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corporate plan & 2006/07 budget - foundations for the future

We aim to:

  • provide fair, consistent, authoritative and persuasive outcomes to complaints, and be recognised as an expert organisation in resolving consumer disputes;
  • be demonstrably accessible and impartial, and give consumers and firms a good standard of customer service;
  • have well-trained and highly-motivated staff;
  • be efficient, effective and flexible, and make good use of technology;
  • coordinate our work with associated regulatory and dispute-resolution bodies, so far as is consistent with our independent roles;
  • be open about our work and governance, and ensure stakeholders understand our role and have confidence in our work; and
  • provide a comprehensive service covering, as far as practicable, activities that consumers identify as 'financial'.

To fulfil these aims, allowing for the challenges and constraints described in chapter 2 - a demand-led service - and chapter 3 - dealing with the demand - we have adopted an ambitious agenda for the next three years and beyond. The main development tasks currently underway or planned are as follows.

incoming work We carry out significant external liaison and training activities. These are designed to reduce incoming cases by encouraging firms and consumers to resolve complaints themselves, and also to help eliminate the sources of financial complaints. We will be reviewing ways to make our work in this area even more effective.

Despite the uncertainties explained in chapter 2 - a demand-led service - our forecasts have been remarkably accurate. We will continue to improve the model we use to estimate:

  • the nature and extent of incoming work;
  • the stage of our process at which incoming work is likely to be resolved; and
  • the staff numbers we need to deal with this work.

We will also keep in close contact with HM Treasury, the FSA, the Department of Trade and Industry and the OFT to help ensure that extensions to our jurisdiction are phased in accordance with our ability to absorb the work efficiently.

mortgage endowment cases Mortgage endowment cases have formed almost two-thirds of our incoming work in the current year - 2005/06. While that continues, we will continue to treat these cases differently from other types of case, in two ways.

First, the cases that reach the ombudsman service are part of a wider regulatory picture, with which the FSA is actively engaged. So we will continue to provide relevant firms and the FSA with a wider range of data about mortgage endowment cases.

We are also seeking, in conjunction with the FSA, to increase the industry’s engagement in the project-management of issues affecting mortgage endowment cases, including greater transparency in numbers and responsibilities. At the same time we will continue making our own contingency plans for changes in the number of mortgage endowment cases.

Second, we will continue for a time to operate within the more generous timeliness standards we use when resolving and closing mortgage endowment cases. But we will then move towards the standards we use for other types of case.

We will continue to provide speedier arrangements for priority cases. But in most mortgage endowment cases, the loss will materialise at a future date. Consumers know there is a huge surge of mortgage endowment cases and our satisfaction surveys show that - as long as we keep consumers informed - they accept that dealing with these cases will take a little longer.

staff recruitment and retention We will keep our policies for recruiting and retaining staff under review - in the light of projected work, likely staff turnover and competition from other potential employers. We will also improve our mechanisms for manpower and 'succession' planning.

By continuing to attract applicants with appropriate skills and to offer our staff appropriate opportunities, rewards and motivation, we will help our organisation to develop. Ensuring that our salaries and benefits remain competitive will require realistic budgetary provision.

Internal transfers, secondments and training, supported by further expansion in our intranet-based knowledge system, will help increase the number of our staff who have the technical skills to deal with complaints about a range of different products.

We will introduce more robust, representative and business-focused arrangements for consulting and communicating with our staff. We will also ensure we are seen to value the work of all our employees.

quality We have appointed a quality director to champion quality issues. We will refine the criteria we use to define 'quality'. We will also review:

  • the way we produce, disseminate and record technical and process information; and
  • the relationship between this information and our staff-training materials.

We will enhance our internal quality-management system to:

  • assure the integrity of our quality-checking;
  • demonstrate that casework is carried out in accordance with our documented processes and standards;
  • analyse where things can be improved; and
  • feed back information to help improve our process.

We will reduce the amount of time between our taking on a consumer complaint and allocating it to an adjudicator for investigation. We will also continue to improve our communication with consumers, while cases are awaiting allocation.

Our systems for identifying cases that remain unresolved for significantly longer than average will be improved, and we will continue with our targeted programme for reducing the number of such cases.

enquiry and casework process We will consider how the kind of external changes that may occur over the next three years and beyond could affect us - including possible changes in:

  • user expectations;
  • the profile of firms;
  • the social profile of consumers;
  • general working and communication methods; and
  • the role of third parties such as claims-management companies.

Continuous improvement and innovation in our process and productivity will be a key focus for us and will include a review of:

  • how far our process is efficient, flexible, clear, documented and accessible for firms and consumers (including disadvantaged and disabled consumers);
  • how well our process manages - and fulfils - the expectations of consumers and firms;
  • how we can build on the adaptability we have already demonstrated in dealing with mortgage endowment cases;
  • how we can address the possibility of a shifting balance between enquiries and cases (including more early-resolution of cases and the development of self-help processes); and
  • how we can develop different ways of handling cases, depending on their complexity or on the types of firms and consumers involved.

information We will consider with stakeholders whether it would be appropriate to increase the amount of information about cases and outcomes that we currently make publicly available. This would help to enhance the predictability of our approach.

We will improve the scope, appropriateness, clarity and reliability of our management information. This will include the systems for monitoring quality issues and identifying firms whose conduct should be referred to the regulator.

systems and resources We have set up a team to plan for 'next-generation' information and telephony systems that:

  • can support flexible casework processes and communication channels; and
  • are secure, resilient, scalable and easy to modify.

The team will also review the effectiveness of our current disaster-recovery and business-continuity plans.

We will discuss with our stakeholders ways in which we can increase the flexibility of our finances. We will also review the structure of our annual levy and case fee. In particular, we will consider ways to:

  • further mitigate small firms' concerns about case fees;
  • improve the way in which costs are allocated among the large firms which provide most of our income; and
  • allow for the firms that will be brought in by the proposed consumer credit jurisdiction.

We will prepare contingency plans enabling us to continue operating effectively if we were to outgrow our existing premises.

stakeholders We will maintain close liaison with the FSA, OFT and Financial Services Compensation Scheme - so far as is consistent with our independent roles - in order to demonstrate a ‘joined-up’ system for users and improve our responsiveness to each other’s concerns.

And by continuing to share our experience with firms, industry bodies and consumer groups, we aim not only to encourage the fair resolution by firms of consumer complaints but also to help avoid the need for our direct involvement in these complaints.

We will continue to collate information about the root causes of complaints and to share this with firms, industry bodies, consumer bodies and regulators, to help prevent complaints occurring. And we will review the ways in which we liaise with firms, industry bodies and consumer bodies, to ensure effective two-way communication at the right level.

To promote a clear and realistic understanding of our work, we will maintain constructive relations with all our stakeholders - including the media, who play a vital role in helping us deliver key messages to the general public. We will also continue to share experience with those - nationally and internationally - who are involved in dispute-resolution, and to work with those who wish to apply the Financial Ombudsman Service model to their own sphere of work.