What is an Ombudsman?
An Ombudsman takes complaints from citizens or consumers about agencies or service providers.
The Ombudsman will investigate those complaints and reach a resolution that is fair to both sides.
The term 'Ombudsman' commonly describes both the person who holds that position and the office they head up.
In Australia and New Zealand, there are two types of Ombudsmen:
- Industry-based Ombudsmen who take complaints from customers of companies that provide particular services—such as telecommunications, banking, insurance, investments, energy, water and public transport
ANZOA admits both types of Ombudsman to membership—provided they meet certain criteria.
Where does the word ‘Ombudsman’ come from?
The modern meaning of Ombudsman arose from its use in Sweden with the Parliamentary Ombudsman instituted in 1809 to safeguard the rights of citizens by establishing a supervisory agency independent of the executive branch. The word is not gender-specific.
Its specific meaning has since been adopted into English as well as other languages, and ombudsmen have been instituted by many other governments and organisations. The origin of the word is found in Old Norse and the word umbuds man, meaning representative. The first preserved use in Swedish is from 1552. It is also used in the other Scandinavian languages such as the Icelandic umboosmaour, the Norwegian ombudsman and the Danish ombudsmand.
You can read more about the 200 year history in this article from the newsletter of the British & Irish Ombudsman Association.
How does an Ombudsman work?
The Ombudsman’s staff will investigate the complaint to reach a resolution that is fair to both sides—in doing this, they don’t take sides. If a resolution can't be reached, the Ombudsman has the power to make a final decision.
The Ombudsman’s services are free to citizens and consumers—and, very importantly, are fair and completely independent. You don’t need a lawyer to make a complaint to an Ombudsman.
An Ombudsman generally has a responsibility to help improve service and administration in the organisations about which they take complaints—especially where a complaint indicates there is a more general or systemic problem.
History of Ombudsman services in New Zealand
The first New Zealand Ombudsman was appointed in 1962 under the Parliamentary Commissioner (Ombudsman) Act 1962. New Zealand was the fourth country to establish the office of Ombudsman, after Sweden, Finland and Denmark.
The first industry-based Ombudsman in New Zealand was the Banking Ombudsman, set up in 1992.
History of Ombudsman services in Australia
The first State parliamentary Ombudsman was set up in 1971 in Western Australia, followed by South Australia in 1972 and Victoria in 1973. The first Commonwealth Ombudsman was appointed in 1977.
The first industry-based Ombudsman scheme in Australia was the Australian Banking Industry Ombudsman, set up in 1990—it is now the Financial Ombudsman Service.
More about Parliamentary Ombudsman offices
A parliamentary Ombudsman is appointed and funded by government to investigate complaints against Government agencies and to produce reports and make recommendations aimed at improving public administration.
In Australia, there is a parliamentary Ombudsman for each state and territory, as well as a Commonwealth Ombudsman. New Zealand has an Office of the Ombudsmen, which presently has two Ombudsmen.
Governments have also appointed other Ombudsmen or commissioners with more specific mandates—for example, to consider complaints about lawyers, health services or police. These offices can be combined with the parliamentary Ombudsman or separate.
More about industry-based Ombudsman schemes
Service providers in a number of industries in Australia and New Zealand—such as telecommunications, banking, insurance, investments, energy, water and public transport—are required by legislation or operating licence to join an independent external dispute resolution (EDR) scheme.
This scheme is headed up by an Ombudsman who is responsible for its day-to-day operation and the receipt, investigation and resolution of complaints.
The scheme will also have a Board or Council—made up of equal representatives of industry and consumers and an independent Chairperson. The Board or Council has oversight responsibilities, including corporate governance, approval of budgets, strategic planning and, importantly, ensuring the Ombudsman’s independence. In most cases, the Board appoints the Ombudsman.
Government, or an independent regulator, may be involved by approving the scheme and ensuring that it complies with certain standards. Sometimes a parliamentary Ombudsman also has a role an as industry Ombudsman—for example, the Ombudsman Western Australia and Ombudsman Tasmania are also the energy Ombudsmen for their states.
An industry-based Ombudsman typically charges each provider under its jurisdiction according to the number and/or the complexity of complaints it receives about that organisation.
