SHARPER TEETH: THE CONSUMER NEED FOR OMBUDSMAN REFORM. An Analysis By The Ombudsmans61percent campaign (4) Page 6.
The Ombudsmans61percent Campaign believes that whoever operates the new scheme(s) needs to be:
* A fit and very proper person.
* Have statutory powers.
* Be transparent and accountable in all they do.
* Ensure Whistleblowing Policies are effective.
* Publish all decisions online.
Aspiration: Comprehensive ombudsman membership in consumer sectors In an ideal world, all companies in consumer sectors would be members of an ombudsman.
This could be delivered through a single ombudsman for all consumer complaints, with every business serving consumers being a member; or having one ombudsman per sector, combined
with a single body acting as a portal for all ombudsmen, and filtering complaints to the appropriate ombudsman behind the scenes.
NO behind the scenes - consumers need full transparency/
accountability.
However, this aspiration is far from being implemented; it would require radical, wholesale change. Until that happens, ombudsmen should be reformed to operate at a gold standard, truly
distinct from other ADR providers.
Your recommendations for monitoring this would be a
ongoing disaster for consumers. But it does raise the crucially
important issues of:
* Unimpeachable integrity in those operating the scheme(s)
* Competency.
* Trust.
* Transparency and accountability.
in what is fast becoming a twilight democracy.
SHARPER TEETH: THE CONSUMER NEED FOR OMBUDSMAN REFORM. An Analysis By The Ombudsmans61percent Campaign (2) Page 3:
We agree with the following:
"• On average, 53% of people who had used an ombudsman said they were put off using an ombudsman again, even a different one.
Our research also found:
• The current ombudsman landscape is complicated for consumers to navigate. In some sectors there are competing ADR schemes and in other areas there is a lack of ombudsman provision, or ombudsmen with few members.
• It can take too long to escalate a complaint to an ombudsman. The 8-week rule was created in a non-digital age, but in this digital age with instant credit-scoring and decisions, 8 weeks is
simply too long and should be reduced.
• Even when a complaint reaches the ombudsman, consumers feel their complaints are dealt with slowly.
• Currently firms are required to say what the approved ADR scheme is in their sector even if they will not work with it, thus giving false hope to consumers. This rule is a farce."
"This mixed bag of experiences with ombudsmen devalues the term, and means consumers cannot rely on them as they should be able to. While use of the word ‘ombudsman’ is restricted, we do not believe it is restricted enough."
"With the growth of ADR, ombudsmen should be regarded as the gold standard. Only those who meet that gold standard should be called ombudsmen."
We disagree:
Britain left the gold standard in 1931. What is needed is a
transparent and accountable system of democratic
accountability. The APPG on Consumer Protection chaired
by Yvonne Fovargue refused us permission to address the
group The EU Justice Sub-Committee chaired by Baroness
Kennedy did likewise.
Both committees were supposedly there to protect the
consumer. Both seemed more intent on protecting a
Chief Executive who needed to take an "honest" look
at what he was achieving.
This information was available to the public.
Why didn't MSE make use of it?
Had they done so surely their conclusions would have been
radically different and more importantly consumers would
have been afforded - protection.
"These issues are not academic – they affect real consumers with real disputes. When ombudsmen fail, consumers lose: substantial reform is urgently needed."
We beg to differ.
These issues are academic. A great deal of valuable, scholarly
work exists on the subject of ombudsmen and their schemes
and yet MSE makes no mention of it.
Steven E Aufrecht: Evaluating Ombudsman Systems 2000:
"An ombudsman's job is to investigate and evaluate others.
Ombudsmen must be subject to evaluation."
The two Parliamentary committees we approached disagree.
Trevor Bruck, Richard Kirkham and Brian Thompson: The
Ombudsman Enterprise and Administrative Justice 2011:
"The ombudsman is an institution endowed with remarkable
power and itself needs to be called to account. Not only can
an ombudsman fail due to error or incompetency, but an
ombudsman can also fail through timidity."
DJS Research's Customer Satisfaction Reports for Ombudsman
Services suggest all three were present at this particular scheme.
