Not correct, I'm afraid, Eddie.
There is no automatic right for a defendant to claim his costs or be awarded compensation following an aquittal in a criminal court. There is a limited provision for the Crown Court to award costs for indictable (that is, Crown Court) matters, and there are provisions for Magistrates' courts to award costs for cases where a prosecution is started but not continued. There are other provisions relating to appeals and discontinued matters but in general that's about it. The only circumstances where costs and/or compensation may be awarded is where it can be shown that the prosecution was malicious or false. It would have to be shown that:
1. The Crown Prosecution Service/Police acted without “reasonable and probable cause”
AND
2. The Crown Prosecution Service/Police acted maliciously.
Both these seem to be unlikely from Keith's description.
Keith could try launching a civil action against the CPS but it would be almost certain to fail. Again, the only time it is likely to succeed is if it could be shown that the prosecution was false or malicious. A more likely route to success would be to launch a civil action against the witness, though this again would be very likely to fail. Keith should take advice before going down this route.
It is probable that all acquitted defendants would feel aggrieved in being unable to recover their costs, but the CPS cannot be reluctant to prosecute matters for fear of the costs incurred should the prosecution fail.