Thomas Mackintosh
Reporting from the inquiry

Following on, Jeremy Hunt's reply is then shown to the inquiry.

In particular, section six highlights the chancellor's rejection of the proposal Kemi Badenoch had previously made in her letter.

"Yes," Badenoch tells the inquiry when asked if this was her understanding.

"This rejection is to be seen as initial resistance," Jason Beer asks her to confirm.

Badenoch again answers: "Yes".

Jenna Moon
Reporting from the inquiry

Image source, Post Office Inquiry

We turn now to a letter from Badenoch to former chancellor Jeremy Hunt in August 2023.

The letter is titled "Accelerating Post Office Horizon Compensation". It is "an expression of my frustration" in the slow process of remuneration for victims, Badenoch says.

Badenoch and Kevin Hollinrake - then parliamentary under secretary of state - penned the letter as a means of escalating the situation, she says.

Counsel to the inquiry Jason Beer KC asks if she should've immediately escalated when she took over the ministry in February 2023.

"No, I would not have known enough" at that time, she says. "I had my own personal objective that we did right by the postmasters" and wanted to be seen to be doing the right thing, Badenoch adds.

Beer asks if it would be more important to actually do the right thing, prompting some laughs from the gallery.

Thomas Mackintosh
Reporting from the inquiry

Turning to compensation and redress, Jason Beer KC pulls up Badenoch's witness statement, in which she writes that she and former Post Office minister Kevin Hollinrake "wanted to get the money out there" for affected sub-postmasters.

"But we were always given a reason why we couldn't," Beer reads - citing Badenoch's statement.

Beer asks if Badenoch was aware of "any blockers in the Treasury" to full and fair compensation.

"No," Badenoch replies.

Beer then asks why she then became concerned with the pace at which the compensation was being delivered.

"Justice delayed is basically justice denied," Badenoch tells the inquiry. "I feel there is often too much bureaucracy in the way of getting things done.

"People are worried about process, them being on the hook for that and so they carry out lots of checks and balances beyond what I think is required in order to deliver the right outcome.

Beer highlights another part of her statement, reading: "We were allowing bureaucracy to get in the way of redress too much of the time."

Who was allowing this, he asks.

"The government machine," Badenoch answers.

Jenna Moon
Reporting from the inquiry

Image source, Post Office Inquiry

We're reviewing a page of evidence from a briefing provided to Badenoch in February 2023 about the relationship between the government and the Post Office.

Jason Beer KC is asking Badenoch if Post Office policy team had responsibility for setting the "overall policy direction for the Post Office".

Badenoch says that Post Office policy was decided before she became business secretary. She says that funding and the nature of how the Post Office operated is decided by politicians.

She is also explaining that the briefing documents that show the relationship shouldn't be regarded as a "bible" but rather a "useful illustration".

Badenoch says that various individuals within the department would be responsible for deciding the policy direction of the Post Office.

Image source, Post Office Horizon IT Inquiry

Opposition leader Kemi Badenoch is being questioned by counsel to the inquiry Jason Beer KC.

He begins by taking us through Badenoch's parliamentary CV, detailing her roles in the last government and the current opposition (this bit normally goes on for quite some time).

The inquiry is most interested in the period spanning February 2023 to July 2024, Beer says.

Badenoch is asked what her understanding of the Horizon scandal was before she took her role as business secretary in February 2023.

She says that she was vaguely aware of the issues, but unfamiliar with "the full detail of what had gone wrong with Horizon and what the postmasters had endured".

Asked about her role within the business department, Badenoch says she was still the "official decision maker" as secretary of state.

Image source, Reuters

As Badenoch gives her evidence, we'll be listening for any questions for the new Conservative leader about a row with Post Office chair Henry Staunton.

Staunton was sacked in January, and the former chair says he was ordered to stall payments so the previous government could "limp into the election".

That has been disputed by Badenoch. She said at the time that there were concerns about Post Office governance and "the entire business model".

Image source, Post Office Inquiry

Kemi Badenoch walks into the inquiry room and takes the oath ahead of giving her evidence - hit watch live above to follow the blow-by-blow.

As we await Kemi Badenoch's evidence, here's a quick digest of the the top lines from Business Secretary Jonathan Reynolds:

• Reynolds said change was needed "right down to the internal governance of the Post Office", characterising the corporate culture as the "root" of the scandal

• Pressed over details of the financial redress scheme, the cost of which is still unclear, he said 172 claims had been received and 36 have been settled
• Reynolds said he would consider setting a deadline for payoutsto affected sub-postmasters, but refused to commit to extending the redress scheme to family members
• He also defended a decision to refuse compensating claimants who accept legal advice, arguing it would slow down claims

• Reynolds said the Post Office scandal was an example "abuse of power" and of "different bits of the state not accepting responsibility"

Image source, PA Media

With the business secretary's evidence wrapped up, next to appear will be his predecessor in the role, Kemi Badenoch.

Like her political heroine Margaret Thatcher, Badenoch - the new Conservative leader - divides opinion even within her own party.

Her robust views, "anti-woke" values and no-nonsense style have made her a darling of the Conservative right and the party's grassroots and they have chosen her over fellow right-winger Robert Jenrick.

As the first black woman to lead a major UK political party she has made history, but she is no fan of identity politics.

Born in Wimbledon in 1980, she was one of three children of Nigerian parents. She grew up in Lagos, Nigeria, and in the United States where her mother lectured.

