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Former chief executive from 2012 to 2019 makes her second appearance before the public inquiry, with questions about her top lawyers set to feature
4.30pm: Vennells cries for the first time today when Beer says her role in the group litigation diminished during 2019. It is not really clear what caused that. She did, however, silently join a call to discuss whether to apply for the judge to recuse himself. She later said it was 'difficult but completely the right decision' for the Post Office to apply for recusal. She was 'proud and pleased' of the board in taking the decision and would have come to the same conclusion.
And with that we are done. Sir Wyn Williams thanks everyone in the public gallery for their 'excellent behaviour' and makes a couple of announcements. Firstly, he is going to make a statement tomorrow on the refusal by former general counsel Jane MacLeod. Secondly, the inquiry will not sit on 4 and 5 July due to the general election, but otherwise should not be affected.
Vennells is back tomorrow where she will face questions from lawyers for the sub-postmasters. Should be well worth watching (and if not, following here).
4.20pm: In July 2013, when it emerged that there were bugs, glitches and defects in the Horizon system, Vennells asked her husband for a 'non-emotive' word. He suggested 'exception or anomaly' and these words were routinely used in the future.
Vennells looks crestfallen at seeing this on screen and says: 'I should not have engaged in this at all. We should have said bugs and so should the rest of the organisation.'
4.10pm: Beer touches briefly on another area of disagreement between Crichton and Vennells. Asked in 2011 whether to comment to a press enquiry from Private Eye, Crichton said she would not say anything in response ‘on the basis that this is old news and we do not want to prolong the story.’
Vennells disagreed. She emailed: ‘We need to be front foot and counter anything that has a reputational impact. It’s a goal of mine that all press even local press (perhaps esp local press) should be scoured for negative comment and refuted’.
Vennells says now she wrote this 'completely wrongly' and she is 'genuinely very sorry'. She was trying to say that Crichton had two responsibilities but had failed to balance them.
'Susan absolutely - and I respect it 100% - had the professional conduct requirements of a lawyer. That was her role as the lead lawyer for the organisation.'
Beer asks: 'Did you think there was a choice to be made between a lawyer's integrity and the needs of the business and that Susan Crichton had made the wrong choice?'
Vennells: 'No.'
Beer: 'Why did you type it?'
Vennells: 'I have tried to explain. She had two areas of responsibility and I think that she neglected the business side, as she had to all of the time in her job on the legal side. That is what I was trying to say. I was not at all trying to say that she either hadn't done the legal side or that I thought she shouldn't.'
3.50pm: Then we go to the meeting between Vennells and Crichton in a Costa, where the inquiry has previously heard that the general counsel got angry and started shouting at her chief executive. Vennells' record of the meeting is that Crichton had been 'destabilised' by doubts about her competence at this time. Vennells even noted, without irony apparently, that 'she clearly makes lawyers notes on everything'.
3.40pm: A deep dive now into the relationship with general counsel Susan Crichton, who has come up continually during Vennells' evidence.
Vennells says she did not blame Crichton for bringing in Second Sight as that was 'not my style'.
She adds: 'I don't recollect anybody saying Susan had brought in Second Sight and that is what the board saw at the root of the problem.'
3.35pm: Another sticky moment for Vennells. Inquiry sees an email she sent to Susan Crichton in 2013. She stated that the hope of mediation was to 'avoid or minimise compensation'. Another meeting note stated that Vennells saw any potential payment as 'token'. Was she concerned with saving the organisation money? 'I had a responsibility to the board around the budget which had been agreed and this information was shared with the board,' she says.
3.20pm: Back from a break. A quick note on the breaktimes. On days like today, the reception area is a hive of activity. Lawyers discuss tactics and evaluate how the day has gone, sub-postmasters chat and producers from the BBC, ITV, SKY and Channel 4 grab people for interviews. The sub-postmasters are a varied bunch: one generally wears a Wales rugby top; another brings her two dogs. You can watch proceedings on sofas put in front of large-screen televisions. It's a very positive and supportive atmosphere, often in contrast with what has happened before the inquiry. Plus there are free biscuits.
2.55pm: The board was told in Crichton's paper (which Vennells insists she did not present) that around 5% of the 550 prosecutions in the last 10 years may be affected by one of the detected bugs. Beer asks if Vennells was concerned about the figure or regarded it as small.
She replies: 'It was an extremely serious matter. It was something I was relying very heavily on the legal team to lead and advise on. Any wrongful prosecution would have been unacceptable and the Post Office needed to do whatever it needed to do.'
Beer asks whether, given how much this analysis was down to lawyers, Vennells ever told the board: 'I am not a legal expert; the person who is sitting outside on a chair'.
'I am sure I did but the chairman [Alice Perkins] positioned it very clearly.'
2.45pm: Beer says Susan Crichton was left to wait outside the board room on a chair like a naughty schoolgirl. Vennells: 'I felt bad about that. It must have felt terrible.'
