Performance at the Legal Ombudsman (LeO) will get worse before it gets better as the complaints-handler has admitted recovery will take longer than it anticipated.
What was expected to be a two-year “improvement trajectory” until 2023 will take at least a year longer, with recruiting investigators proving a particular problem.
A consultation on LeO’s 2022/23 business plan and budget, published on Friday, said it needed the planned 3.8% increase (or £550,000) on its £14.5m cost – which is paid by the profession and went up 13% this year – but an extra 1.3% (a total of £740,000) would enable it to pursue more “radical” reform.
The first six months of its business year, which runs from 1 April, has seen “significant progress” in stabilising LeO, such as a 30% increase in case closures despite having on average 16% fewer investigators than expected, while individual productivity was also on the up, with investigations 10%, or 12 days, quicker.
The investigation time for low complexity cases averaged 91 days, for medium complexity 141 days and for high complexity 211 days.
An initiative to resolve cases without investigation, where the original provider’s offer is consistent with the likely outcome of a full investigation, has closed nearly 400 complaints and halved the time to resolution.
Another change has been the creation of a general enquiry team investigator role; they create “investigation-ready files and close low complexity cases at an earlier stage”.
However, living up to LeO’s promise to be more transparent and accountable, the consultation said the number of complaints coming into LeO has increased by nearly a quarter in the past 18 months, with the result that the pre-assessment pool (PAP) – cases accepted but awaiting investigation – is set to spiral upwards.
The current year’s budget increase was meant to help reduce the PAP from over 5,000 cases to 4,696 by next March, but LeO now expects it instead to jump to 6,732. The original projection of 3,609 by 2023 is now 5,493, although it should then fall to 2,985 in 2024.
“Our progress is being critically undermined by not having the required number of people in the business and significant shortages in the labour market at a time when we are upscaling and investing in new investigative teams to address the backlog,” said chief ombudsman Paul McFadden.
LeO said it needed to improve its employment offer – as well as struggling to recruit, two-thirds of those who left cited better pay and/or prospects elsewhere. It also acknowledged that there was “still too much variation between staff who are performing at the expected level and those who are not”.
The staff problems have made it difficult to balance business as usual alongside improvement initiatives, the consultation said.
As a result, while LeO worked on the assumption it would close 7,057 cases in 2021/22, it is now forecasting 6,177, or just 5,069 without the early resolution initiative.
Mr McFadden said: “We are behind the trajectory of performance improvement and recovery that we set ourselves and we are currently forecasting a longer recovery journey through 2022/23 and beyond than was initially thought.
“This will raise understandable questions about when an acceptable level of service will be reached. The forecasts… show that 2022/23 will see further pace brought to this as significant investment in recruiting and training new investigators begins to deliver increased productivity.
“Our review of scheme rules and associated wider business process change are being progressed urgently this year and next. We will deliver these changes in parallel with benefits realising over 2022/23 and into 2023/24.”
Mr McFadden argued that to shorten the journey to “an acceptable position”, LeO had to think “even more radically”. One innovation at an early stage is robotic process automation, which will “free up manual intervention into the 110,000 enquiries coming in”.
LeO said the Legal Services Act prevented it from contracting out cases to agency or temporary staff and so it would push for reform of this, as well as other scheme rules which constrained efforts to deal with the PAP.
Further, the service will look to develop “proportionality criteria” for cases with low-level detriment/impact and pilot that initiative – nearly half of all the cases it investigates result either in an outcome that the service provided was of a reasonable standard or that the detriment to the consumer was either negligible or non-existent.
“Work is already ongoing to identify cases in the PAP where the likely outcome is a no poor service finding so that an ombudsman can consider whether they should be dismissed at that point…
“Further work is in progress to enable cases that have been accepted for investigation to be concluded at the earliest possible opportunity where it is evident that the service was of a reasonable standard.”
These and other business process changes could deliver performance ahead of the new forecasts.
The bigger increase in LeO’s budget next year would allow “investment in senior ombudsman experience placed at the front end of our process to apply proportionality and demand management at a faster rate”, and lead to a “significant reduction” on the forecast PAP.
Elisabeth Davies, who chairs the Office for Legal Complaints – the board that oversees LeO – said: “My sense is that few now doubt the hard work that is being put in, or that what the Legal Ombudsman is doing will deliver sustainable changes in the longer term, but this is a significant undertaking and it is taking time.”
The consultation also stressed that “enhanced understanding and reporting” meant LeO was confident that its forecasts were now “robust”.
The Legal Services Board, which ultimately oversees LeO, has made it clear that if the latest effort to turn the service around does not succeed, it will look at alternative arrangements.
The consultation closes on 13 December.