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annual review 1 April 2003 to 31 March 2004 - our customers and stakeholders

what type of consumer uses the ombudsman service?

how old are consumers who complain to the ombudsman service?

pie chart

35 to 44 = 27%
45 to 54 = 29%
55 to 64 = 25%
65 or older = 12%
25 to 34 = 6%
younger than 24 = 1%

Our ‘average’ customer is between 35 and 54 years old. Over half the people who use our service are in this age bracket. This reflects the fact that people in this age group tend to have wider levels of ownership of financial and investment products. Most mortgage endowment complaints we have received this year involve consumers in this age bracket, who took out mortgages in the 1980s and early 90s.

... and what gender are they?

pie chart

male = 59%
female = 41%

A significant proportion of complaints we receive relates to policies and accounts held jointly. With joint accounts, the first-named holder of the account is frequently male - and this is the name that our system records. This may result in some bias in the data we record about the gender of people who complain to us.

... where do consumers live who complain to the ombudsman service?

pie chart

East Anglia = 5%
Wales = 4%
Northern Ireland = 2%
South East = 18%
North West = 12%
Greater London = 11%
South West = 10%
Scotland = 9%
West Midlands = 8%
Yorkshire/Humberside = 8%
East Midlands = 7%
North East = 6%

We do not have reliable external data to help us compare the levels of ownership of financial products across the different regions of the UK with the levels of complaints we receive from people living in those regions. However, we regularly compare regional population figures for the UK with our figures that show where consumers who complain to us come from. This helps us target where we may need to focus outreach work in raising awareness of our services.

Our research shows that the regional location of those using our service broadly reflects the spread of the population across the UK as a whole. The proportion of regional consumers who complained to the ombudsman during the year differed by more than one percentage point from the regional population figures in just four regions. People from East Anglia comprise 9% of the population but 5% of our customers (4% of our customers in the previous year). Conversely, people from the South West comprise 8% of the population but 10% of our customers (11% in the previous year). 6% of our customers came from the North East, where 4% of the UK population lives. And 18% (22% in the previous year) of people who used our service came from the South East (home to 14% of the UK population).

Compared with the figures for last year, there was an increase in the proportion of consumers bringing complaints to the ombudsman service from Northern Ireland, Scotland, the North East and North West, the East Midlands and East Anglia. Complaints from London and the South East and the South West fell slightly. These figures may to some extent reflect the different regional focus of our external liaison activities during the year.

what newspapers do consumers read who complain to the ombudsman service?

pie chart

The Independent / Independent on Sunday = 3%
other newspapers = 9%
Daily Mail/Mail on Sunday = 32%
The Express = 14%
The Telegraph/Sunday Telegraph = 10%
The Times / Sunday Times = 8%
The Mirror / Sunday Mirror = 7%
The Guardian / Observer = 7%
The Sun = 6%
Financial Times = 4%

Knowing which newspapers are read by consumers who bring their complaints to the ombudsman gives us an insight into the socio-economic make-up of our customers. It also helps us plan how we can get messages across more effectively to the people who do - and don’t - know about and use the ombudsman service. We have collected this information as part of our consumer research during the year. The figures show what the consumers who have used our service tell us they read.

how do consumers who complain to the ombudsman rate the service we provide?

we keep consumers well informed about progress on their complaint
87% agree
13% disagree
we explain clearly the reasons behind our decisions
75% agree
25% disagree
we resolve complaints within an acceptable length of time
75% agree
25% disagree
our staff remain polite at all times
95% agree
5% disagree
people who use our service are likely to recommend it to friends and family with a financial complaint
79% agree
21% disagree

Each month, we send a consumer satisfaction survey to a random selection of around 400 people whose complaints we have dealt with, asking a range of questions about their experience of our service. The feedback we receive from these monthly surveys tells us what consumers want and expect from us - and where we need to focus our priorities in terms of the service we provide. The bar chart above shows how consumers who have completed the survey rated our service - measured against a number of customer service benchmarks.

