Lee Melissa: Securities Trustees and Statutory Supervisors Bill — First Reading 
Lee Melissa: Securities Trustees and Statutory Supervisors Bill — First Reading 
[Volume:661;Page:9726] 
MELISSA LEE (National) 
: 
 It is a pleasure to speak in support of the Securities Trustees and Statutory Supervisors Bill and I would like to congratulate the Minister of Commerce the Hon Simon Power. As all sides of the House agree this is an important bill and I am glad that the Opposition supports it. 
I start by making the observation that I find it quite ironic that the chairperson of the Commerce Committee the Opposition member the Hon Lianne Dalziel complained about the time it has taken for this bill to come to the House. I find it ironic in the sense that the previous Labour Government had been in power for 9 years when the finance company failures happened and I believe it was she who was the Minister of Commerce at the time. 
This bill is about accountability. It requires corporate trustees and certain statutory supervisors to be licensed thereby improving the quality of corporate trustees’ supervision. The Securities Trustees and Statutory Supervisors Bill is intended to protect investors’ interests and enhance market confidence by enabling the Securities Commission to hold trustees and statutory supervisors accountable for failing to perform effectively. It will be an offence to act as a trustee or statutory supervisor without a licence. If I can use the words of my colleague John Boscawen it is about beefing up the Securities Commission. 
We need to build the trust in capital markets of mum and dad investors as it has been severely dented by finance company failures and the global recession. This bill is an important part of achieving that. This bill is about making sure that people are competent for the job they are doing and are improving their performance and it enables the Securities Commission to hold them accountable for any failure to act according to the expected standards. This new licensing regime will apply to trustees of debt securities unit trustees and statutory supervisors of certain collective investment schemes and retirement villages. The Securities Commission will administer the new regime granting licensing applications and receiving mandatory reports from licensed trustees and statutory supervisors. The commission will have more power to require information from trustees and to direct them to act in emergency situations. Retirement village statutory supervisors have been included as recognition of the similar role they play to trustees of investment products in monitoring the financial position of retirement villages. 
The bill improves the accountability of trustees and statutory supervisors and the commission will be able to seek pecuniary penalties and compensation orders on behalf of investors against trustees and statutory supervisors who have breached their obligations. This bill also makes it an offence for failing to comply with the commission’s directions which include providing information about the trustee statutory supervisor or issuer. Maximum penalties will range from $100000 to $200000. It will be an offence for a person to act as a trustee statutory supervisor or unit trustee without an appropriate licence and he or she is liable to pay a fine of up to $300000. 
The bill makes detailed provisions for licence holders to report at regular intervals to the commission—that is between 6 and 12 months from when the licence is issued and once every 6 months thereafter. This monitoring system will be put in place to protect the interests of investors and make sure they have confidence in our financial markets. To me that is fantastic news especially given the financial climate that has been before us. 
These changes are part of the Government’s comprehensive reform agenda in the financial arena which also includes work around financial advisors moratoria regulation auditors and the Government’s action plan for responding to the report of the Capital Market Development Taskforce. Many in the Korean community lost a lot of money during the financial crisis and the finance company failures and I am sure they will feel a sense of relief that this National-led Government is doing something about it. This is a great bill and it is an important bill. I commend it to the House.