Submissions

This joint submission is on behalf of Financial Rights Legal Centre (Financial Rights) and Financial Counselling Australia, providing comments and recommendations on Treasury’s Review of the Terrorism and Cyclone Insurance Act 2003.

This submission is in response to the public consultation on the exposure draft of the Treasury Laws Amendment Bill 2025: Limiting the use of genetic information by life insurers. It is the product of wide collaboration, consultation, and consensus between a broad range of stakeholders, including genetic health professionals, researchers, consumer support groups, health and financial services advocacy organisations, professional member organisations and others. This submission should be considered as representative of the views of more than 60 organisations (as well as many additional individuals) whose names are listed on the pages within.

We are thankful for the opportunity to comment on the Australian Financial Complaint’s Authority’s (AFCA’s) draft Approach to the duty to take reasonable care not to make a misrepresentation – life insurance. We have had the opportunity to read the submission from the Australian Law Council and support the positions expressed therein. This submission provides comments and recommendations on the proposed wording for this Approach.

We welcome the fact that the ATO is putting principles on the table, and particularly that vulnerability is explicitly recognised. However, the framing is still very much about ‘protecting the system from abuse’ rather than a trauma-informed and person-centred approach. There is a big push needed here for stronger recognition of lived experience; that many people want to pay their tax debts but just can’t; and that everybody benefits from a more flexible approach to relief. There is also the broader issue of the overall ATO accessibility, which means people often don’t even get through the door to access hardship support or other services they need from the ATO.

AFCA is to be commended for the substantial improvement to this approach document. We are grateful our previous advice has been incorporated. We have additional suggestions, outlined in this submission order of the updated approach rather than by importance. Many of our comments recommend minor wording changes for completeness, recommend relevant references, or ensuring that client preferences are incorporated. The key substantive recommendation is an expansion of the Life Insurance section, which is notably short.

This submission provides comments and recommendations on the proposed wording for Australian Financial Complaint’s Authority’s (AFCA’s) draft Approach General Insurance Claims Handling Consultation

Industry codes bridge an important gap between governing legislation and the delivery of fair and just outcomes for consumers. In some sectors, this gap is huge, with legislation providing very little in way of detailed obligations or effective consumer protections. Codes in the financial services sector are central to the work that financial counsellors and community lawyers do every day to protect the rights of people experiencing vulnerability and financial hardship. But Codes need to be effective and rigorous in order to have any hope of meeting that purpose. If not, then codes only serve to confuse and obscure consumer protections and regulation.

We support CHOICE’s recommendations to the RBA to proceed with its proposed ban on card surcharges; commit to a post-implementation review within 2-3 years of the proposals coming into effect, with a particular focus on whether cross-subsidisation is occurring between credit and debit card users, and whether further regulatory intervention is necessary to bring down scheme fees; encourage the Federal and State Governments to revisit the taxi industry’s exemption from surcharging rules; and recommend that the Federal Government proactively ban surcharges on cash transactions.

This joint submission calls on the ACCC to require member banks to offer a basic bank account by default to all new eligible customers (the default condition), and safely migrate eligible customers to basic bank accounts unless they opt out.

We hope the proposed changes to the AFCA Rules (Rules) will significantly expand AFCA’s capabilities to investigate and make adverse findings against banks who do not do all they can to stop scam activity, including though mule bank accounts, which has significantly contributed to scammers being so effective in stealing $2.03 billion last year from Australians. At the same time, banks have deliberately pushed people online to undertake all their banking but without implementing the proper safeguards. We expect AFCA will support the proposed changes to the AFCA Rules with clear and easy to understand direction though its operational guidelines, and other public AFCA guidance documents, including AFCA Approach Guides, EDR response guides and fact sheets (Guidance Materials) to assist parties understand and comply with the changes.

Too many Australians dealing with financial services firms have faced gruelling processes, long delays, lack of access to information, inappropriate service and increasingly, scams and fraud. Transparency of breaches and complaints drives firm accountability by allowing the media, policy makers, consumer advocates and the public at large to scrutinise firm behaviour and highlight major issues and trends. It is also very useful to have public records that demonstrate the impact particular laws are having on the sector and its consumers that can be used for research and evaluation purposes to support public policy development and law reform. In this way, transparency deters poor practices and supports better outcomes for consumers. We have long called for the publication of reportable situations and internal dispute resolution data at a firm level. We therefore strongly support ASIC’s proposal to finally shed further light on well-hidden systemic problems in this sector and urge ASIC not to delay publication any further.

Consumer advocates strongly support the proposed reforms to Centrepay. While this submission contains some comments and recommendations about the detail of the new Terms of Use, we strongly endorse all the overarching proposed reforms. That being said, these reforms will only lead to improved customer outcomes if they are robustly enforced, and businesses understand that compliance with the new rules will be closely monitored by Services Australia.

This submission is the product of wide collaboration, consultation, and consensus between a broad range of stakeholders, including genetic health professionals, researchers, consumer support groups, health and financial services advocacy organisations, professional member organisations and others. The submission represents broad community views, beyond the organisations which contributed to the original A-GLIMMER study.

Financial Rights and our peers have been advocating for the regulation of BNPL products for years and keenly await the implementation of the new legislative regime, which will reduce the risk of people being signed up to unaffordable BNPL debts that leave them worse off. However, the regime is novel and complex so we strongly support ASIC’s intention to provide guidance on the laws.

Despite operating for less than 12 months, the CSLR has already paid out life-changing amounts of compensation to some applicants whose disputes have been in limbo for months or even years. It is not an easy or short pathway to become eligible for CSLR compensation – applicants must have strong evidence of misconduct in connection with a narrow scope of licensed products and services, and persevere undeterred in the face of successive failures by the financial service provider over time. Our submission contains examples of cases where the CSLR has provided a lifeline to people left in difficult financial situations by professional misconduct.

While use of cash has decreased in recent years, this should not be interpreted as a sign that people no longer need or care about the ability to use cash. Over the last two months, CHOICE surveyed 12,999 supporters to gauge sentiments towards cash. Over 97% of respondents told us it is very important or quite important that businesses selling essential goods and services should be required to accept cash. By comparison, around 92% of people considered those businesses’ acceptance of credit/debit card payments as very important or quite important.

We, along with our peers, have been advocating for the regulation of BNPL products for years, and keenly await the implementation of the new legislative regime, which will reduce the risk of people being signed up to unaffordable BNPL debts that leave them worse off. However, we are extremely disappointed to see the changes made in the Draft Regulations to the cap on default (late) fees. For certain BNPL models (notably, the model used by Afterpay), the permitted annual cap on late fees has more than doubled the previous proposal.

We support the urgent passage of the Scams Prevention Framework Bill 2024 (SPF Bill) but with a key amendment to give effect to the Assistant Treasurer’s stated intention that regulated entities will compensate victims if they fail to meet their SPF obligations. Without this amendment we are deeply concerned that the SPF Bill will introduce a burdensome regime that fails to ensure fair outcomes for scam victims.

Unfair business practices cost people time, money and wellbeing, and erode trust in markets. While the existing legislative framework addresses some extreme forms of exploitation, it remains insufficient to counter the nuanced and systemic nature of unfair practices, particularly in the digital age.

This submission represents combined efforts and consistent perspectives from the consumer sector. It builds on our past submissions to Treasury, which identified more than 50 examples of unfair business practices that harm consumers and should be captured by reforms.

We support AFCA introducing both the Duty Approach and the Updated Approach. This submission provides a small number of recommendations to clarify some of the concepts addressed.