There are two main circumstances that arise. One is that they want to transfer from one super scheme to another one, often run by a different company. The other is where they request a withdrawal payment during the lock-in period.
Stevens says, in her recent newsletter, that the ombudsman’s office receives complaints from consumers who have had requests to transfer from one plan to another declined.
This can be because the lock-in arrangements of the alternative plan or scheme are considered to be less stringent than those applying in the current plan.
“If the plan’s trust deed gives the trustee absolute discretion to approve the transfers the ombudsman is unable to influence the trustee’s exercise of its discretion.
“In some cases a transfer request can be declined because the plan’s trust deed only permits funds to be transferred to another plan or scheme which is administered by the same company. This cause frustration for consumers who, for a variety of reason, may want to transfer to a plan or scheme provided by another company, but cannot do so.
However provided the trustee has complied with the plan’s trust deed provisions the ombudsman cannot require it to take a different course of action.
“Unfortunately there is very little the ombudsman can do assist consumers with complaints which relate to trust deed provisions governing the operation of a plan.”
She says complaints can be made to the Government Actuary in limited circumstances.
The other complaint the office gets is where a request for an early payment is made because of the death of the member, a total and permanent disablement (TPD), permanent emigration or financial hardship.
The ombudsman’s ability to resolve this type of complaint is generally limited. This is because it is usual for the plan’s trust deed to give the trustee absolute discretion to pay a benefit on grounds of TPD, permanent emigration or financial hardship
“Where this is the case the (ombudsman) has no power to influence a plan trustee in exercising its discretion.”
She says that often the amounts involved are quite small and the end result is that the consumer stops paying because of dissatisfaction with the company and the company is then left to administer an individual plan account with a small balance.
“This is generally not in either party’s best interests,” she says.
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