She was business secretary in Rishi Sunak's government, and got into a row with a former Post Office boss about the reasons for his departure.

Here's a full profile of the new Tory leader

Jenna Moon
Reporting from the inquiry

With that, Jonathan Reynolds' testimony wraps up and he leaves the inquiry room.

There will be a 15 minute break now, before Kemi Badenoch's turn in the hot seat.

As a reminder, you can tap watch live at the top of the page to follow along.

Jenna Moon
Reporting from the inquiry

Let's return again to the inquiry room, where the business secretary is continuing to take questions.

Jonathan Reynolds is asked by inquiry chair Sir Wyn Williams if it's "worth preserving the Post Office".

The business secretary says he feels the public still wants a Post Office. While he doesn't feel that sub-postmasters are "earning appropriate remuneration", he does see busy offices when he stops by in his own community.

Reynolds says there is "fundamentally a need for something that is a Post Office on the high street."

He adds that public demand and the policy rationale "is still there."

Image source, EPA

Away from the inquiry room, Leader of the Opposition Kemi Badenoch has just arrived outside Aldwych House, where she's due to give evidence after Jonathan Reynolds.

Thomas Mackintosh
Reporting from the inquiry

Image source, Post Office Horizon IT Inquiry

Angela Patrick, a barrister representing sub-postmasters, asks whether there are any issues with papers being passed from the previous Conservative administration.

Business Secretary Jonathan Reynolds says he does not feel this has been a barrier for him since he took office in the summer.

"I would say specifically in relation to the Post Office I have never felt there is something I have needed that I have not had access to," he adds.

The evidence of Jonathan Reynolds resumes after a short break.

The business secretary will answer a few more brief questions, before we break again ahead of testimony from opposition leader Kemi Badenoch, who held the business portfolio in the last government.

Image source, Post Office Horizon IT Inquiry

The business secretary is now asked about how government oversight and transparency of the Post Office should work going forward.

"There are things that have been going fundamentally wrong with how power is wielded in the UK, how accountability is provided for," Reynolds says.

Reynolds cites cases like Grenfell Tower fire and Hillsborough disaster as historic miscarriages of justice, which he says are all connected.

"There have been too many cases in modern British history of fundamental abuses of power and that is just how it is, and we've got to recognise, we've got to have the humility to recognise lessons have to be learnt from all of these things going forward," he says.

Thomas Mackintosh
Reporting from the inquiry

Image source, Post Office Inquiry

Next are some questions from the counsel of the National Federation of Sub-postmasters (NFSP).

The lawyer reflects on evidence given previously by outgoing Post Office CEO Nick Read - who is in the room today - where he said that the culture had "changed and improved under his five years" in the role.

She says this does not align with a report and asks Jonathan Reynolds whether he accepts there are continuing issues with the culture and governance of the Post Office.

Reynolds says he cannot comment on the claims as he has only been in the position of business secretary for a number of months - but shares a view that the job at the Post Office requires "transformation".

We want to bring you some more detail from a line of questioning we heard a little earlier, which went to the issue of when claimants could receive compensation under the Group Litigation Order (GLO) scheme.

Sir Alan Bates, who leads the Justice for Subpostmasters Alliance, has called for a deadline of March 2025 by which claimants should receive payouts.

Services Minister Gareth Thomas has previously told the BBC that it would be difficult to achieve that.

Blake asked Reynolds whether he similarly would refuse to commit to such a deadline.

"The worry about a deadline, can you imagine a situation where, for whatever reason a claim has not come in, I think it it would be unconscionable to say that that is not going to be considered," Reynolds says.

The "real significant delay" in the GLO scheme is the claims being submitted due to the time it takes to prepare them, he adds.

He says he'd consider setting a deadline if there are still challenges early next year.

Jenna Moon
Reporting from the inquiry

We're moving now to the role of Fujitsu - the Japanese company that developed the Horizon software - in the scandal.

Sam Stein KC asks if there is communication between the government and the company about redress from Fujitsu.

"Has the government to your knowledge ... reached out to Fujitsu?" Stein asks. Reynolds says he has not been in direct conversation with the company.

"It's quite convenient, [ boss of Fujitsu's European arm Paul] Patterson is in here today, maybe there's an opportunity" for a conversation, Stein says to a laugh from attendees.

Reynolds says he believes it is an important conversation to have.

Jenna Moon
Reporting from the inquiry

Image source, Post Office Inquiry

Sam Stein, a lawyer representing sub-postmasters, asks Reynolds about a timeline for a green paper - consultation documents produced by the government - that examines the Post Office.

Reynolds says that there are continuing conversations about the Post Office and that the government hopes to publish it soon.

Stein asks if he can give more details about when the paper will come. Reynolds says it hopes it will arrive in the first half of next year.

Stein says there are difficulties throughout the inquiry with disclosures of material that have "contributed to the length of this".

Reynolds acknowledges issues with the speed of the inquiry and says that he understands concerns over expediting the process.

"I don't think given where we are sat here today, we could have increased the speed any further than we have", he says.

Continuing with the topic of the future of the Post Office, Jonathan Reynolds says he believes as an" institution and a brand there is a tremendous amount of affection and desire for".

"We have got to consider all of these issues as to its future business and how it is run as part of that process."

Counsel Julian Blake has finished his questions and we now move on to some supplementary questions from Sam Stein KC.