Why sub-postmaster scandal forced Paula Vennells resignation

Lucy Harley-McKeown
·3 min read
Tim Parker, Post Office chairman and Paula Vennells, former Post Office chief executive at the opening of the Nyetimber Post Office branch in Sussex. Photo: PA
Tim Parker, Post Office chairman and Paula Vennells, former Post Office chief executive at the opening of the Nyetimber Post Office branch in Sussex. Photo: PA

The former chief executive of the Post Office has stepped down from her roles on the boards of both supermarket Morrisons (MRW.L) and homeware group Dunelm (DNLM.L), in the wake of the fallout from an IT scandal which led to the wrongful conviction of former postmasters. 

Paula Vennells was CEO of the post office from 2012 to 2019. She has served as a non-executive director of Morrisons since 2016.

She also said she would stop her duties as an ordained Church of England minister. 

At the end of last week, former Post Office workers had criminal convictions overturned by the Court of Appeal. 

The flawed software system Horizon had led to shortfalls in the accounts of 39 workers where they did not exist. The system had been installed in 1999.

At the time, the Post Office defended the IT system as "robust" and "reliable."

22 other cases are currently under review by the Criminal Cases Review Commission.

In a statement on Monday morning, Andrew Higginson, the chairman of Morrisons, said: “Paula has been an insightful, effective and hardworking non-executive director, and, on behalf of the board, I want to thank her for her significant contribution over the last five years.”

Andy Harrison, Dunelm's chairman said: “We respect Paula’s decision to step down from the board and I would like to thank her for the positive contribution she has made to the business since her appointment in September 2019.”

Since the scandal hit, questions have been raised about the actions of Post Office directors who were in place at the time. Vennells has faced calls to give back bonuses and be stripped of her CBE which was awarded for "services to the Post Office and to charity."

The case has been called one of the most widespread miscarriages of justice in the history of the UK. Other appeals are expected to follow. 

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In a statement on the St Albans diocese website Vennells said: “I am truly sorry for the suffering caused to the 39 sub-postmasters as a result of their convictions which were overturned last week. 

"It is obvious that my involvement with the Post Office has become a distraction from the good work undertaken in the Diocese of St Albans and in the parishes I serve. 

"I have therefore stepped back with immediate effect from regular parish ministry, and intend to focus fully on working with the ongoing Government Inquiry to ensure the affected sub-postmasters and wider public get the answers they deserve.”

Watch: Ex-Post Office chief Paula Vennells quits retailer boardroom roles

The scandal has shown how a case of this severity can send ripples across C-suites and boards. 

“Paula Vennells’ decision to step down from the boards of Dunelm and Morrisons demonstrates the influence of three little letters and should fire a warning shot across the bows of all companies,” said Danni Hewson, AJ Bell financial analyst.

“ESG has power, and whilst much of the focus has been on the environmental credentials of businesses it’s the S and G that have quietly been taking hold.

"Deliveroo’s IPO might have been a different tale if it hadn’t been caught up in a row about employee rights and companies considering large pay rewards will find the shareholder bar this year is considerably higher than in the past."