Treasury has given the Australian Financial Complaints Authority a solid thumbs in its scheduled review, saying the consolidated body was “performing well in a difficult operating environment and a changing regulatory landscape”.
The review, which was delivered to financial services minister Jane Hume in August but released to the public Wednesday, praised the authority for bringing together three legacy complaints schemes and providing an effective dispute resolution service.
Moreover, Treasury said, AFCA was doing its job in the right way by upholding the lens of fairness in the way it operates.
“We were, overall, favourably impressed by the apparently orderly process, the consistent concern to provide procedural fairness and the respectful communication with all parties, including unsophisticated and demanding participants,” the review noted.
“We did not find in the 20 cases we examined a single instance of apparent bias or lack of independence. We considered that the written preliminary assessments and determinations were of a consistently high quality, clearly written and logically reasoned.”
While endorsing AFCA’s performance in its adolescant phase, Treasury was also clear that the authority needed to continue developing and improving its processes and “consolidating” its place in the financial services ecosystem.
To that end, the review provided 14 recommendations for AFCA to focus on in its next phase, which broadly covered areas such as transparency, efficiency and timeliness.
After two years in operation AFCA now has just over 40,443 members and has received 153,246 complaints. The average time to close a complaint so far is 74 days, with the average compensation awarded being $4,118.
Fifty-nine per cent of complainsts made to AFCA came from the banking and finance area, while 26 per cent were linked to insurance and nine per cent superanuation.
Only six per cent of AFCA complaints were linked to investments and advice.
Last week AFCA’s lead ombudsman for investments and advice Natalie Cameron said only 1,238 of the 70,510 total complaints – or 1.8 per cent – received by the authority from July 1, 2020 to June 30 2021 came from the advice sector.