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Community Scheme Reforms

Tuesday, 23rd September 2014

The NSW Government has released a position paper outlining its preferred approach to improving community scheme laws across NSW.

The NSW Government has released a position paper outlining its preferred approach to improving community scheme laws across NSW.

“The release of this position paper comes after extensive consultation over the past two years, which has resulted in a common-sense approach to modernising the operation of community schemes,’’ NSW Fair Trading Minister, Matthew Mason-Cox said.

“The position paper sets out a coherent and informed approach to meet the future needs of residents living in nearly 2200 community, neighbourhood and precinct schemes operating around the state.

“At the very heart of the package are measures that seek to better protect residents with a focus on ensuring transparency and accountability in decision-making.

“We are establishing a framework for community schemes that is modern, flexible and removes the onerous requirement to have all owners agree unanimously on decisions about their property.

“Special resolutions will be sufficient where a significant majority of owners are in agreement.

“Reforms to the Community Land Management Act and Community Land Development Act will establish new procedures to strengthen the rights of individual owners and enhance the democratic decision-making process supporting these schemes.

“We are maximising participation for residents and tenants, giving them greater ownership of the issues that count for their schemes.

“Our reforms will also strengthen responsible management of these schemes and create opportunities to provide more transparency and consistency in how these schemes operate.’’

The position paper outlines 58 proposed changes to the current laws including:

Helping community, precinct or neighbourhood associations understand their obligations and expenses involved in maintaining the property by requiring a builder or developer to provide a building maintenance schedule at the first AGM.

Limiting proxy votes to prevent an individual or small group controlling a scheme.

Streamlining the enforcement of by-laws to provide better means to penalise serial offenders, and enable recovery of enforcement costs.

“More than 25 per cent of the NSW population lives or works in strata and community schemes and by 2040 more than half of Sydney’s housing stock will be multi-unit dwellings,’’ Mr Mason-Cox said.

“Community schemes range from high-rise buildings to rural subdivisions with irrigation channels as association property, as well as large closed communities with private roads, high security and extensive recreational facilities such as marinas and golf courses.’’

Mr Mason-Cox said industry and community input had played a major role in informing the Government’s approach to the position paper.

“Extensive consultation underpins good public policy and the consultation process on these reforms has been comprehensive,” he said.

“Many people who live in these schemes, as well as industry groups have shaped our reforms, with NSW Fair Trading receiving more than 1,200 comments online and around 2,000 submissions on the 2012 discussion paper.

“Community scheme law reforms will be delivered as part of a package of building industry reforms concerning the multiple occupancy of buildings, strata, security of payments and home warranty insurance.

“Next steps include drafting of the Community Scheme Bills and further consultation on the draft legislation in the new year.’’

For more information, visit Fair Trading website.

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