Lib Dem leader Ed Davey apologises to campaigner Alan Bates for initially refusing to meet him while serving as postal affairs minister in 2010
In his witness statement, Davey says the letter to Bates was "poorly judged" - he went on to meet him five months later
Davey also says he would have "acted differently" if the "Post Office had told the truth"
Earlier, Labour's Pat McFadden, who held the same job from 2007-2009, said politicians were "very reliant" on others telling them the truth as they made decisions about Horizon IT failures
Between 1999 and 2015, hundreds of sub-postmasters were blamed and prosecuted for losses caused by bugs in Fujitsu's faulty IT Horizon system
Earlier, Pat McFadden said politicians were "very reliant" on others telling the truth about Horizon IT failures.
Here's a snippet from the ongoing inquiry.
Francesca Gillett
Reporting from the inquiry
I hear a gasp or two here in the inquiry room when an email from Alan Cook, the then-managing director of Post Office is read out.
In the email - which we've reported on before - Cook says sub-postmasters had their "hands in the till" - and the IT was "stable and reliable".
McFadden is now shown correspondence from Alan Cook - which refers to "subbies with their hand in the till".
McFadden says it is "shocking and revealing" and that he only saw it in detail for the first time on Monday.
He adds that he never heard Post Office people say that at the time.
Cook has since expressed regret at the email.
Still on the letter from MP Brian Binley, McFadden is asked if there's any more he "could have or should have" done to challenge the Post Office line.
McFadden says it was so "emphatic" that he's not sure he could have.
However, on the whole story he adds: "I wish I had done more to question these responses".
But even if he had done this, he thinks he would've got the same response - both in terms of the Post Office's faith the system and in reference to court judgements.
Referring to Binley's letter, McFadden says the Post Office repeated multiple times that "no evidence [had] been found" to show there were issues with the Fujitsu IT system.
He says his decision-making was informed by what ministers were being told by the Post Office. And at the time, no evidence was shared with him to suggest the system was at fault, he says.
The Post Office was using court judgements as "a proof point" to convince ministers everything was as it should be, although later on they were found to be "unsafe".
McFadden is next shown a letter from MP Brian Binley dated to February 2009.
The letter refers to an email that had been sent from Computer Weekly reporter Rebecca Thompson who says she had spoken with several current and former sub-postmasters. Her email refers to flaws in IT and deficits in accounts.
McFadden says he does not remember reading the letter but that if it was dealt with as normal then he would have seen it at some point.
He explains later that he would have seen the letter in conjunction with the Post Office reply to it - and notes how "emphatic" they were in defending the system.
He also confirms that this was the first time he became aware of the Post Office's prosecutorial role.
Francesca Gillett
Reporting from the inquiry
Image source, PA MediaLee Castleton was made bankrupt after he lost a two-year legal battle with the Post Office, after they falsely accused him of stealing £25,000
More now from our chat with former sub-postmaster Lee Castleton just a few moments ago.
We asked him what he made of McFadden saying the government felt reluctant to get involved with the Post Office's prosecutions - as they felt it was best left to the court system.
Castleton tells us: "I do think there's a responsibility for the government to make sure that prosecutions undertaken by a government-owned entity are done in the right way".
Image source, Post Office Horizon IT InquiryMcFadden is now shown the letter from Jacqui Smith - the MP who wrote to him about Julian Wilson, one of her constituents.
In the letter, Wilson is said to have been suspended on the assumption he was "making false cash declarations" back in 2008.
Asked if he remembers the letter and the reply to Smith, McFadden says no. But he adds that the way he would have dealt with it would have been by getting information from Post Office Limited.
He explains to the inquiry there was no way he would have access to more information independently than what was coming from the Post Office.
Zoe Conway
Reporting from the inquiry
Pat McFadden has been asked about how the government was responding to MPs who were voicing concerns about how sub-postmasters were being treated.
In his witness statement, McFadden says that in January 2009 Jacqui Smith, the then-Labour MP for Redditch wrote to him about her sub-postmaster constituent, Julian Wilson.
He had been suspended from his job and "the charge is that the Post Office is £27k adrift over the last five years".
She wrote: "I feel that there could be a system problem here" and she asked McFadden to investigate the issue.
His witness statement also contains his response where he wrote that the Post Office operated at "arm's length" from government and said there was "nothing" he could "usefully add".
This morning he said he relied on the information supplied to him by his officials and they would have been relying on the Post Office to give them the relevant information.
The inquiry has been trying to get a better understanding of the relationships between ministers, officials and the Post Office. In short: where did the accountability lie.
After a short break, McFadden is asked what power he believed he had to become involved in operational decisions.
At the time, McFadden responds, he would have considered it "improper" to become involved in operational decisions about an individual contract or branch for example.
He references the division between operational and strategic policy again, underlining it was "quite well-established".
