On 11 December 2024, the Financial Ombudsman Service (FOS) published for consultation its strategic plans and budget for next year.  

In the 2024/25 plans and budget the FOS sets out that it expects to receive 210,000 new complaints. Seven months into the year, the FOS has received 172,000 complaints and expects to end the year having received 291,000 new complaints – an increase of 39% against budget. This increase has been driven by significantly higher than expected complaints about motor finance commission and unaffordable/irresponsible lending. Just under 50% of the complaints coming to the FOS this financial year are brought by professional representatives on behalf of consumers – up from 19% this time last year and 10% in 2022/23.

The FOS is budgeting to resolve 270,000 complaints in 2025/26 and to deliver on this a key focus will be to build more flexibility into its workforce. The FOS plans to deliver further cost efficiencies by implementing some of the more transformative digital elements of its programme. Also, it anticipates making a significant structural change to its charging framework to start charging professional representatives who represent complainants that use its service, subject to obtaining consent from the FCA.

The FOS is forecasting an operating cost of £281.7m – an increase of £36.3m on 2024/25 – primarily because it needs additional resource to deliver 45,000 more complaints than in 2024/25.

Next steps

The deadline for comments on the consultation is 29 January 2025.

The consultation supports the FOS’ plans and budget for 2025/26, which will be published on 31 March 2025.