The Government has strengthened its independent inquiry into the Post Office Horizon IT dispute, putting it on a statutory footing to ensure it can establish the truth about what happened.

The move will give the Inquiry new powers to compel witnesses and demand documentary evidence. Parties who fail to comply with the new inquiry or take actions to hinder it could face a fine, imprisonment, or both. The Inquiry's Terms of Reference will also be changed to clarify that it can investigate the Post Office's decision-making in pursuing prosecutions of postmasters.

The decision was taken by the Secretary of State for Business, Energy and Industrial Strategy, Kwasi Kwarteng and Minister for Postal Affairs Paul Scully, in light of the recent Court of Appeal judgment which saw 39 postmasters have their convictions quashed.

The Post Office Horizon IT Inquiry was initially established in September 2020 on a non-statutory basis to enable the Chairman, retired High Court judge Sir Wyn Williams, to work quickly in establishing a clear account of the implementation and failings of the Horizon IT computer system over its lifetime.

The Inquiry's overarching aims - to ensure the right lessons have been learnt and to establish what must change - will remain in place. However, in light of the Court of Appeal judgment, its Terms of Reference will be updated to reflect this judgment and the need for an in-depth analysis of the events that led to the Horizon scandal. These issues went beyond those already considered by Justice Fraser in his 2019 ruling, which was the basis for the current inquiry.

This decision follows engagement with postmasters by the Prime Minister and Postal Affairs Minister to determine the best option to understand where mistakes were made and ensure something like this does not happen again. It is also supported by Sir Wyn Williams, who will continue as Chair for the Inquiry's next phase, building on the current Inquiry. The next phase will begin from 1 June.

Prime Minister Boris Johnson said:

"We must stand with postmasters to get to the bottom of what went wrong in the Post Office Horizon IT dispute. I heard first-hand the irreparable impact it has had on their lives.

"That's why, in light of the recent Court of Appeal judgment, we're stepping up our independent inquiry by putting it on a statutory footing, so we can get the answers they deserve."

Postal Affairs Minister Paul Scully said:

"The Horizon dispute has wrecked the lives of postmasters and their families - its impact cannot be overstated.

"We are determined to ensure something like this can never happen again, which is why we launched this Inquiry last year to bring the failings around Horizon into the light.

"Sir Wyn and I are both of the view that the context for the Inquiry has changed in light of the Court of Appeal's judgment and that now is the right moment to convert the Inquiry to a statutory footing.

"While the Inquiry has already made significant progress, these extra powers will ensure the Inquiry has access to all the information it needs to establish the truth."

The change to the Inquiry means it will have an extended timeframe to allow for a thorough Inquiry and analysis of the decision-making processes that led to the Horizon dispute, with its final report now expected in Autumn 2022, rather than Summer 2021. However, Sir Wyn will provide a progress update this Summer, to set out the Inquiry's progress to date and any initial findings. Public hearings that had been planned for June will be temporarily delayed while the Inquiry is repositioned to meet the new terms of reference and establishes itself as a statutory Inquiry in line with the requirements of the Inquiries Act 2005.