Waiting time to escalate complaints to be cut in half

Consumers unhappy with how financial firms have handled complaints will be able to escalate grievances to independent arbiters in half the time it takes now, under government plans.

Currently, aggrieved customers must wait eight weeks for firms to dismiss or uphold complaints before looking to a higher authority, such as the Financial Ombudsman Service.

However, this week the Government said there was a “good case” for cutting this down to four weeks. It is considering the move after finding evidence of consumers abandoning complaints due to the lengthy twomonth wait time. It added that protracted disputes caused consumers stress and financial hardship.

Martin Lewis, of the consumer site Money Saving Expert, said that firms’ poor treatment of customers had “devastating impacts” and “urgent intervention” was crucial.

“It’s simply not good enough to have to wait eight weeks after contacting a firm before you can escalate your issue,” he said. “Your finances could be catastrophically damaged during that time. The reduction seems a fair balance.”

Some companies within the energy sector have already reduced waiting times voluntarily.

The Government has also proposed tougher training requirements for ombudsman staff, including the introduction of a “fit and proper” persons test. This would ensure that case officers had the expertise to resolve complex disputes quickly and fairly to minimise harm to consumers.

This month, Telegraph Money revealed thousands of customers have been kept waiting for years for their complaints to be resolved at the ombudsman – the last line of defence for people battling financial firms for compensation. Low staff morale and competency were blamed for the arbiter’s shortcomings.

“People have a right to know their complaints will be properly and effectively managed. Frankly, this hasn’t happened often enough,” Mr Lewis added.

The ombudsman said it would consider the proposals, but declined to comment further.