Civil servant dragged into fight with ex-chair of Post Office has government’s backing – for now

Sarah Munby and Henry Staunton have published different interpretations of their meeting about the Post Office’s finances. Photograph: https://www.gov.uk/government/people/sarah-munby#biography

Sarah Munby, the civil servant at the heart of the Post Office dispute, has found herself uncomfortably exposed after the organisation’s former chair alleged she told him to slow compensation claims to Horizon victims.

Henry Staunton, the ex-Post Office chair, originally did not name Munby, who was permanent secretary of the business department at the time.

But after Kemi Badenoch accused him of lying, he produced a contemporaneous note on Wednesday which said that Munby told him to “hobble” on until the election without dealing with long-term financial issues.

Civil servants prefer to operate beneath the radar, but finding herself in the centre of a political storm, Munby took the unusual step of hitting back hard with a letter outlining her own recollection and the government’s own records, saying this interpretation is categorically untrue. To back up her rebuttal, she issued a multipage account of her own recollections written in response, while the department promised to publish its own minutes of the meeting from the time.

“I don’t think she’s toast,” said one Whitehall insider, after Staunton’s note was published. “You could say she could have been more careful but it seems more like she was giving some frank advice about how the government might respond to things suggested by the Post Office.”

Munby is described as “well-regarded” by Whitehall insiders but at the time had less than three years as permanent secretary under her belt. Neither is she a career civil servant, having rejoined the government in 2019 after 15 years working as a consultant at McKinsey.

One of her problems is that she has become a “pawn in the game” between Badenoch and the Post Office, said Jill Rutter, a former No 10 civil servant and expert on government at the thinktank UK in a Changing Europe.

The focus now is inevitably on whether she or Staunton is telling the truth about the meeting – or whether “both sides could have come away with different impressions of it, which is always possible in government”, Rutter says.

“There are two possible variants of this. One of them is that he misinterpreted what they were saying,” she said. “He thought they were saying: go slow, minimise the exposure on this before the election, [but] they didn’t mean that. The second is that that they were giving him heavily coded messaging and that he interpreted it correctly … It certainly doesn’t explicitly say: whatever you do, don’t pay out any money to those bloody post people.”

The episode overall demonstrates some of the opacity around how decisions and advice is given and recorded within the civil service and its arms-length bodies.

Alex Thomas, programme director of the Institute for Government, another thinktank, said: “We need to recognise the importance of clear communication between senior people, ministers and civil servants and arms-length bodies, at the top of government, and for those to be clearly understood by all sides and for proper records to be kept.”

For now, Munby has Badenoch firmly fighting her corner, with their interests firmly aligned in rebutting Staunton’s claims. But Munby should be mindful of whether that support will extend for ever if it becomes politically expedient to cut her loose, said one former senior civil servant. “We all saw what happened to Tom Scholar. We have all seen what they do to permanent secretaries when they are not on the same page any more.”

Rutter added: “Down the line, the bit I’d be worried about if I was a civil servant working for this government is that if there’s something more that comes out, one of the things I think you know at the moment is that ministers will be quite prepared to sacrifice you to save their career – unless you’ve got and are prepared to use a clear audit trail.”