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annual review 2012/2013

1 April 2012 to 31 March 2013

the complaints we received

our consumer helpline

In the financial year 2012/2013 the number of people contacting our consumer helpline - with questions, concerns and complaints about the way they had been treated by financial businesses - continued at record levels.

We handled a record 2,161,439 initial enquiries and complaints during the year - a 70% increase on the previous year (following a 25% rise in the year before that).

This means that each working day during the year we responded to an average of over 7,000 phone calls and enquiries from consumers contacting our helpline.

initial enquiries and complaints from consumers

year ended
31 March
phone enquiries written enquiries
(including by email)
total enquiries
2013 1,067,607 1,093,832 2,161,439
2012 673,999 594,799 1,268,798
2011 461,613 550,758 1,012,371
2010 448,140 476,955 925,095
2009 399,918 389,959 789,877
2008 425,942 368,706 794,648
2007 341,455 286,359 627,814

Our consumer helpline is the first port of call for everyone who phones the ombudsman service on one of our easily-memorable "non-geographic" numbers. During the year 96% of 25,000 people surveyed said it had been easy to find out how to contact us (95% in the previous year).

Consumers can choose which number they prefer to call us on - depending on which is more convenient for them personally and which is cheaper (or in many cases free - subject to their own phone tariff).

the numbers that people used to contact our helpline

  • 53% used 0800 023 4567 the most
  • 34% used 0300 123 9 123 the most
  • 13% used 0845 080 1800 the most

The increase in the proportion of people choosing to phone us on our 0300 helpline - rising from 27% of all calls in the previous year to 34% this year - may reflect the growing use of mobile phones, as calls to numbers starting with 0300 will usually be cheaper (or free) for mobile users.

We have not promoted our original 0845 number for almost five years - because of the higher costs it can trigger for mobile phone users. Calls to this number continue to fall - with the proportion of people phoning us on 0845 dropping from 26% to 13% during the year.

However, the fact that people are still using this number shows how long it can take for the many organisations who give out our contact details to update their records with our new alternative contact numbers.

the time of day consumers phoned us

  • 11% between 8am and 10am
  • 25% between 10am and midday
  • 23% between midday and 2pm
  • 22% between 2pm and 4pm
  • 15% between 4pm and 6pm
  • 4% between 6pm and 8pm

Last year we extended the opening hours of our consumer helpline to include Saturday mornings. And in July 2012 we extended our opening hours again - for a further two hours each weekday evening.

This means consumers can now contact us from 8am to 8pm on weekdays, as well as on Saturday mornings. This is in line with our commitment to make our service as accessible as possible for everyone - whatever their family and work commitments and lifestyle.

Peak times for phone calls are generally on Mondays between 10am and 2pm. During the year we received up to 750 phone calls an hour at this time of the day.

We use call-centre software and planning tools to help manage the volatility in the number of phone calls. This means that the moment the volume of incoming calls increases - often in response to coverage on broadcast media - those of our helpline advisers who are dealing with written rather than phone enquiries are alerted to log on to the phone system and start taking calls.

The busiest day in the year for our consumer helpline was Monday 3 December 2012, when we received 10,006 phone calls - our highest ever number in a single day. The following Monday (10 December 2012) we took 9,758 calls - the second highest number. On the busiest day in the previous year we received 5,086 phone calls.

Around half of these calls were about payment protection insurance (PPI).

On Monday 7 January 2013 we received a record 4,137 phone calls about PPI - handling an unprecedented 529 PPI enquiries between 11am and 12 noon on that day.

The quietest working day for our consumer helpline was Friday 25 May 2012, when the number of phone enquiries fell to 2,725. Friday afternoons in July and August were also quieter times on our phones.

how people phoned our consumer helpline

  • 78.5% from a "fixed line" phone
  • 17.5% from a mobile phone
  • 3.5% from an overseas or untraceable phone
  • 0.5% over the internet

The proportion of calls to our consumer helpline from mobile phones increased slightly during the year from 17% to 17.5% - and the proportion of calls from "fixed line" (or landline) phones fell from 79.5% to 78.5%.

3,332 people called us from payphones (compared with 1,819 in the previous year). If people are worried about the cost of calling us, we tell them that we are happy to phone them back.

