Thursday – 5 December 2024

Today the Board of the Public Trustee has been advised by Government that following an independent review to determine the most appropriate governance structure for the delivery of the Public Trustee’s non-commercial services, that the government has accepted the recommendations of the review.

The report concluded that the current GBE structure is not appropriate for the Public Trustee, primarily because the commercial objectives of the Government Business Enterprise Act 1995 are considered to be incongruent with the provision of services to vulnerable Tasmanians.

The Board remains committed to doing what’s right for our clients, our staff and the community and will continue to work constructively as Government decides on the future structure of the Public Trustee.

The Board would like to acknowledge the work undertaken by Alicia Leis and WLF.  The Board provided a submission to the review, which considered the entire range of the Public Trustee’s services to Tasmanians and outlined the benefits of the current Government Business Enterprise (GBE) model as fit-for-purpose to deliver social and economic obligations to the Tasmanian community. 

The Board notes that the review’s terms of reference were narrow in scope and assumed that the will, estate and trustee services of the Public Trustee would be transferred to the private sector.  

The Board is of the view that the recommended alternative structure for consideration is very similar to the Public Trustee’s existing structure yet comes at a significant cost in terms of expense, government disruption to the organisation and to the clients it supports.

Importantly, the broader impact on the Tasmanian community of a change to the Public Trustee structure includes disruption to client services, reduced capacity for service delivery, increasing demand on the court system and Tasmanian Civil and Administrative Tribunal (TASCAT), demands on the private sector for wills and estates services and increased costs of transition. Therefore, to avoid the costs to government and disruption to client services, it is the very clear view of the Board that the GBE model should be retained, as it provides all necessary accountability mechanisms for the Public Trustee and is fundamentally best placed to serve the needs and interests of our clients and the community. Furthermore, the Board is confident in the Public Trustee’s ability to deliver on all aspects in an efficient and effective manner.

The Public Trustee’s corporate plan and values focus on quality client-focussed services to meet the needs of Tasmanian community, through respect for our clients, and open, honest and ethical service delivery. Profit, or dividend is not the sole driving motivation of the Public Trustee’s operations. The economic and social objectives for the State met by the Public Trustee is to offer services for all Tasmanians, regardless of their situation, to support the growing needs of the community. (Governance of the Public Trustee)

In the past, the outdated Community Service Obligation (CSO) thresholds and long-standing funding shortfall, has led to significant resource constraints and restricted economies of scale being achieved, negatively impacting the client experience and creating unmanageable workloads for frontline staff.

In line with the Bugg Report recommendation for Government to fully fund CSO obligations in 2021, the 2024-25 State budget now provides the additional CSO funding recommended to underpin the Public Trustee’s new client focused model of service. The Public Trustee’s employees are resourced and supported to meet the expanded legislative obligations and provide quality services in line with the organisation’s updated Ministerial and Client Service Charters.

The Public Trustee’s positive transformation has been driven by Board autonomy with strong leadership, and professional experience, culture and change management, which has produced outstanding results to date.  This transformation has been acknowledged by clients, stakeholders and the community.

The recent unexpected announcement by Government to restructure the Public Trustee has created great uncertainty for the clients, supporters, stakeholders and staff of the Public Trustee. 

A restructure of the organisation at this stage would disrupt the Public Trustee’s positive momentum of achievements, destabilise the organisation and jeopardise performance in the immediate to medium term, directly impacting on the recently improved client experience. Privatisation of commercial services is not in the interests of the community, as all Tasmanians deserve cost effective options for the provision of independent executor, trustee and attorney services – the role of Public Trustees around Australia.

Many of the changes we have implemented in recent years have been co-designed by stakeholders representing the community sector and vulnerable Tasmanians.   It is vital that before the Government makes any decisions about the future of the Public Trustee that it engages directly with these stakeholders to fully understand the impact of any proposed changes on the community and the clients we serve.

It is the Board’s view that the restructure would achieve very little in terms of governance. Clients would be better served if the Public Trustee is allowed to continue its transformation and focus its energy and resources on finalising recommendations from the Bugg Report, Office of the Economic Regulator (OTTER) Report and important client reforms from the Disability Royal Commission.

Public Trustees across Australia all recognise and are preparing for the impending peak in demand for trustee services over the next 20 years. Growth in the ageing population represents the biggest intergenerational wealth transfer in Australian history, with one in six people over 65, a 52% increase since 2009, (ABS 2022).

Rates of disability and dementia are also increasing, with Tasmanians having the highest rate of disability – 26% compared to 18% nationally, (ABS 2015). Tasmania is expecting a 56% increase in people living with all forms of dementia by 2054.^[1]

With significant reforms already implemented, a focus on future strategic opportunities and implementing the remaining recommendations from OTTER, it is projected that the Public Trustee’s operations are entering a future growth phase. In its current structure, through growing revenues and improving efficiencies, the Public Trustee will continue to defray the costs of delivering important Community Service Obligations for vulnerable Tasmanians into the future in addition to providing a financial dividend to the State.

Importantly, the future effectiveness of the Public Trustee is protected by the existing GBE model, by ensuring the provision of important and essential services including acting as an ‘independent’ executor, attorney and trustee at an affordable price to all Tasmanians not otherwise provided by the private sector. This model offers the ability to adapt to demand and regulate the service provision through the offset of CSO costs and public oversight.

The Board remains committed to doing what’s right for our clients, our staff and the community and will continue to work constructively as Government decides on the future structure of the Public Trustee.

[1] Dementia Australia (2024) 2024-2054 Dementia Prevalence Data Estimates and Projections – All forms of dementia.