The NSW Attorney General, Minister Mark Speakman, MP needs to review the exorbitantly high fees for surety bonds over managed estates of people with a disability, as the risk level of misappropriation of funds has not yet been established. Empirical evidence points to it being historically low and in the overwhelming majority of cases misappropriation does not happen.
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Minister Speakman’s justification for mandating this surety bond in NSW is that when a court or tribunal appoints a private manager and NSWTG is responsible for oversighting the decisions of a private manager, the community expects that if something happens to the protected person’s funds then there is a system in place to protect the privately managed person’s financial security. On first reading this appears quite reasonable, until one reads the FAQ relating to surety bonds.
The rational behind this FAQ document is purely to absolve the NSW Trustee and Guardian of any legal responsibility in being the body to appoint the financial manager. The FAQ information doesn’t answer any question a financial manager may have regarding how to claim, who claims and what benefits are payable for what level of misappropriation.
This document leaves a lot of questions unanswered e.g. does the NSWTG receive a financial benefit from this surety bond scheme?
NSW is the only state to make this surety bond mandatory, without a data driven basis for premiums. The high premiums appear to reflect the level of greed by the single provider, a multinational insurance company as a flat annual rate is set unrelated to any risk factor. Financial managers of the estate have no choice of insurance company and the estates of disabled people are being ripped off by this uncompetitive process.
For example I am a financial manager for my mother’s estate of a modest $300,000 the estate is paying $1,200 per annum for probably another 20 years without any benefit.
Colleen Carmody,
Port Macquarie