People on disability support and aged care pensions with assets will continue to be charged up to 40 per cent of their low incomes for financial administration services by the Public Trustee of Queensland, despite a report criticising the practice.
- The Public Trustee says a review on fees and charges is already underway but would not be completed for at least six months
- The government has not yet set a timeframe for when a board to oversee the Public Trustee will happen
- The opposition is calling for an independent audit of the Public Trustee
Queensland Attorney-General Shannon Fentiman tabled the Public Advocate’s report into the Public Trustee in state parliament earlier this month.
It documented high fees for asset-rich pensioners, fees for no service and charging multiple sets of fees on managing the same funds, like superannuation.
In response, the state government announced that a board would oversee the Public Trustee.
However, the government has not yet set a timeframe for when this would occur and what authority it would have.
The Public Advocate’s report also exposed routine profiteering from cash assets that were funnelled exclusively into the Public Trustee’s own investment products – something called the “interest differential”.
“The practice of directing all client funds into Public Trustee investments also means that the Public Trustee earns income and fees additional to the general Asset Management Fees it charges clients for providing administration services,” the report stated.
Trustee earns millions from clients’ assets
The report found that in 2019-20 alone, the Public Trustee kept $12.9 million in interest earnings from the cash assets of clients.
“The conflicts inherent in this funding arrangement appear to be incompatible with the duties and obligations of a trustee and fiduciary to not profit from its clients and to avoid conflicts,” it said.
Public Advocate Mary Burgess made 32 recommendations and in a statement responding to the report, Ms Fentiman said the majority of the recommendations were primarily the responsibility of the Public Trustee to implement.
One of the recommendations included changing the legislation to clarify when and how the Public Trustee could invest client funds.
Ms Fentiman did not say whether the government would review its legislation to determine whether profit was permissible under the Public Trustee Act, and she denied the report’s finding that the Public Trustee profits from financial administration services.
“A moratorium on fees and charges would impact on the Public Trustee’s ability to provide important services to vulnerable Queenslanders,” Ms Fentiman said.
She also said many of the reforms had already been implemented or were underway.
The Public Trustee said a review on fees and charges was already underway but would not be completed for another six to eight months.
The Public Trustee denied it made a profit.
‘At what point do we matter?’
Sue Nunn, who has a person close to her who has been under financial administration, said she was sickened by the way they had been treated.
Ms Nunn said her complaints and concerns about the Public Trustee had fallen on deaf ears.
The Guardianship and Administration Act prevents the ABC from disclosing anything that could identify a person under a financial administration order — something that critics said prevented them from speaking out.
The person Ms Nunn is advocating for is paying close to 40 per cent of a disability pension in Public Trustee fees for financial and asset management.
She said she was disappointed by the response of the state government to the Public Advocate’s report.
“At what point do we matter?” Ms Nunn said.
“How many people have to be gouged of their finances?
“How many people have to lose everything they have, before we become important, and before it’s enough to say ‘stop, things need to change’.”
Ms Nunn said she had lost count of the number of complaints she had made to assorted government bodies and ministers, and in her view, Ms Fentiman had downplayed the extent of the issues in her response to the parliament.
‘Getting money at any cost’
Steven Collins is another person with multiple family members who either are, or have previously been, under financial administration.
Mr Collins said he had observed questionable financial decisions being made for a family member, including trying to sell their house for more than it had been valued.
He claimed the family member was moved into rental accommodation that was costing more per week than the mortgage repayments had been.
The person was moved back into their house when it had not sold.
The same family member was being given just $100 a week to live on at one stage, once the Trustee had extracted its fees and charges.
Mr Collins said when he started advocating on his family members’ behalf, and asking questions of the Public Trustee, they stopped responding.
“The letter I got back from them was actually quite appalling — it was a generalised, bureaucratic letter, and it really didn’t get into the heart of any of the questions I asked,” Mr Collins said.
“From there, they really stopped talking to me and wouldn’t communicate with me from then on out.”
‘Public Trustee continues to milk those clients’
Shadow attorney-general Tim Nicholls is now calling for an independent audit of the Public Trustee, and for the legislation that governs it to be either rewritten or amended substantially.
“It’s really the case that the report has been done, the government has looked at it, and then handed it to the Public Trustee and said, ‘You solve your own problems’,” he said.
“There’s no clarity about the [fee] review and what the changes are likely to be.
“The Public Trustee continues to milk those clients for every cent under a flawed system that sees the most disadvantaged people paying more and getting less.”