Fos’s name-and-shame puts customers first

As a consumer journalist I was much more concerned about the damage firms were able to inflict on their customers’ finances while remaining anonymous.

These figures have in fact proved to be a rather useful tool when selecting who we do business with.

The headline figure of how many complaints a firm receives must be taken in context. If Lloyds Bank received fewer complaints than Coventry Building Society that would be shocking – of course it never does and in all probability never will.

What I find far more informative are the uphold rate and the type of complaints. From the latest set covering January to June this year we can surmise that some banks are still shovelling payment protection insurance complaints at the ombudsman because they cannot be bothered to deal with them properly.

Black Horse, part of Lloyds, suffered an overall 78 per cent uphold rate on complaints, with a shameful 86 per cent of PPI cases being upheld. This compares with an average uphold rate of 57 per cent for all firms across all lines of business.

Barclays has a 70 per cent uphold rate and 81 per cent in PPI. But HSBC was 44 per cent and 66 per cent in PPI.

Compare this with Nationwide where the overall uphold rate was 22 per cent with a 17 per cent rate for PPI. I know which organisation I would prefer to handle my money.

Most of us have a pretty easy relationship with our bank or building society most of the time. What these figures tell us is how the organisation is likely to respond when something goes wrong.

Will they investigate the complaint fully and fairly, considering their customer’s point of view, or are they more likely to put up barriers and make life difficult?

Will the organisation investigate the complaint fully and fairly, considering their customer’s point of view

Now take a look at some figures closer to home.

Hargreaves Lansdown had a 15 per cent uphold rate against Sesame which came in at 27 per cent, but Interactive Investor Trading was 62 per cent and TD Direct Investing was 61 per cent.

In the same period, these three firms received 60, 172, 76 and 57 new complaints respectively.

If I were running Interactive Investor Trading or TD Direct Investing, I would be taking a serious look at how client complaints were being handled, because those uphold rates are too high for a customer-focused business.

If a complaint goes to the ombudsman, then administering it becomes more expensive and more time-consuming – so surely everything possible should be done to make sure each is handled effectively internally.

There will always be occasions when both firm and client believe they are right, and it takes an adjudicator to decide. That is the ombudsman’s job – not dealing with badly handled cases.

There will also be frivolous complaints; these come with the territory of running a business.

Customer service and complaint handling are integral to a well-run business.

These figures are not just instructive to the public at large – they are a lesson to those running businesses of how well – or how badly - they are faring against their peers.

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Time to take axe to barmy pension tax idea

There is increasing speculation that pensions could be taxed on the way in rather than on the way out – the so-called pension Isa option.

The idea may be barmy, but I can see the attraction to the Treasury. The amount of tax relief could be slashed for several years giving a huge boost to government coffers.

No doubt pension providers would be expected to ring-fence current pension savings which would still be taxed when paid, while new funds would build up under a new environment.

The costs of administering this nightmare would fall on the industry and investors.

This would not worry Treasury civil servants as the costs for their pensions are picked up by taxpayers.

This idea should never have been allowed beyond the Treasury’s corridors. The fact that it was mentioned in the Budget suggests it was not bounced off wiser, more knowledgeable ministers.

It should be buried before more time is wasted on it.

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HSBC covering its own back

Is HSBC’s announcement that it will be launching a retirement advice service to help customers with the pension freedoms a sign that the bank is sticking its toe back into the water of wide-scale financial advice – albeit restricted to one area?

This is a ‘watch this space’ issue – though I suspect any ‘advice’ element will be severely restricted, and what we are more likely to see is guidance to limit responsibility on the bank.