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Annual Report 2011/2012 Professional Standards Councils



Annual Report 2011/2012 Professional Standards Councils

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Tabled paper 112


Tabled Papers for 12th Assembly 2012 - 2016; Tabled Papers; ParliamentNT






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Professional Standards Council

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C o u n C ilS 11Professional Standards Councils Annual Report 201112 ISSUES AND ChALLENgES The COST Of prOfeSSIONAL INdeMNITy INSurANCe IS LIkeLy TO rISe Australias rate of inflation has fallen to its lowest level since the global financial crisis, giving rise to the expectation that the Reserve Bank will continue to cut the cash rate. Consequently, the cost of professional indemnity insurance (PII) has risen. Specialist advisers, such as private bankers, financial planners, engineers, accountants and lawyers, are required to carry PII insurance in the event a financial loss to a client occurs. The Councils continue to assess the impacts. COrpOrATe INSOLVeNCIeS CONTINue TO INCreASe ASIC has reported that corporate insolvencies have increased by 9.2 per cent from the previous year. The problem appears to be so serious that ASIC has a set up a new commission to deal with the issues. What this means for the Councils is that the demands for and expectations on our schemes will be higher than before. federAL TreASury reASONAbLe AMOuNT The Commonwealth Government has made the decision not to prescribe any professional standards schemes under the Australian Securities and Investments Commission Act 2001 or the Corporations Act 2001. The Government made this decision due to the potential conflict of professional standards schemes liability caps with the approach that the financial services regulatory regime has taken, particularly the requirement on financial services licensees to have adequate compensation arrangements in place, which includes having adequate PII. The OPSC is still assessing the impact that this decision will have on its schemes. expANdINg The SCheMeS COVerAge A key challenge in the future will be to expand the coverage of the schemes to a broader range of occupational bodies. A key focus over the next 12 to 18 months will be to maintain strong relationships with both existing and new stakeholders through increased communications activity and implementing business development strategies. prOCureMeNT AgreeMeNT Competing needs of a federated procurement arrangement continue to create challenges for the Councils in their attempt to meet Statespecific requirements. The purpose of the Procurement of Services Agreement and the Inter-Departmental Services Agreement (see page 19) is to ensure that the Councils have the secretariat services and support they need to carry out their functions under the relevant professional standards legislation. The requirement to renew these agreements every two years will be considered as part of the next review of the agreements. pAperLeSS OffICe hIghLIghTS ISSueS Of rApId IT ChANge With Councils moving to a system of electronic papers (rather than hard copies), it highlights the need for a policy that minimises the security issues. C o u n C ils