Blakeway: Strong platform for change
The decision to deny the Legal Ombudsman (LeO) the budget it needs could see consumers waiting more than a year for the outcome of their complaint by 2028, the organisation warned yesterday.
The Legal Services Board (LSB) – which approves LeO’s budget – last month denied it the 11.1% increase, or £2.2m, on its current £20m budget it had requested and gave it an alternative 6.5% (£1.3m) proposal [1].
This was the ‘minimum operating budget’ option outlined in the consultation issued last year by the Office for Legal Complaints (OLC), the board that oversees LeO.
Though LeO’s improved performance means it expects to increase the number of complaints resolved in the year, which started on 1 April, the even higher level of incoming matters means that both the volume of complaints awaiting allocation and customer journey times are expected to rise sharply.
There was a 36% jump in complaints being investigated in the year to 31 March, and a further 25% is forecast for the current year and 20% the year after.
“LeO’s analysis indicates a rise in demand across most areas of law, with residential conveyancing being a significant driver,” the finalised business plan and budget for 2026-27 [2], published yesterday, said.
“While the nature of complaint issues, such as delays and poor communication, remains largely unchanged, there has been an increase in both the complexity and the number of issues escalated in complaints – possibly influenced by AI.”
As a result, unallocated investigations are expected to hit 4,939 by the year-end, and 7,602 the year after, a record. Customer journey times, approximately 260 days in the most recent year, will be between 330 and 390 days by the end of 2027-28.
The OLC said it stressed these risks to the LSB in its budget submission. “The impact can be expected to compound into 2027-28, where the inability to recruit additional investigators during 2026-27 will be particularly felt.
“LeO will do everything it can to mitigate these risks in the forthcoming year, and is fully focused on the longer-term transformation of its service.
“But the lack of additional operational capacity in 2025-26 inevitably limits its ability to control the growth of backlogs and customer wait times in the short term.”
The “scale of dissatisfied consumers” meant LeO’s operating model was “no longer suitable”, the OLC said.
“We have pushed past the point at which iterative efficiency gains and operational improvements make meaningful differences in countering incoming demand.
“And, as this year’s budget discussions have demonstrated, past the point where support can be commanded for the level of resourcing and funding that LeO’s existing model would require to meet the challenges.
“LeO has to adapt to this reality. In response, the OLC has initiated a process to radically transform the LeO scheme.”
It set out a “three-pillared approach” – continuous improvement, reducing demand and transformation.
Ways to reduce demand – by encouraging better complaints handling by lawyers – could include a tiered, ‘polluter pays’ case fee structure and using AI to facilitate the publication of all ombudsman final decisions.
Proactive engagement with the sector – including initiatives like LeO’s model complaints resolution procedure – has been built into the demand forecast; it anticipates that these activities will reduce the rate of growth by 5% this year.
The LSB approved funding of £300,000 for the first phase of the transformation programme – instructing external consultants to identify opportunities to modernise the service – and provisionally another £680,000 to develop the new operating model and a plan to deliver it.
Ric Blakeway, who has just taken over as chair of the OLC, said that the “staggering increase” in complaints was “beyond what LeO’s current operating model can deal with”.
“LeO is leaning into this challenge, and will be a proactive and positive partner to those service providers seeking to improve their complaint handling and their service,” he said.
The former housing ombudsman went on: “The business plan reflects a challenging operating environment, shaped by a sustained and unprecedented rise in demand, but it also marks a clear and important moment for the Legal Ombudsman.
“The OLC board welcomes the LSB’s recognition of the need for LeO to transform, and its decision to approve additional funding to support that vital work, subject to approval from the Ministry of Justice.
“This provides a strong platform to drive meaningful change and will be central to building a modern, agile organisation that is better equipped to respond to rising demand and deliver a more sustainable service for consumers and the sector over the long term.
“Crucially, this also means a step-change in the way legal providers handle complaints themselves.”