FOS to boost staff by a third as costs soar
The Financial Ombudsman Service is planning to boost its staff numbers from 1,890 to 2,545 over the next year, as its forecasts a 75 per cent hike in its operating costs.
The FOS published its annual consultation on its plan and budget for 2012/13 today.
It reveals the FOS’ plans to increase staff numbers by 35 per cent with the recruitment of an additional 655 staff during the course of the financial year.
The number of ombudsmen is set to increase from 90 to 125, while the number of frontline customer contact staff will go from 150 to 220.
Those working in casework divisions, including adjudicators, will increase from 1,490 to 2,000, and support staff will rise from 150 to 200.
The FOS has seen a surge in the number of payment protection insurance complaints, which it expects to continue over the next year.
At the same it has experienced significantly higher levels of staff turnover, as banks poached FOS contractors to handle their own PPI complaints.
The FOS says: “We have found it challenging to compete against the remuneration packages offered by some of those businesses.
“The higher levels of adjudicator turnover during 2011/12 as a result of this have added to our recruitment and operational challenges.”
Over 80 per cent of FOS costs relate to staffing. In 2012/13 staffing costs are expected to total £149.4m.
The overall FOS budget is set to jump from £113.1m for 2011/12 to £197.6m for 2012/13.
The FOS is funded by a mixture of case fees and an industry levy. The £500 case fee is charged to businesses on the fourth and any subsequent case referred to the FOS during the year.
The FOS has frozen both the £500 case fee and the industry levy for the third year in a row. However it says given the expected rising costs and inflationary pressures it is likely case fees will increase from 2012/13.
Network members will continue to be liable for case fees as the free cases will apply to the network as a whole.
For the 10 financial groups that make up over 70 per cent of the FOS’ workload, the ombudsman is proposing a new group account arrangement to align costs with the firms that generate the most complaints.
Table on forecasted number of FOS staff taken from FOS plan and budget for 2012/13: