A coalition of consumer organisations have cautioned the Turnbull Government about the establishment of a Banking Tribunal.
Consumer Action Law Centre, Financial Rights Legal Centre, Financial Counselling Australia and Consumers’ Federation of Australia have jointly written to the Prime Minister, the Treasurer and the Minister for Financial Services.
The groups believe that it is unclear how a new tribunal might improve access to justice and that it may, in fact, deliver worse outcomes. They are concerned a tribunal may drag out or delay issues even further, confuse Australians with another complex and legalistic form of dispute resolution, and won’t address the real reasons Australians are dissatisfied with the banks.
The letter states that mandatory external dispute resolution (EDR) schemes, such as the Financial Ombudsman Service, have provided access to justice to thousands of Australians who would have been unable to resolve disputes if they had to rely on existing courts and tribunals. A recently announced review of EDR schemes is an important opportunity to consider how to enhance dispute resolution in banking and finance.
Quotes attributable to Gerard Brody, CEO Consumer Action Law Centre and Chair Consumers’ Federation of Australia:
‘Mandatory external dispute resolution schemes in many sectors, such as the Financial Ombudsman Service, has been one of the greatest advances in consumer protection in the past 20 years. Ombudsman provide fair and legally binding resolutions without the cost and hassle of legalism.’
‘The Turnbull Government recently announced a review into EDR in the finance sector. This review is an important opportunity to enhance dispute resolution and ensure financial service providers are kept to account.’
‘It’s unclear how a new tribunal will enhance consumer outcomes. The existing review is the avenue to inform further developments in dispute resolution and to ensure consumers have redress when things go wrong.’
Banking Tribunal Letter Aug 16