The Financial Services Compensation Scheme (FSCS) and the financial services industry faced enormous challenges in 2007/08, said the report. It was a year in which the markets suffered their worst turmoil in recent years. Despite this, FSCS made over 9,450 payments for insurance claims and completed close to 22,000 other claims, reduced waiting times for consumers and paid more than £82 million in compensation. That brought the total amount of compensation paid by FSCS since it was set up to more than £1.04 billion.
FSCS received fewer claims overall during 2007/08 than originally projected. Most notably mortgage endowment and pension review claims - both major drivers of the Scheme's work in recent years - continued on a downward trend. Following this reduction in the volume of claims, FSCS was able to contain its costs and ended the year under budget by some £6m.
The Scheme ended the year achieving its core target of completing 90% of new claims within six months of receiving an application for compensation. It bettered this considerably in some areas, such as credit union claims, where it completed more than 96% of claims within two weeks, according to the report.