And 7,059 people phoned us over the internet using services such as Skype - two and half times more than in the previous year.

We aim to answer 80% of phone calls to our consumer helpline within 20 seconds. This is a widely accepted standard for organisations dealing with the volume of phone calls that we handle.

During the year we answered 83% of calls within 20 seconds (65% in the previous year) - dealing with enquiries about everything other than PPI.

For enquiries specifically about PPI, we answered 72% of phone calls within 20 seconds - less than our target, largely as a result of the significant increase in calls to us about PPI.

92% of 25,000 consumers surveyed during the year said their calls to us were answered promptly (91% in the previous year).

the length of calls to our consumer helpline

  • under 3 minutes: 28%
  • between 3 and 5 minutes: 14%
  • between 6 and 10 minutes: 22%
  • between 11 and 15 minutes: 20%
  • between 15 and 20 minutes: 8.5%
  • over 20 minutes: 7.5%

Consumers who phone the ombudsman service hear a welcome message - recorded by the chief ombudsman - giving four options to choose from. This helps to filter the call to an expert on our consumer helpline with the relevant technical knowledge. This filtering is essential, given the very wide range of complaints we cover - from spread-betting to payment protection insurance (PPI).

During the year, the proportion of phone calls taking longer than ten minutes increased from 20% to 36% of all calls. This reflects the increasing numbers of consumers phoning us themselves to ask for help and guidance about making a PPI complaint - rather than paying a claims manager to do this for them.

online contact

While many people prefer to phone us to talk through their enquiry, growing numbers of consumers get the information they need straight from our website.

Each day during the year an average of 18,943 people visited our website. The busiest time on our website continues to be between 12 noon and 1pm on weekdays. However, people use our website round the clock, 365 days a year, to send us emails and register complaints online - including 2,637 people who downloaded complaint forms from our website on Christmas Day.

The busiest day on our website during the year was 22 May 2012 - when 37,399 people logged on to download our new annual review which we published on that day.

660,246 complaint forms were downloaded from our website during the year - a 48% increase on the previous year. This increase largely resulted from the rise in complaints about payment protection insurance (PPI) - which led to a 157% increase in the number of PPI questionnaires downloaded from our website (4,430,761 downloads compared to 1,726,447 in the previous year).

The PPI questionnaire is the agreed standard form that helps businesses, consumer organisations, claims managers and the ombudsman service streamline the handling of PPI complaints - gathering and sharing consistently as much information as possible in one place at the start of the process.

The other most visited pages on our website were:

  • Our news page (with 149 news updates added during the year).
  • Our online careers resource - with 295,117 downloads during the year of our job adverts and job descriptions (72,301 in the previous year).
  • Our various online videos - including a new short film featuring people talking about what the ombudsman personally means to them, and a short film made by young people on avoiding financial problems.
  • Case studies from the online version of our newsletter, ombudsman news.

To help people find what they are looking for across more than 4,000 pages on our website - from technical data on pension calculations to how to apply for a job at the ombudsman service - we have a specially-tailored search facility. However, many people find the quantity and complexity of data that these types of online "search engines" produce increasingly confusing and overwhelming.

This is why we introduced a new simpler online tool last year - called "what are you looking for?" This helps people who may not be sure about the exact terminology or words to use in a search engine - by prompting them with specific questions.

The questions are generated automatically using "intuitive" software that learns from how people have previously looked for - and found - similar information.

the most searched for words on our website

| complaint | claim form | PPI | car insurance | compensation | fraud
| bank charge | mortgage | mis sold | direct debit

950 organisations link from their websites to ours - ranging from bbc.co.uk to shelter.org.uk, sheffieldforum.co.uk to thestudentroom.co.uk. There is more information about the people who visit our website later in this annual review.

"multi-channel" engagement

During the year we have also been reviewing our use of social media and digital communication, as a way of engaging with our customers. This has included:

  • Developing apps and digital content specifically for tablets and smart phones.
  • Tracking over 10,000 mentions of the ombudsman across social media, 84% of which were favourable.

