Compare and contrast – informal resolution by sector

We are grateful to the Nuffield Foundation for providing us with some supplementary funding in order to follow up on some of the issues that arose when we launched our report on The use of informal resolution approaches by ombudsmen in the UK and Ireland last month. One of the pieces of work we want to do is to look at approaches used by schemes operating in the same sectors but in different jurisdictions to see what similarities and differences there are in the way they handle the same types of complaints.

For example, three organisations in our mapping study deal with complaints about financial services: the Financial Ombudsman Service (UK) (FOS), the Financial Services Ombudsman Scheme (Isle of Man) (FSOS) and the Financial Services Ombudsman’s Bureau (Ireland) (FSOB). They are vastly different in size: the FOS handles half a million complaints each year, while the Isle of Man scheme handles fewer than 300, with FSOB at nearly 8,000. All three schemes use informal resolution, but the extent to which they do ranges from 94% of complaints (FOS) to 22% (FSOS) down to <1% (FSOB). Both FSOS and FSOB use a process they call ‘mediation’, but these appear to be quite different.

Only one, the FSOB in Ireland, uses what we might call ‘true’ mediation: a process where an independent third party helps the parties in dispute to try to reach an agreement and in which the parties, not the mediator, decide the outcome.

Mediation is offered to both parties in all cases accepted by the FSOB. The scheme describes its mediation as “a process where the parties to the complaint try to reach a solution through agreement with the assistance and support of a mediator rather than through an immediate investigation of the complaint and a decision from this Office on the complaint.” The mediator is one of three members of the FSOB staff who are trained and accredited in mediation. Mediations take place in person, with both parties attending, at the FSOB offices in Dublin. Parties are advised to set aside a full day to attend mediation in person, although in practice mediations are concluded within a few hours.

Mediation is voluntary for both parties, and the very small percentage of FSOB complaints going to mediation, even though it is the default offer of the scheme, suggests that buy-in by the parties is low.

We’d like to explore what these and other sector-specific schemes share, and how they differ.