Professional Standards Amendment (Mutual Recognition) Bill 2007

PROFESSIONAL STANDARDS AMENDMENT (MUTUAL RECOGNITION) BILL 2007

Second Reading

The Hon. TONY KELLY (Minister for Lands, Minister for Rural Affairs, Minister for Regional Development, and Vice-President of the Executive Council) [3.09 p.m.]: I move:
That this bill be now read a second time.
I seek leave to have the second reading speech incorporated in Hansard.

Leave granted.
Professional standards legislation has been enacted in all States and Territories to facilitate the capping of occupational liability. Such legislation also protects consumer interests through requirements for insurance and the implementation of risk management strategies and complaints and disciplinary procedures.
In New South Wales, there are currently eight schemes approved under the Professional Standards Act 1994 . These schemes cover accountants, legal practitioners, engineers, surveyors and valuers.
The Professional Standards Amendment (Mutual Recognition) Bill 2007 implements a decision of the Standing Committee of Attorneys General that States and Territories amend their professional standards legislation to enable mutual recognition, between jurisdictions, of schemes approved in other jurisdictions.
Under current professional standards legislation, the process for professionals to obtain capped liability outside their home jurisdiction is cumbersome, inefficient and involves duplication.
Mutual recognition of schemes by jurisdictions aims to address these problems and provide a more seamless national system of professional standards legislation.
Mutual recognition will cut the "red tape" currently facing professionals who wish to have capped liability when providing services in other jurisdictions. It recognises the reality that the work of professional practices often transcends state boundaries.
I now turn to the key provisions of the Bill.
Clause [1] of the Bill inserts a number of new definitions in the Act.
Under professional standards legislation, an occupational association may submit a proposed scheme to the Professional Standards Council for approval. Alternatively, an occupational association may ask the Council to prepare a scheme on its behalf.
Clause [3] of the Bill provides that a proposed scheme may indicate an intent to operate in New South Wales only, or in both New South Wales and one or more interstate jurisdictions.
Under professional standards legislation, there is a requirement for the Council to advertise a proposed scheme and to receive and consider comments and submissions on the scheme.
Clause [4] of the Bill provides that if a proposed scheme indicates an intent to operate in more than one jurisdiction:
• the scheme must be advertised in each of those jurisdictions; and
• the advertising requirements of each of those jurisdictions must be met.
Under professional standards legislation, the Professional Standards Council is required to consider a range of matters before approving a proposed scheme. These matters include:
• all comments and submissions received on a proposed scheme;
• the position of people who may be affected by capping the occupational liability of members of the occupational association; · the nature and level of claims relating to occupational liability made against members of the occupational association;
• the risk management strategies of the occupational association, and the means by which those strategies will be implemented;
• the cost and availability of insurance against occupational liability for members of the occupational association; and
• the standards determined by the occupational association in relation to insurance policies.
•
Clause [5] of the Bill provides that if a proposed scheme indicates an intent to operate in more than one jurisdiction, the Council must consider:
• the matters outlined, plus any other matters specified in the professional standards legislation of the interstate jurisdictions; and
• all of the matters in the context of each of the jurisdictions concerned.
Under professional standards legislation, the Professional Standards Council may submit a scheme approved by it to the Minister.
Clause [6] of the Bill provides that if the scheme indicates an intent to operate in one or more interstate jurisdictions, the Council may submit the scheme to the Minister administering professional standards legislation in those jurisdictions.
Under professional standards legislation, the Minister may authorise the publication in the Gazette of a scheme submitted to him or her by the Professional Standards Council.
Clause [7] of the Bill provides that the Minister may also authorise the publication in the Gazette of a scheme submitted to him or her by an interstate Council.
Under professional standards legislation, a person who is or is reasonably likely to be affected by a scheme published in the Gazette may apply to the Supreme Court for an order that the scheme is void for want of compliance with the Act.
Clause [10] of the Bill extends the right to challenge a scheme to any person who is or is reasonably likely to be affected by a scheme in its application in another jurisdiction.
While the professional standards legislation of States and Territories is largely consistent, there are some jurisdictional differences.
Clause [11] of the Bill provides that a Court:
