The former legal case manager at the Post Office has told the Horizon IT inquiry she had “nothing to hide” despite appearing to advise “throwing money” at a subpostmistress to keep her concerns out of the public domain.

Emails sent between employees at Fujitsu – the company that created the faulty accounting software – showed how Mandy Talbot had suggested dealing with a subpostmistress’ claim of system defectiveness by saying: “How much to go away and keep your mouth shut”?

Giving evidence to the inquiry on Thursday, Ms Talbot said she did not think she would have “expressed myself in those terms” – saying she had “absolutely no desire to hide what had happened” in the case of Julie Wolstenholme.

Ms Wolstenholme ran a branch in Cleveleys, Lancashire, and was pursued for £25,000 through the civil court by the Post Office.

IT expert Jason Coyne was instructed to assess whether the subpostmistress was responsible for the losses at her branch, but produced a report in 2003 which said the Horizon system was “clearly defective”.

Asked if she was “worried” about the effect Mr Coyne’s opinion might have had, Ms Talbot told the inquiry: “No, because I was assured it was on a unique set of facts that had occurred in 2000, and in 2004 it simply couldn’t happen.”

Mr Blake pressed the witness again, saying: “So you weren’t at all worried?”

“No,” Ms Talbot replied.

The witness was shown the email between two Fujitsu employees, in which they spoke of how she had advised “the safest way to manage this is to throw money at it and get a confidentiality agreement signed”.

The email, sent by audit manager Jan Holmes to commercial and financial director Colin Lenton-Smith, continued: “She is not happy with the ‘expert’s’ report as she considers it to be not well balanced and wants, if possible, to keep it out of the public domain.”

Mr Holmes also appeared to make reference to how Ms Talbot had spoken of conceding that the expert’s report was accurate, and that it would then be a case of “how much to go away and keep your mouth shut”?

Asked if the phrase “how much to go away and keep your mouth shut” were her words, Ms Talbot said: “It’s communication created by Jan Holmes – it really doesn’t sound like me.

“I really don’t think I would have expressed myself in those terms.”

Mr Blake then asked: “Why a confidentiality agreement? Why keep your mouth shut? Why would you want to hide what had happened in this case?”

Ms Talbot responded: “I had absolutely no desire to hide what had happened in this case.

“If the matter was settled there would be no need for the expert’s report to be disclosed in court. If the matter was not capable of being settled then it would have been disclosed in court.”

Mr Blake continued: “So you did not mind if publicity was shined upon this case?”

“No,” Ms Talbot replied.

Mr Blake interjected: “Nothing to hide?”

The witness responded: “In effect, if it had gone into court at that time, then it might well have had an impact on (the Post Office) and its relationship with Fujitsu, but so be it.”

Mr Blake asked again: “So, absolutely nothing to hide?”

Ms Talbot answered: “No.”

Continuing to press the witness, Mr Blake said: “Didn’t want to hide it from public view?”

Ms Talbot again replied: “No.”

The witness was then shown a separate document titled “advice on evidence and quantum” produced by the Post Office’s instructed solicitors in the case against Ms Wolstenholme.

In the document, the solicitors said they were asked to take into account that the Post Office was “anxious” to give Mr Coyne’s report about the “clearly defective” Horizon system “as little publicity as possible”.

Mr Blake asked: “If your view at the time was ‘nothing to hide’, why on earth would your solicitors have got the impression that the Post Office is ‘anxious for the negative computer expert’s report to be given as little publicity as possible’? Where do you say that was coming from?”

Ms Talbot replied: “I can’t comment.”

The Government announced that wrongfully convicted subpostmasters will be offered £600,000 to settle their claims.

The Horizon scandal, which has been described as the most widespread miscarriage of justice in UK history, saw more than 700 Post Office branch managers handed criminal convictions after the system made it appear as though money was missing.