The Financial Ombudsman Service is to increase its standard case fee from £500 to £550 and hike the total amount it levies firms from £17.7m to £23m.
It is also increasing its total budget by 90 per cent from the £147.2m forecast for 2012/13 to £280.1m for 2013/14. The budget including levies on financial services firms, those who hold consumer credit licences and the amount raised from case fees.
In its plan and budget for 2013/14, published today, the FOS says the standard case fee will increase to £550 in April.
It has also confirmed plans to increase the number of free cases from three to 25, also in April.
The FOS is funded by a combination of case fees, which currently firms have to pay if they have four or more complaints referred to the FOS within a year, and a compulsory levy imposed on all financial services firms.
The FOS has frozen the standard case fee for the last four years, but last year said this would be unsustainable in future due to rising costs and the increasing complexity of cases.
The FOS says many firms will have to pay a “slightly higher” levy in 2013/2014, depending on which FSA fee block they are in.
The FOS is also planning to introduce a new “group account” fee structure for the largest firms. The FOS says the new structure would apply to the four biggest banking groups that together account for 60 per cent of its caseload.
Group account fees would be set in advance with a quarterly fee based on the proportion of complaints from each group. Fees would then be adjusted at the end of the year if actual complaint figures were markedly different. Group account fees will also be introduced from April.
The FOS says most of its workload continues to stem from complaints about payment protection insurance misselling. It is currently receiving 5,000 new PPI complaints a week and expects this trend to continue. Last year the FOS introduced a supplementary case fee of £350 for complaints about missold PPI. The supplementary case fee is paid when the case is referred to the FOS, as opposed to when the case is resolved for standard case fees.
The FOS plans to keep the £350 supplementary case fee for PPI complaints for at least another year, though says it will keep the fee under review.