• may not make an order that an interstate scheme is void for want of compliance with the New South Wales Act on the ground that the scheme fails to comply with the requirements in the New South Wales Act relating to the contents of schemes; and
• may make an order that an interstate scheme is void on the ground that the scheme fails to comply with the requirements of the interstate law, under which it was approved, in relation to the contents of schemes.
Under professional standards legislation, either the Minister or the Council may initiate a review of the operation of a scheme. A review may be conducted to decide whether a scheme should be amended or revoked or whether a new scheme should be made.
Clause [12] of the Bill provides that a review may also be conducted to decide whether the operation of an interstate scheme should be terminated in New South Wales.
Under professional standards legislation, either the Minister, the Council or an occupational association may initiate the amendment or revocation of a scheme.
Clause [14] of the Bill provides that the provisions relating to amendment and revocation do not apply to an interstate scheme. Clause [15] of the Bill inserts a separate section governing the termination of an interstate scheme operating in New South Wales. Either the Minister, the Council or an occupational association may initiate a termination.
Clause [15] of the Bill also provides that:
• when an instrument revoking a scheme that also operates interstate is published in the gazette, the Minister must give notice to the relevant interstate Ministers; and
• when the Minister receives notice that an interstate scheme that also operates in NSW has been revoked, he/she must publish a notice in the Gazette.
The process for the amendment and revocation of a New South Wales Scheme and the termination of an interstate scheme is similar to that for the approval of a scheme. That is, there are requirements for public notification and receiving of submissions, for the Council to consider a range of matters, and for gazettal.
Clause [16] of the Bill inserts a more comprehensive provision on the duration of schemes to cover both New South Wales schemes and interstate schemes which may operate in New South Wales.
Clause [19] of the Bill provides that for the purpose of dealing with a scheme that operates, or indicates an intent to operate, in both New South Wales and another jurisdiction, the Professional Standards Council may:
• in the exercise of its functions under the Act, act in conjunction with the Council of the interstate jurisdiction; and
• act in conjunction with the Council of the interstate jurisdiction in the exercise of that Council's functions under interstate PSL.
This Bill is supported by the Professional Standards Council. It is also supported by key professional bodies, including the Law Council of Australia, New South Wales Law Society, New South Wales Bar Association, and the National Institute of Accountants, which were consulted during the drafting of the Bill.
I commend the Bill to the House.
The Hon. JOHN AJAKA [3.09 p.m.]: The Professional Standards Amendment (Mutual Recognition) Bill amends the Professional Standards Act 1994 with respect to the mutual recognition of New South Wales and interstate schemes for the limitation of occupational liability. The bill is not opposed by the Coalition. It is part of an ongoing process initiated by the Standing Committee of Attorneys-General that will allow mutual recognition between jurisdictions of schemes approved in other jurisdictions. This process is sensible and inevitable because of the increasing synchronisation of legislation between the States and Territories.
The Professional Standards Act 1994 was introduced, first, to enable the creation of schemes to limit the civil liability of professionals and others; secondly, to facilitate the improvement of occupational standards of professionals and others; thirdly, to protect consumers of services provided by professionals and others; and, fourthly, to constitute the Professional Standards Council to supervise the preparation and application of schemes and to assist in the improvement of occupational standards and protection of consumers. Under the Act, there are eight schemes in New South Wales, covering accountants, legal practitioners, engineers, surveyors and valuers.
There is an ever-increasing tendency for the work of professionals in Australia to transcend State boundaries. Unfortunately, development in the work of professional practices has been hampered by excessive red tape. This is made worse when dealing with the red tape of differing States. This is something I am well aware of, having acted for many interstate clients on matters that were applicable in two or more States. The proposed changes before the House will allow professionals to seamlessly obtain capped liability outside their home jurisdiction and overcome the now cumbersome and inefficient system of having insurance in different States. The proposed amendments will cut red tape and allow for more efficient professional practices in New South Wales. This will help to create a system that is fairer and more consistent not only for the various professional bodies but, just as importantly, if not more so, for the consumers dealing with those professionals.
