FOS Plans and Budget for 2024/25

We take a look at The Financial Ombudsman Service's strategic plans and budget for the upcoming year ahead.

The Financial Ombudsman Service (FOS) have released their strategic plans and budget for 2024/25. This includes a discussion of the latest complaint trends as well as what FOS anticipates it will see through 2024/25. 

FOS has set out that significant improvements were made in the 2023/24 year, and they remain committed to putting customers at the heart of their service in order to improve experience.

FOS anticipates receiving 210,000 complaints in the 2024/2025 year, whilst anticipating that they will resolve 225,000 complaints. This would mark an increase of 32,500 complaints resolved in the coming year as opposed to the preceding year, a fairly sharp improvement which will be in part driven by the recruitment of 400 additional complaint staff.

FOS have highlighted that key focuses for 2024/25 include:

• Improvements to the digital journey for users.
• Expanding their presence across UK hubs.
• Continuing to build a culture of continuous improvement.
• Continuing to reduce the time it takes to provide customers with responses.
• Building data capabilities to better share insights; and
• Building resilience within the FOS workforce.

In welcome news for the advisory community, FOS' Compulsory Jurisdiction levy will reduce from the 2023/24 forecast of c.£109m to £70m, whilst the Voluntary Jurisdiction levy will reduce from £0.9m to £0.5m. 

FOS also plans to reduce the individual case fee from £750 to £650, as well as promising that businesses will continue to receive 3 free cases before the charge applies (this does not apply to group-account fee arrangement businesses who do not receive free cases). 

FOS continue to monitor complaint trends and it seems that new complaints will largely be driven by the fallout from the 'cost of living' crisis, as FOS expects to see a continued rise in cases involving consumer financial products including irresponsible and unaffordable lending complaints, account closure complaints, motor finance complaints and mortgage complaints (given rise in interest rates). FOS also expect complaints to remain high in respect of travel insurance, motor insurance as well as consumer complaints relating to insurance premiums. 

FOS has set out that they anticipate a fall in complaints regarding investments and pensions, as well as fewer complaints regarding the British Steel Pensions Scheme.

Of course, we can't forget the Consumer Duty. Given its recent implementation, few complaints have been received regarding this to date, however, stakeholders expect to see a rise in Consumer Duty related complaints in line with the rise in banking, consumer credit and insurance complaints being received by FOS. 

If you would like to read FOS' full Plans and Budget for 2024/25 please click here.