We recognise that the speed, immediacy and informality of some forms of digital communication may make them unsuitable for using in complex and sensitive financial disputes. But they can be helpful in broadening our accessibility to wider audiences and in making frontline contact with us easier for many people.

how we handle initial enquiries and complaints

The frontline advisers on our consumer helpline deal with all initial enquiries and complaints - giving general advice and guidance on what to do if consumers have a complaint about a financial product or service.

Our advisers are trained to make their own decisions about how to handle each individual call - tailoring their response accordingly in each case. Their aim is to sort out as many enquiries, problems and concerns as possible at an early stage - without needing the more formal involvement of an adjudicator or ombudsman.

The work of our consumer helpline involves responding to consumers' problems and concerns at an early stage by:

  • Explaining the complaints procedure that financial businesses have to follow.
  • Reassuring consumers who feel intimidated by the formal process of complaining.
  • Stressing that a business should have the opportunity to sort out matters with its customers, before the ombudsman can formally step in.
  • Confirming the details of who consumers should complain to at a business - if they haven't already done this.
  • Forwarding complaints direct to the relevant business.
  • Reminding consumers that they can ask us to get involved formally - if a business isn't able to resolve their complaint within eight weeks.
  • Clarifying the role of the ombudsman.
  • Directing the consumer to relevant helplines and self-help websites.
  • Providing the consumer with the facts they need, to resolve the problem themselves.
  • Giving an early steer on the likely outcome of a complaint - from our informed independent viewpoint.
  • Offering practical suggestions to both sides on sorting things out informally - without needing to escalate the case as a formal dispute.
  • In cases where we don't believe it would be helpful or productive to pursue the matter further, explaining why we think this.
  • Providing impartial guidance on any compensation already on offer.
  • Explaining the rules of our jurisdiction - for example, time limits that may apply.
  • Explaining the difference between the ombudsman and the regulator.
  • Suggesting other bodies or ombudsman schemes who might be able to help.

what people phoned our consumer helpline about

  %
payment protection insurance (PPI) 41
loans and credit 8
motor insurance 6
current accounts 6
general insurance - including travel insurance, mobile phone cover, warranties and home emergency cover 4
credit cards 4
household insurance 3
mortgages 3
mortgage endowments 2
other banking services 2
other financial products 5
other problems and concerns (for example, debt-related worries, money questions, and complaints we can't help with about utilities and phone companies) 16

During the year the proportion of enquiries to our consumer helpline about payment protection insurance (PPI) increased by 46% - from 28% to 41%. The relative proportions of calls about all other financial products remained broadly similar to the previous year.

making it easy to contact us

Our day-to-day experience on our consumer helpline - and our wider research - suggests that certain groups of consumers are more likely to find formal complaint procedures off-putting.

The range of people who contact our consumer helpline broadly continues to reflect the diversity of the population at large. But some consumers are more likely than others to pursue complaints to the next stage (either against a financial business or as a dispute referred to the ombudsman service).

In particular, younger consumers and people from lower socio-economic groups are generally less likely to pursue a formal complaint following initial contact with us. This may relate to the type of financial products involved in these cases - as well as to a range of socio-economic and attitudinal factors. We continue to carry out research in this area - and we highlight some key findings about who complained to us later in this annual review.

We want to remove barriers that may unfairly prevent particular consumers from using our service. As part of this commitment, we have a team of specially-trained casework advisers who work with more vulnerable people who might otherwise struggle with forms and procedure. During the year this team worked on cases involving the following situations.

a consumer with generalised anxiety disorder

Over a period of two days a consumer in her twenties called us nine times to check how her complaint was going. We were concerned about how anxious she seemed and how little information she was able to take in during each call.

So we arranged for one of our specially-trained casework advisers to talk to her. During their first chat, she told him she was signed off from work because things had become very difficult for her. She was getting treatment for anxiety disorder.

She didn't know how it had started but she couldn't stop herself worrying about the smallest of things. She was very worried that she would miss or forget something important - and this was why she was calling us as much as she was.

We arranged for her to have a direct line to her dedicated casework adviser. He talked to her about what she needed from us to reassure her she hadn't forgotten anything. And between them they agreed a way that she could receive regular updates from us over the phone - followed up with a brief email that would clearly say if she needed to do something (or not).