SHARPER TEETH: THE CONSUMER NEED FOR OMBUDSMAN REFORM - An Analysis By The Ombudsmans61percent Campaign (1) Page 2.
"An ombudsman’s job is to resolve complaints, effectively operating as a final referee between the complainant and the body being complained about. This is a crucial role for consumer protection.
This report shows that the Alternative Dispute Resolution (ADR) landscape that ombudsmen exist within is a complex maze, full of inconsistencies. Ombudsmen are not equal. Despite sharing a name, ombudsmen have different powers, and vary widely in effectiveness.
Key areas where ombudsmen differ include whether membership is compulsory, whether firms can be forced to cooperate, and what happens if companies do not comply. Much of this discrepancy comes from whether or not the ombudsman in question has some form of statutory basis. Many do not.
This uneven provision results in some consumers having positive experiences with ombudsmen, but for too many it is a frustrating waste of time. This was shown in our consumer survey results.
Respondents self-selected to take part in the survey, so it is to be expected that the results would be a little more negative than in a non-self-selecting poll (as people who have a complaint to make were more likely to participate). Despite this, the results were stark:
• Our survey identified serious issues with firms not cooperating with ombudsmen and complying with their decisions (although ombudsmen gave a different view). Consumer responses indicated that the Financial Ombudsman Service’s decisions are most likely to
actually be put into action.
• The perception of impartiality was called into question by our survey, which found that the majority – 60% – thought the ombudsman was biased against them; 8% thought the
ombudsman was biased towards them; and only 31% said the ombudsman was neutral."
We agree with MSE that ombudsman "impartiality" is a crucial problem. But it is something the report does not examine or explain. In their second Customer Satisfaction Report for Ombudsman Services, DJS Research reported that 61% thought the ombudsman's decision went against them. Hence - The Ombudsmans61percent Campaign. This figure rose to 84% (as recorded on page 60 of this report). Again, this startling statistic is left unexplained.
"• For only one ombudsman surveyed did the majority of respondents say that the decisionwas fair; for all others, more than 50% of their users said that the decision was unfair."
ISSUES:
* Ombudsman as referee. Many referees simply aren't up to the job. This report simply avoids examining the reasons why ombudsmen are "unfair."
* Who ARE ombudsmen accountable to and why are they NOT being held to account for their "unfairness?"
MARTIN LEWIS - SHARPER: THE CONSUMER NEED FOR OMBUDSMAN REFORM. Questions raised about the Report's Conclusions/Recommendations. Pt 4 (96)
Martin you say, "There are too many ombudsmen with too few powers."
Q. Would you give a CO who needed to take an "honest" look at what he was actually achieving MORE power?
Q. Or a property ombudsman who arrived at decisions in an illogical manner - more power?
2. Martin, you say that substantial reform is necessary so that consumers can have the confidence to go to an ombudsman and be sure of "a fair hearing."
Yet your report doesn't clearly say why that isn't so at present.
It glosses over DJS Research's CSRs for Ombudsman Services.
3. Martin, if you had analysed DJS Research's CSRs more carefully wouldn't you have arrived at a far different set of conclusions/recommendations?
The CO and property ombudsman at OS didn't need MORE powers - they needed to investigate consumer complaints fairly and diligently.
4. Martin, despite evidence to the contrary you say, "We like ombudsmen. We think they're a good thing."
Q. Is an Ombudsman Services:Property ombudsman who "arrives at decisions in an illogical manner" a good thing?
Q. What is there to like about such a person?
5. Then there's the matter of the instances of maladministration at Ombudsman Services.
Q. Would you seriously give such people MORE powers?
Q. What is there to like about such people and why are they a good thing?
6. You say "...based on the evidence used in this report, we take the opportunity to make policy recommendations that the APPG may wish to consider."
Based on the evidence we have provided would you with would you like to amend those recommendations and if not why not?
7. Money Saving Expert must surely get its expertise from
a careful appraisal of the very best data available.
The Ombudsmans61percent Campaign has attempted to provide you with that.
We have provided you with evidence and criticised; The OFT, The RICS, The OA, The BEIS and OS.
