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Fix SCT funding now says ASFA
There is an immediate need to deal with the backlog of cases within the Superannuation Complaints Tribunal (SCT) and to make sure its funding is adequate, according to the Association of Superannuation Funds of Australia.
The ASFA has used its pre-Budget submission to renew its calls for the Budget funding of the SCT to be more clearly delineated from that of the Australian Securities and Investments Commission (ASIC) under whose allocation it operates.
The ASFA calls directly confronts some of the preliminary findings of panel led by Professor Ian Ramsay currently reviewing financial services external dispute resolution (EDR) arrangements and the Government's apparent preference for the establishment of a one stop shop ombudsman service for the industry.
The ASFA submission described the SCT as being "a service of critical importance to APRA regulated superannuation funds and their members", adding that the time taken to resolve complaints is an issue which impacts on consumers' confidence in the superannuation system.
Referring to the Ramsay panel, the ASFA submission pointed out that the review not due to provide its final report until 31 March 2017, adding that "any reforms the government elects to make in response are likely to take some time to implement".
"As a result, there is an immediate need to deal with the current backlog of cases before the SCT," it said.
"In this context, ASFA welcomed the government's announcement on 20 April 2016 that the SCT would be provided with an ad hoc funding increase of $5.2 million to deal with legacy complaints and improve its processes and infrastructure."
However, the submission said it was ASFA's view, the one off nature of the 2016—17 funding injection did not adequately address the deficiency in funding of the SCT's ongoing needs.
"Submissions to the Ramsay Review demonstrate that consistent underfunding of the SCT has created a situation where complaints backlogs inevitably build up. In contrast, funding should be determined on the basis of consideration of complaint volumes," the submission said.
It said additional funding was also needed to automate and improve internal processes and systems which were currently inefficient and largely manual in nature.
"ASFA strongly urges Treasury and ASIC to urgently review the SCT's funding needs to ensure it is receives adequate resources on an ongoing basis to address its workload and meet its statutory objectives, without the need to rely on ad hoc funding increases," it said.
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