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annual review 2010/2011

1 April 2010 to 31 March 2011

the complaints we received

our consumer helpline

Our customer-contact division runs our consumer helpline - for enquiries by phone, letter and email. In the financial year 2010/2011 the number of people contacting us - with questions, concerns and complaints about the way they had been treated by financial businesses - continued at record levels.

We handled a record 1,012,371 initial enquiries and complaints during the year - a 9% rise on the previous year and a 61% increase on the number we dealt with four years ago.

This means that each working day during the year our customer-contact division dealt with a record 4,000 phone calls and items of new mail from consumers.

initial enquiries and complaints from consumers

year ended
31 March
phone enquiries written enquiries
(including by email)
total enquiries
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

The consumer helpline is the first port of call for everyone who phones the ombudsman service on one of our two easily-memorable "non-geographic" numbers - 0300 123 9123 and 0800 023 4567. Consumers can choose which number they prefer - depending on which is more convenient for them personally and which is cheaper (or in many cases free - subject to their own phone tariff).

In our customer research carried out over the year, 96% of people said that they had no problem finding our contact details.

how do people phone the ombudsman service?

  • 80% from a "fixed line" phone
  • 17% from a mobile phone
  • 1% from "voice over internet" phone ("VoIP")
  • 2% from an overseas or untraceable phone

During the year we saw a 13% increase in calls to our consumer helpline from mobile phones. 1,014 people phoned us from payphones (0.2% of all phone calls). We continue to remind these callers that we are happy to phone them back, if they are worried about the cost of calling us.

One of our service standards is 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 77% of calls within 20 seconds - meaning we just missed our target.

This was largely as a result of dealing with the 9% increase in phone calls and new mail. However, 97% of consumers surveyed during the year said their calls to us were answered promptly.

Peak times for phone calls are generally on Mondays between 10am and noon. We use call-centre software and planning tools to help manage surges of calls throughout the day. 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.

online contact

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

Our website recorded a monthly average of 225,000 visits (210,000 in the previous year). The busiest time on our website is late morning on weekdays. However, people use our website round the clock, 365 days a year, to send us emails and register complaints online.

537,774 complaint forms were downloaded from our website during the year (a 23% increase on the previous year). This increase largely resulted from the rise in complaints about payment protection insurance (PPI) - with 214,140 PPI consumer questionnaires downloaded from our website since April 2010, when we launched this form to help streamline the handling of this type of complaint.

The other most-visited pages on our website were:

"... 55,756 people watched our various online videos"

Over 500 organisations now link from their websites to ours - ranging from the BBC to the Cornish Community Banking credit union, and from Cancer Research UK to the Silver-Surfers Guide.

There is more information about the people who use our website further on in this annual review.

how we handle initial enquiries and complaints

The front-line 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 includes:

  • explaining the official complaints procedure, set out by the Financial Services Authority (FSA), which financial businesses have to follow;
  • confirming the details of the person consumers should complain to at a business, if they haven't already done this;
  • forwarding complaints direct to the relevant businesses - for them to deal with in the first instance, under the FSA's complaints-handling rules;
  • directing consumers to other appropriate complaints bodies, helplines and websites;
  • providing the facts and information that empower people to resolve problems themselves;
  • offering practical suggestions on sorting things out informally - without needing to escalate the matter as an official complaint; and
  • giving an early steer on the likely outcome of a complaint, from our informed independent viewpoint.

"... if we think there's a genuine case to pursue, we will reassure anyone who seems intimidated by the complaints process"

If we do not think it would be helpful or productive for a consumer to pursue a grievance further, we explain why we believe this. We also provide impartial guidance on any redress already on offer. But equally, if we think there is a genuine case to pursue, we will reassure anyone who seems intimidated by the process of complaining.

making it easy to contact us

Our research throughout the year suggests that there are certain groups of consumers who are more likely to find formal complaint procedures off-putting. The range of people who contact our consumer helpline broadly reflects the diversity of the population at large. It is clear, however, that 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).

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 behavioural factors.

We are committed to identifying and, wherever possible, removing barriers that may unfairly prevent particular consumers from using our service. As part of this commitment, we have put in place a team of specially-trained front-line advisers to work with more vulnerable consumers who might otherwise struggle with forms and procedure.

During the year this team worked on cases involving:

a widow in her nineties who was hard-of-hearing and lived alone.

English was her second language and she was struggling to make sense of the forms and paperwork as part of her complaint. She was nervous of strangers and cautious about answering the phone, if she did not know who was calling. We arranged for the same casework adviser to phone her at the same time every two weeks - to give her a regular update on what was happening on her case. The consumer felt secure, knowing that she would be speaking to the same person - who understood her difficulties and could explain things for her, slowly, clearly and step by step.

a consumer with cognitive impairment as a result of a severe head injury sustained while on active service overseas.

We arranged for him to receive letters in the format he requested - large print on specially tinted paper.

There is more information about our accessibility and diversity work further on in this annual review.

