The government authority that handles disputes about super, the Superannuation Complaints Tribunal, has had its funding halved as the Federal Government aims to wind it down by 2020.
Similar to how Centrelink dissolved into Human Services a few years ago, the Superannuation Complaints Tribunal is being combined with the Financial Ombudsman Service and the Credit and Investments Ombudsman to form the Australian Financial Complaints Authority (AFCA).
This new body will be funded by the financial services industry, with companies holding a financial services licence required to be a member. The idea is to offer a body where customers are offered access to free, fast and binding dispute resolutions.
It was revealed last year that a backlog of 1500 open complaints meant that the retirement savings of thousands of Australians were trapped in bureaucratic limbo. To help clear the backlog the tribunal received emergency funding of $5.2 million for the financial year.
While the funding has helped to clear some of the backlog, the number of complaints has increased to 1600 and the body will receive more until June 2018.
With further funding to be cut next year, principal at legal firm Berril & Watson, John Berrill, believes that the super tribunal risks being burdened by a far bigger backlog of cases and the new authority would face a deluge of old super cases.
With more than $2.2 trillion of Australian workers’ and retirees’ wealth sitting in superannuation, why is the Government not investing more to ensure a secure and just superannuation system in a timely fashion?