8. Yet you still insist that you stand by your report and its conclusions and recommendations to the APPG on Consumer Protection.
Should your report's recommendations be put into effect we believe consumers would even worse off in terms of protection than they are now.
9. When all has been said and done it comes down to one simple rule: consumers need to be protected from the cowboys - and not the cowboys from their consumers.
We believe that without a shadow of a doubt that the cowboys have the sheriff riding with them.
Riding roughshod.
10. The scandal is not that ombudsmen don't have enough power but that the power they do have has been abused.
The scandal is that governments - and now MSE it would seem - have known about this endemic injustice and still refuse to do anything about it.
Things will get worse.
Sharper Teeth: The Consumer Need For Ombudsman Reform a further update by The Ombudsmans61percent Campaign (94):
DJS Research Set The Gold Standard In Independent Research/Customer Satisfaction Reports.
We attempted to raise the following issues with Martin Lewis on twitter but without success:
A) THE DEPARTMENT OF BEIS AND THE OMBUDSMAN ASSOCIATION - SETTING GOLD STANDARDS?
1) Martin Lewis, should: Sharper Teeth: The Consumer Need For Ombudsman Reform be implemented - especially the recommendations that the BEIS and OA set the gold standard in what is to be an ombudsman then consumers will be at an even greater disadvantage than they are today.
Both ignored us.
2) The BEIS was the BIS back in the day when our campaign - The ombudsmans61percent Campaign began.
We tried raising the issue of an ombudsman who "arrived at decisions in an illogical manner" (DJS Research) with:
Vince Cable, Joe Swinson, Sajid Javid and Greg Clark.
All of them ignored us.
3) Had Vince Cable, Joe Swinson, Sajid Javid and Greg Clark acted upon our complaint consumers would have been stopped form taking their complaints to an ombudsman who, "arrived at decisions in an illogical manner."
But they didn't act.
Consumer dissatisfaction levels thus rose from 61% to 85%.
PLEASE NOTE: we've fact-checked your table on p60 and think the "unfairness" level is 84%. The table is hard to read.
4) On page 8 of the report it states you did "desk research" and "on the record fact checking."
DJS Research conducted independent CSRs for Ombudsman Services (2008-11).
Their reports are dynamite
They stated that the property ombudsman "arrived at decisions in an illogical manner."
5) When you did your "on the record fact checking" with the CEO and Chief ombudsman at Ombudsman Services what did he have to say about his property ombudsman who arriving at decisions in an "illogical manner?"
Q. Would you care to comment now?
Q. What do you to say to those complainants?
6) We contacted DJS Research to confirm that they had indeed discovered an ombudsman who was arriving at decisions "in an illogical manner."
They had
They said we could use their name in our campaign.
Q. Did you fact check this startling revelation with DJS Research and if not why not?
7) DJS Research also report that:
* investigators/ombudsman did not understand the complexity of property disputes.
When you did your "on the record fact checking" what did the CEO and Chief Ombudsman have to say to that?
When an ombudsman is confused by the complexity of disputes how can this a proper investigation of a consumer's complaint?
8) DJS Research also report that:
* investigators/ombudsman did not understand the complexity of property disputes.
Q. Martin, when you did your "on the record fact checking" what did the CEO and Chief Ombudsman have to say to that?
Is this a proper investigation of a consumer's complaint?
9) DJS Research say:
* evidence was omitted and/or misrepresented.
When you carried out your "on the record fact checking" with the CEO and Chief Ombudsman what did he have to say to that?
What do you say to consumers who suffered this terrible injustice?
10) DJS Research continue:
FURTHER REPRESENTATION - 83% had submitted further rep. 66% submitted further evidence.
Most complainants said this didn't alter the outcome.
Q. What did the CEO and Chief Ombudsman say about this when you contacted him?
11) DJS Research in what was to be their final report state at 8.24: "To be effective the SOS (later rebranded as OS) must be seen as an impartial arbitrator between parties - currently this does not seem to be the consensus of opinion."
Q. What did the CEO say to that?
12) When you desk researched Ombudsman Services minutes what response did you make to:
Minutes for Dec 2009:
"The Chief Executive noted that there had been some concern over the apparent increases in levels of award."
