1. A service for all? Are ombuds schemes designed for wider society?OA
Seminar: vulnerability
London
Naomi Creutzfeldt
University of Westminster
Jodi Gardner
University of Oxford

2. Outline vulnerability indicators from a comparative project
Case study: payday lending

3. Who is vulnerable?
personal characteristics and circumstances of particular groups
age;
low income;
those who do not work;
long term disabled;
those with lower educational attainment;
rural dwellers; and
ethnic minorities.

4. Who is vulnerable?
beyond individual traits, highlighting firstly the multi-dimensional nature of vulnerability
consumer vulnerability is dynamic and transient
all of us have the potential to be vulnerable when placed in a consumption situation over which one has little control
impact of the market on consumer vulnerability

5. A few UK stats How many people can be classified as vulnerable?
Vulnerable consumers are likely to require additional attention; more likely to experience legal problems
UK:
Over 11 m people report a limiting long-term illness (DWP 2014)
1,5 people have a form of learning disability
one in four experience at least one mental heath disorder (FCA 2015)
Over 1.5 m people are over 85 years old (age UK 2015)

6. Naomi’s research project
Trusting the middle-man: impact and legitimacy of ombudsmen in Europe
Peoples perceptions of fairness and trust in informal justice
What explains users' perceptions of fairness and trust vis-a-vis ombudsmen institutions?
How do cultural frameworks influence citizens use of ombudsmen?

7. Project website & project reports :
14 private and public sector ADR bodies in Germany, UK and France
Project website & project reports :

8. A few of demographics overall sample over 3,000

9. Mean age of respondents

10. Male / female distribution in the sample

11. UK sample Financial Ombudsman Service n=195
Ombudsman Services: energy n=421
Parliamentary and Health Services Ombudsman n=272
Local Government Ombudsman=316
Legal Ombudsman n=52

12. Highest level of education?

13. Do you have any long-standing illness, disability or infirmity
Do you have any long-standing illness, disability or infirmity? By long-standing we mean anything that has troubled you over a period of time or that is likely to affect you over a period of time?

14. To which of these ethnic groups do you consider you belong?

15. Jodi’s case study Financial Ombudsman and high-cost credit
High-cost credit users = more likely to be vulnerable
CMA conducted empirical review on borrowers:
Less education
Lower incomes / unstable employment
Financially excluded
Lack of savings
Some people however value speed and convenience

16. FOS and High Cost Credit
2012 report from Office of Fair Trading
Advertising sweep, mystery/secret shopping, and compliance inspections
Widespread lack of compliance with regulatory regime
Lenders making 50% of their revenue from loans that were rolled over or refinanced
Incentivised to lend to people who could not afford to repay
Questionable debt collecting practices

17. FOS and High-Cost Credit
Citizens Advice Bureau surveyed 665 high-cost credit loans
76% of borrowers would have at least one ground of complaint to the FOS
Similar findings at FOS
In 2011/2012, FOS held in favour of 81% of high-cost credit borrowers (compared to 37% for other unsecured loans)

18. FOS and High-Cost Credit
2010/2011: 59 complaints
2011/2012: 296 complaints (19,183 for credit cards)
2012/2013: 542 complaints (19,634 for credit cards)
2015/2016: 3,216 complaints
After FOS initiated a campaign to focus on high-cost credit borrowers
Positive outcomes!
But raises questions of who is making complaints

19. Thank you. Background on Naomi’s project and project reports: