Thank you for the opportunity to appear before the Treasury Sub-Committee to discuss the work of the Financial Ombudsman Service. I was grateful for the chance to talk about some of the changes that we are making to the way we work, about what we are seeing, and about the challenges we are likely to face in future. During the evidence session, there were a few areas that I said I’d be able to follow up with further information to help the Sub-Committee with its work.

our casework roles

We discussed how the ombudsman service is changing to ensure that the people here who handle complaints brought to us by consumers and micro-enterprises are able to get involved earlier in the complaints process, and to ensure that, where possible, complainants will have one point of contact at the ombudsman service from when they first come to us.  Investigators are at the core of this new model, and combine the roles previously carried out by consumer consultants and adjudicators. Investigators provide both the first point of contact for someone coming to the service and investigate the circumstances of a complaint about a financial business. I have attached a job description for an investigator and an adjudicator.[1]

With regards to the pay scales, it is not possible to provide a direct comparison between the two as the roles are different, as is the structure that they are working within – but we have set out the different internally published pay scales in these roles below.

New employees starting in the role of investigator will be paid £27,000 per year. There are three further levels that investigators can apply for, and the starting salaries at those levels are also included in the table above.

The starting salaries for different adjudicator grades are in the table above, as is the range of salaries available within those grades.

As can be seen in the tables above, investigator levels 1 – 3 start on a higher salary than the nearest equivalent for adjudicators.

It is worth noting that we have also introduced other new roles in our investigation model, for example, ‘ombudsman managers’ lead our investigation teams to ensure that ombudsmen are providing professional leadership at the heart of everything we do. Previously teams of adjudicators were led by team managers.

micro-enterprise complaints

Following a question about the complaints that we receive from micro-enterprises, I said that we’d write with further information about the specific products that complaints were being brought to us about. In the financial year 2016/17, the following were the ten most complained about products and the percentage of the total complaints from micro-enterprises that they made up.
 

In August 2015 we published a paper that looked at the complaints that are brought to us by micro-enterprises. In this paper we picked out some broader themes, including:

vulnerability and support

We found that in only 8% of the complaints we reviewed did the micro-enterprise in question have legal or accountancy support at the time of the event they were complaining about. This showed that levels of understanding about money matters varied for micro-enterprises, just as it does for consumers, and that it shouldn’t be assumed that micro-enterprises understand financial products and services better than individual consumers.

terms and conditions

Over half of the complaints reviewed involved a problem with the terms and conditions of a financial product, generally because a micro-enterprise customer didn’t know about one of the terms, conditions, exclusions or features of the product they’d bought – or disagreed with the financial provider over how it should be interpreted. The case studies we published showed that sometimes problems with terms and conditions arose because of a simple oversight by a micro-enterprise and sometimes because of a failing by a financial provider.

expectations and service

In one in five cases we reviewed, we had to explain things that financial providers hadn’t explained properly before. Many micro-enterprises were unhappy with the level of support offered by financial providers, and a quarter thought that the provider had failed to support them enough or hadn’t fulfilled what the micro-enterprise regarded to be a duty of care. We also looked in further detail at how the complaints came to us, and took a closer look at some key sectors – the report is available here: http://www.financial-ombudsman.org.uk/publications/pdf/Micro-enterprise-complaints-Aug-2015.pdf

We look forward to welcoming the Sub-Committee to the ombudsman service, and to discussing these and other matters in further detail – my office will be in contact shortly to arrange a date. In the meantime, if there is any more information that we can provide to assist the Sub-Committee, we would, of course, be more than happy to help.

Caroline Wayman, Chief Executive and Chief Ombudsman

January 2018