Q. Surely the ombudsman is independent and free to make awards?
ISSUES: Independence of Ombudsman / Integrity / Fit-and-proper-person / OFT Guidelines / Role of Regulator.
13) DJS Research have a different take on this.
They state, "OSP is different to OS Energy and OS Communications in that the financial implications of complaints are much larger as they relate to expensive purchasing decisions. This should be looked at .. the scale of financial award be increased to be more in line with financial losses incurred by the complainant as a result of the problem." (DJS Research)
Q. When you had an on the record fact check with the CEO and Chief Ombudsman what did he say to this and why did his property ombudsman instead REDUCE financial awards significantly?
14) The RICS had a Memorandum of Understanding with OS:Property its "appointed" company.
It had a Director of Regulation sitting on its appointed company's board.
Q. When you fact checked this with the OS CEO how did he justify this in terms of the ombudsman's independence?
15) The RICS monitored its appointed company for "the effective resolution of disputes."
Q. When you fact checked this with the OS CEO had did he explain a decision "not arrived at in a logical manner" as being "effective?"
Q. Effective for fee-paying members or consumers?
B) THE OFT CRITERIA FOR APPROVING OMBUDSMAN SERVICES PROPERTY:
When you did desk research you will have read the OFT's criteria for the approval of its approved and monitored ADR scheme - OS:P.
Criterion 5 states: "The ombudsman must proceed fairly and in accordance with principles of natural justice."
Q. Martin how is an illogical ombudsman able to proceed fairly?
Q. Where is the the natural justice when an ombudsman is illogical?
Sharper Teeth: The Consumer Need For Ombudsman Reform an update by The Ombudsmans61percent Campaign (94)
DJS RESEARCH SET THE GOLD STANDARD IN INDEPENDENT RESEARCH
1) Martin Lewis, should: Sharper Teeth: The Consumer Need For Ombudsman Reform be implemented - especially the recommendations that the BEIS and OA set the gold standard in what is to be an ombudsman then consumers will be at an even greater disadvantage than they are today.
Both blanked us.
2) The BEIS was the BIS back in the day when our campaign - The ombudsmans61percent Campaign began.
We tried raising the issue of an ombudsman who "arrived at decisions in an illogical manner" (DJS Research) with:
Vince Cable, Joe Swinson, Sajid Javid and Greg Clark.
All of them blanked us.
3) Had Vince Cable, Joe Swinson, Sajid Javid and Greg Clark acted upon our complaint consumers would have been stopped form taking their complaints to an ombudsman who, "arrived at decisions in an illogical manner."
But they didn't act.
Consumer dissatisfaction levels thus rose from 61% to 85%.
PLEASE NOTE: we've fact-checked your table on p60 and think the "unfairness" level is 84%. The table is hard to read.
4) On page 8 of the report it states you did "desk research" and "on the record fact checking."
DJS Research conducted independent CSRs for Ombudsman Services (2008-11).
Their reports are dynamite
They stated that the property ombudsman "arrived at decisions in an illogical manner."
5) When you did your "on the record fact checking" with the CEO and Chief ombudsman at Ombudsman Services what did he have to say about his property ombudsman who arriving at decisions in an "illogical manner?"
Q. Would you care to comment now?
Q. What do you to say to those complainants?
6) We contacted DJS Research to confirm that they had indeed discovered an ombudsman who was arriving at decisions "in an illogical manner."
They had
They said we could use their name in our campaign.
Q. Did you fact check this startling revelation with DJS Research and if not why not?
7) DJS Research also report that:
* investigators/ombudsman did not understand the complexity of property disputes.
When you did your "on the record fact checking" what did the CEO and Chief Ombudsman have to say to that?
When an ombudsman is confused by the complexity of disputes how can this a proper investigation of a consumer's complaint?
8) DJS Research also report that:
* investigators/ombudsman did not understand the complexity of property disputes.
Q. Martin, when you did your "on the record fact checking" what did the CEO and Chief Ombudsman have to say to that?
Is this a proper investigation of a consumer's complaint?
9) DJS Research say:
* evidence was omitted and/or misrepresented.