It is important to note that the other States and Territories will also need to introduce uniform amendments to ensure the improved efficiencies. I am pleased to speak on a bill that the Federal Attorney General successfully pushed for at a meeting of Attorneys General in April this year. Over the past 11 years the Federal Liberal Government has proved to be a champion of improved efficiency, which is evidenced by the resulting strong national economy. The bill is supported not only by the Federal Attorney General but also by the Professional Standards Council, the Law Council of Australia, the Law Society of New South Wales, the New South Wales Bar Association and the National Institute of Accountants. I am pleased to indicate that the Opposition does not oppose it.
Ms SYLVIA HALE [3.13 p.m.]: On behalf of the Greens, I support the bill. Professional standards schemes are generally in the interests of the community in that while they cap occupational liability they also put in place obligations for insurance, risk management strategies, and complaints and disciplinary procedures. With such schemes operating in different States and Territories, it is sensible to have mutual recognition of the schemes across the jurisdictions. The bill provides for safeguards when schemes based in other jurisdictions operate in this State, and provides a review mechanism when doubt is cast on the efficacy of such schemes. For those reasons the Greens support the bill.
Reverend the Hon. FRED NILE [3.14 p.m.]: The Christian Democratic party supports this bill, which is a machinery measure that will have a valuable impact when it brings into line the operation of professional standards schemes in all States. The legislation has been initiated by the Commonwealth, which has enacted complementary legislation, and this bill will be the New South Wales contribution to capped liability schemes, which will be approved in all States and Territories.
Professional standards legislation has been enacted in all States and Territories to improve occupational standards, protect consumers and enable professional standards councils to approve schemes that cap the occupational liability of their members. We support the bill, particularly as it is already supported by the Professional Standards Council and key professional bodies, including the Law Council of Australia, the Law Society of New South Wales, the New South Wales Bar Association and the National Institute of Accountants. For that reason the Christian Democratic Party supports the bill.
The Hon. JOHN HATZISTERGOS (Attorney General, and Minister for Justice) [3.15 p.m.], in reply: I thank honourable members for their contributions to the debate. I take this opportunity to address two matters raised by the member for Epping during debate on the bill in the Legislative Assembly on 29 May 2007, one of which was also raised by the Hon. John Ajaka today. First, the member for Epping raised concerns about the provisions in item [11] of schedule 1 to the bill. These provisions were inserted on the advice of Parliamentary Counsel to enable a mutual recognition regime to operate effectively on a national basis. They are necessary because States and Territories do not have uniform professional standards legislation, although they have largely consistent professional standards legislation. The provisions will ensure that schemes do not fail because of minor differences in State and Territory legislation.
Secondly, the member for Epping credited the Federal Attorney General with initiating mutual recognition reforms at the meeting of the Standing Committee of Attorneys-General [SCAG] on 12 April this year. Effectively, the Commonwealth is taking credit for reforms initiated by New South Wales. I place on record that it was in fact my predecessor, the Hon. Bob Debus, who placed the matter of mutual recognition on the agenda of the Standing Committee of Attorneys-General meeting in July 2006. I acknowledge, however, that once the matter was on the agenda the Commonwealth expressed support for the reforms. This bill is a result of State and Territory Attorneys General cooperating and working together through the Standing Committee of Attorneys-General to improve the operation of professional standards legislation on a national basis.
The amendments in the bill will be introduced by other States and Territories, thereby ensuring that the States and Territories continue to have nationally consistent professional standards legislation, and that there will be a more seamless national system of professional standards legislation. The bill recognises the realities of various markets for professional services which transcend State boundaries and enables the States and Territory professional standards councils, which have the same 11 members appointed to them, to act more effectively as a national council; and it cuts red tape and administrative and compliance costs for professionals and professional bodies. I note that a key priority of the Government's State Plan is to cut red tape and reduce the regulatory burden on businesses. This bill is entirely consistent with the Government's commitment in this area. It will ensure that consumer interests are protected by extending existing consumer protection measures to situations where a scheme is to apply in more than one jurisdiction. I commend the bill to the House.
Question—That this bill be now read a second time—put and resolved in the affirmative.
Motion agreed to.
Bill read a second time.

Third Reading

Motion, by leave, by the Hon. John Hatzistergos agreed to:

That this bill be now read a third time.
Bill read a third time and returned to the Legislative Assembly without amendment.