The Financial Ombudsman Service (FOS) spent more than £1,000 per case in the last financial year and revealed its backlog in cases grew to more than 90,000 as the Covid pandemic hit its service.
In its annual report for 2020/21 the FOS confirmed its cost per case shot up 13% from £920 in 2019/20 to £1,040 – far exceeding its budget of £926 per case.
The FOS began the year with 28,000 cases unopened but said “exceptional in-year demand” driven by the pandemic meant it ended with nearly 90,000 complaints waiting to be allocated to an investigator.
“The level of incoming complaints far surpassed what we had been resourced to handle,” said interim chief executive and chief ombudsman Nausicaa Delfas.
“We received 237,000 non-PPI complaints – 92,000, or over 60%, more than the 145,000 than we and our stakeholders anticipated.
“A sizeable proportion of the additional complaints were linked to the pandemic. The unacceptably long waiting times that resulted are reflected in a decrease in users’ satisfaction with our service.”
Overall, just 36% of cases were given an answer within 28 days compared to the goal of 50%, only half of complaints were allocated to a case handler in 28 days compared to the 100% target, and only 90% of complaints more than 12 months old were resolved although this matched performance from the previous year.
As a result, just 54% of consumers said they were satisfied with the service, down from 57% and below the 65% target, while 72% of business complaint handlers rated the service positively, down from 77% and below the 80% target.
“The additional in year demand meant we ended the year with more customers waiting for an unacceptably long time,” Delfas continued.
“Despite the enormous efforts that colleagues put in, the previous year’s backlog, combined with the sheer weight of new claims, made it an extremely difficult task. A step change is now required.”
Delfas noted the FOS was already taking innovative and ambitious steps to address the challenge, focusing on how operations can be more efficient, improving processes, workflow and productivity.
“Reducing these queues and improving satisfaction is at the heart of our casework plans for 2021/22, and we have taken ambitious steps to address it – over and above our original 2021/22 plans,” she added.