The consumer felt reassured, knowing that she would be speaking to the same person - who understood her situation and was helping her to manage her anxiety over her case.

a consumer with speech and mobility difficulties

The consumer explained to us that he had had a major stroke six months earlier. Although he was recovering well, he was conscious that he sometimes had difficulties "getting his words out". He was also worried that he wouldn't be able to write down what his complaint was about, because the stroke had left him with significant muscle weakness in his writing hand.

As a first step, we told him he didn't need to worry about writing everything down, because we could do that at our end from what he had been saying to us over the phone.

When we asked him what more we could do to help, he told us that he needed time to be able to gather his thoughts together before he spoke. And it was easy for him to lose his train of thought if he was interrupted mid-flow or when he was getting tired.

So on a very practical level, we found out when he felt at his best to talk to us. And we agreed to call him only during those times of the day. We also knew to let the phone ring for longer than usual, because it would take him a little while to get to the phone from where he was sitting.

And between us, we found a simple way of making sure we didn't inadvertently talk over him - with the consumer using an agreed "code word" when he'd finished speaking, giving us the cue to reply.

Our outreach work with community and advice workers across the UK has shown that some consumers are reluctant to phone us directly without someone from their own local advice agency also taking part in the call - to introduce them and help explain their problem to us.

This is why - working with Citizens Advice - we introduced arrangements last year that allow three-way phone conversations between a consumer, their contact at Citizens Advice and someone from our own consumer helpline.

Following very positive feedback on this initiative, we extended the arrangement during the year to cover other consumer helplines across the UK - including Northern Ireland Advice Line, Age UK and Macmillan Cancer Support. We now handle around 500 calls a month that involve these kinds of three-way conversations.

During the year we launched a similar initiative with National Debtline. But this arrangement is slightly different in that it enables our helpline advisers and adjudicators to initiate themselves a three-way conversation with a National Debtline counsellor, where a consumer has agreed they would like a specialist money adviser to help with a wider problem.

There is more information about our access and inclusion work later in this annual review.

Our aim is to make our process as straightforward as possible - and more accessible and user-friendly than the courts. But making it easier for people to tell us their side of the story - without feeling confused or intimidated - does not make us a consumer champion. We are just as concerned to reduce hurdles for businesses - who also tell us that they want as little red tape and bureaucracy as possible.

This means making sure no one is disadvantaged in bringing a complaint to us - while also emphasising our impartiality. "Impartial" means we do not "side" with anyone.

This is a hard message for some people to accept. But it is an important part of our work to manage expectations realistically - and to set out clearly what we can and cannot do.

This includes explaining time limits and restrictions that may apply. We are also very clear that we are not the regulator - and that our work does not involve punishing or fining businesses.

how consumers who contacted our consumer helpline
first heard about us

  • from a financial business: 23%
  • on the internet: 23%
  • from a friend, relative or colleague: 22%
  • in the media (press and broadcast): 16%
  • from a consumer-advice agency (eg Trading Standards or Citizens Advice): 11%
  • from a claims-management company: 3%
  • other and "don't know": 2%

During the year, consumers who contacted our helpline for advice and guidance were:

  • More likely than in the previous year to have heard about us from a friend, relative or colleague (22% compared with 19%).
  • More likely than in the previous year to have heard about us on the internet (23% compared with 20%).
  • Slightly less likely than in the previous year to have heard about us from a financial business (23% compared with 24%).

At this early stage, the ways in which people say they first heard about the ombudsman are different from when people bring a formal complaint. For example, consumers who contacted our helpline early on were:

  • Over a third less likely to have first heard about the ombudsman from a financial business than consumers who pursue a formal complaint with us.
  • Over a third more likely to have first heard about us through word of mouth from a friend, relative or colleague.
  • Almost twice as likely to have heard about us from a consumer-advice agency.

the value of our early involvement

Our customer research shows that our approach to initial enquiries and complaints is valued by the consumers who contact our consumer helpline. During the year:

  • 93% of people who contacted our helpline said they were given a clear explanation of what would happen next with their complaint.
  • 93% said we showed an interest in their enquiry.
  • 87% felt that the person they spoke to knew enough to answer their questions.

