NATIONAL SAVINGS AND INVESTMENTS TO COME UNDER THE JURISIDICTION OF THE FINANCIAL OMBUDSMAN SERVICE

The Treasury, in consultation with National Savings and Investments (NS&I), the Financial Ombudsman Service (FOS) and the Parliamentary Ombudsman, has decided that the NS&I’s complaints procedure should be harmonised with that of other retail financial services providers.

As a first step, the FOS is today publishing a consultation paper which outlines the modifications required to its voluntary jurisdiction rules in order to accommodate NS&I.

Notes for Editors

1. The consultation period runs until 11 August 2004. The document can be found online .

2. All responses should be sent to:
Alison Hoyland, Financial Ombudsman Service, South Quay Plaza, 183 Marsh Wall, London, E14 9SR. alison.hoyland@financial-ombudsman.org.uk

3. Currently, if a customer has a complaint about the service provided by NS&I, which cannot be resolved satisfactorily by communication with NS&I, there are two avenues of recourse open to them, depending on the nature of the complaint:

the Independent Adjudicator for National Savings and Investments deals with unresolved complaints about contractual matters; and
the Parliamentary Ombudsman (PO) deals with unresolved complaints about maladministration.

4. The Financial Ombudsman Service provides consumers with a free, independent service for resolving disputes with financial firms. The FOS has two separate jurisdictions under the Financial Services and Markets Act 2000:

A compulsory jurisdiction, which applies to unresolved complaints about specified financial services activities in relation to the financial firms that are regulated by the FSA; and
A voluntary jurisdiction, which applies to unresolved complaints about specified financial services activities in relation to the financial firms that provide them, if the firms concerned choose to join.

Because NS&I is not regulated by the Financial Services Authority, it could only move into FOS’s voluntary jurisdiction.

5. Joining the FOS’s “voluntary jurisdiction” is a first step in the process of bringing NS&I under the FOS. The post of the Independent Adjudicator and recourse to the Parliamentary Ombudsman will be reviewed and if necessary Parliamentary authority will be sought to abolish the post of Independent Adjudicator and NS&I removed from the Parliamentary Ombudsman’s jurisdiction. Both jurisdictions would be effectively covered by the FOS’s voluntary jurisdiction.

6. Media enquirers should call Simon Moyse at HM Treasury press office tel. 020 7270 4420, the FOS press office, tel. 020 7964 0869 or NS&I press office, tel. 020 7348 9301.