The Financial Ombudsman Service (FOS) saw its satisfaction levels slip over the past year, as the Covid-19 pandemic created “significant and unanticipated” demand for its services.

In its annual report for 2020/21, FOS reported that 72% of business complaint handlers rated its service positively.

This was down on its 2019/20 level of 77% and was below its aim of 80%.

Meanwhile, 54% of consumers said they were satisfied with FOS’ service, compared with 57% the previous year. This was below its target of 65%.

FOS resolved 87% of complaints with an informal view, compared with 90% in 2019/20.

The average cost per case went up to £1,040, compared with £920 in 2019/20, and against a budget of £926.

“The year 2020/21 brought unimaginable challenges for UK businesses and consumers,” says interim chief executive and chief ombudsman Nausicaa Delfas.

“As we highlighted in our annual complaints data and insight, the Covid‑19 pandemic’s repercussions were reflected in both the volume and wide-ranging nature of complaints referred to us.”

In total FOS registered around 454,000 enquiries in 2020/21, and the complaints it took on to investigate numbered around 279,000.

Delfas adds: “The level of incoming complaints far surpassed what we had been resourced to handle.

“We received 237,000 non-PPI complaints – 92,000, or over 60%, more than the 145,000 that we and our stakeholders anticipated. A sizeable proportion of the additional complaints were linked to the pandemic.

“The unacceptably long waiting times that resulted are reflected in a decrease in users’ satisfaction with our service.”

Reducing these queues and improving satisfaction will be a key focus of FOS’ casework plans for 2021/22.

It said in the report that it has taken “ambitious steps” to address it – over and above its original 2021/22 plans.

These include continued investment in its case handling system; the development of plans for delivering customer portals; and the implementation of its new HR and finance system – Workday.

This will replace multiple separate systems and increase the group’s efficiency in support services.

FOS has conducted its most recent periodic review, which will be published in November.

The organisation said this will bring “new focus” to its ambitions.

The Ombudsman is still looking to appoint a new chief executive after Caroline Wayman left the role.

Until now, Delfas has been acting as interim chief executive.