The Legal Ombudsman will ask for a 19% hike in its budget amid concerns the service is no longer able to properly function with its current funding.
The Office for Legal Complaints, which oversees the ombudsman service, says the current position is ‘unsustainable’, with 5,000 people likely to be waiting for an investigation into their complaint by the end of this financial year.
Without further investment, the current minimum six-month wait for an investigation will continue to increase, risking further damage to the reputation of a body plagued by leadership crises and delays since it was created.
The business plan and budget published yesterday sets out that the net expenditure for 2021/22 needs to rise from £12.8m to £15.26m. This would be followed by a further 6% increase in 2022/23 to £16.16m.
Setting out the rationale for the rise, Elisabeth Davies, chair of the OLC, said the current budget is not sufficient to ensure consumers and lawyers receive the level of service they want and need.
Davies said: ‘Additional resource is required to resolve complaints at a rate that meets current demand, addresses the additional impact of Covid-19, reduces the time customers wait for an investigation to start, and to ensure insight from casework is shared, enabling the sector to improve complaints-handling and tackle the root causes of consumer dissatisfaction.’
This is the second successive year the OLC has asked for a significant increase in the ombudsman budget. Earlier this year it applied for an extra 21%, but this plan was widely criticised by the legal profession – which ultimately pays for the service – and thrown out by the oversight regulator the Legal Services Board.
Davies acknowledged the legal sector was entitled to ask ‘why should we listen to you now’ but said this new plan adopts a ‘more coherent process’ based on better information and better forecasting.
The number of cases concluded has fallen from 6,206 in 2018/19 to fewer than 5,000 this year. Meanwhile the number of people waiting for their case to be investigated has risen by 54% in the last two years. With its budget increases, the OLC says it can conclude more than 9,500 in 2022/23 and reduced the backlog of customers waiting to an estimated 1,245.
The OLC says a standstill budget would lead to a further deterioration in customer wait times, which are already a source of customer dissatisfaction, with continued limitations on learning and insight work.
The Covid pandemic has exacerbated existing problems, with staff productivity affected and many service provider unable to deal with complaints within the usual timescales due to furloughed staff and closed offices. The number of suspended investigations increased by 100% this year to 350 at its highest point.
The OLC will now open its business plan to consultation from the profession and other stakeholders. This closes on 15 January, after which there will need to be another application to the LSB to approve any budget changes.