President’s Report Neville Sanders, President REIV
Proposed changes threaten to strangle agents with red tape
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he move to national licensing of real estate agents is an issue of vital importance to the profession in Victoria. It should not be rushed; as much consensus as possible between government and the profession before implementation should be the goal. So far, that consensus has not been achieved. There are many hurdles to overcome on key issues such as conduct harmonisation and ensuring any new system does not create extra and unnecessary red tape. The reform proposals overseen and released by the Council of Australian Governments in July this year were a bitter disappointment to the industry and were condemned by the REIA on behalf of real estate agents nationwide. In September, a report on their potential impact – the Decision Regulation Impact Statement: Proposal for National Licensing for Property Occupations – was released. There were some improvements; for example, the plan to deregulate non-residential sales has been abandoned, but the reform proposals are still not good enough. The REIV represents more than 2100 estate agencies, employing more than 10,000 people. Although we support a move to a national occupational licensing system which improves mobility and efficiency for agents, we will not support a flawed system which creates problems for our members. Outstanding problems must be resolved to ensure efficiency actually improves, before the proposals are implemented. Otherwise, we are likely to see a system creating as many problems as it solves and requiring amendment after its introduction. Among the problems is the separation between licensing and conduct harmonisation. Conduct relates to issues such as trust accounting, standards of behaviour, rights to commissions, conduct of auctions and information requirements. At present,
these are governed by many pieces of legislation with inconsistencies between states and territories. How can a single licence operate efficiently and effectively in such circumstances? While the national licence would supposedly ease mobility for agents, we already have mutual recognition between states and most agents move upwards within a state, rather than across borders.
Why include us with gasfitters, plumbers and airconditioning installers when a move to the second tranche would include us with related occupations such as valuers and conveyancers? For those who do move states, introducing a national licence without reforming the conduct laws means they still must be aware of differences between legislation from state to state. We believe conduct harmonisation must be dealt with concurrently with national licensing and that the National Occupational Licensing Authority (NOLA) has overstated the supposed productivity benefits of increased mobility.
We also believe the proposals have no net economic benefit for Victoria. Instead of our present single licence, enabling agents to sell across sectors, multiple licences will be introduced – extra costs and extra red tape for Victorian agents. Interstate labour mobility is presented as a key basis for the reform, without considering the loss of mobility from changing the Victorian single-licence structure to a multiple licence. The timeline for the introduction of the first wave of national licensing reforms was overly optimistic – NOLA has conceded this. Also, the inclusion of property occupations in this first wave makes no sense. Why include us with gasfitters, plumbers and airconditioning installers when a move to the second tranche would include us with related occupations such as valuers and conveyancers? This would provide time for outstanding issues to be resolved, including finalising conduct harmonisation, working for consensus between NOLA and the industry and alignment of property services in the various states. This includes tackling the issue of licences for business broking, for which it is necessary to be a fully qualified agent in Victoria, but for which a lower-level licence is available in other states. The current plans would give Australia a flawed, one-size-fits-all scheme, described by the REIA as a “lowest common denominator of a scheme” designed to meet an arbitrary bureaucratic timetable. Not only is substantial redrafting required to avoid extra red tape and the loss of the excellent Victorian single-licence system, more realistic cost-benefit analysis is required as is concurrent handling of the issue of conduct harmonisation. The Estate Agent ❘ December 2013
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12/10/13 6:08 PM