‘Farmers unaware of financial rights’

Farmers and farm workers are among those least aware of their financial rights, a government watchdog has warned.

The Financial Ombudsman said rural residents tend to be less aware than people in larger towns and cities of their financial rights – including their right to complain.

Socio-economic monitoring across the UK showed that people from the poorest backgrounds (“DE”), such as farm workers, knew less than other groups about their rights as consumers and about the role of the ombudsman.

It warned: “The nature of much of the rural economy – traditionally involving low-paid employment, seasonal jobs and less skilled work – can mean disproportionately more people in poverty and unemployment.”

The ombudsman has published a series of case studies to illustrate the extent of the situation. The case studies show there is no stereotypical set of circumstances that can leave people out of pocket.

One dispute involved a dairy farmer – known as Mr A – who was incorrectly sold a whole-of-life policy at the time he took out a £75,000 business loan so he could buy additional milk quota.

The bank set up the loan to be repaid over 10 years. It also sold Mr A the whole-of-life policy, explaining that the policy would “ensure the loan would be repaid” if he died before the end of the 10-year term.

Ten years later, the bank wrote to Mr A. Rather than telling him there was nothing more to pay, the bank ordered him to start paying increased premiums because the “underlying investment” had not performed as well as expected.

Mr A complained to the ombudsman, which ruled in his favour. There was nothing to suggest that the bank had properly explained how the policy worked, the ombudsman said. The bank was ordered to issue a refund.

Chief financial ombudsman Natalie Ceeney said she believed lower levels of awareness among rural people about their rights may be exacerbated by lower levels of broadband internet access in the countryside.

“Consumers without access to the latest technology can find themselves increasingly disadvantaged – with fewer options and with more limited access to services than ever before.”