Page 176 - Week 01 - Thursday, 15 February 1990
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also give encouragement to newly established and reputable building societies by allowing them to be approved for trustee investments.
The Bill provides amendments to the Trustee Act 1957, which regulates the activities of trustees, including how they invest trust funds. It is essential that we have such laws so that those who manage the financial affairs of another person, on a trustee basis, do so in a responsible manner.
Under the law as it now stands, a trustee may invest in only a building society which is approved by the Minister, being the Attorney-General, by notice in the Gazette; has carried on business in the Territory for a period of not less than 10 years; has withdrawable funds of not less than $50m; and, finally, has, to the satisfaction of the Minister, complied substantially with the Co-operative Societies Act 1939 during the immediately preceding period of five years.
The amendments in the Bill will remove the 10-year rule while retaining measures to protect trustee investments. For example, a newly established building society will not be approved for trustee investment status unless it can furnish an irrevocable undertaking of $50m which is issued by another long established and reputable building society. This measure will ensure that, as far as possible, trust funds are protected.
Clause 3 of the Bill contains a proposed new subsection (2AA) which permits that undertaking, which is similar in effect to a guarantee, to be given by a building society located either in the ACT or elsewhere. The proposed new subsection (2AA) stipulates the requirements that must be satisfied by a building society before its undertaking is acceptable.
This Bill is neutral in terms of revenue and expenditure. It is only a minor Bill but it will allow useful changes to this area of trustee investment.
Question resolved in the affirmative.
Bill agreed to in principle
Leave granted to dispense with the detail stage.
Bill agreed to.
TAXATION (ADMINISTRATION) (AMENDMENT) BILL (NO. 3) 1989
Debate resumed from 23 November 1989, on motion by Ms Follett:
That this Bill be agreed to in principle.
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