The Financial Ombudsman Service has increased the number of complaints it expects to see this year by 15 per cent, which it partly put down to ongoing cost of living pressures.
The Fos's complaints estimation for 2024/25 has risen to 210,000 from December’s calculation of 181,300.
The ombudsman put this down to everyday financial concerns such as unaffordable lending, credit card complaints and fraud and scams.
The ombudsman’s budget, published today (April 4) also showed that forecasted operating expenditure has risen to almost £252mn, up from around £220mn in 2023/24.
This included the recruitment of 400 new full time case handlers to deal with an increase in complaints.
This figure has also risen from the consultation in December, which estimated 2024/25’s expenditure would be £218mn, which the Fos put down to the elevated number of complaints expected.
Abby Thomas, Fos chief executive and chief ombudsman, said: “In the year ahead it’s likely that our service will see increasing levels of complaints, with many of those disputes expected to focus on the critical issues that impact people’s everyday lives.”
Thomas said the Fos wants to resolve complaints more quickly in the coming year.
The new target for complaints resolved within six months is 90 per cent and the latest end of year forecast for 2023/24 stands at 82 per cent.
It said it has reduced the time it takes to resolve a case from 4.8 months in 2022/23 to 2.96 months in the last three months of 2023/24.
In December it consulted with businesses and consumer groups on the expected number of complaints which could come forward.
The report added: “Stakeholders flagged that people are still facing challenges around the cost of living, suggesting we may see further complaints about unaffordable lending and forbearance.
“Some stakeholders also suggested we should expect to see complaints from consumers who want to switch to an interest-only mortgage but can’t.”
Total casework costs are expected to be £174.4mn, an increase of £27.1mn on the previous year.
Thomas added: “With uncertainty around casework levels in the year ahead, we’re building a service which is flexible and agile, allowing us to respond to increased demand across any area of our business.
“Our plans 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.”
The ombudsman has also committed to reducing the case fee by £100 per case to £650.
tara.o'connor@ft.com
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