The Superannuation Complaints Tribunal (SCT) has warned superannuation fund trustees that they need to ensure that communications with members is both effective and easily understandable.
The chairman of the Tribunal, Graham McDonald, has used the SCT’s latest quarterly bulletin to state that communications issued by trustees must be clear and not written assuming an understanding of industry terms, expectations or practices.
However, he pointed out that the Tribunal had recently upheld a trustee’s submission that a member had an obligation to read material received from a superannuation fund, and if they failed to do so they had to take responsibility for the consequences.
“The Tribunal continues to be concerned at the number of cases coming to it concerning a failure of member understanding of and the provision of timely trustee information about the options relating to continuing insurance cover,” McDonald said.
The chairman referred specifically to cases where employers failed to inform trustees that a member had left employment and where the superannuation fund continued to send the member statements indicating that they had continuing insurance cover.
He said this made clear that trustees needed to have systems in place to allow identification of cases where deductions were being made for the payment of insurance premiums without there being concomitant receipt of member contributions.
McDonald also used the quarterly bulletin to express satisfaction at the significant growth that had occurred in the number of cases being conciliated.
He said in the 2003-2004 reporting year 268 cases were conciliated, and this had increased by 27.6 per cent to 342 cases in the 2004-2005 financial year.
“As a result of this increase, the Tribunal has decided that it will change the practice of approaching parties about their availability for a conference, from one where the conciliator contacts the parties to establish suitable times, to one where the Tribunal decides the date and time and provides this notice to parties,” McDonald said.
“The Tribunal does not wish to inconvenience parties by setting down the time and date of the conference, however, it has to balance its limited resources against its statutory objectives of being economical, informal and as quick as practicable in resolving complaints,” he said.
The SCT’s quarterly data revealed that it had received 485 complaints for the period from July 1 to September 30, with those relating to death benefits at 25.6 per cent, followed by complaints about disability benefits at 21.4 per cent.
