Former Post Office chairman Henry Staunton defended his “successful” 50-year career as he was sacked by then business secretary Kemi Badenoch in a telephone call, a recording has revealed.

The recording from January heard Ms Badenoch acknowledge the fallout from ITV drama Mr Bates vs The Post Office had been “traumatic” for the organisation.

Mr Staunton also said the four weeks after the drama had been “horrific”.

The recording was played to the Horizon IT inquiry on Tuesday, where he was heard to say: “I’ve chaired some companies, a lot of companies, very successfully – but this one’s a bit of a nightmare.”

The hearing also heard Mr Staunton, speaking to Ms Badenoch, describe chief executive Nick Read as “unstable” as Mr Read listened from the public gallery.

In his witness statement to the inquiry, Mr Staunton denied using racist or misogynist comments in a meeting, claiming colleagues had said “there was not an ounce of racism in me”.

He added that he was “deeply stung” by allegations of inappropriate comments after a meeting about candidates to be chair of the Post Office’s Remuneration Committee.

Ms Badenoch told Mr Staunton in the call that she had received complaints about him which were “serious enough for us to intervene in this way”.

She publicly said she was forced to intervene over “difficulties” with Post Office governance, leading to a public row between the pair.

Ms Badenoch proceeded to say the former chairman was being investigated over bullying allegations before his dismissal.

In his call with Ms Badenoch, Mr Staunton said: “We must make this organisation more postmaster-centric.

“It’s just been horrific, the last four weeks (since the drama).

“We need to get on the front foot and I think that (being) postmaster-centric does that for you.”

Ms Badenoch replied: “There is so much that needs to be done and I’m very sorry that your tenure with the organisation has ended up this way.

“I know that the events of the last four weeks must have been particularly difficult – not just for you but for the whole organisation… I will go as far to say traumatic.

“But the complaints we have received are serious enough, I’m afraid, Henry, they are serious enough for us to have to intervene in this way.”

Mr Staunton said he had a “reputation built up over 50 years” and it was “very important” to him.

He added: “There will be enough crises in the Post Office in the next two weeks and this will be just a small item in a footnote in due course.”

Mr Staunton told the inquiry his “willingness to contradict the Post Office” on the treatment of postmasters “meant my card was marked”.

In his witness statement, he said he was a “champion of diversity”, and colleagues had raised concerns with him about how the investigation into his comments was “contrived, unfair and bizarre”.

Mr Staunton took the Post Office role in December 2022 after nine years as chairman of WHSmith.

He said he attended an interview with barrister Marianne Tutin who conducted an investigation into a complaint made by former Post Office HR director Jane Davies in late January.

Mr Staunton also said he was “shocked” at Ms Badenoch’s words in the House of Commons when she said he was being investigated for bullying, describing her comments as “baseless”.

Asked if the culture within the Post Office encouraged whistleblowers to speak openly about their concerns, Mr Staunton said: “Based on my own experience I do not think the culture has encouraged people to be able to speak up safely and without repercussions.

“While I was not given reasons for my termination, it seems likely that my willingness to contradict the Post Office orthodoxy on the treatment of postmasters meant my card was marked.

“I subsequently suffered the public trashing of my reputation.”

More than 900 subpostmasters were prosecuted between 1999 and 2015 after faulty Horizon accounting software made it look as though money was missing from their shops.

Hundreds are still awaiting compensation despite the previous government announcing that those who have had convictions quashed are eligible for £600,000 payouts.