A tougher approach to ‘free’ investigations will allow the Legal Ombudsman to raise an extra £1.6m through case fees in 2013/14, the ombudsman’s office revealed today.
In the coming financial year the ombudsman will charge firms for their first case rather than allow two free cases per year.
The move will increase case fee income from £212,000 in 2012/13 to £1.8m in 2013/14 and mean case fees account for more than 10% of the £16.9m budget.
As a result, the levy against all firms will fall from £16.8m to £15.1m – although the overall budget remains unchanged. The figures are outlined in the budget plan for 2013/14.
The change to case fee structure was announced in November when Adam Sampson, the chief ombudsman, revealed that firms accepting their first investigation would be charged £400.
He said the reform followed lobbying by the Law Society, which argued that ombudsman costs should be met by firms under investigation rather than the profession as a whole.
Meanwhile, full-time staff numbers at the ombudsman service are to rise by 9% to 277 as the service takes on complaints relating to claims management companies for the first time. Three additional investigators and team leaders and four co-ordinators will handle the expected increase in activity.
The start-up costs of claims management complaint-handling, estimated to be around £3m, will be ringfenced and recovered from the Ministry of Justice rather than the legal profession.
The plan for 2013/14 predicts that an increase in economic activity will feed through to higher numbers of complaints about solicitors.
There were 3,867 complaints in the first six months of 2012/13 and 7,455 in the whole of 2011/12. The 2013/14 plan makes no specific prediction for how many complaints are likely.
Introducing the plan, Sampson said the complaints-handler still faces considerable challenges three years on from its creation under the Legal Services Act.
‘As a relatively new organisation, although we have made a good start to our work, we can still improve on the speed, cost and quality of our handling of complaints,’ he said. ‘If we are to extend our powers, we also have to learn how to make use of them more effectively.’