Post Office to cut senior leadership team by 50% under '£1.2bn transformation'

19 November 2024, 13:59 | Updated: 19 November 2024, 19:02

The scandal-hit Post Office has moved to cut its senior leadership team by half under efforts to reduce costs and bolster the business's damaged culture.

New chairman Nigel Railton told a committee of MPs the move was started just moments after his transformation plan - a major effort to turn a page on the Horizon IT scandal - was revealed to Post Office staff last week.

He also confirmed the total cost of the initiative, yet to be agreed with ministers, had been estimated at £1.2bn.

That sum, he said in his evidence to the business and trade committee, included the projected cost of a replacement for the Horizon accounting system.

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Mr Railton did also not deny he could consider his position if the bill was not approved by the government.

The transformation plans could lead to more than 1,000 job losses through the closure of more than 100 so-called crown branches which currently lose significant amounts of money.

On top of that headcount figure are planned cuts to head office roles.

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While no total has been set, Mr Railton, who succeeded Henry Staunton after he was sacked by-then business secretary Kemi Badenoch in January, confirmed it was in consultations with 30 out of 64 members of the current senior leadership team.

The wider transformation proposals include an aim to boost postmaster pay by a combined £250m over five years in a bid to remedy long-held complaints over remuneration.

The MPs held their evidence session as the public inquiry into the scandal nears its conclusion, with just closing speeches to be made ahead of the publication of the findings next year.

The compensation and redress issue is continuing to dominate the fallout amid the criticism over delays after the blanket quashing of wrongful theft convictions linked to the faulty accounting system software.

The MPs raised concerns, that were supported by witnesses including Mr Railton, that the redress schemes still needed to go faster despite some improvements in processes.

Attention is, however, also turning to potential prosecutions connected with the scandal though such charging decisions could take years to materialise.

Sky News revealed on Monday that police, who have been monitoring evidence and submissions to the inquiry, are investigating up to four individuals to date on suspicion of offences including perjury.

Ministers are considering a new ownership model for the business, which could result in an employee-owned future akin to the John Lewis Partnership structure.

(c) Sky News 2024: Post Office to cut senior leadership team by 50% under '£1.2bn transformation'