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Fujitsu continues to reap billions from contracts with the government despite criticism over the UK Post Office disaster

The political establishment in the United Kingdom is putting increasing pressure on Japanese IT company Fujitsu to explain its involvement in the scandal that led to the prosecution of hundreds of post office operators for accounting irregularities.

Meanwhile, Fujitsu has become a major player in a story that has lasted for almost 25 years. Despite a British court ruling that Fujitsu’s accounting software was flawed and unreliable, the government has kept awarding contracts worth billions of pounds to the Japanese tech company as a strategic supplier.

U.K. broadcaster ITV’s four-part serialization, Mr. Bates vs. The Post Office, brought the British Post Office Scandal back into the spotlight last week. The program recounts the wrongful prosecution of over 700 sub-postmasters (Post Office franchisees) for fraud, false accounting, and theft over a fifteen-year period, with many of them going to jail, losing their jobs, and even declaring bankruptcy.

In the end, it turned out that the sub-postmasters’ accounts had “balancing” issues because of a flawed IT system that the government had implemented in 2000 to digitize social benefit payments. The creator of the Horizon software was International Computers Limited (ICL), a British company that Fujitsu acquired as a wholly owned subsidiary in 1998 and subsequently incorporated into the Fujitsu brand in 2001.

In 2009, members of the partnership claimed that Horizon was responsible for the financial inconsistencies, leading to a long-standing campaign demanding justice for the guilty sub-postmasters. The Post Office concluded a protracted and contentious private investigation in 2015 and concluded that there were no system-wide IT issues. This prompted the Justice for Sub-postmasters Alliance to initiate legal proceedings, which ended in a £58 million settlement in December 2019—and a High Court decision that the Horizon system was not strong or dependable.

The British Post Office scandal has been the talk of the town in the United Kingdom since the beginning of this year. Even though the whole incident has been reported widely in the press for years, the fact that a television drama has managed to garner such interest is possibly a tale unto itself. However, there are already fresh demands that Fujitsu be brought to justice. Priti Patel, a member of parliament and a former home secretary, has publicly demanded that Fujitsu and the Post Office be “held to account.”

Legislators have also requested that Fujitsu representatives appear before a parliamentary evidence session next week. Liam Byrne, who chairs the Commons Business and Trade Select Committee, has called for Fujitsu to “confess how they got it so wrong,” raising the question of how the firm has managed to keep receiving contracts from the public sector.

Despite all the controversy in recent years, the government awarded Fujitsu 107 contracts worth £4.5 billion between January 2020 (after a U.K. court had already expressed its concerns about Fujitsu’s software) and the end of 2023, according to data provided to public sector market intelligence company Tussell. Just three weeks ago, the Northern Ireland Education Authority signed a £485 million agreement with Fujitsu to implement a new school management system (SMS). This was the most recent contract for the company.

Curiously, £2.4 billion of these monies were allotted to the Post Office’s Horizon system. The system will remain operational until March 2025, thanks to a £36 million extension that was agreed upon only two months ago. Despite the Postal Service’s best efforts, it has been unable to move to a new cloud-based infrastructure and must instead continue working with Fujitsu to oversee its on-premises systems.

No Fujitsu employee has been brought to justice in almost two decades after the first convictions at the Post Office, based on data from the Horizon program. In the first sub-postmaster cases, police interrogated former Fujitsu workers on charges of suspected perjury; concurrently, a statutory public investigation of the Horizon IT system has been continuing since 2021.

After these last ten days, it’s very evident that Fujitsu will be subject to far more scrutiny than before the scandal—and all it took was a TV dramatization to pique the public’s and legislators’ interest.

“It is clear that Fujitsu faces serious questions that demand a response,” said Jonathan Reynolds, a Labour MP and Shadow Secretary of State for Business and Trade, during this week’s sessions in Parliament. “If it turns out that Fujitsu was aware of how bad things were, then there should be repercussions proportional to the wrongdoing.”

Has contacted Fujitsu for a comment regarding the report. We will provide an update as soon as we hear back from the firm.


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