front office changes, making it a significant challenge.

A multi-year scandal

The Post Office announced in April 2021 that it would be concluding its agreement with Fujitsu's Horizon system by 2025, with an additional year to facilitate the transition to a new system.

However, it was in June 2015 that MP Andrew Bridgen told the House of Commons that the Post Office was considering replacing Horizon system with IBM technology.

"Despite the Post Office claiming the Horizon system is 100% reliable, I have an email in my possession proving that the Post Office is now urgently seeking a replacement software system from IBM. It would appear to me that it is sunset for the Horizon system indeed," he said.

The Post Office responded that this was not a new occurrence, as various contracts were coming to end.

Initially developed by ICL, which Fujitsu acquired in 2002, Horizon was introduced in 1999 as a replacement for predominantly manual accounting procedures.

However, the implementation resulted in over 700 Post Office branch managers being wrongfully convicted of fraud, due to defective software that made it look like public money had gone missing from their branches.

Dozens of subpostmasters were wrongfully imprisoned for crimes they did not commit, while hundreds were compelled to repay the accounting discrepancies from their own money.

These subpostmasters have shared their experiences of financial ruin and being shunned by their communities; unfortunately, some of them have since passed away.

The case turned into a political issue in 2009, when it was first reported that the fault may lie with the Horizon system, rather than the subpostmasters.

The Post Office only acknowledged the Horizon fault in 2019, ending a group litigation action brought by the Justice for Subpostmasters Alliance - a campaign group of 555 subpostmasters.

It has since come out that both Fujitsu and Post Office employees were aware of the system issues but did not disclose them during the subpostmasters' trial.

In July 2021, the UK government said it had set aside £233 million to compensate the hundreds of workers who were wrongfully accused of theft and false accounting.

Criminal convictions for over 80 individuals have been overturned in the last three years.

The ongoing statutory public inquiry, now in its third phase, is investigating the operations of the Horizon system.

This includes examining aspects such as training, support, dispute resolution, knowledge and the correction of system faults.

Correction: A previous version of this story said Gary Blackburn gave evidence relating to IBM. It was in fact Shaun Turner, not Gary Blackburn, who gave such evidence.