Our aim is to make our process as easy and 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 smaller businesses - who also tell us that they want as little red tape and bureaucracy as possible.

"... making it easier for people to tell us their side of the story does not make us a consumer champion"

This means a key challenge for us is to work proactively to ensure no one is disadvantaged in bringing a complaint to us - while at the same time emphasising our impartiality. "Impartial" means we do not "side" with anyone.

The concept of "impartiality" can be difficult for some of our customers 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 did consumers who contacted our helpline
first hear about the ombudsman?

  • 28% from a friend, relative or colleague
  • 18% on the internet
  • 18% from a financial business
  • 14% in the media (press and broadcast)
  • 7% from a consumer-advice agency (eg Trading Standards or Citizens Advice)
  • 1% from a claims-management company
  • 14% other and "don't know"

Consumers who contact our helpline at this stage to ask for initial guidance - rather than to refer an actual complaint - are 43% more likely to have first heard about us through word of mouth than consumers who pursue a formal complaint with us. However, consumers who refer complaints to us formally are more than twice as likely to know about us through the media.

the value of our early involvement

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

  • 95% of people who contacted our helpline said they were given a clear explanation of what would happen next with their complaint; and
  • 91% felt that the consumer adviser 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 five 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.

"... 95% of people who contacted our helpline said they were given a clear explanation"

Each year we commission independent research to find out more about what happened next to the four out of five consumers who contacted us initially on our helpline - but then never returned with a formal complaint.

The latest survey shows that of these consumers, 45% were subsequently able to resolve their problem themselves, without needing further help from the ombudsman service (44% in the previous year).

  • 92% of these consumers felt it was our early involvement that had helped them to sort things out satisfactorily at this early stage (85% in the previous year).

Of the 55% of consumers who were not immediately able to resolve their problem themselves, after contacting our helpline for initial help and guidance:

  • 73% 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); and
  • 27% said they had let the matter drop.

"... there was a 20% increase in the people who said they would continue to pursue complaints"

There was a 20% increase in the proportion of people who said they would continue to pursue complaints that they had not initially been able to resolve directly with the financial business involved. There is more information further on in this annual review about people's attitudes to pursuing complaints - and some reasons why people say they do not do so.

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:

There is more information about our accessibility and diversity work further on in this annual review.

other languages

During the year 1,722 consumers from 100 countries outside the UK brought complaints to the ombudsman service about UK financial services and products.

This is reflected in the demand for our interpreting and translation services, which has risen by 16% compared with the previous year - as the financial companies we cover increasingly carry out more international business with customers round the world.

1,251 cases during the year (0.75% of our overall workload) involved working in a language other than English or Welsh. In total this meant working in 49 languages. Of these cases:

  • 45% involved Western European languages - from Maltese to Swedish
  • 31% involved Eastern European languages - from Lithuanian to Romanian
  • 16.5% involved Asian languages - from Sinhala to Nepalese
  • 7% involved Middle Eastern languages - from Kurdish to Hebrew
  • 0.5% involved African languages - from Swahili to Somali.
languages other than English and Welsh %
Polish 24
French 13
Spanish 11
German 10.5
Urdu 5
Italian 4.5
Bengali 3
Turkish 3
Arabic 2.5
Portuguese 2.5
other Asian languages 8
other Eastern European languages 6.5
other Western European languages 4.5
other Middle Eastern languages 1.5
African languages 0.5

The languages listened to most frequently during the year as audio-file downloads from our website - other than English and Welsh - were Chinese, Arabic and Punjabi.

new cases referred to our adjudicators

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 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, our customer-contact division sorts out all the paperwork and checks 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 teams of adjudicators to deal with.

"... in 40% of cases the business had not issued a final response to the consumer after eight weeks"

Under the complaints-handling rules set by the Financial Services Authority (FSA), businesses are required to send a final response to a consumer's complaint within eight weeks of receiving it. However, in 40% of the complaints we took on formally as new cases during the year, the businesses involved had not issued a final response - even though their customers had already been waiting longer than eight weeks.

This figure was higher than the previous year (31% in 2009/2010). It was also significantly higher for complaints involving payment protection insurance (PPI) where - in 51% of the cases we dealt with - businesses had failed to send consumers a final response within the required timescale.

In our discussions with financial businesses, we stress how important it is for a business to respond fully to a customer's complaint within this eight-week period set by the FSA. We would like to see as many complaints as possible resolved directly by businesses themselves at this stage.

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 around one in five consumers said they heard about us from the business they complained to.

number of new cases

year ended 31 March number of new cases
2011 206,121
2010 163,012
2009 127,471
2008 123,089
2007 94,392
2006 112,923
2005 110,963
2004 97,901
2003 62,170
2002 43,330

In the financial year 2010/2011, our customer-contact division referred a record 206,121 new cases to our adjudicators - out of a total 1,012,371 enquiries and complaints raised initially with our consumer helpline.

This is a 26% increase on the 163,012 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.