We also calculate an annual baseline figure, so that we can measure and compare, year on year, the general level of satisfaction of consumers who use our service. This year, 80% of consumers’ views of our service were generally positive (76% in the previous year). This small increase results largely from improved satisfaction with the way in which we try to manage expectations and keep consumers informed about progress on their case.

consumer diversity

15% of consumers using our service describe themselves as having some form of disability (12% in the previous year) - predominantly hearing impairment and mobility difficulties. There is strong demand for our publications in Braille, large print and on audiotape - and we use Typetalk and sign-language on request. This is part of our commitment to be flexible and accommodate consumers’ needs wherever we can.

Our consumer surveys indicate that around 4% of people who use our service define themselves as ‘minority ethnic’. During the year, we have carried out research to try to find out how this figure compares with the general levels of ownership of financial and investment products among people from minority ethnic communities. Unfortunately, however, there appears to be little data available in this area.

For people who are not comfortable using English, we provide information and handle phone calls in other languages - and have done so during the year in 23 languages, ranging from Arabic to Welsh. During the year, we also distributed language packs to Members of Parliament - for use when advising constituents - as well as to consumer advice centres across the UK. These packs contain factsheets about the ombudsman service in the UK’s ten most widely-used ethnic languages.

what type of financial firm do consumers complain about to the ombudsman service?

This chart shows how the complaints we have dealt with during the year are spread across the different sectors of the financial services industry. We are aware that the complaints patterns we identify do not necessarily reflect the current marketplace in financial services. This is because many of the complaints we receive relate to advice, sales and marketing that took place some time in the past - especially complaints involving investments, where problems may only start to emerge a number of years later.

In fact, the spread of the complaints we have received this year across the different industry sectors probably gives a truer picture of how the marketing and distribution of retail financial services - especially in relation to products such as endowment mortgages - operated between five and 15 years ago.

firms complained about (by sector)

pie chart

fund managers = 9%
life assurers = 38%
advisers and brokers = 27%
banks and building societies = 13%
general insurers = 13%

how often do financial firms have complaints about them referred to the ombudsman service?

8,315 firms (79% of all firms covered by the ombudsman service) had no complaint referred to the ombudsman during the year
1,080 firms (10% of all firms covered by the ombudsman service) each had 1 complaint referred to the ombudsman during the year
361 firms (3.5% of all firms covered by the ombudsman) each had 2 complaints to the ombudsman
176 firms (1.5% of all firms) had 3 complaints to the ombudsman
304 firms (2.9% of all firms) had between 4 and 10 complaints to the ombudsman
98 firms (0.9% of all firms) each had between 11 and 20 complaints to the ombudsman
90 firms (0.9% of all firms) each had between 21 and 50 complaints to the ombudsman
55 firms (0.5% of all firms) each had between 51 and 100 complaints to the ombudsman
45 firms (0.4%of all firms) each had between 101 and 250 complaints to the ombudsman
16 firms (0.1% of all firms) each had between 251 and 500 complaints to the ombudsman
35 firms (0.3% of all firms) each had more than 501 complaints referred to the ombudsman during the year

The above chart shows that almost 80% of the financial firms that are covered by the ombudsman service had no complaints against them brought to us by their customers - and so these firms have little or no direct contact with us. 1,441 firms - 14% of all firms covered by the ombudsman - had only one or two complaints against them referred to us during the year. (From April 2004, firms will be charged no case fees for the first two complaints during the year.) At the other end of the scale, 20 of the UK's largest financial services providers accounted for 51% of the total number of complaints we received.

how do firms who have complaints against them brought to the ombudsman rate the service we provide?

During the year, we carried out research to gauge the views of the firms we deal with on how we handle complaints and accommodate their particular needs and concerns.