As a result of our focus on resolving as many enquiries as possible at this early stage, only around one in four potential complaints raised with our consumer helpline during the year went on to become a case needing the more formal involvement of an adjudicator or ombudsman.

We continue to carry out research to find out more about what happened next to the three out of four consumers who contacted us initially on our helpline - but then never returned with a formal complaint.

The latest survey shows that of these consumers, 47% were subsequently able to resolve their problem themselves, without needing further help from the ombudsman service.

  • 98% of these consumers felt our early involvement helped them to sort things out satisfactorily at this early stage (92% in the previous year).

Of the 53% of consumers who were not immediately able to resolve their problem themselves, after contacting our helpline for initial help and guidance:

  • 72% said they had continued to try to sort out the problem directly with the financial business involved - and might ask the ombudsman for further help later on.
  • 28% said they had let the matter drop - mostly saying it was because they did not think pursuing it further would achieve anything.

There is more information about people's attitudes to pursuing complaints - and some reasons why people say they do not do so - later in this annual review.

meeting different needs

Our service is for everyone. We aim to be accessible and to adapt the way we communicate with our customers to meet any particular needs people may have. This includes providing:

  • An instant over-the-phone interpreting service to handle calls in languages other than English.
  • Information on our website in 25 languages.
  • Online video and audio content for people who prefer these formats rather than text.
  • Text Relay services and British Sign Language videos.
  • Information in alternative formats such as large print and on CD/DVD.

other languages

During the year 2,745 consumers from 109 countries outside the UK brought complaints to the ombudsman service about UK financial services and products (1,910 consumers from 104 countries in the previous year).

This is reflected in the demand for our interpreting and translation services - rising by 59% during the year - as the financial companies we cover increasingly carry out more international business with customers round the world.

3,619 cases during the year (2,282 in the previous year) - around 0.7% of our total workload - involved working in a language other than English or Welsh. In total this meant working in 55 languages.

Of the cases we handled in other languages:

  • 38% involved 12 Eastern European languages.
  • 29% involved 12 Western European languages.
  • 26% involved 20 Asian languages.
  • 5.5% involved 6 Middle Eastern languages.
  • 1.5% involved 3 African languages.
languages we worked in other than English and Welsh %
Polish 28.5
German 7
Spanish 7
French 6.5
Chinese 5.5
Urdu 4.5
Portuguese 4
Bengali 3.5
Gujurati 3
Punjabi 3
Russian 3
Turkish 3
Hindi 2
Tamil 2
other Eastern European languages 6
other Western European languages 4.5
other Middle Eastern languages 3
other Asian languages 2.5
African languages 1.5

Statistics from the 2011 UK census show that 22% of people living in London have a first language other than English. The statistics also show that nationally the most common first languages - other than English and Welsh - are (in order) Polish, Punjabi, Urdu, Bengali, Gujurati and French.

The most frequently-requested languages we worked in during the year were broadly the same as in previous years - and generally in the same order. However, within that same order, the proportion of casework in Polish increased by 27%, while demand for French and German fell by 40%.

This reflected a wider shift - with requests for Western European languages declining by 30% as a whole, while the proportion of casework in Eastern European languages rose by 15% and requests for Asian languages increased by 44%.

new cases referred to our casework teams

Where a consumer has already complained to the business they are unhappy with - and contacts us to say they are dissatisfied with the business's final response - we ask them to complete and sign our complaint form. This gives us the basic information about their complaint - and their permission for us to look into it.

If consumers ring us up, we can guide them through the complaint form over the phone - and then send it to them to check and sign. This is generally more efficient, because it means we can encourage people to stick to the key facts.

When we receive a completed complaint form, the advisers on our consumer helpline sort out all the paperwork and check the details. If the complaint is one we can deal with, we accept it formally as a new case - and pass it to one of our casework teams to start work on.

Under the complaints-handling rules set by the regulator, businesses have up to eight weeks to send a final response to a consumer's complaint, before it can be referred to the ombudsman service.

In 16% of the complaints we took on formally as new cases during the year, the businesses involved had not issued a final response within eight weeks. This figure is a significant improvement on previous years - where businesses had failed to respond properly to their customers' complaints in up to four out of ten cases we saw.