"... over the last ten years the ombudsman service has received a total of 1,172,719 cases"

The record level of new cases in the financial year 2010/2011 resulted from a 113% increase in complaints about the sale of payment protection insurance (PPI) - following a 58% increase in the previous year.

However, other trends during the year included the number of complaints about:

  • motor insurance, consumer credit and travel insurance increasing by 6%, 15% and 27% respectively; and
  • health and medical insurance, current accounts and mortgage endowments falling by 13%, 21% and 44% respectively.

This means that since the ombudsman service was set up in 2000, we have received a total of 1,172,719 cases, of which:

  • 26% have involved the sale of mortgage endowments;
  • 17% have involved the sale of PPI; and
  • 4% have involved unauthorised-overdraft charges.

who these new cases were from during 2010/2011

complaints made by consumers themselves 43
complaints made on behalf of consumers by commercial claims-management companies 45
complaints made on behalf of consumers by professionals (eg lawyers and accountants) 5
complaints made on behalf of consumers by friends and family 3
complaints made on behalf of consumers by free consumer-advice agencies (eg Trading Standards and Citizens Advice) 2
complaints made by smaller businesses 2

43% of people who used the ombudsman service during the year did so in a personal capacity as individual consumers. But people wanting to bring a complaint can appoint someone else to do this for them. During the year 5% of cases involved someone acting for free on behalf of the person with the complaint.

Over half of these cases involved people referring complaints on behalf of friends and family. A smaller number involved a wide range of professional consumer representatives and advocates, acting for free on behalf of clients. These included Trading Standards and Citizens Advice, debt counsellors and money advisers, employers and union representatives, members of parliament and councillors, and community and charity workers.

In 50% of cases referred to the ombudsman service during the year, consumers paid for the services of someone to represent them. 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 increased from 28% to 45% during the year - directly as a result of the 113% increase in PPI complaints, where claims-management companies are most active.

complaints from smaller businesses

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 decreased by 35% during the year - from 4,758 cases to 3,093. This was exactly the size of the increase in the number of complaints from smaller businesses in the previous year.

complaints from smaller businesses %
banking 71
insurance 25
investment 4

The decrease in the number of complaints referred to us by smaller businesses largely reflects the fall in complaints about business banking - and in particular, about business bank-charges, which fell from 2,265 cases in 2009/2010 to 1,359 cases in 2010/2011.

The 25% of complaints brought by smaller businesses about insurance issues included cases involving commercial vehicles and property, and business protection insurance.

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.

For example, 15% of people who completed our customer surveys during the year described themselves as self-employed or running their own business - far higher than the number who formally registered their case with us as a business dispute (and a 15% rise on this figure in the previous year).

"... 15% of people who used the ombudsman were self-employed or running their own business"

During the year we continued our outreach activities with smaller businesses - including working with smaller-business trade associations and networks (including our own smaller-businesses forum), taking part in business start-up shows and similar events, and arranging targeted coverage in specialist business-to-business publications.

cases referred by claims-management companies

payment protection insurance (PPI) complaints 83
credit card complaints 10
current account complaints 4
mortgage endowment complaints 3

The proportion of complaints referred to the ombudsman service by claims-management companies on behalf of consumers rose steeply during the year - from 28% to 45% of all cases.

This follows steady year-on-year increases in previous years - and is broadly in line with the growing volumes of complaints relating to payment protection insurance (PPI), where claims-management companies are most active. 76% of the 104,597 new PPI cases during the year were brought by claims-management companies.

"... we prefer to hear from consumers in their own words"

Seven claims-management companies accounted for 53% of all the cases we handled during the year where consumers were represented by this type of company. The other 47% of cases involved over 200 other claims-management companies.

We work closely with the claims-management regulator (a part of the Ministry of Justice), to inform it about the conduct of the companies it regulates and to tackle abuses. But we cannot handle complaints about claims-management companies ourselves.

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 consumers to bring a complaint on their behalf.

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. And 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.

Our research shows that those who are more likely to use a claims-management company to refer a complaint to us include consumers:

  • between the ages of 25 and 54 (35% of people in this age bracket are represented by claims-management companies); and
  • from the unskilled (DE) socio-economic group (almost twice as likely to use a claims-management company as they are to bring a complaint to us directly).

On the other hand, consumers who are more likely to complain to us direct - without using a claims-management company - include people:

  • aged under 25;
  • aged over 65 (85% of whom bring complaints to us direct, rather than through a claims-management company);
  • from the skilled and semi-skilled (C1/C2) socio-economic group;
  • from non-white ethnic backgrounds.

The kinds of consumer who are more likely to use a claims-management company are clearly those specifically targeted by the extensive marketing and advertising campaigns run by those companies.

The kinds of consumer who show a clear preference for complaining to us directly, without using a claims-management company, are broadly the groups on which we have focused our own outreach and awareness-raising initiatives over the last few years.

There is more information about the demographics of our customers - and about our outreach work - further on in this annual review.