As Chair of the All Party Parliamentary Group (APPG) on Consumer Protection, Dumfries and Galloway MP Richard Arkless is heading up a new cross-party inquiry into the effectiveness of the ombudsmen service.
Mr Arkless, who has a background as a consumer litigator, founded the APPG last year when he discovered that there was no voice for consumer’s at parliament. Following months of discussions with stakeholders, the parliamentary group will now begin to seek recommendations as to how consumer rights could be better serviced by the ombudsmen regime.
To kick start the inquiry, the APPG have commissioned a report from Martin Lewis and MoneySavingExpert (MSE) to investigate the effectiveness of the ombudsman service with their report being used as evidence as part of a wider inquiry. The APPG will then produce a final report and present their finding to the Government with recommendations of how the ombudsmen service can be improved.
An ombudsman is an official appointed to represent the interests of the public by investigating complaints that are raised against a company or organisation. There are various different groups of ombudsmen that focus on separate areas of business – from the Financial Ombudsman Service (FOS), which deals with banking complaints, to the Consumer Ombudsman, which handles issues with retailers. Mr Arkless is concerned that there are now far too many ombudsmen wielding varying levels of powers and scope and that this has resulted in an inconsistent and unreliable service for consumers.
Commenting Mr Arkless said:
“The whole ombudsman system is confusing and unclear for consumers. Some ombudsmen look at the substance of a complaint, others can only look at the process, some can bind the offender and others can’t. A major overhaul is needed and now is the time is perfect for us to look into this.
“I am delighted that MoneySavingExpert (MSE) will be producing a report into the effectiveness of Ombudsmen. It should provide some clarity about what ombudsmen actually do and recommend changes in the ombudsman regime to help achieve better outcomes for consumers.”
Money Saving Expert founder Martin Lewis said:
“The word ombudsman has real power – many people believe that it’s a government backed organisation that can replace the courts. In fact different ombudsman have vastly different powers, authority and even potentially legitimacy.
“At the top end there’s the FOS; set up by statute, with its rulings that are automatically binding on banks, insurers and financial firms.
“Yet it seems some ombudsmen are set up by individuals, that ply their trade, even though they have no power to force companies to even talk to them; in reality they’re just an alternative dispute resolution process that’s only useful if both parties agree.
“It’s time to set stronger rules limiting who can be an ombudsman, and guidance to consumers on what they can expect. We hope this report will help the APPG to conduct its important inquiry into the effectiveness of ombudsmen, to bring about better protection for consumers when something goes wrong.”
