Robert Troy (Longford-Westmeath, Fianna Fail) | Oireachtas source

I thank the Acting Chairperson. I welcome the opportunity to engage with Members on the Bill. The Bill will strengthen protections for financial customers in Ireland and ensure that the office of the Financial Services and Pensions Ombudsman, FSPO, can continue to carry out its statutory functions in line with the Constitution. Many will have heard the ombudsman, Mr. Liam Sloyan, on RTÉ this morning speaking on the FSPO's new report on complaints in 2024. That 6,185 complaints were received by the FSPO and €5.7 million was delivered in outcomes for consumers last year highlights the importance of the ombudsman as a service in demand. It also highlights the importance of progressing this Bill to ensure that it is maintained on a sound legal basis.

The Government published the Bill on 19 December 2023. On 5 March 2025, the Bill progressed through Committee, Report and Final Stages in the Dáil. Amendments were debated and adopted by the Deputies present. Today's Second Stage debate on the general principles of the Bill is an important step in the progress of this legislation. The FSPO was established on 1 January 2018 by the Financial Services and Pensions Ombudsman Act 2017, as amended. The office is a critical part of consumer protection framework in Ireland providing an independent, impartial, fair and free service that helps resolve complaints for consumers, including small businesses and other organisations, against regulated financial services providers and pension providers. The work of the FSPO complements the wider consumer protection framework for financial services in Ireland.

Last Monday, I spoke at the launch of the Central Bank's revised consumer protection code, which updates and modernises the code and aims to ensure firms put the interests of the consumer at the centre of how they operate their business. The FSPO resolves complaints through one of two ways. The first is informal mediation. The second is through formal investigation and adjudication. This can include oral hearings, if required. This leads to legally binding decisions that are subject only to statutory appeal to the High Court.

Some of the amendments to the FSPO ACt proposed by the Bill have come as a result of the ruling in the case of Zalewski v. the adjudication officer, the Workplace Relations Commission, Ireland and the Attorney General. In that ruling, the Supreme Court held that the exercise of power by the adjudication officers under Part 4 of the Workplace Relations Act 2015 was the administration of justice under Article 34 of the Constitution. The administration of justice is normally preserved for the courts. However, the Supreme Court found that the administration of justice as carried out by the adjudication service is permissible within the meaning of Article 37 of the Constitution as the administration of justice was limited. In light of this ruling and throughout the drafting of the Bill, the Department consulted with stakeholders, particularly the Office of the Attorney General and the FSPO. The consultations were to ensure the necessary amendments arising from the Zalewski ruling are put in place and to ensure the FSPO continues to administer justice within the meaning anticipated by Article 37. This includes the possibility of holding hearings in public where deemed appropriate. The Bill also improves the 2017 Act with some clarifications and correcting errors, such as typos.

I will outline the main provisions of the Bill. First, I will give an overview of the main Zalewski-related amendments. I will then summarise the other amendments proposed within the Bill. Section 13 provides that the ombudsman may require any person to attend before him and be examined and cross-examined on oath or affirmation. This updates the principal Act to include a provision for cross-examination and that a person can make an affirmation instead of taking an oath.

Section 16 provides that the ombudsman is required to take a decision whether to hold an oral hearing as provided for under section 12(1)(c) of the 2017 Act and as conducted under section 47(3) in public. This decision is taken after consultation of the parties concerned. The nature or circumstances of the complaint or other matters in the interest of justice should also be considered. This is one of the key amendments that has come about as a result of the Zalewski Supreme Court ruling.

Section 17 provides that mediation shall always be conducted in private. This provides an important comfort to complainants, who otherwise may be disinclined to submit complaints to the ombudsman. The procedures of the FSPO greatly encourage mediation between the parties on a voluntary basis to ensure that every effort can be made to facilitate the resolution of the complaints in the way that empowers the parties themselves to design and agree a confidential solution. This is in accordance with provisions of section 58(1) of the Act, which requires the ombudsman to try as far possible to resolve a complaint by mediation. Mediation by its very nature is a confidential process. Given that mediation is one of the various forms of "investigation" anticipated by section 12(1) of the Act, it would be contrary to the Act and the well-established procedures for conducting mediation for any FSPO investigation by way of mediation to be conducted in public.

