Each day, UK households spend millions of pounds on consumer goods with the expectation that if something goes wrong with the items they buy, or the service they’ve received is not up to scratch, the issue can be easily and quickly resolved.
However, this isn’t always the case.
If you have an issue with a product or service that can’t be worked out with the supplier, there should be a free and straightforward route to get redress, regardless of the sector. But access to redress is patchy – our recent Ending Consumer Detriment report found that more than half of all purchases made by consumers are made in sectors that don’t guarantee access to a free, legally binding ADR service. All-in-all, consumer spending in under protected sectors tallies up to £746 billion each year.
This means that if something does go wrong, consumers might have to take the legal route to get their money back, which can be costly, time consuming, and emotionally challenging. This is particularly likely in sectors like retail, where there is not compulsory redress in place. By comparison, sectors like energy and finance have a mandatory ombudsman, which means consumers are much better protected.
In some sectors, redress exists, but it can actively add to the detriment faced by consumers. There are over 70 ombudsman, ADR and complaints handling schemes, which can be confusing as many operate in multiple sectors. In the property sector alone there are 11 redress providers – how is a consumer meant to know which one is right for them? This makes for a frustrating resolution process that consumers shouldn’t have to deal with.
It is clear that something needs to change, and soon. In our Ending Consumer Detriment report and our response to the Modernising Consumer Markets: Consumer Green Paper, we’ve proposed a different route that would put consumers at the heart of the market in all sectors.
When consumers experience a problem that cannot be solved by a company directly, they need to
know where to go for redress, which means signposting needs to be clear. In addition, the experience of seeking redress must reduce rather than add to their detriment, so it should be free for them to access, as well as independent and fair.
For this reason we believe that an ombudsman, backed by strong regulation and effective advocacy groups, provides the best possible protection for consumers.
We’ve been following this model in the energy sector for years and through this experience we know that having only one ombudsman can reduce confusion for consumers seeking redress. The single ombudsman model provides one avenue for consumers – it’s clear, and prevents them being passed from pillar to post.
We want to make sure consumers have the best possible complaints system – one that works for consumers and business. Our role as an ombudsman is to reduce the stress consumers face to get an issue resolved, so a single ombudsman model may be the ideal, but what matters above all else is ensuring that consumers have easy access to effective redress and resolution.