We hope that this improvement results from our discussions with financial businesses, where we have stressed how important it is for them to respond fully to their customers' complaints within the period set by their regulator. We would like to see as many complaints as possible resolved directly by businesses themselves at this stage.

% of cases where the business had not sent their customer a final response within eight weeks

year ended 31 March %
2013 16
2012 37
2011 40
2010 31
2009 28

The complaints-handling rules also require businesses' final responses to include information about the consumer's right to refer an unresolved complaint to the ombudsman service. During the year 23% of people who contacted our consumer helpline said they heard about us from the business they complained to.

The way in which businesses tell their customers about the ombudsman is generally by sending them our consumer leaflet, your complaint and the ombudsman - which we produced in partnership with the disability charity, Shaw Trust.

During the year we distributed over a million copies of this leaflet. We charge businesses for bulk supplies - but they can print it for free themselves under licence from us. We provide copies free of charge to consumer advice agencies, libraries and community centres - in a wide range of languages and formats.

number of new cases

year ended 31 March number of new cases
2013 508,881
2012 264,375
2011 206,121
2010 163,012
2009 127,471
2008 123,089
2007 94,392
2006 112,923
2005 110,963
2004 97,901

In the financial year 2012/2013, the advisers on our consumer helpline referred a record 508,881 new cases to our casework teams for further work - out of a total 2,161,439 enquiries and complaints raised initially with our consumer helpline.

This is a 92% increase on the 264,375 new cases recorded in last year's annual review - and is the highest number of cases we have received in any year since the ombudsman service was set up in the year 2000.

The record level of new cases in the financial year 2012/2013 resulted mostly from a 140% increase in complaints about the sale of payment protection insurance (PPI) - following a 51% increase in the previous year.

Other trends during the year included the number of complaints about:

  • Current accounts, mortgage endowments, pet insurance and payday loans increasing by 34%, 43%, 50% and 83% respectively.
  • Contents insurance, point-of-sale loans and so-called "structured" investment products falling by 3%, 14% and 22% respectively.

the most complained-about financial products since we were set up

  %
payment protection insurance (PPI) 38
mortgage endowments 16
bank and credit-card charges 5
other financial products 41

Since the ombudsman service was set up in 2000, consumers have referred a total of 1,945,975 cases to us - of which 59% have involved just three issues: mortgage endowments, bank and credit-card charges, and payment protection insurance (PPI).

The significant volatility in workload relating to these three issues - and the way in which financial businesses have themselves managed the substantial volumes of complaints involved - have presented us with major operational challenges over the last decade.

In July 2012 we received our 1,500,000th case. And in October 2012 complaints referred to us about mis-sold PPI reached the half a million mark.

how these new cases were brought to us

  %
complaints made by consumers themselves 48
complaints made on behalf of consumers by commercial claims-management companies 45
complaints made on behalf of consumers by friends and family 3
complaints made on behalf of consumers by professionals (eg lawyers and accountants) 2
complaints made on behalf of consumers by free consumer advice-agencies (eg Trading Standards and Citizens Advice) 1
complaints made by smaller businesses 1

48% of people who used the ombudsman service during the year did so in their own personal capacity as an individual consumer. This number rose from 42.5% in the previous year.

People wanting to bring a complaint can appoint someone else to do this for them. During the year 4% of cases involved someone acting for free on behalf of the person with the complaint.

Three quarters of these cases involved people referring complaints on behalf of friends and family. A quarter involved a wide range of professional consumer representatives and advocates, acting for free on behalf of clients. These included Trading Standards, Citizens Advice and community workers.

In 47% of cases referred to the ombudsman service during the year, consumers paid for the services of someone to represent them (50.5% in the previous year). These included professionals such as accountants and solicitors. But most of these "represented" cases involved commercial claims-management companies.

The proportion of cases we dealt with where the consumer was represented by a claims-management company fell from 46.5% to 45% during the year - as more consumers brought PPI complaints themselves, rather than using claims managers.

complaints from smaller businesses

complaints from smaller businesses %
banking complaints 69
insurance complaints (excluding PPI) 18
investment complaints 7
payment protection insurance (PPI) 6

We also look at complaints brought by "micro-enterprises" - an EU term covering smaller businesses. To be able to bring a complaint to us, a smaller business must have an annual turnover of up to two million euros and fewer than ten employees.

