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<br><P><A name=_Toc25329010></A></P><B><SPAN style="FONT-SIZE: 14pt">
<P> </P>
<P>May 2003</P>
<P align=center></P>
<P align=center>A NATIONALLY CONSISTENT PROFESSIONAL STANDARDS LEGISLATION ("PSL") REGIME</P></B></SPAN></B>
<P align=center></P><B>
<P align=center>Recommendations for implementation by 1 January 2004</P>
<P align=center>on behalf of Australia’s professions</P></B>
<P align=center></P>
<P>The April 2003 Perth meeting of Government Ministers responsible for insurance issues agreed to examine a package of reforms to dramatically improve the availability and affordability of professional indemnity insurance.</P>
<P>Together with a Commonwealth commitment to make appropriate amendments to the Trade Practices Act, Ministers agreed to develop both a nationally consistent model for proportionate liability and nationally consistent Professional Standards Legislation ("PSL").</P>
<P align=justify>Several professions have experience with PSL in NSW. Drawing on that, this paper recommends the key elements required to implement nationally consistent PSL by 1 January 2004.</P><B><U>
<P align=justify></P></B></U>
<TABLE cellSpacing=1 cellPadding=7 width=611 border=1>
<TR>
<TD vAlign=top bgColor=#c0c0c0><B><U>
<P align=justify>10 KEY POINTS </P>
<UL></B></U>
<LI>Simplicity, uniformity and consistency are required to ensure the consumer benefits provided by PSL are delivered across all jurisdictions.</LI>
<LI>A nationally consistent PSL would be implemented by an inter-governmental agreement, annexing agreed principles based on the existing PSL with consistent legislation enacted in each State and Territory.</LI>
<LI>A Professional Standards Council ("PSC") would be appointed in each State and Territory to approve schemes and oversee their operation, answerable to the relevant Ministers in each State and Territory.</LI>
<LI>Each PSC will comprise the same members. There will only be one nominee from each State and Territory with agreement by the Ministers to appoint the other Ministers’ nominees.</LI>
<LI>Applications for a scheme will be made by professional bodies on behalf of their members in each State and Territory.</LI>
<LI>It is expected that each profession will submit uniform schemes on behalf of their members.</LI>
<LI>Each Attorney-General will remain the Minister responsible for authorising the schemes in each State and Territory following approval by the PSC.</LI>
<LI>Once the scheme is approved for a professional body it will apply to all members with only limited exemptions.</LI>
<LI>The PSC will ensure that schemes remain consistent and uniform.</LI>
<LI>The PSC and the PSL schemes will be fully funded by the professional bodies and their members.</LI></UL><B>
<P align=justify></B></P></TD></TR></TABLE><B><U>
<P align=justify> </P>
<P align=justify>HOW TO IMPLEMENT A NATIONALLY CONSISTENT PSL BY 1 JANUARY 2004</P>
<P align=justify></P></B></U>
<TABLE cellSpacing=1 cellPadding=7 width=619 border=1>
<TR>
<TD vAlign=top bgColor=#c0c0c0 colSpan=2><B>
<P align=justify>The Five Step Strategy</B></P></TD></TR>
<TR>
<TD vAlign=top width="14%" bgColor=#c0c0c0><B>
<P align=justify>Agree</B></P></TD>
<TD vAlign=top width="86%" bgColor=#c0c0c0>
<P align=justify>The Inter-Governmental Agreement.</P></TD></TR>
<TR>
<TD vAlign=top width="14%" bgColor=#c0c0c0><B>
<P align=justify>Adopt</B> </P></TD>
<TD vAlign=top width="86%" bgColor=#c0c0c0>
<P align=justify>Enact legislation in each State and Territory based on the existing PSL.</P></TD></TR>
<TR>
<TD vAlign=top width="14%" bgColor=#c0c0c0><B>
<P align=justify>Appoint</B></P></TD>
<TD vAlign=top width="86%" bgColor=#c0c0c0>
<P align=justify>Establish a PSC comprising the same members.</P></TD></TR>
<TR>
<TD vAlign=top width="14%" bgColor=#c0c0c0><B>
<P align=justify>Amend</B></P></TD>
<TD vAlign=top width="86%" bgColor=#c0c0c0>
<P align=justify>The <I>Trade Practices Act</I> and other appropriate State and Federal Legislation.</P></TD></TR>
<TR>
<TD vAlign=top width="14%" bgColor=#c0c0c0><B>
<P align=justify>Arrange</B></P></TD>
<TD vAlign=top width="86%" bgColor=#c0c0c0>
<P align=justify>Arrange for the PSC to be funded by the professional bodies.</P></TD></TR></TABLE><B><U>
<P align=justify>AGREE</P></B></U>
