Ombudsman annual report highlights ‘good news’ for UK pension schemes

It comes as the Pensions Ombudsman (PO) published its annual report and accounts (128-page / 3.21MB PDF) for 2022-23. The report shows that the PO continues to “play a vital role in handling member complaints”, pensions litigation expert Hayley Goldstone of Pinsent Masons said.

According to the report, the demand for the service continues to rise at a much higher rate than anticipated, with the number of complaints increasing by 17% to 7,280 in the past year. It is expected that this trend will continue, with a growing number of people enrolled in pension schemes. The report sets out the PO’s main focus areas for 2023-24, including measures to reduce wait times and deal with more complex cases in a more thorough way.

Goldstone said: “The service is busier than ever with many complaints being resolved at an early stage. Whilst waiting times have sometimes been frustrating, it’s reassuring to know that the PO has a plan to reduce these times and get on top of its caseload. The emphasis on early resolution of complaints is good news for schemes keen to avoid a potentially protracted investigation and dispute.”

Additionally, pensions schemes and providers are likely to experience an increase in efficiency due to £1.7million in funding for a new temporary team to help reduce customer waiting times by trialling innovative new ways of working. This will be done by identifying “packages” of work which can be dealt with separately, the PO said, with aims of easier and speedier case closures in what has been described as “good news” by experts.

This follows another chunk of funding which has already benefited pensions schemes, employers and employees, the report said, allowing for a 32% increase on the closures achieved by the business-as-usual resources Further, the unit dealing with complex and high value cases requiring oral hearings has secured funding until 2025, to allow for these issues to be tackled by a specific PO team.

The annual report also sets out the process by which the PO will take on complaints. For example, many complaints during 2021-22 were rejected by the PO as invalid, primarily because the complaint provided had no documentation, or had not yet been raised with those being complained about. Goldstone said that the additional guidance on how the complaint procedure works, for example the need for documented evidence and exhaustion of other methods of dealing with the issue, such as between a contributor and scheme directly, would allow pension schemes and providers to attempt resolution in house without the need for PO involvement.

“The PO rejects as invalid many complaints where members have not yet raised the matter with the scheme or completed an internal dispute resolution procedure – this is a good opportunity for schemes and providers to try to resolve members’ concerns and potentially avoid an Ombudsman complaint altogether. The Ombudsman has practical guidance to help schemes stop a complaint from escalating,” she said.