The number of complaints referred to us by smaller businesses increased by 5% during the year - from 4,304 cases to 4,526. This followed a 39% increase in the number of complaints from smaller businesses in the previous year.

However, sole traders and people running small businesses do not always register their complaint specifically as a business dispute - as they often see the issues as essentially personal rather than commercial.

This may partly explain why 16% of people who completed our customer surveys during the year described themselves as self-employed or running their own business (the same as in the previous year) - significantly higher than the 1% of cases where the dispute was formally registered with us as a business dispute.

69% of cases referred to us by smaller businesses involved complaints about business banking (the same as in the previous year) - including 495 disputes about charges and a large range of administration problems.

The 18% of complaints brought by smaller businesses about insurance issues included 1,319 cases involving commercial vehicles and property (a 24% increase on the previous year) and 261 disputes about business protection (a 63% increase on the previous year). 6% of complaints brought by smaller businesses were about mis-sold PPI.

During the year we also received 258 complaints from businesses about interest-rate hedging products sold by banks. We are not able to take on cases where the business bringing the complaint does not meet the definition of a micro-enterprise. And in many of these cases, the compensation being claimed significantly exceeded the maximum we could award.

During the year we continued our outreach activities with smaller businesses - to promote understanding of the circumstances where the ombudsman service can help with commercial disputes relating to financial services.

This included working with smaller-business trade associations and networks (including our own smaller-businesses forum) and targeted coverage in specialist business-to-business publications ranging from Farm Business to Convenience Store.

cases referred by claims-management companies

  %
payment protection insurance (PPI) 94
credit card complaints 4
other types of complaint (including investments, current accounts and mortgages) 2

The proportion of complaints referred to the ombudsman service on behalf of consumers by claims-management companies fell during the year - for the first time - from 46.5% to 45% of all cases.

This fall results from the significant increase in the number of consumers bringing their own complaints about payment protection insurance (PPI) - rather than paying commercial claims-management companies to do this for them.

% of PPI cases referred by claims-management companies

year ended 31 March %
2013 57
2012 69
2011 76
2010 66
2009 51
2008 14

57% of the 378,699 new PPI cases during the year were brought by claims-management companies. In the previous year 69% of PPI cases involved claims-management companies.

The fall - for the second year running - in the proportion of consumers using claims managers to refer PPI complaints to us may reflect the fact that we have again taken every opportunity this year to tell consumers that they do not need the help of a claims-management company.

12 claims-management companies accounted for 51% of the cases we handled during the year where consumers were represented by this type of company. The other 49% of cases involved around 500 other claims-management companies.

We work closely with the claims-management regulator (a part of the Ministry of Justice) and we pass information onto them about poor practice we see in the claims-management sector.

This is in line with the joint note that we agreed and published in July 2011 with the Ministry of Justice, the FSA and the Financial Services Compensation Scheme (FSCS). Each of these organisations has its own particular relationship with claims-management companies - and we aim to co-ordinate our approach and share information wherever we can.

We cannot handle complaints from consumers about claims-management companies. That is currently the responsibility of the claims-management regulator - and will be the job of the Legal Ombudsman from a date (not yet confirmed) some time in 2013/2014.

But we do everything we can to make sure that claims-management companies who refer complaints to us understand and follow our processes, so that our interactions with them can be as efficient as possible.

For example, we meet regularly with the larger claims-management companies, to set out the practical steps that should be taken to avoid unnecessary complaints and delays when referring complaints to us on behalf of consumers. During the year this has included meetings to remind claims managers - as well as financial businesses - about our well-established approach to disputes over whether or not a PPI policy was actually sold in an individual case.

We continue to tell consumers that we do not think they need the help of a commercial third party - such as a claims-management company or solicitor - to bring a complaint to us.

We are a free service for consumers, but commercial companies charge people to bring a complaint on their behalf. And our procedures are designed to be simple for consumers to use.

We decide cases by looking at the facts - not at how well the arguments are presented. We prefer to hear from consumers in their own words. The outcome of cases shows there is no difference - whether consumers bring them to us themselves direct, or pay a claims-management company to complain on their behalf.