Ombudsman service forecasting rise in pension complaints

The Financial Ombudsman Service is forecasting it will have to handle a significant rise in pension complaints in 2015/16. Officials have predicted there will be 5,400 new cases regarding retirement products in the next financial year.The forecast is a rise of just over 1,000 compared to the 4,364 pension cases in 2013/14. By the end of 2014/15 the forecast is 5,000 cases.The ombudsman has asked for views and comments on whether there could be even higher levels of complaints about pensions with the reforms coming into effect in April.There have been warnings from some experts that the new freedoms could trigger another misselling scandal.{desktop}{/desktop}{mobile}{/mobile}The FOS report stated: "At this stage, we are assuming that the only new or emerging issue where we will be dealing with higher case volumes in 2015/2016 is packaged bank accounts."But we would particularly welcome feedback from our stakeholders about any other emerging issues which they think we may see. For example, given the current attention on pensions, are we likely to receive more pension-related complaints?"Based on current trends, the FOS said it expects to receive 16,000 new cases about investments and pensions this year, slightly higher than 2013/14. This includes mortgage endowments.The report said: "In many investment cases, consumers complain that what they bought did not match the description they were given. These cases may be complex – so they can take more time to assess and resolve than other cases."We have seen an increase in complaints about unregulated collective investment schemes. Last year the FCA banned the promotion of these investments to the vast majority of retail investors in the UK. These complaints are particularly challenging – often involving numerous parties and overseas investments."The FOS announced today it will cut its budget by £31m and freeze its levy at £23.3m in 2015/2016.Officials this morning outlined the budget for next year, includingplans to recruit an additional 200 adjudicators and ombudsmen.The new budget of £220.7m represents a 13% reduction in cost to the financial services sector, the FOS reported.Caroline Wayman, chief ombudsman, said: "Our plans take into account the increasingly hard-fought and complex nature of the cases we are seeing – not only in PPI but also in areas like mortgages and pensions. No two financial complaints are alike."The case fee paid by businesses will be frozen at £550 – payable only after the 25th case. Officials said this meant 99% of businesses will continue to pay no case fee at all.

Ombudsman service forecasting rise in pension complaints

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