Beer tells her Crichton's evidence is that she told Vennells before the board meeting there would be 'many successful claims against the Post Office arising from past convictions'.
Vennells says she has no recollection of ever being told that. Beer points out that Crichton knew about the advice saying prosecutions were unreliable, but she was locked out from reporting this to the board.The inquiry counsel suggests that Crichton's warning before the meeting was the 'last thing you wanted to hear'.
Vennells replies: 'Mr Beer I would not cover anything up in this process.'
Beer suggests Crichton's exclusion was an attempt at 'shielding the board from the executive team's dirty laundery'.
Vennells says this conclusion is 'completely wrong'.
2.35pm: Despite her misgivings, Vennells presented Crichton's report to the board. Minutes show the chief executive said the Second Sight review had been 'challenging [but] it had highlighted some positive things as well as improvement opportunities'. Beer says this was an attempt at spin, which Vennells denies. The minutes also recorded that the board was 'concerned that the review opened the business up to claims of wrongful prosecution'.
2.25pm: We now go to the board meeting on 16 July 2013 and a paper prepared by Susan Crichton setting out a pro-active and reactive approach. This was the meeting at which Crichton was left outside for an hour waiting to be invited in. Vennells says chair Alice Perkins made that decision and she believed it was unfair. Perkins asked Vennells to table the legal paper and she felt 'uncomfortable' about it, given she was not a lawyer.
2.15pm: Vennells is pressed on what she understood 'systemic issues' to mean. She believed at the time it meant an issue that affected the whole system. This is how the Post Office justified its repeat assertion that Horizon did not have 'systemic issues'. Beer asks whether it ever occurred to her that there could be another category involving a large number of branches (but not all) which may have experienced an issue. She says she did not rule it out.
2.10pm: A fairly low-key start to the afternoon, with Beer going over in great detail the transcript of a phone call between Vennells, Second Sight and Post Office's chief information officer Lesley Sewell in July 2013.
Second Sight wanted to discuss whether evidence of bugs should be publicised, but Sewell said these were 'all in the public domain'. In fact the bugs would not be made public for another two weeks.
1.05pm: We finish up before lunch with a quick look at the press release issued following the Second Sight interim report. Vennells says she does not know why it did not mention that bugs were known about back in 2010.
Then it's time for an entire room of people to flock to the Pret over the road. Back in 45 minutes or so.
12.50pm: An attendance note from July 2013, when Simon Richardson, a solicitor from external advisers Bond Dickinson, met with Post Office lawyers Susan Crichton and Hugh Flemington.
Richardson has plenty of startling admissions, including that the board wanted to sack Second Sight and that there were tensions between Crichton, Vennells and chair Alic Perkins.
But most significantly, Richardson said the 'real worry was around the Fujitsu expert who appeared to have known of some of the problems but not referred to them in his report or statement'. This was the Jenkins issue again, but the lawyers' conversation was never relayed to Vennells.
Beer asks: 'Would you be surprised that members of your team were having this in-depth and frank conversation about Gareth Jenkins?'
Vennells: 'Yes I would be surprised at that.... it was not a practice in the Post Office, which was wrong, for advices to be fed back. It should have been shared.'
12.35pm: We're back, and straight onto the Post Office response to the Criminal Cases Review Commission which asked for information about convictions in July 2013.
Beer asks whether it would have been the honest thing to do to disclose the Gareth Jenkins issue at this point, but submits that did not happen for 'years and years'. Vennells says this is correct.
12.15pm: The inquiry hears that the Post Office regarded doubts about Jenkins as a 'red herring'. Vennells appears to distance herself from knowledge about the significance of the expert witness failing to disclose the bugs in criminal trials.
But in one email shown to the inquiry from October 2013 she referred to an 'unsafe witness' [Jenkins] and then warned that while his lack of disclosure was not material 'it could be high profile'.
'You understood there was an issue about the reliability of the Fujitsu expert evidence about there being bugs,' suggests Beer.
'That is what it says here,' she responds. Vennells says her belief that Jenkins' reliability was not material was based on advice from Susan Crichton.
We go to another short break.
12.05pm: Now we move to Vennells' knowledge that Gareth Jenkins, the Fujitsu employee who was expert witness for so many Horizon prosecutions, knew about the existence of two bugs but did not disclose this.
She was made aware in the middle of 2013 that there had been an issue with two bugs but says she didn't 'join the dots' that this might have relevance to whether to review past cases.
She was told Cartwright King, the Post Office's external lawyers, were reviewing the cases affected by the two bugs.
11.50am: Beer: 'Do you agree the PR man has influenced you conclusively as to a decision whether or not the Post Office would itself review whether and to what extent there had been miscarriages of justice?'
Vennells: 'I would not take steer on a legal matter from Mark Davies... I would not have taken a decision on anything at all to do with legal matters from Mark Davies.'
