July 26, 2017
The Federal Government has advanced its plans for a single external dispute resolution scheme by appointing a transition team to ensure the scheme is operational by 1 July, 2018.
While the legislation for the creation of the single scheme – Australian Financial Complaints Authority (AFCA) – has yet to pass Parliament, the Government also announced the appointment of former Assistant Governor (Financial System) of the Reserve Bank of Australia, Dr Malcolm Edey, as the Chair of the transition team.
The team will be located in the Treasury Department and will consult with industry and consumer stakeholders and the three schemes which will be replaced: the Financial Ombudsman Service, Credit and Investments Ombudsman and Superannuation Complaints Tribunal.
It will also advise the Government on AFCA’s terms of reference, governance and funding arrangements, the transitional arrangements required to appropriately settle cases currently before the existing schemes and overseeing the transition from the existing schemes to AFCA.
In announcing the appointment of Edey and the formation of the transition team, the Minister for Revenue and Financial Services, Kelly O’Dwyer said AFCA would “…replace the current inconsistent and narrower system…” under the existing schemes and under AFCA “…there will no longer be uncertainty or confusion about which body has jurisdiction to hear a particular dispute”.
O’Dwyer said AFCA would handle disputes of significantly higher values than those dealt with under current schemes and the Government was also considering the creation of compensation scheme of last resort.
According to O’Dwyer the Government has asked the Ramsay Review to consider the establishment, merits and potential design of a compensation scheme of last resort as well as the merits involved in providing access to redress for past disputes.