At this time of the year, during the period of consultation on our corporate plan and budget, we encourage input from consumer groups and financial businesses.
As part of this consultation process I visit the main trade associations - to meet the practitioner members on their committees and to discuss the trends they are seeing in complaint numbers. Our own forecast for the number of cases we expect to receive in the coming year (150,000) is considerably up on the number we forecast for the current year (90,000) - and our budget is having to rise commensurately.
The mood among those I have visited has been largely sombre, with many practitioners worried about their own businesses. The amount they will be paying towards the ombudsman service is significantly less than the levies needed for the Financial Services Authority (FSA) and for the Financial Services Compensation Scheme. Everyone seems to accept that complaints are bound to rise in times like these, and I can confirm that this is happening already.
But if these complaints were simply a symptom of stressed consumers seeking a desperate lifeline - and throwing a hopeless complaint to the ombudsman - I would expect the rate at which we uphold complaints to fall. Sadly it is rising. And it is clear that the rise is attributable in part to stressed businesses rejecting complaints they would previously have taken more care to investigate - and might have settled.
In its Financial Risk Outlook, the FSA warns firms against cutting back their resource devoted to complaints-handling - which I imagine means that the FSA will scrutinise this area more closely.
So I suspect that the lowered heads and furrowed brows I have seen recently indicate that firms are wrestling with how to comply with the FSA's complaints-handling requirement - and at the same time make the right calls in managing their businesses through this recession. For their employees and their customers, I hope they succeed. Rebuilding trust in financial services requires acknowledging where things have gone wrong and putting them right.
ombudsman news gives general information on the position at the date of publication. It is not a definitive statement of the law, our approach or our procedure.
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