Industry Super Australia says not-for-profit superannuation funds shouldn’t have to pay for the recently announced banking tribunal.
“It is beyond dispute that there are significant conduct and culture problems in the banking industry, and additional oversight by a banking tribunal – an idea flagged in a government review of the external disputes resolution system – would be welcomed by consumers,” said a statement by Industry Super Australia (ISA).
“However, super fund members in the not-for-profit superannuation sector should not be called on to contribute funding to pay for an integrated, one-stop-shop tribunal to deal with problems that relate pointedly to the retail banking sector.”
The Government has announced it will create a banking tribunal, though the details are at this stage unclear.
ISA CEO David Whiteley said: “Problems such as cross-selling, up-selling and high, ongoing commissions are tied to the vertically-integrated business models of retail banks. Funding should be closely linked to risk to give the banking sector an incentive to address entrenched problems with profit-driven conduct and culture.”
“Not-for-profit super funds operate on very different principles – they exist solely to invest and manage their members’ super savings and deliver all profits to members.”
Mr Whiteley noted that APRA-regulated super funds already have the Superannuation Complaints Tribunal (SCT) for external dispute resolution.
“Given that superannuation is compulsory and quite different from other financial products and services, it is critical that fund members have access to a dedicated and transparent dispute resolution mechanism,” he said.
“The unique features of the SCT deliver significant consumer protections that other external dispute resolution schemes in the financial sector do not provide. These include no monetary limits, enforceable determinations and the ability to appeal determinations to the Federal Court on a question of law. Any change to this by integrating the SCT with a banking tribunal would create a weaker system for the public.”