The friendly societies industry, as represented by the FSA, has a public policy agenda which is continually evolving. Current public policy priorities depend on regulatory and legislative hurdles the industry is confronted with, which are largely dictated by government.
While the member-owned/community benefit structure that the overwhelming majority of Australian friendly societies employ is foremost, any public policy development which presents commercial risk to friendly societies will be at the top of the FSA’s policy agenda.
The FSA’s current public policy priorities include:
- Encouraging greater investment in scholarship plans
Just as superannuation helps fund retirement, scholarship plans help fund both school and university education. The FSA supports the Federal Government encouraging higher levels of investment in scholarship plans through the introduction of a co-contribution scheme for friendly societies scholarship plans. The industry also supports reinstating an appropriate tax-free threshold on taxable benefits paid to minors under friendly societies scholarship plans, which are currently taxed at rates as high as 66 per cent.
- The friendly societies industry’s commitment to looking after the best interests of consumers
Unlike other larger corporations, the customer is the owner of a friendly society and therefore, friendly societies directly benefit local communities. As part of our community benefit structure, looking after the best interests of consumers is our highest priority. To reinforce this, the FSA is in the process of developing a new code of practice which will highlight how friendly societies foster productive, mutually beneficial relationships with their members and other customers. The new code will also spell out the process should a consumer wish to complain about the conduct of a friendly society. The FSA does not tolerate any of its members engaging in behaviour which has a deliberate negative impact on members and other customers.
- Broadening the definition of funeral expenses
Funeral bonds and funeral insurance are not the same – if a consumer invests in a funeral bond, funds received when it matures are the total of the capital they initially invested plus accumulated growth. For funeral insurance, consumers choose the amount of cover they would like when they apply to be insured. Premiums will then be required to be paid for a period according to the terms of the selected policy. The definition of what expenses qualify for funerals should be broadened so that it takes into account Australia’s multicultural population.