we uphold a reasonable proportion of complaints against firms
76% agree
12% disagree
12% neutral/don't know
our decisions are generally fair
71% agree
11% disagree
18% neutral/don't know
we provide firms with a better alternative to going to court
90% agree
5% disagree
5% neutral/don't know
we have a good reputation among financial firms
57% agree
19% disagree
24% neutral/don't know
our letters and adjudications are clear and concise
80% agree
9% disagree
11% neutral/don't know
we keep firms up-to-date with news and information
91% agree
5% disagree
4% neutral/don't know
firms feel able to challenge the views expressed by our case-handling staff
85% agree
8% disagree
7% neutral/don't know
our case-handling staff are sufficiently knowledgeable
61% agree
14% disagree
25% neutral/don't know

how we get our messages across

activity result
roadshows We held 14 roadshows across the UK - from Cardiff to Glasgow, Maidstone to Newcastle.
tradeshows and consumer events We took our exhibition stand to 27 tradeshows and consumer events - from Business Start-Up at the NEC to Mortgage Business Expo at Olympia.
conferences We organised 10 workingtogether industry conferences in London, Leeds, Manchester and Belfast.
speeches and presentations We spoke at 90 seminars, conferences etc
visits and workshops for consumer advisers We visited 66 consumer advice organisations nationwide, such as trading standards departments and citizens advice bureaux.
visits and training for firms We visited 271 financial services providers - from local credit unions to international investment banks.
industry meetings and seminars We took part in 178 meetings for groups of financial practitioners - including our industry liaison forums (attended by trade bodies and industry representatives).
media enquiries We handled over 3,000 enquiries from newspapers, magazines and TV/radio stations.
MPs We responded to 389 letters and enquiries from MPs - as well as sending our factsheet (in a range of ethnic languages) to constituency offices across the UK.
website hits 75,000 people a month logged on to this website.
publications We printed and distributed over a million copies of our publications (including our leaflet, your complaint and the ombudsman, and 10 editions of our regular newsletter, ombudsman news).
our technical advice team
(general guidance and advice on ombudsman practice and procedures - for professional complaints-handlers in firms and the consumer advice sector)

Our technical advice desk handled 18,823 enquiries, comprising:

  • 15,444 calls from financial services practitioners
  • 2,576 enquiries from consumer advisers
  • 803 calls from trade associations, researchers, official bodies etc.

year ended 31 March 2004

how feedback we receive influences our policy and procedures

We have a range of mechanisms in place - from roadshows to our website - to help us get our messages across to our different stakeholders. And we also need processes in place to help us tune into, and respond to, the views and concerns of our stakeholders. These processes involve our executive team keeping under constant review the way we engage with, and report back to, all those with an interest in our work - at events ranging from our industry liaison forums (regular formal meetings with practitioners and trade body representatives) to workshops with groups of consumer advisers. A special committee of board members also meets quarterly to review our ‘stakeholder dialogue’ processes and our communications strategy.

Some of the issues which we identify as being of concern to stakeholders involve sensitive regulatory policy matters. We take these forward on what is necessarily a confidential basis with the FSA and other regulators, as well as with individual firms. The handling of these types of issues - and the way we can (or cannot) ‘report back’ to the parties concerned and to the wider world - form what has become known as the ‘wider implications’ process.

Here are just a few examples of where feedback from stakeholders during the year has led to our reviewing and changing our policy and procedures.

feedback how we picked up on the feedback action we took as a result of the feedback how we reported back to stakeholders
perceived unfairness of the case fee for smaller firms regular contact with IFAs at roadshows etc following discussion with trade bodies and subsequent public consultation, we introduced a new approach to the case fee system: not charging firms case fees for the first two complaints referred to the ombudsman service each year
  • our plan and budget - and related publicity
  • liaison visits to firms
  • conferences and events
the '15-year long-stop' being used by firms to prevent consumers from complaining to the ombudsman consumer bodies clarification of the position: the ombudsman service has its own rules on time limits (which do not include a '15-year long-stop')
  • 'endowment forum' for trade bodies and consumer groups (Dec 2003)
  • ombudsman news updates - issues 33 & 34
details of complaints contacts at firms not up-to-date on our database queries from firms project to review ongoing accuracy of data - and to chase firms to tell us about changes of personnel/contact details
  • liaison visits to firms
  • messages to the industry through our technical advice desk
insurance and mortgage brokers unprepared for statutory complaints-handling and the ombudsman
  • trade press
  • queries from firms
  • liaison with relevant trade bodies - speaking at their seminars and conferences
  • running our own roadshows for intermediaries around the UK
special issue of ombudsman news - introducing new firms to the ombudsman

useful links