<P align=justify>The inter-governmental agreement would contain provisions dealing with:-</P>
<OL type=i>
<P align=justify>
<LI>the agreed principles, based on the existing PSL, of the nationally consistent PSL;</LI>
<P align=justify>
<LI>the administrative arrangements and composition of the PSC operating nationally;</LI>
<P align=justify>
<LI>the functions of the PSC operating nationally;</LI>
<P align=justify>
<LI>how the legislation will be introduced in each State and Territory;</LI>
<P align=justify>
<LI>procedures for requests by a jurisdiction to amend or vary the PSL and schemes operating under that legislation;</LI>
<P align=justify>
<LI>procedures relating to the enactment of regulations and rules across each State and Territory;</LI>
<P align=justify>
<LI>procedures for periodically reviewing the PSL legislation and schemes; </LI>
<P align=justify>
<LI>procedures for varying the inter-governmental agreement; and</LI>
<P align=justify>
<LI>dispute resolution.</LI></OL><B><U>
<P align=justify> </P>
<P align=justify> </P>
<P align=justify>ADOPT</P></B></U>
<P align=justify>Each jurisdiction would enact legislation based on the existing PSL, pursuant to the agreed principles in the inter-governmental agreement. </P>
<P align=justify>This approach will provide the essential features of <B>uniformity</B> and <B>consistency,</B> and is <B>simple</B> to implement. It accommodates the fact that PSL legislation already exists in two States. It will also ensure that the consumer benefits provided by PSL are consistently delivered, and that "forum shopping" will not occur.</P><B><U>
<P align=justify>APPOINT – THE PSC</P></B></U>
<P align=justify>Each State and Territory Attorney-General would appoint one nominee to be a member of the PSC. The Commonwealth may also choose to appoint a nominee. To give effect to the national approach, each Minister will then agree to appoint each other’s nominees as well as the Commonwealth nominee. The PSC may therefore consist of 8 or 9 members.</P>
<P align=justify>Operating as a single council, the members would elect a chair and deputy chair and the Council will operate following the existing PSC model. </P>
<P align=justify>Submission by professional bodies of the same scheme or one scheme to cover all States and Territories will ensure consistency and reduce the likelihood of one scheme being preferred over another. Applications will be made by professional bodies. If the scheme is approved, it will apply to all members of the association with only limited exceptions.</P><B><U>
<P align=justify>AMEND</P></B></U>
<P align=justify>The Law Council has already proposed amendments to the <I>Trade Practices Act </I>which will give effect to a nationally consistent PSL.</P>
<P align=justify>The proposal for nationally consistent PSL will necessitate some minor amendments to the New South Wales and Western Australian PSL.</P>
<P align=justify>Other legislation which may need amendment includes the State<I> Fair Trading Acts, Victorian Legal Practice Act, Queensland Law Society Act,</I> the <I>Commonwealth Corporations Act </I>and the <I>Australian Securities and Investments Commission Act (there may be other Commonwealth Acts affected).</P></I><B><U>
<P align=justify>ARRANGE - FUNDING</P></B></U>
<P align=justify>Rather than be funded by governments, the PSC and schemes approved under the PSL will be funded by the professional bodies and their members, as already occurs in NSW and WA. This self-funding co-regulatory arrangement should prevail in all States and Territories. </P>
<P align=justify> </P>
<P align=justify>For further information: </P>
<P align=justify>Dr David Stephens, Professions Australia, Ph. 02-6251 5842, 0413 867 972</P>
<P align=justify>May 2003</P>
<P align=justify></P>
<P>Professions Australia (<A href="http://www.professions.com.au/">www.professions.com.au</A>) is a national organisation of professional associations. It represents a coalition of professions supporting indemnity insurance reform and professional standards legislation.</P>
<P>Contact: 02 6257 6100 or <A href="mailtpolicy.consultant@professions.com.au">policy.consultant@professions.com.au</A>. </P>
<P align=justify></P>
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