The need for the Government to move to simplify Australia’s superannuation legislation has been exemplified by the annual report of the Superannuation Complaints Tribunal (SCT).
The Tribunal chairperson, Graham McDonald used the 2003-04 annual report to point out that while the volume of written complaints lodged with the Tribunal over the 12 month period had dropped, this had been more than offset by the steady increase in complexity of the matters requiring investigation and determination.
“One example of this was the need to determine a complaint which challenged the duties of a trustee in the calculation of the superannuation surcharge as the result of the introduction of the Superannuation Contributions and Termination Payments Taxes Legislation Amendment Act 1992,” he said. “The increasing volume and detail of legislation applied in the superannuation arena will see complexity as an ongoing feature of complaint resolution.”
McDonald used his chairperson’s review in the annual report to say several proposals for the amendments to improve the operation of the Superannuation (Resolution of Complaints) Act 1993 were before the Government.
“Another area in which amendment needs serious consideration is for the introduction of a requirement that trustees give written reasons to members when declining the payment of a benefit,” his review said. “The current law contains no such requirement and was developed at a time when payment of benefits arose as the result of a non-compulsory, non-contributory benefice bestowed by an employer or other third party.”
He said the nature of compulsory contributory superannuation gave rise to entirely different considerations.
“Most members would be surprised to learn that trustees are not required to provide a summary of the matters considered relevant when their claim is rejected, if for no other reason that it precludes them from properly addressing relevant points at the review process,” McDonald said.
He said that while many trustees voluntarily provided reasons, there were a number which continued to not do so.
“It is these trustees that may need some legislative encouragement,” he said.
McDonald also pointed to the position of the SCT in relation to alternative dispute resolution schemes covering the financial services area.
“The fact that the Banking and Financial Services Ombudsman (BFSO) is able to look at disputes arising in all bank subsidiaries and given the growth of integration of financial services through bank takeovers, this may ultimately result in superannuation complaints being determined either by the Tribunal or the BFSO,” he said.
McDonald said that if this were to occur, differing procedures and criteria for complaint resolution would apply, “inevitably leading to confusion for both industry and complainants”.
He said there would clearly be some advantages and savings from the instigation of a single operating scheme.
