OMBUD COUNCIL ANNUAL REPORT 2024/25

PART B: PERFORMANCE INFORMATION

2.4 OVERVIEW OF OMBUD SYSTEM OPERATIONS AND TRENDS

2.3.3 AMENDMENTS TO FOUNDING LEGISLATION (CHAPTER 14 OF FSR ACT) The FSR Act is the Ombud Council’s founding statute. Chapter 14 of the FSR Act sets out the Ombud Council’s objective, prescribes its functions and duties, and provides the Council with a comprehensive toolkit of subordinate law-making, supervisory and enforcement functions to deliver on its mandate. The effect of these provisions is to establish the Ombud Council as the regulatory authority for all financial sector ombud schemes. The COFI Bill includes several consequential amendments to Chapter 14 of the FSR Act. These include moving the provisions establishing the two current statutory schemes, the FAIS Ombud, and the Office of the Pension Funds Adjudicator (OPFA), from their current founding statutes 1 to the FSR Act. Amendments to the jurisdiction and governance processes of the two schemes, aimed at greater alignment between them, are also proposed, impacting the Council’s responsibilities. After publication of the National Treasury’s policy paper, “A Simpler, Stronger Financial Sector Ombud System” in February 2024, which confirmed the National Treasury’s acceptance of most of the reforms proposed in the WBD Report, the Ombud Council engaged with the National Treasury, the World Bank, and the FSCA to discuss an action plan for drafting the necessary legislation to progress the next phase of these reforms. A technical task team, comprising representatives from the Ombud Council, the National Treasury, the FSCA and the World Bank, has held several working sessions to begin drafting a dedicated amendment Bill named the Financial Ombud System Amendment Bill. If approved, the Bill will amend the FSR Act to establish the framework for the reformed ombud system. Planned consultations with key stakeholders including the financial ombud schemes, the Financial Services Tribunal, the South African Reserve Bank, the National Credit Regulator and the Department of Justice and Constitutional Development, amongst others, will focus on addressing jurisdictional and procedural alignment in areas including credit complaints, payments, and debt collection. 2.3.4 DRAFT FINANCIAL OMBUD SYSTEM AMENDMENT BILL

Section 184(d) of the FSR Act requires the Board of the Ombud Council to keep the Minister of Finance informed of trends in the nature of complaints to ombud schemes, and the conduct of financial institutions giving rise to these. The Council has developed a streamlined reporting framework for schemes to report complaint data to us on a consistent and comparable basis. The final reporting framework requires the industry and statutory schemes to submit quarterly information within one month of the end of each quarter. The NFO and the FAIS Ombud commenced with submission of the reports in line with an earlier draft version of the reporting framework, although the two statutory schemes will formally adopt the reporting framework from the first quarter of 2025/26. An appropriate reporting format enhancing the level of complaint trend information to be reported going forward has been agreed with the National Treasury. The methodology will be implemented in respect of quarter one of 2025/26 onwards and will be included in future performance reports to the Minister. The Ombud Council takes this opportunity to highlight key complaint handling statistics and trends observed in interactions with the financial ombud schemes we oversee. The schemes have continued to handle a significant volume of complaints across various sectors, covering banking, credit, life insurance and non-life insurance; pension funds; market infrastructures; and financial advice and intermediary services.

1 Being the Financial Advisory and Intermediary Services (FAIS) Act (Act 37 of 2002) and the Pension Funds Act (Act 24 of 1956) respectively.

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OMBUD COUNCIL ANNUAL REPORT 2024/25