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plan & budget 2004/05 for the year ending 31 March 2005 - productivity, timeliness and service quality

5.1 productivity

Since most mortgage endowment policies will not mature - and therefore crystalise any actual losses - in the near future, our strategy is to prioritise those complaints that do not involve these policies, while managing the expectations of all our customers. However, we give early consideration to mortgage endowment complaints where the underlying mortgage is due to be repaid shortly or where the policyholder is seriously ill.

Productivity levels in 2004/05 will be lower than in 2003/04 because:
  • the remaining "stock" of mortgage endowment cases will become increasingly difficult as we complete the more straightforward cases;
  • we will transfer some existing staff, currently processing mortgage endowment complaints, to deal with other types of complaint;
  • high levels of recruitment will have an impact on the productivity both of the new staff, while they are being trained, and of those existing staff who are involved in the training. Our priority when recruiting will be for staff to work in areas other than mortgage endowments, since the work in these other areas is more specialised and complex, and the productivity levels are lower at present than for complaints involving mortgage endowments.

    In 2005/06 we expect the upward trend in productivity to return. There will be a decline in the economies of scale that help speed productivity levels for mortgage endowment complaints. However, this will be more than compensated for by the fact that our newer staff will by then be fully trained and able to work on a wider range of cases.

5.2 headcount

We have assumed there will be no additional recruitment in 2004/05.

5.3 cases resolved

With our increased numbers of case handlers, we expect to resolve and close 88,000 cases in 2004/05, an increase of 10% compared with the current year. For 2005/06, we expect the number of cases we resolve to increase to 90,000, with no additional increase in case-handling staff.

5.4 timeliness

We intend to maintain the targets we set in 2003/04, despite the exceptional increase in the workload (see table 5.6).

5.5 work-in-progress

Work-in-progress will remain at 23 weeks. However, the time it takes before we can allocate mortgage endowment complaints will increase as staff are redeployed to deal with other types of cases. We are keen to ensure that mortgage endowment complaints do not adversely affect service standards for the rest of our workload.

The recruitment of additional staff in 2003/04 will increase our capacity for resolving cases. However, volumes of new cases are likely to remain high, with mortgage endowment cases forming a significant proportion. The average waiting time before a case (of any type) can be allocated to an adjudicator will have reduced to 6 weeks by the end of this year.

In 2005/06, staffing levels will remain steady and we expect our capacity for resolving cases to significantly exceed the level of new cases reaching us, reducing the work-in-progress by over 25%. The average time before we are able to allocate a case to an adjudicator will have reduced further to 4 weeks by the end of 2005/06.

5.6 summary

actual 2002/03
forecast 2003/04
budget 2004/05
plan 2005/06
opening work-in-progress
19,793
25,504
43,504
38,504
new complaints
62,170
98,000
83,000
68,000
cases resolved
56,459
80,000
88,000
90,000
closing work-in-progress
25,504
43,504
38,504
16,504
work-in-hand (weeks)
21
23
23
10
productivity
4.9
4.9
4.4
4.5
resolved within 3 months
44%
44%
45%
45%
resolved within 6 months
76%
81%
80%
80%
resolved within 9 months
90%
93%
90%
90%
resolved within 12 months

all cases reported to the board

5.7 In our view, these forecasts represent a sound basis for budget planning and service delivery. However, as in previous years, we intend to react flexibly to changes in demand as they arise, and this may involve our needing to recruit further staff in order to keep our work-in-progress to acceptable levels.