June Smith.

Improving complaint handling efficiency and timeliness are among the key priorities for AFCA’s rule change consultation.

The complaints authority opened the consultation on Monday, and the proposed rule changes will align with the recommendations from the Treasury-led independent review of AFCA in 2021.

The complaint handling rule change was developed in response to Recommendation 5, which advised AFCA to continue publishing data on its timeliness, and to start publishing data on the full range of complaints it resolves (including those that extend beyond 12 months), better manage expectations around timeframes, and focus on improving the timeliness of complaints that remain unresolved after a year. AFCA had previously expressed a desire to halve the time it takes to resolve complaints.

Additionally, the consultation will also address AFCA’s ‘fairness doctrine’ and continue to refine how it is applied. Following on from the review’s recommendation, it has suggested “both parties should be provided with procedural fairness by having the opportunity to comment on changes to the scope of the complaint”. However, in instances where AFCA finds parties inappropriately seeking to add new issues, it should act to dismiss or curtail such behaviour.

Complaints lodged by professional or sophisticated investors should be excluded from AFCA’s purview unless exceptions apply.

The consultation process

Last year, AFCA announced it would create a uniform framework for consultation when developing its guidelines for how it approaches complaints, and provide clarity of the authority’s role in response to recommendations made by its Fairness Jurisdiction project.

The proposed changes were developed with the help of an external consultant – legal, regulatory, and compliance expert Debra Russell – and are designed mainly to implement recommendations of the recent.

The public consultation on the proposed changes began on 27 March and will close on 22 May. The feedback will help shape the final form of the proposals, which AFCA’s independent board will then consider before ASIC approves them. AFCA expects the approval process to be completed by 31 December.

The authority will then prepare for the changes ahead of the amended AFCA Rules and Operational Guidelines that will take effect on 1 July 2024.

“Our hope for the consultation is that consumers and financial firms, along with the groups that represent them, will take advantage of this opportunity to provide feedback,” AFCA deputy chief ombudsman June Smith tells Professional Planner.