Section 18 outlines that a person who gives evidence on oath or affirmation that is false, and that he or she knows to be false, has committed an offence and is liable on summary conviction to a class A fine or imprisonment for a term not exceeding three months or both.

I turn to the amendments to the 2017 FSPO Act that do not relate to the Zalewski case. Section 1 is a standard provision defining that the term "principal Act" refers to the 2017 FSPO Act.

Section 2 amends the interpretation section of the principal Act. Three separate issues are addressed here. The first substantive amendment is to the definition of "financial services provider" as set out in the 2017 Act. The definition is the list of financial entities in respect of which a complainant may submit a complaint to the FSPO. The amendment will include any person engaged in the activity of credit servicing before the commencement of the Consumer Protection (Regulation of Credit Servicing Firms) Act 2015 and 2018, respectively. Currently, the FSPO may only accept a complaint relating to the conduct of a credit servicing firm where the conduct giving rise to the complaint occurred after the commencement of the relevant Act. The amendment will extend the jurisdiction of the FSPO relating to the activity of credit servicing. The FSPO will have jurisdiction to review complaints made at any point after a loan sale. This includes complaints before the commencement of either the 2015 or 2018 Acts.This issue was raised during the Dáil Second Stage debate in February 2024. The amendment will now address the legitimate concern raised and will ensure all mortgage holders will have access to the FSPO if needed. This part of the amendment was welcomed by and passed with the support of Opposition spokespersons in the Dáil on 5 March.

The second part of the amendment is to clarify the definition of the term “credit reviewer”. The third part of the amendment clarifies that the FSPO has the power to investigate complaints against a financial services provider or pension provider which met the definition of financial services provider or pension provider, as defined in the 2017 principal Act, at the time of the conduct complained of, even if that provider ceased to meet the definition of the financial services provider or pension provider, as defined in the principal Act, before the complaint was made to the FSPO or before the FSPO’s investigation of the complaint has been concluded. This proposed amendment will eliminate any ambiguity in the interpretation of the legislative provisions and it will confirm the FSPO can investigate firms which may no longer meet the definition of a financial services provider or pension provider at the time of the complaint. This is the interpretation long since taken by the FSPO and its predecessor, the Financial Services Ombudsman Bureau. Having considered the matter carefully and with the advice of the Attorney General's office, the proposed legislative amendment seeks to provide further clarity to confirm the position taken by the FSPO with respect to the existing statutory powers underpinning the investigation of these kinds of complaints.

Section 3 outlines the methodology for calculating expenses via percentage split. This is charged to the financial services sector by a levy for financial services complaints and expenses charged by the Exchequer for pension cases.

Section 6 outlines the process for appointing an acting ombudsman during the absence of an ombudsman in a number of scenarios. This includes providing a statutory basis for a member of staff to assume the position of acting ombudsman where there is no deputy ombudsman at the time. There is also a series of amendments to various sections of the 2017 FSPO Act to reflect the potential for there to be more than one person appointed as deputy ombudsman. This point is facilitated by amendments in sections 4, 5 and 7 to 11, inclusive.

Sections 12 and 14 clarify the respective remits of the FSPO and the credit reviewer. The credit reviewer makes a recommendation regarding a participating bank's lending decision, as a result of which the participating bank may decide to approve the loan. The FSPO’s jurisdiction does not overlap because the FSPO will not interfere with the commercial discretion of a financial services provider or a recommendation of the credit reviewer. However, a consumer may make a complaint to the FSPO regarding the conduct of a bank in how it has processed the application. This reflects input from the Committee on Finance, Public Expenditure and Reform, and Taoiseach in the previous Oireachtas in its pre-legislative scrutiny report.

Section 14 corrects a cross-referencing error. This amendment clarifies that the ombudsman may accept a complaint where a financial services provider or pension provider has initiated legal proceedings in relation to a complaint and where the ombudsman believes, based on reasonable grounds, that the provider has initiated those proceedings to frustrate or delay its investigation.

Section 15 would allow the Minister for Finance to make regulations that require financial services providers, or certain classes thereof, and pension providers, or certain classes thereof, to establish internal dispute resolution procedures for dealing with complaints and to publish their internal dispute resolution procedures. Currently, there is no statutory obligation on pension providers to have internal dispute resolution procedures in place. Furthermore, the regulation-making powers currently drafted would require the regulations to be applicable to all entities that meet the definition of pension provider.