LeO wins approval for 9.6% increase in budget to £16.8m

Complaints: Performance improving but not at expected level

An “inflationary” 9.6% increase in the Legal Ombudsman’s (LeO) budget for 2023-24, to £16.8m, has been approved by the Legal Services Board (LSB).

Excluding the impact of inflation at 10% and an 8% pay increase for staff, the budget rise is actually only 1.4%.

LeO’s budget rose by 5.3% for the current year to £15.3m, after a 13% increase the year before as the Office for Legal Complaints (OLC) – its governing body – sought to stabilise the organisation as performance plummeted.

The budget has remained unchanged following consultation, but more has been diverted to LeO’s operational teams after it found ways to decrease its non-staff costs, such as IT, the board of the LSB was told this week.

A paper before the board said LeO’s performance has improved significantly in this financial year, although not quite to the level it had predicted. Future caseload predictions will see “a more cautious approach, stripping out optimism bias”.

It is forecast to resolve 9,400 complaints in the current year, which ends next week. Though a 43% increase (or 2,800 complaints), compared to 2021/22, which itself saw a 40% increase from the previous year, it represents around 93% of what LeO had hoped to resolve.

At the same time, recent quality reviews and customer satisfaction surveys have been positive, the paper went on.

“Its focus on improving ways of working and targeting early resolutions are having a tangible impact, and upcoming changes to the scheme rules [from 1 April] are expected to deliver further positive impacts.”

The big problem for LeO in recent years has been the size of the pre-assessment pool – complaints accepted for investigation but not allocated to an investigator. Although this has shrunk by 27% during the year, again the organisation has not met its target.

In 2022/23, it is taking 289 days to handle a complaint, made up of an average wait time of 202 days and a resolution time of 87 days after being allocated. The overall ‘customer journey’ time has fallen by nearly 100 days for low-complexity cases.

Customers whose complaints were resolved through early resolution could expect a 67% shorter customer journey time than the average low-complexity case that required a full investigation.

The board heard that, by the end of March 2024, LeO expects the average customer journey time to be between 132 and 187 days. The average wait time for most will be 45 to 100 days, followed by an average of 87 days’ resolution time.

The LSB paper said: “Overall, we recognise the performance improvements that have been achieved in 2022/23 and the OLC’s progress to reduce the pre-assessment pool queue to a working level by March 2024, which is at the heart of LeO’s performance recovery plans.

“We also note the improved confidence that LeO’s stakeholders have reflected in the responses to the consultation, with broad support for the budget and business plan activities it will fund to ensure LeO continues to move in the right direction.

“Nevertheless, we welcome and expect the OLC to maintain, in its words, a ‘laser-like focus’ on a level of performance that is acceptable and sustainable in the long term.”

The OLC’s budget approval application said: “While the OLC is very mindful of pressures on the legal sector, it also needs to recognise the impact of the rising cost of living on LeO’s people and on LeO’s competitiveness in the labour market.

“This is the central challenge in the budget-setting process. Recruitment and attrition remain a substantial and increasing risk to LeO’s ongoing improvement trajectory.

“A lower, or no increase would not be the right thing to do by LeO’s people or customers, potentially increasing attrition further, and impacting LeO’s ability to improve customers’ experience.

“Pay and benefits was the only area where ratings declined in LeO’s latest Civil Service survey results.”

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