When you carried out your "on the record fact checking" with the CEO and Chief Ombudsman what did he have to say to that?
What do you say to consumers who suffered this terrible injustice?
10) DJS Research continue:
FURTHER REPRESENTATION - 83% had submitted further rep. 66% submitted further evidence.
Most complainants said this didn't alter the outcome.
Q. What did the CEO and Chief Ombudsman say about this when you contacted him?
11) DJS Research in what was to be their final report state at 8.24: "To be effective the SOS (later rebranded as OS) must be seen as an impartial arbitrator between parties - currently this does not seem to be the consensus of opinion."
Q. What did the CEO say to that?
12) When your desk researched Ombudsman Services minutes what response did you make to:
Minutes for Dec 2009:
"The Chief Executive noted that there had been some concern over the apparent increases in levels of award."
Q. Surely the ombudsman is independent and free to make awards?
13) DJS Research have a different take on this.
They state, "OSP is different to OS Energy and OS Communications in that the financial implications of complaints are much larger as they relate to expensive purchasing decisions. This should be looked at .. the scale of financial award be increased to be more in line with financial losses incurred by the complainant as a result of the problem." (DJS Research)
When you had an on the record fact check with the CEO and Chief Ombudsman what did he say to this and why did his property ombudsman instead REDUCE awards?
14) The RICS had a Memorandum of Understanding with OS:Property its "appointed" company.
It had a Director of Regulation sitting on its appointed company's board.
Q. When you fact checked this with the OS CEO how did he justify this in terms of the ombudsman's independence?
15) The RICS monitored its appointed company for "the effective resolution of disputes."
Q. When you fact checked this with the OS CEO had did he explain a decision "not arrived at in a logical manner" as being "effective?"
Q. Effective for fee-paying members or consumers?
THE OFT CRITERIA FOR APPROVING OMBUDSMAN SERVICES PROPERTY:
When you did desk research you will have read the OFT's criteria for the approval of its approved and monitored ADR scheme - OS:P.
Criterion 5 states: "The ombudsman must proceed fairly and in accordance with principles of natural justice."
Q. Martin how is an illogical ombudsman able to proceed fairly?
Q. Where is the the natural justice when an ombudsman is illogical?
‘His political solutions seem so abstract and unworkable’: Thomas Piketty. Photograph: Joel Saget/AFP/Getty Images
To bring a book into the world with 1,065 pages, there has to be a good reason. Thomas Piketty’s reason is that without a detailed account of the ideologies that have sustained inequality in the past, we cannot understand its present form, or how to overcome it.
So Capital and Ideology takes us on a historical grand tour of the hypocrisy of elites, ranging from the punishments meted out to slaves in Mesopotamia to the cruelty of the Belle Époque, which, as French economist Piketty points out, was belle only for a small number of white men.
But the main focus of the book is the present, which is marked by extreme and rising inequality, alongside the breakdown of traditional, class-based politics. The social coalition that drove redistribution in the mid-20th century has disappeared. If we don’t do something radical to reduce inequality, Piketty argues, “xenophobic populism could well triumph at the ballot box and initiate changes that will destroy the global, hypercapitalist digital economy”.
Piketty’s 2014 book Capital in the 21st Century showed how inequality is baked into our current economic model. In a free-market economy, he argues, inequality inevitably rises faster than growth. And as the incomes of the rich become reliant more on asset wealth than salaries, the old forms of redistribution, based on income tax and corporation tax, cease to work.
In this book, Piketty outlines his solution: a “participatory socialism” in which capitalism is gradually abolished via a progressive income tax and a tax on inherited wealth, which are used to finance both a basic income and a “capital endowment” for every citizen.
In a single table, Piketty demonstrates that, in the abstract, it would be possible to finance a radically egalitarian economy if both income tax and inheritance tax for the rich were set around 60-70%. The outcome would be to “make ownership of capital temporary”. Meanwhile, by legislating to enforce power-sharing within firms, between workers and bosses, you could achieve the “true social ownership of capital”.