10.50am: Perhaps the most uncomfortable moment so far for Paula Vennells, as we see an email from head of PR Mark Davies with concerns about opening more cases for review. Davies said this could have a 'ballistic' effect and would 'fuel the story'. Beer says it was 'grossly improper' for a decision on past convictions to be based on media reputation. Vennells agrees.
Beer asks if this influenced the decision not to reopen cases and Vennells is resolute that she would not take any such decision based on one colleague's advice.
With immaculate timing, Beer brings up Vennells' response to Davies: 'You are right to call this out. And I will take your steer, no issue.'
For the first time there are jeers from the public gallery, prompting Sir Wyn Williams to call for quiet in the room.
11.30am: In the same email, Vennells did ask why all cases of false accounting from the last five to 10 years might also be included in the review. They ultimately were not.
Beer asks: 'Do you agree that your idea of reviewing all prosecutions of false accounting, if it had been carried out into effect, may have avoided a lost decade until miscarriages of justice were discovered.'
Vennells pauses, then says: 'It may well have done.'
11.25am: We're back, and there's yet another attempt to pass off something on general counsel Susan Crichton.
Vennells sent an internal email in July 2013 in the wake of the Second Sight report. One proposal being put forward was that external lawyers review all prosecutions from the previous 12-18 months. This would obviously exclude hundreds of other cases.
Vennells says: 'I was not proposing that. I had been given that information by someone else. It could only have been Susan.'
11am: More discussion about 'systemic issues', the absence of which in the interim Second Sight report was so vital to the Post Office in the years it defended the Horizon convictions.
Vennells says there was no discussion about what it meant and that she did not ask - but should have - what systemic issues referred to. We go to a short break.
10.50am: Internal documents show the Post Office wanted Second Sight to review two or three cases and 'select the ones that they feel best indicate systemic problems'.
Beer asks how it is possible to find systemic issues from individual cases.
After a long pause, Vennells concedes: 'It's not.'
She stresses the Post Office was not trying to shut the review down.
10.40am: An email from Simon Baker, head of business change, to Second Sight about the parameters of its investigation. The request was for just two or three cases to be looked at, and from that question of whether there are systemic defects in Horizon could be answered.
Horizon's interim report said there were not systemic defects: Jason Beer says this was a view that was 'forever paraded' by the Post Office whenever there were questions from the media in future.
Vennells says she does not recall giving such instructions to Baker, but chair Sir Wyn Williams is not having that, pointing out the email to Second Sight is clearly based on her instructions. She accepts there may have been a 'conversation' at some stage with Baker.
10.25am: And back to the 'open the floodgates' issue. Vennells states she was not aware of the view among Post Office lawyers that a review of a large number of cases might create the risk that sub-postmasters could make claims.
Did you not commission an independent report because it would result in claims against Post Office?
'No, absolutely not,' says Vennells. 'I didn't know about the [floodgates view].'
10.20am: Inquiry sees email sent by Vennells to campaigner Alan Bates in June 2013, as he demanded to know what was happening about the case review. Vennells said it was too early in the investigation to suggest anything had been uncovered to question the integrity of the system or the validity of prosecutions.
How did she come to such a conclusion at this stage? Vennells says she relied on senior colleagues including Crichton to give her this information.
10.05am: Discussions about the key role of lawyers features early. The Post Office had the choice of whether to include criminal rather than just civil cases in the review of Horizon.
The inquiry has previously seen a note of a lawyers' meeting with Richard Morgan KC, asked to advise on this issue, where it was said by someone that 'if the findings are negative that will open the floodgates to damages claims by SPM's'.
Vennells says she was not told about this advice.The inquiry then looks again at this internal Post Office email where general counsel Susan Crichton is reported to have said that re-opening the Seema Misra case would be a 'red rag to a bull'. Misra, who was pregnant at the time, was wrongly convicted in 2010 and jailed for more than a year.
Vennells suggests Crichton was influenced by the Morgan meeting and says she was not involved in these discussions at all. Her view would have been that all cases flagged up by MPs should be reviewed.
'Did you share Susan Crichton's concerns about the red rag to a bull? asks Beer. No, she replies.
9.55am: Jason Beer KC starts by looking at the decision to bring on board forensic accountants Second Sight to review a small number of Horizon-related cases. Vennells says her concern and priority was to choose an organisation that would be welcomed by sub-postmasters, rather than one of the Big Four who would not have expertise in how small businesses or Post Offices ran.
Second Sight's approach was to select a representative sample of cases and selectively test the Horizon system. Vennells accepts this didn't happen.
9.45am: The sub-postmasters, the media and the lawyers are back in their seats. Public gallery not quite as full as yesterday but still a huge buzz in the room. Sir Wyn Williams and his team take their seats and Paula Vennells is ready to go again.
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