corporate plan and 2007/08 budget
January 2007
complaint trends
enquiries
Enquiries to our ‘front-line’ customer contact division, by telephone and in writing, have been reducing during the year.
| actual 2005/06 |
budget 2006/07 |
forecast 2006/07 |
budget 2007/08 |
|
|---|---|---|---|---|
| phone calls to our enquiry line | 359,131 | 370,000 | 320,000 | 290,000 |
| written enquiries | 313,842 | 320,000 | 270,000 | 240,000 |
| total | 672,973 | 690,000 | 590,000 | 530,000 |
Our customer contact division is resolving an average of 160 complaints per week that would otherwise have gone on to be ‘full-blown’ cases and incurred a case fee.
new cases
The total number of new cases is beginning to fall and this is expected to continue through 2007/08. This reduction is mainly due to mortgage endowment complaints becoming
time-barred.
| types of complaint | actual 2005/06 |
budget 2006/07 |
forecast 2006/07 |
budget 2007/08 |
|---|---|---|---|---|
| endowments linked to mortgages | 69,149 | 60,000 | 60,000 | 32,000 |
| pensions | 4,053 | 4,000 | 4,000 | 4,000 |
| single premium investment bonds | 4,541 | 3,500 | 4,000 | 3,500 |
| other investments | 7,201 | 7,000 | 7,000 | 6,500 |
| banking and loans | 11,082 | 10,500 | 12,000 | 13,000 |
| mortgages | 3,942 | 4,000 | 4,500 | 4,500 |
| insurance | 12,955 | 13,500 | 13,500 | 14,500 |
| consumer credit | 0 | 0 | 0 | 2,000 |
| contingency | 2,500 | |||
| total | 112,923 | 105,000 | 105,000 | 80,000 |
As explained previously, because of the nature and scale of the complaints received about mortgage endowments, we treat them as a separate category and set different service levels for them.
mortgage endowment cases
We have assumed that the number of new cases about mortgage endowments will reduce significantly in 2007/08, mainly as a result of the time limits set by the FSA for bringing complaints. There are considerable uncertainties about the future pattern of these cases.
We expect to reach a point when an increasing number of disputes about time bars will overtake a reducing number of disputes about the merits of cases – but it is not possible to predict when, or how quickly, this will happen.
It is unclear how many cases where there is a dispute about time bars will result in the firm having to pay a case fee. As we have explained in ombudsman news, our regular newsletter, if it is apparent (with full evidence) that the complaint is time-barred at the time we receive it, no case fee will generally be payable. Our working assumption is that we will receive approximately 12,000 such time-barred mortgage endowment complaints in 2007/08.
These 12,000 or so complaints will represent a substantial block of work to be processed. However, for budget purposes they will not be recorded as ‘closed cases’ but will instead be treated as non-chargeable ‘enquiries’. This is consistent with the way in which we usually record complaints that are resolved in our customer contact division. It is also consistent with the presentation of budget figures for previous years.
Excluding these 12,000 complaints, we expect the number of new mortgage endowment cases to fall from about 60,000 in 2006/07 to about 32,000 in 2007/08. We plan to close 54,000 mortgage endowment cases, though the rate at which we resolve and close these cases will slow over the year as the number of adjudicators reduces. Over the year, we expect the number of mortgage endowment cases in progress to more than halve – from about 40,000 in April 2007 to about 18,000 by March 2008.
other cases
We are assuming an increase in banking complaints – partly as a result of the media focus on disputes about bank charges – and a smaller increase in general insurance complaints. We expect investment complaints to continue at the current level while market conditions remain broadly favourable.
Our new consumer credit jurisdiction comes into force in April 2007. But it will relate only to complaints about events after that date, so we expect only about 2,000 cases in the first year. Overall, we expect the number of new cases, other than mortgage endowment cases, to rise to 48,000 in 2007/08.
We aim to close 52,500 cases (compared to 47,300 this year), with an improvement in both productivity and timeliness. For example, by the end of the budget year we aim to be closing half of the cases within 3 months.
workload plans
| opening work-in-progress | actual 2005/06 |
forecast 2006/07 |
budget 2007/08 |
|---|---|---|---|
| mortgage endowment cases | 49,608 | 48,000 | 39,500 |
| other cases | 22,701 | 17,800 | 15,500 |
| total | 72,309 | 65,800 | 55,000 |
| new cases | actual 2005/06 |
forecast 2006/07 |
budget 2007/08 |
|---|---|---|---|
| mortgage endowment cases | 69,149 | 60,000 | 32,000 |
| other cases | 43,774 | 45,000 | 48,000 |
| total | 112,923 | 105,000 | 80,000 |
| cases resolved | actual 2005/06 |
forecast 2006/07 |
budget 2007/08 |
|---|---|---|---|
| mortgage endowment cases | 70,757 | 68,500 | 54,000 |
| other cases | 48,675 | 47,300 | 52,500 |
| total | 119,432 | 115,800 | 106,500 |
| closing work-in-progress | actual 2005/06 |
forecast 2006/07 |
budget 2007/08 |
|---|---|---|---|
| mortgage endowment cases | 48,000 | 39,500 | 17,500 |
| other cases | 17,800 | 15,500 | 11,000 |
| total | 65,800 | 55,000 | 28,500 |
| work in hand (weeks) | actual 2005/06 |
forecast 2006/07 |
budget 2007/08 |
|---|---|---|---|
| mortgage endowment cases | 32.5 | 30.0 | 18.1 |
| other cases | 20.3 | 17.0 | 11.6 |
| total | 28.4 | 24.7 | 14.9 |
| productivity | actual 2005/06 |
forecast 2006/07 |
budget 2007/08 |
|---|---|---|---|
| mortgage endowment cases | 5.6 | 5.1 | 4.7 |
| other cases | 3.5 | 3.5 | 4.0 |
| total | 4.5 | 4.3 | 4.3 |
| % closed within 3 months | actual 2005/06 |
forecast 2006/07 |
budget 2007/08 |
|---|---|---|---|
| mortgage endowment cases | 20 | 20 | 20 |
| other cases | 43 | 50 | 50 |
| total | 32 | 35 | 35 |
| % closed within 6 months | actual 2005/06 |
forecast 2006/07 |
budget 2007/08 |
|---|---|---|---|
| mortgage endowment cases | 45 | 45 | 45 |
| other cases | 74 | 80 | 80 |
| total | 59 | 60 | 60 |
| % closed within 9 months | actual 2005/06 |
forecast 2006/07 |
budget 2007/08 |
|---|---|---|---|
| mortgage endowment cases | 65 | 70 | 70 |
| other cases | 84 | 85 | 85 |
| total | 75 | 75 | 75 |
| % closed within 12 months | actual 2005/06 |
forecast 2006/07 |
budget 2007/08 |
|---|---|---|---|
| mortgage endowment cases | 80 | 80 | 80 |
| other cases | 89 | 90 | 90 |
| total | 85 | 85 | 85 |