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The problem, of course, is the resistance of the current elites: the phalanx of Super Pacs in the US, the Brahmin-like permanence of the European centrists, the extreme concentration of power alongside wealth, the evisceration of democracy, the culture of secrecy around the taxes paid by rich people and corporations.
It’s a resistance bolstered by the ideology of what he calls “hypercapitalism”: our willingness to believe billionaires have earned their money, that their philanthropy offsets their greed, that most of the poor are “undeserving”, and that any tinkering with the present distribution of wealth will lead to economic collapse.
As the book demonstrates, the task is further complicated by the breakdown of left-right politics. Piketty makes the case that most electorates are now fractured into four parts: the globalist camp is split between egalitarians and anti-egalitarians, but so is the nativist camp. As a result, any movement for economic equality has to include nativists and globalists, who, as the UK general election showed, currently hate each other’s guts.
If there is a case for optimism in this book, it relies on the incoherence of the hypercapitalist ideology, which promises social mobility to the poorest 50% but repeatedly dumps them at the bottom of the pile.
‘Piketty’s big idea is to tax capitalism out of existence’: an Occupy Wall Street protester, New York, September 2013. Photograph: Emmanuel Dunand/AFP via Getty Images For Piketty, the history of ideologies is autonomous from that of the societies they have been used to justify. Unlike Marx, who wrote that all history “is the history of class struggles”, Piketty believes it is “the history of the struggle of ideologies and the quest for justice”. For the avoidance of doubt, Piketty does not say – as French structuralists did – that ideology is relatively autonomous from the economy: instead he says “the realm of ideas, the political-ideological sphere, is truly autonomous”.
Piketty’s socialism, then, is not just a socialism without the working class. It is a socialism without class struggle, or the need for class struggle. As a result, the intellectual and moral rearmament the left must undergo has to arise out of academia, or the world of thinktanks and NGOs. As for ideologies, they are, in Piketty’s historical scheme, almost never busted open from below, but simply destined to lose their coherence from within.
As he recounts the history of the transition from slave-owning, feudal and colonial societies towards 19th-century modernity, the most consistent actor in the name of progress is the state. By the end of the book, while we have a detailed description of the correlation between forms of inequality and the ideologies used to justify them, there is not a trace of cause and effect. Facts, Piketty states, are untrustworthy because they themselves are socially constructed.
It is as if Piketty, a commanding figure in the economics department, has sauntered across to give a (very long) lecture series in the history department without bothering to engage in the methodological debates that rage there. But his implicit method is that of the Enlightenment philosopher Georg Hegel: human progress exists, the state is nearly always its main actor, and history is driven by supra-historical ideas – above all, the idea of justice.
And that’s what makes his political solutions seem so abstract and unworkable. What happens to the value-creation process in a world where the rich are getting their wealth confiscated and their incomes flattened (ie the actual problem that destroyed the Soviet experiment)? How do you revive the actual democracies we are fighting in other than by giving every citizen a “democracy voucher” to even out political spending by the elite? By the time we get to page 1,027, and Piketty’s design for a world government, we are well and truly down the rabbit hole of bright abstractions.
As for the most pressing problem – how to deal with the rise of nativism and xenophobia among the communities that once voted left – Piketty’s solutions are perfunctory. He rightly slates the French left for becoming “Brahmins” – exclusive representatives of the educated class – and calls for left parties to be less elitist and less hostile to the self-employed.
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But electoral experience – in the UK, the US and France – shows that right-voting workers are strongly wedded to inequality. As Labour found out in December 2019, pledging to tax the rich without mobilising those voters with a narrative of self-liberation can backfire. Only recently, a survey of “red wall” seats found they want “modest tax hikes to make the system fairer but outright reject attempts to take money from the modestly well-off and even from billionaires”.
Piketty is right to say that, in moments of transformation, big ideas come first. His big idea is to tax capitalism out of existence, and it has triggered an avalanche of derision among the Davos-going crowd. My objection is not that it is too radical but, lacking any explanation of which social forces might enact it, not radical enough. Paul Mason is a writer and broadcaster on economics and social justice • Capital and Ideology by Thomas Piketty is published by Harvard University Press (£31.95). To order a copy go to guardianbookshop.com. Free UK p&p over £15
