The Legal Services Board (LSB) recently accepted proposals by the Office of Legal Complaints (OLC) which would substantially reduce the time within which consumers can bring complaints to the Legal Ombudsman, from six years to one year; and to limit the grounds for escalation of cases to a more limited set of circumstances.
The history and challenges necessitating these proposals are well documented. Whilst recognising improvements made within the organisation over the last 12-months, consumers are still currently facing a backlog. A smaller but not insignificant number of customers are still facing a wait of over 12 months. The pandemic has exacerbated matters, and the strain on staff retention within the OLC, at all levels of the organisation, has worsened.
The LSB, which has oversight responsibility for OLC’s performance, has maintained consistent scrutiny of the organisation. The Ministry of Justice has added another layer of scrutiny. Clearly, there is considerable pressure from the LSB, the MOJ and legal service providers who pay directly for the service, as well as from consumers, to speed up the service and reduce the backlog.
The OLC has responded to the pressure by setting out plans for a substantial revision of its Scheme Rules. A Challenge and Advisory Group was established to help develop and test its thinking. The Consumer Panel along with the Solicitors Regulation Authority, Council for Licenced Conveyancers, Association of Consumer Support Organisations, The Law Society and the Bar Council were all represented on the group. Some of the changes mooted in that group were subsequently consulted on.
The Panel submitted a detailed but balanced response to the consultation. We were worried about the excessive use of discretion to address contentious issues. We said that at the very least the exercise of discretion must have safeguards, and must be accompanied by robust and transparent monitoring, analysis, and crucially independent oversight.
The Panel’s strongest concern was about the proposal to reduce the time limit for consumers to bring a case from 6 years to 1 year. We said this change should only be made after proper research and analysis of the impact on consumers, and of consumer insight. We said that LeO should be able to demonstrate clearly that the net impact of the change on consumers is positive. We also said that there should be more detailed exposition of the limits applied in comparable Ombudsman services. We noted that at present, the Financial Ombudsman which arguably deals with similarly complex cases, accepts complaints within 6 years of the problem occurring, or 3 years of the consumer being aware of it. Given that LeO liaised with several other Ombudsman services during this review, including the Financial Ombudsman Services, it would have been useful to see an explanation of why it might need to deviate from those which have a longer time limit.
The LSB’s board consented to the proposed changes, with a caveat around effective monitoring and evaluation of the reduction in time-limit. We have heard and read concerns about the decision to give consent to this significant reduction in time limit, but also accept that the backlog and performance necessitated radical intervention. We stand by our assessment that the time limit deserved detailed and transparent exposition of LeO’s existing data about the volume of complaints made within one, two or three years of the service complained about. We also wanted to see an articulation of areas other than conveyancing, where impacts may only become apparent after a delay, with an analysis of how different types of consumers might be affected.
One particular concern we had was that the proposals left considerable discretion to LeO to decide how to interpret the starting point of the time limit. The time when a consumer was first aware of the issue which prompted them to make a complaint can be contested, particularly if there is any imputation of the concept of “should have been aware”. Given the difficulty of knowing when issues such as problems with the conveyance of a property really come to light, it is vital that any benefit of the doubt should be decided to the benefit of the consumer. The way in which LeO makes such decisions will be an important point to look at when evaluating the new policy.
We are somewhat reassured by the clear request by the LSB for a robust monitoring and implementation plan, and the OLC and LeO’s clear commitment throughout to this. The effective monitoring and evaluation of this huge shift in time limitation would provide early intelligence on the impact of this change, with the possibility of modifying or even reversing the policy if need be.
We recognise and accept that perfect information or evidence cannot always be available prior to significant policy changes. However, where changes are likely to impact consumers adversely, it is up to policy makers to work harder to provide the assurance that consumer detriment would be mitigated or detected quickly. Monitoring and evaluation can fill the gap. Yet monitoring and evaluation has not always been a strength across the sector, and as recently as July, we published a paper on the topic to help regulators, including the OLC, to do it better. We will continue to use this work to advise the OLC and the LSB.
An effective and fair redress system is a crucial protection for consumers of legal services. The Panel will maintain its focus on the impact of these significant changes to ensure that consumer needs are still being met.