Personal injury lawyers and the audit of the NSWTAG
22nd Jun 2023
I was part of the ALA delegation – including Victoria Roy, Joshua Dale, Roshana May, and Dr Andrew Morrison RFD SC – who raised concerns about the NSW Trustee & Guardian (NSWTAG) with the NSW Attorney-General, Shadow Attorney-General and Greens prior to the NSW election.
We expressed our dismay regarding changes in fees which had resulted in a large cohort of undercompensated injured people, also our longstanding concerns about inadequate government funding and poor levels of service impacting some of the State’s most vulnerable people.
Most ALA members Australia-wide are aware of similar problems with public trustees in all states and territories, based on client experiences and increasingly frequent media coverage.
NSWTAG performance audit
Our concerns have been reinforced after reading the recent NSWTAG performance audit published by the NSW Auditor General, ‘Managing the Affairs of People under Financial Management and/or Guardianship Orders’ (18 May 2023).
The report included some helpful statistics; as of 30 June 2022:
- The NSWTAG provided direct financial management and/or guardianship services to over 13,300 people who were deemed unable to manage their own affairs.
- The different types of disabilities and conditions of their direct financial management clients were (in descending order of prevalence) psychiatric, intellectual, age-related, brain injury, neurological, substance abuse and stroke.
- A very small percentage of their direct financial management clients were aged under 20 (approximately 2%), and the largest age group was 51-70 (nearly 40%).
- Over 6,200 people had private financial managers, all supervised by the NSWTAG.
The audit report makes clear that years of under-funding have left the NSWTAG without the systems or data to know if they are meeting legislated requirements and standards. Without the data to identify and quantify the costs of service provision, they struggle to prove whether their revenue is sufficient to meet these costs. They also struggle to know if some client’s fees are being used to subsidise other clients, something that is not supposed to be happening.
Despite the lack of detailed data, there is clearly a growing gap between the rate of growth in client numbers (and complexity) and government funding.
NSWTAG frontline staff have high caseloads and struggle with inadequate IT systems. It’s estimated that by 2026, only approximately 11 minutes a week (or 9.5 hours per year) can be devoted to all tasks associated with directly managing a client’s financial affairs.
The NSWTAG has no legislated authority, or funding, to provide financial coaching to help clients develop their financial literacy and skills, meaning those in the system have little opportunity to develop the skills to escape the system by proving capacity.
The audit recommends improving data collection as well as assessing staff competency and providing training. As with all organisations, effectiveness requires adequate skilled staffing and good technology – both cost money.
Growing numbers – particularly private management
A point made throughout the report is that the NSWTAG is intended to be the financial manager of last resort, but orders appointing them have steadily grown. Private management appointments are growing at an even faster rate.
Over the five years to 30 June 2022:
- The number of people who needed the NSWTAG to act as their direct financial manager increased by 8%.
- There was a 32% increase in the number of people who have private financial managers.
The point is made that the fees charged by the NSWTAG to privately managed clients do not cover the cost of the NSWTAG’s oversight role. Thus, some high-wealth NSWTAG direct clients may be subsidising this service. It also seems that the NSWTAG is not appropriately funded to properly guide, monitor, and supervise private managers.
Change is clearly needed and long overdue.
The NSWTAG has welcomed the report and notes that it will continue to work with Treasury to secure appropriate funding and particularly IT upgrades. They have apparently already started to include roles and teams focused on identifying opportunities for early discharges from orders and providing advice to the NSW Civil and Administrative Tribunal (NCAT) on their 'last resort' role, to divert some people from orders where there are other appropriate alternatives available.
The NSWTAG’s action plan involves consulting with stakeholders in Q2 of 2023–24, so I look forward to working with the ALA NSW Committee to provide input.
Financial management is hard enough for us all at the best of times, so it’s obvious that those without capacity need adequate support and service. The system needs to be fit for purpose. Lawyers and family members referring people into the system need to be assured of this. There is much work to do!
The ALA thanks Jane Campbell for this contribution.
|Jane Campbell is a financial adviser and former lawyer specialising in personal injury financial advice. She is the Principal of Aeran Pty Ltd and a longstanding NSW ALA Committee member.|
The views and opinions expressed in this article are the author's and do not necessarily represent the views and opinions of the Australian Lawyers Alliance (ALA).