Wealth manager trade body PIMFA has called on the Chancellor to reform The Financial Ombudsman Service (FOS) ahead of tomorrow’s (15 March) Mansion House speech 

Reform of the Ombudsman is one of several measures industry commentators have speculated could be included in Chancellor Rachel Reeves’ latest Mansion House speech.

PIMFA expects proposals to reform the Ombudsman to be included within the speech and said it would like to see greater alignment between the FCA’s regulatory framework and the Ombudsman’s decision making process.

Simon Harrington, head of public affairs at PIMFA, said: “The Financial Ombudsman Service (FOS) plays a vital role in maintaining consumer confidence, but it is clear that the way complaints are currently assessed can occasionally create uncertainty for firms, especially where decisions depart from existing and established FCA rules and guidance.”

He added that while maintaining the FOS as a free and accessible route to complaint is essential, change is needed.

He said: “We would like to see changes to the DISP rules to ensure that regulatory rules and guidance are not just taken into account by the Ombudsman, but actively applied when making decisions. This would go a long way to providing firms with greater clarity and confidence.

“As firms increasingly navigate outcomes-based regulation under the Consumer Duty, there is a growing case for introducing a clearer, fairer appeals mechanism for firms – one that is subject to defined criteria and provides a proportionate route to challenge decisions. A system that enables better alignment between the FCA and the Ombudsman, while offering appropriate safeguards for firms, would mark a significant and welcome evolution of the current model.”

Chancellor Rachel Reeves will deliver her second annual Mansion House speech on Tuesday.

She is expected to officially launch the Government’s planned pensions adequacy review, covering workplace pensions, retirement savings measures for the self-employed and potentially State Pension clarification.

There had previously been speculation that a cut to the cash ISA allowance would be included in the Mansion House speech, but this is now looking increasingly unlikely. 

Speculation suggested that the Chancellor would cut the £20,000 allowance, perhaps to £5,000, to nudge people to invest more for better returns and to support UK investment. Unconfirmed reports suggest Ms Reeves will instead focus on new plans to provide consumers with the information and support they need to invest.

The Government is expected to continue talking to industry members and others about the options for reform, with a broad consensus that the UK’s savings and investment culture needs to be encouraged.