Today we have published details on the next phase of our transformation, in a consultation on our plans and budget for the 2024/25 financial year.
The document sets out the significant strides that we have already made to the service we offer consumers and businesses – including reducing the average time we take to resolve a case from 4.8 months in 2022/23 to 3.2 months in the first half of this year while improving the percentage of cases meeting our quality assessment from 92% in 2022/23 to 94%.
Commenting on the organisation’s transformation, Abby Thomas, our Chief Executive and Chief Ombudsman, said:
“The Financial Ombudsman Service has delivered significant improvements in the service we offer, getting customers decisions more quickly while maintaining the quality of our work. We will be even more ambitious next year, with plans to resolve complaints faster, while also reducing the cost of our service to businesses.
“Our plans for the year ahead will help ensure that the customer is at the heart of everything we do. We want every person who engages with our service to clearly understand the outcome of their case. Now more than ever it’s crucial that businesses work with us to improve all customers’ experiences of financial services.”
We have set out plans to build on these improvements and reduce the cost of our service to industry in 2024/25. We propose to reduce the case fee by £100 per case to £650 and reduce our compulsory and voluntary jurisdiction levies on businesses. This results in an effective £60 million reduction in case fee and levy costs to businesses, once inflation and increases in the number of cases resolved are taken into consideration.
We plan to use the investment in transformation to reduce costs. In addition, we propose to utilise surplus reserves to reduce costs to industry in the form of our fees and levy, delivering an improved customer experience while maintaining the quality of our work.
In the next financial year we expect to receive 181,300 new complaints about financial providers. We have also set a new target of resolving 90% of cases within five months, to build on the progress we have made to get consumers and businesses answers to disputes as quickly as possible while maintaining the quality of judgements.
The consultation will also seek views on the possible exercise of new powers granted in the Financial Services and Markets Act, allowing the Financial Ombudsman Service to charge claims management companies and other relevant professional representatives. Draft enabling legislation for this has been published by HM Treasury.
Commenting on the consultation to charge professional representatives, James Dipple-Johnstone, our Deputy Chief Ombudsman, said:
“We are committed to improving our service so it is as easy to use and accessible as possible, while ensuring it remains free for all consumers and that those with upheld complaints can keep all of any award we make.
“Professional representatives play an important role in resolving financial disputes. However, twenty percent of cases are brought by representatives, some of whom benefit commercially at scale, yet more than half of such cases are not upheld. It is therefore timely that we explore whether our fee structure is right for the current climate and best reflects the costs we incur in helping resolve disputes for customers.
“We welcome all views from industry and consumer groups on our proposals on whether and how a charging regime might work in practice.”
We are inviting views on whether and how a charging regime might be implemented, including on the level of any fee itself; the impact on complaint volumes, the potential impact on different groups of complainants, and the lead time required for businesses and professional representatives to be ready.
As this consultation is seeking early feedback to inform next steps, no assumptions on the potential impact of charging professional representatives, or the possible revenue derived from such a scheme, have been included in the proposed plans and budget for 2024/25.
The consultation is open until 30 January 2024 and is published on its strategic plans and budget page.
The Financial Ombudsman Service was set up by Parliament to resolve individual complaints between financial businesses and their customers on a fair and reasonable basis, as a free alternative to the courts. It can look into problems involving most types of money matters. It is committed to sharing insight and experience to encourage fairness and confidence in financial services.
6 December 2023
Welcome to the latest edition of Ombudsman News. In this edition, we mark 16 Days of Activism against Gender-Based Violence by sharing our approach to financial complaints involving economic or domestic abuse. We also highlight our Plans and Budget Consultation for 2024/25 and our Annual Report and Accounts.
2 December 2022
Welcome to the latest edition of Ombudsman News. In this edition we highlight our recent motor insurance event for insurers and brokers and our blog about issues we’re seeing in vehicle theft claims. We also share our Annual Report and Accounts for 2021/22 and our Future Funding Feedback Statement.
31 March 2022
Welcome to the latest edition of Ombudsman News. In this edition we share a summary of what’s covered in our recently published plans and budget for the year ahead, outline changes to our award limits from next month and share links to our online guidance for consumers about storm damage complaints.
