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| Coalition backs down on bank victims' tribunal in favour of financial ombudsmen Coalition backs down on bank victims' tribunal in favour of financial ombudsmen | |
| (10 days later) | |
| The federal government has backed away from its proposed bank victims’ tribunal after an independent review recommended combining two financial ombudsmen instead. | The federal government has backed away from its proposed bank victims’ tribunal after an independent review recommended combining two financial ombudsmen instead. |
| On Tuesday the Ramsay review of dispute resolution mechanisms released an interim report recommending one ombudsman for financial, credit and investment disputes and another for superannuation, with a view to join the two in future. | On Tuesday the Ramsay review of dispute resolution mechanisms released an interim report recommending one ombudsman for financial, credit and investment disputes and another for superannuation, with a view to join the two in future. |
| In October, Malcolm Turnbull announced the government was “working towards one tribunal that deals with consumer claims in a cost-effective and speedy way”. | In October, Malcolm Turnbull announced the government was “working towards one tribunal that deals with consumer claims in a cost-effective and speedy way”. |
| A bank tribunal was first proposed by a Senate committee in May and was seized on by the Liberal MP Warren Entsch as an alternative to a royal commission as a quicker means to compensate victims of banks. | A bank tribunal was first proposed by a Senate committee in May and was seized on by the Liberal MP Warren Entsch as an alternative to a royal commission as a quicker means to compensate victims of banks. |
| On Tuesday the financial services minister, Kelly O’Dwyer, welcomed the Ramsay report, which rejected a new statutory tribunal, finding that it was not required because financial ombudsmen services would “address many of the problems that led to the debate about a tribunal”. | On Tuesday the financial services minister, Kelly O’Dwyer, welcomed the Ramsay report, which rejected a new statutory tribunal, finding that it was not required because financial ombudsmen services would “address many of the problems that led to the debate about a tribunal”. |
| On the ABC’s The World Today, O’Dwyer explained Turnbull’s earlier backing of a “tribunal” was a “catch-all for having a one-stop consumer complaints shop”. | On the ABC’s The World Today, O’Dwyer explained Turnbull’s earlier backing of a “tribunal” was a “catch-all for having a one-stop consumer complaints shop”. |
| She said a “big-T” tribunal was “far more legalistic, which means it is probably less consumer friendly” than the “little-t” tribunal Turnbull and the government proposed. | She said a “big-T” tribunal was “far more legalistic, which means it is probably less consumer friendly” than the “little-t” tribunal Turnbull and the government proposed. |
| O’Dwyer denied opting for an ombudsman was inconsistent with Turnbull’s undertaking in October. | O’Dwyer denied opting for an ombudsman was inconsistent with Turnbull’s undertaking in October. |
| “The government is committed to a one-stop shop for consumer complaints handling that provides consumers with access to justice, the independent determination of disputes, timely reviews and a robust compensation scheme,” she said. | “The government is committed to a one-stop shop for consumer complaints handling that provides consumers with access to justice, the independent determination of disputes, timely reviews and a robust compensation scheme,” she said. |
| O’Dwyer’s explanation comes just two weeks after the House of Representatives economics committee recommended a new “banking tribunal” be established by July, following its grilling of the big four bank bosses in October. | O’Dwyer’s explanation comes just two weeks after the House of Representatives economics committee recommended a new “banking tribunal” be established by July, following its grilling of the big four bank bosses in October. |
| Responding to O’Dwyer’s remarks, the opposition leader, Bill Shorten, said the government deserved a “capital-F fail” for the backdown. | Responding to O’Dwyer’s remarks, the opposition leader, Bill Shorten, said the government deserved a “capital-F fail” for the backdown. |
| The Ramsay review recommended a redesign of the current financial dispute system, which includes a financial ombudsman service, credit and investments ombudsman (CIO) and superannuation complaints tribunal (SCT). | The Ramsay review recommended a redesign of the current financial dispute system, which includes a financial ombudsman service, credit and investments ombudsman (CIO) and superannuation complaints tribunal (SCT). |
| It found found that the monetary limits and compensation caps for consumers and small businesses – which have the effect of excluding some disputes from the dispute resolution system – are outdated and impeding access to justice and recommended that these be increased. | It found found that the monetary limits and compensation caps for consumers and small businesses – which have the effect of excluding some disputes from the dispute resolution system – are outdated and impeding access to justice and recommended that these be increased. |
| The committee recommended a six-monthly review into banking competition by the Australian Competition and Consumer Commission. | The committee recommended a six-monthly review into banking competition by the Australian Competition and Consumer Commission. |