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New financial dispute resolution a landmark initiative

THE Australian Small Business and Family Enterprise Ombudsman (ASBFEO) has welcomed the Government’s landmark move to establish a new one-stop-shop to resolve small business disputes with banks – the Australian Financial Complaints Authority (AFCA).

Ombudsman Kate Carnell said the initiative addressed a key recommendation from ASBFEO’s Small Business Loans Inquiry and would significantly improve access to justice, especially for capital-intensive enterprises.

AFCA will consolidate the existing Financial Ombudsman Service (FOS), the Credit and Investments Ombudsman (CIO) and the Superannuation Complaints Tribunal (SCT). 

A small business will be able to seek resolution of a dispute where the credit facility is up to $5 million and potentially receive compensation up to $1 million.

Ms Carnell said the FOS was currently limited to considering disputes of not more than $500,000 arising from a credit facility no higher than $2 million.

“This excludes many small businesses,” she said.

“Small businesses do not have the money or time to challenge banks through the court system and there is a significant power imbalance between banks and small businesses.

“Small businesses do not have the financial capacity to hire expert legal advice to help them overcome this disadvantage.”

The new one-stop-shop will be able to make binding determinations.

Ms Carnell said the higher compensation cap should incentivise banks to resolve disputes through internal processes before progressing to the AFCA.

“The Government’s proposed model will provide a genuine alternate dispute resolution option in a forum where the needs of small business are understood,” she said.

“It will save time and money by significantly reducing the need for litigation.”

Ms Carnell also welcomed the proposed transitional arrangements and the Government’s commitment to consult on AFCA’s terms of reference.

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Orange to host first regional public hearing

ORANGE will host the first regional public hearing of the Select Committee on Regional Development and Decentralisation. 

The Chair of the Committee, Dr John McVeigh MP said, “the Committee is looking forward to kicking off our public hearing program in Orange.  This will be the first of a series of public hearings we will hold around the country.  The Committee wants to engage with regional and rural towns about the issues affecting them, and to learn more about best practice for the development of sustainable and engaged regional communities.”

“Orange is a good example of a regional town with a mix of public and private decentralisation, as well as regional development initiatives driven by the local community.  ” Dr McVeigh said. 

 

Public hearing details: 10:00 am to 2:30 pm, Monday, 18 September, Moresby Room, Ex-Services’ Club, 231-243 Anson St, Orange, NSW 

10.00 am: Orange City Council
10.45 am: Regional Development Australia Central West
11.30 am: Centre for Economic and Regional Development
12.15 pm: Lunch
1.00 pm: NSW Department of Primary Industries and NSW Rural Assistance Authority
1.45 pm: Orange Business Chamber
2.30 pm: Close

The hearing will be broadcast live at aph.gov.au/live.

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Australian Energy Market Operator to meet committee

THE House Environment and Energy Committee will hear from the Australian Energy Market Operator (AEMO) at a public hearing tomorrow for the inquiry into modernising Australia’s electricity grid.

The Chair of the Committee, Andrew Broad MP, said the Committee was looking forward to hearing from AEMO about measures to ensure the security and reliability of the electricity system, both in the short term and as the system continues to evolve.

“As the market operator, AEMO is on the front line of the changes underway in the electricity grid. The Committee is keen to hear from AEMO what measures it thinks will encourage more dispatchable capability on the grid,” Mr Broad said.

The Committee will also hear from the Energy Efficiency Council, which represents stakeholders with experience in energy efficiency and related issues, such as demand management.

The Deputy Chair of the Committee, Mr Pat Conroy MP, said the Committee was looking forward to hearing about the role of demand management in achieving a more reliable and affordable electricity system.

“Demand management is an important consideration for the Committee as it examines how to ensure a responsive modern grid,” Mr Conroy said.

As part of the inquiry, the Committee is encouraging members of the community to share their views on the electricity system via an online questionnaire.

Further information about the inquiry, including submissions from organisations appearing at the hearings, is available on the inquiry website.

 

Public hearing details: 9:45 am to 11:15 am, Thursday, 14 September, Parliament House, Canberra

The hearing will be broadcast live at aph.gov.au/live

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APRA to face parliamentary scrutiny

THE House Committee on Economics will scrutinise the Australian Prudential Regulation Authority (APRA), as part of its review of the performance and strengths of Australia’s financial and banking regulator.

The Chair of the committee, David Coleman MP, said ‘the hearing will enable the Committee to scrutinise APRA on its performance and operation, including the adoption of “unquestionably strong” capital benchmarks for the four major banks, and further measures to reinforce sound residential mortgage lending practices. 

The committee is also likely to scrutinise APRA on other activities relating to the banking sector, including its inquiry into governance and culture at the Commonwealth Bank.

APRA is the prudential regulator of Australia’s financial services industry. It oversees banks, credit unions, building societies, general insurance and reinsurance companies, life insurance, private health insurance, friendly societies, and most of the superannuation industry.

Public hearing details: 11.15 am to 1.15 pm, Wednesday 13 September, Committee Room 2R1, Parliament House, Canberra 

11.15am – 1.15pm: Australian Prudential Regulation Authority (APRA)
1:15pm: Close

The hearing will be broadcast live at aph.gov.au/live

Interested members of the public may wish to track the committee via the website. 

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House Economics Committee to scrutinise ASIC

THE House Committee on Economics will scrutinise the Australian Securities and Investments Commission (ASIC), as part of its review of the performance and operation of Australia’s corporate regulator.

The Chair of the committee, David Coleman MP, said ‘the hearing will provide the Committee with the opportunity to scrutinise ASIC on its role in promoting investor and consumer confidence, and in enforcing Australian corporate law.’

ASIC regulates Australian companies, financial markets, financial services organisations and professionals who deal and advise in investments, superannuation, insurance, deposit taking and credit. ASIC is empowered to protect consumers against misleading or deceptive and unconscionable conduct affecting all financial products and services, including credit.

 

Public hearing details: 12.15 pm to 1.55 pm, Thursday 14 September, Committee Room 2R1, Parliament House, Canberra

12.15pm – 1.55pm: Australian Securities and Investments Commission
1:55pm: Close

The hearing will be broadcast live at aph.gov.au/live

 Interested members of the public may wish to track the committee via the website. 

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