He adds that it was similar with Royal Mail whereby ministers did not get involved with the day-to-day running of the business.
Francesca Gillett
Reporting from the inquiry
During the break just now, my colleague Tom Espiner and I caught up with Lee Castleton - a former sub-postmaster who was made bankrupt by the Post Office after a two-year legal battle.
Asked whether he's had the answers from McFadden that he'd hoped for, he says "no, not yet".
He says he wants McFadden to be asked about letters he received from other MPs about sub-postmasters in their constituencies who were facing problems - which is happening next.
"It's important to find out why nobody asked any further questions," says Castleton.
Francesca Gillett
Reporting from the inquiry
There are some murmurings among the people listening when Sam Stevens, the counsel for the inquiry, asks McFadden about the prosecutions by the Post Office.
Did the government - as the owner of the Post Office - have any interest in how prosecutions are carried out, he asks.
McFadden says it's for the court for judge these things and ministers are reluctant to intervene in court judgements.
McFadden is asked if it was government policy to ensure sub-postmasters were treated fairly by the Post Office.
The former postal minister says the government wouldn't have been drawn into contractual disputes between the Post Office and sub-postmasters.
McFadden is pressed further on the government's powers to prosecute its staff, because during the time of wrongful convictions the Post Office was owned by the government and it was taking sub-postmasters to court.
He tells the inquiry that, based on his ministerial training, once court judgements were cited he would "not interfere with the courts".
"If ministers start questioning court verdicts, they're very quickly criticised for intervening or trying to interfere on the court process," McFadden adds.
Stevens now asks McFadden about the structure of an arm's-length body and what that means for accountability.
McFadden says it's something he's "thought about a lot".
If an organisation is state-owned, "ultimately" accountability lies with the government, he says.
However, he emphasises that legislation had deliberately created a separation that meant the Post Office had commercial freedom and made its own decisions.
Ultimately, McFadden summarises, if something is publicly owned "people will look to the state" even if ministers are not running the organisation on a day-to-day basis.
Francesca Gillett
Reporting from the inquiry
McFadden turns and gestures to the people listening in the hearing room, as he says that some of the information he was given by the Post Office turned out to be wrong.
He says it led to "terrible human consequences for some of the people here".
Like most days of the inquiry, there are several sub-postmasters and sub-postmistresses and their lawyers here listening.
McFadden says the "heart of this issue" was information that turned out to be "wrong".
He says the inquiry aims to get to who was responsible for that and why it went on for so long.
He says he's trying to illustrate the different layers involved in this. A minister is "sometimes at the end of [a] chain", which includes senior management at the Post Office, the Post Office management itself, the Shareholder Executive and a government department.
The minister is "very reliant" on those other layers having told the truth about the information put in front of them, he says.
McFadden says Post Office management - and not the government - was responsible for running the business day-to-day.
He says his department had "no role in running the business on a day-to-day level, so if anything came in that was to do with an individual sub-postmaster... the only way to get the information was to go to the Post Office."
Pressed on whether Horizon IT issues would have been dealt with by the private secretary (in government), McFadden says they might have been involved but the Shareholder Executive would have helped them frame a response.
The Shareholder Executive managed the government’s shareholder relationships with businesses owned or part-owned by the government - like the Post Office.
McFadden is now being asked how reliant he was on civil servants. "Enormously," he says.
He references the Network Change Programme - which aimed to reduce the Post Office in size and make it "more financially viable".
There were also discussions on new streams of business for the Post Office, he continues, citing the internet and the Post Office card account service which allowed for the collection of pensions or benefits.
At the time it was about trying to get the network on an "even keel" financially and make it fit for the future, McFadden explains.
Francesca Gillett
Reporting from the inquiry
Although we haven't heard much about the Horizon scandal yet, it's been an interesting insight into what the job of a junior minister entails.
So far, McFadden seems to be doing a fair job of explaining his role simply and in layman's terms.
McFadden says he sees his three-year stint as postal affairs minister in two halves.
The first was mainly taken up with a plan to close Post Office branches, and also separately employment relations, he says.
The second half was a bit different - he says he was the lead spokesperson for the business department so postal affairs took up far less of his time.
McFadden is asked if he had any discussions with the then-secretary of state, John Hutton, about allegations made about the integrity of the Post Office Horizon IT system - the computer system at the centre of wrongful convictions of sub-postmasters.
McFadden says he can't remember any such discussions.
Sir Wyn Williams, chair to the inquiry, chimes in to confirm which secretaries of state McFadden reported to during his time as minister for postal affairs.
McFadden says he only reported to two - Hutton and Peter Mandelson.
As a reminder, McFadden was recently appointed to the new cabinet but he is giving evidence to the inquiry for his role as postal affairs minister from July 2007 to June 2009.