Govt signals support for single EDR scheme

A single external disputes resolution (EDR) covering the totality of the financial services industry appears to be on the cards, with the Federal Government appearing to have largely embraced the preliminary findings of the specialist panel reviewing EDR arrangements.

The preliminary report has seen the special panel recommend a single industry ombudsman scheme rather than existing arrangements of three schemes — the Financial Ombudsman Service (FOS), the Credit and Investments Ombudsman (CIO) and the Superannuation Complaints Tribunal (SCT).

The Government's positive attitude to the preliminary report was indicated by the Minister for Revenue and Financial Services, Kelly O'Dwyer who said the Government was "committed to a one-stop shop for consumer complaints handling that provides consumers with access to justice, the independent determination of disputes, timely reviews and a robust compensation scheme".

Related News:

The panel's findings run counter to many of the submissions it received, particularly from the superannuation industry which argued for retention of the SCT albeit on the basis of better funding and resourcing.

In outlining its views, the panel's interim report said it "considers that a shift to a single industry ombudsman scheme for these disputes would incorporate all the strengths of the existing industry ombudsman model — such as the focus on providing low cost, fair and accessible dispute resolution, the ability to innovate and adapt to changes in the regulatory and broader socio-economic environment, and the focus on improving industry behaviour — while addressing the problems that arise where the framework consists of multiple schemes with overlapping jurisdictions".

Dealing with the SCT, the report said the panel considered that the existing problems with the SCT "cannot be addressed within the existing tribunal structure, even with substantial reforms to funding, governance, appointment processes or other aspects of the legislative regime".

It said this was because the rigidity of the statutory model would continue to hamper flexibility and innovation, making it difficult for the SCT to respond to unanticipated future challenges.

"Recognising that the core purpose of the review is to make recommendations to ensure that the EDR system can deliver effective outcomes in a rapidly changing and dynamic financial system, the Panel recommends that SCT be transitioned to a new industry ombudsman scheme for superannuation disputes," it said.

The preliminary report is now open to further submissions.




Related Content

Future advice leaders recognised

The Association of Financial Advisers (AFA) has recognised six financial advisers who are paving the way for the next wave of advice professionals.The...more

Technology arouses logical reaction of fear in advisers

Many advisers still perceive technology as a threat to their profession, fear the rise of artificial intelligence (AI) and hold concerns about being r...more

The folly of removing ASIC from the public service

The Public Service Act sets a high bar for the conduct of Government agencies and those who work within them and it would be folly to remove the Austr...more

Author

Comments

Add new comment