CHAPTER 10
Conclusions
10.1 The Committee considers that there is both a need and considerable
support for an interim solution to the current impasse, pending identification
of a longer-term solution to the problem. The most feasible interim solution
appears to be to introduce legislation allowing the SCT to arbitrate disputes
by consent.
10.2 In the longer term, there appears to be two viable options available
to the Government to put a superannuation complaints resolution body in
place. These are:
- replace the Superannuation Complaints Tribunal with an industry scheme;
and
- revive the Superannuation Complaints Tribunal through amendments to
the Superannuation (Resolution of Complaints) Act 1993 and other
legislation.
10.3 While both of these options are viable, neither is without its own
associated difficulties. It is a matter for the Government to decide the
weight it will allocate to the various assessment criteria for each of
the two options. As noted during the forum by Mr John Larkin of the ISC,
the Government's eventual decision will inevitably involve some risk management
compromises and trade-offs.
10.4 There is little doubt that the first option, an industry based complaints
resolution body, is a potentially viable alternative to the SCT. However,
the Committee is of the view that the Government should only consider
this option if questions about enforcement can be resolved and the industry
agrees on an appropriate model. The Committee also notes that the question
of funding remains a significant issue that must be resolved if the option
is to proceed.
10.5 The second option, reviving the SCT through amendments to the Superannuation
(Resolution of Complaints) Act 1993 and other legislation also offers
a viable alternative for consideration by the Government. While questions
about certainty and enforcement remain to be resolved, legal opinion provided
to the Committee after the forum suggests that these obstacles can be
overcome.
10.6 The Committee considers that this option has a number of advantages
over abolishing the SCT and establishing a new body. In the Committee's
view, it should be possible to make the required amendments to the Complaints
Act and other legislation and restore a complaints resolution process
more quickly than would the case if the Government were to introduce legislation
for a new industry based body. Further, the option largely preserves existing
complaints resolution structures and permits continuity of current cases.
Finally, fund members will be more likely to be perceive the SCT as independent
of the industry.
10.7 If the Government decides to implement this option, it is clear
that there will have to be significant changes to the SCT's complaints
resolution procedures. There is a level of dissatisfaction with how the
SCT has operated in the past.
10.8 The Committee considers that one method of addressing industry,
trustee and consumer concerns about the SCT might be to establish a governing
board for the SCT comprising representatives of these groups as well as
legal and government representatives.
10.9 The other two options considered by the forum were:
- reconstitute the SCT as part of the Federal Court; and
- establish a state based body.
10.10 The Federal Court option may offer greater judical certainty than
other options. However, it was clear during the forum that industry and
consumer group opposition to the option is deeply entrenched.
10.11 Establishing a state based body is also a sound alternative, offering
a high level of certainty. However, probable time delays before such a
body could be established and uncertainties associated with passing consistent
legislation through all the State legislatures militate against the option.
However, should difficulties associated with the other options prove insurmountable,
the option should be re-assessed.
10.12 The final matter considered by the forum was the status of matters
already decided by the SCT. While there were divergent views, some Forum
participants expressed concern about the possible consequences of re-opening
matters already decided. The Committee considers that the Government should
investigate the feasibility of introducing legislation to validate past
decisions of the SCT and makes a recommendation to this effect in Chapter
9.
(signed)
Senator John Watson, Chairman
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