Introduction

While the new Financial Ombudsman Service (‘the FOS’) in the United Kingdom owes much to its predecessors, its size and scope mean that we are witnessing the birth of a new form of the ombudsman remedy. The FOS brings together eight existing complaints schemes and will be organised according to product, rather than provider, as has been the case with the existing ombudsman schemes. The stated rationale behind the political decision to establish a single ‘one-stop’ organisation, taken evidently at ministerial level, is to reduce confusion (though the empirical evidence to support this is conspicuous by its absence) and possible duplication as far as consumers are concerned, while responding to the blurring of traditional distinctions between the industry sectors, as firms are restructured and products packaged together. The move to a statutory ombudsman with overarching responsibilities, to replace the existing fragmented patchwork quilt of mostly voluntary schemes, was almost inevitable once the discredited, largely self-regulatory regime in the financial services sector was replaced by a single statutory regulator in the shape of the Financial Services Authority (‘the FSA’). There were other dynamics at work here, too, and we need to trace, briefly, the history of the ombudsman remedy in the United Kingdom and also to locate the present developments in the context of the Blair Government's Modernising Justice project.