Strata manager’s licensing to monitor professionalism and quality

Only a few weeks ago, SCA (Qld) celebrated its 30th anniversary as the peak Queensland industry body for strata professionals with 190 members and partners.

Setting the celebration night as a masquerade gala ball, we have exceeded all expectations with our event that gave us an opportunity to reminisce and reflect on the history of our sector and award life membership to three of our long serving members. Colin Archer, Ros Janes and Kay Trimble have been active board and committee members for two to three decades having contributed significantly to building a solid foundation for SCA (Qld) to work from. Their achievements have made us a strong organisation that represents 25% of Queenslanders who live and work in strata communities.

The landmark event of turning 30 provides an opportunity to reflect on the tremendous changes that the strata industry has gone through and to have a look at issues that have been on the agenda for a long time. It is no surprise that the Department of Justice has announced a comprehensive Property Law Review as lifestyle living is clearly a future trend. The last ten years have been a decade of significant change in terms of legislation affecting strata communities. The building codes, the work place health and safety, pool safety laws, and fire safety have all left a mark on our work lives.

Interestingly, in the past 30 years there is one ambition that our initial organisation, The Body Corporate Manager’s Institute of Queensland, then the Community Titles Institute of Queensland and now Strata Community Australia (Qld) has been pushing for: a positive licensing scheme for body corporate managers. In 2007 the Council of Australian Governments announced the harmonisation of licensing for specified occupations. In the first instance lots of work from the states and national went into clarifying that body corporate management is in fact not real estate agents’ work and that licensing is to be considered separately. For the past six years through many delays and numerous meetings attended by national representatives, the final recommendations were delivered in August and SCA (Qld) has reiterated its support for a positive licensing regime. SCA (Qld) has pushed for the move in order to create a regulation and minimum education requirement in order to mitigate the financial mismanagement and to protect the strata sector.

The submission included details showing the quite high proportion of Australians that are impacted by the strata management industry, the amount of money that is controlled by strata managers in the sector and the fact that, from a consumer protection perspective, there is no licensing of strata managers in most jurisdictions in Australia. A licensing scheme will increase accountability in the body corporate sector. However, it may also be an increase in ‘red tape’ that could make a body corporate manager’s role unnecessarily complicated.

We would like to see the industry take ownership of a licensing scheme through self-regulation of professional standards, accreditation and continuing education. SCA (Qld) is in an ideal position as an industry-leading body to support a licensing scheme in Queensland with education and training. We have been the peak industry body for almost 30 years and our members currently manage the majority of the Queensland strata industry with 270,000 lots under management.

Body corporate managers play an incredibly important role in strata communities, and it is important that they meet certain professional requirements. If SCA (Qld) was given the green light to roll out a registration scheme, body corporate managers and their staff will need to meet our membership requirements, including holding a Certificate IV in Property Services (Operations); having professional indemnity insurance; and complying with the legislation Code of Conduct and the SCA (Qld) Code of Conduct which they sign upon joining along with national responsibilities. These three requirements are in place to protect both bodies corporate and residents, be they an owner or tenant. Licensing of strata managers across all the states and territories will provide a reliable register of strata managing agents across the country, the number of which is largely unknown because of the current lack of any form of licensing in the majority of the states. We know that the combined total of funds held on behalf of 277,000 schemes Australia wide exceeds $4 billion in an average daily balance, with Queensland’s share being over $1 billion (25% of the body corporate national totals).

Even a small boutique strata management firm may hold millions of dollars on behalf of the body corporate that it manages at any one time and it is ludicrous to think that the strata managers are not registered or licensed in dealing with this amount of money. The benefits of regulation and licensing will outweigh or neutralise the costing associated with non-regulation of the strata industry in Queensland.

The cost of licensing does not need to have a significant impact on either government or the strata manager. The strata industry in Queensland with billions of dollars of assets under management and hundreds of millions of body corporate fees held in trust is the third biggest state industry in Australia – and not having a regulatory foundation is a major gap in the consumer protection framework in Queensland.

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