SCA (NZ) appeared in front of New Zealand Parliament’s Finance and Expenditure Select Committee to present its recommendations and potential changes to the draft Unit Titles (Strengthening Body Corporate Governance and Other Matters) Amendment Bill.

SCA (NZ) President Joanne Barreto and SCA (NZ) Vice-President Liza Fry-Irvine spoke for approximately 15 minutes to the select committee, outlining the key points from the SCA (NZ) and its members. Read our detailed submission with our recommended changes that were presented here.

The SCA (NZ) submission focused on four major themes, as well as recommending a vast array of technical changes to the Bill draft:

1.Electronic voting:
SCA (NZ) is supportive of the measures brought in to allow participation during COVID, which have had overwhelming support from managers and committee members and have increased participation and engagement. Our submission called for greater clarification and regulation around authenticating registration and managing participation of remote attendees, voting features within software such as Zoom or Teams and pre-meeting voting using software already available within current management platforms.

2. Mandatory requirements for medium and large complexes:
SCA (NZ) is pushing for the peer review of Long-Term Maintenance Plans (LTMPs) to be removed, clarification of what ‘defect’ means within the Bill and the ability for small bodies corporate to opt out of many onerous provisions. We are supportive of the need for smaller bodies corporate to have a manager, however we also support there being an opt-out mechanism. We recognize the legislation needs to cater for the broad spectrum of residential, commercial and mixed use complexes that fall within its mandate.

3. Regulation of Body Corporate Managers:
Managers should be recognised in legislation, as they play a vital role in body corporate management, and under the current Unit Titles Act, have been excluded altogether. Regulating managers will increase transparency, consumer protection and improve accountability and professionalism within the industry, something that SCA (NZ) has long championed and promotes as a core industry value. Towards this end, SCA (NZ) also advocated that the approximately 350 body corporate managers in NZ should be a member of an industry organisation and that organisation must have a code of conduct

4. Proxy appointments and votes:
The draft version of the Bill sets a requirement that only 5 per cent of votes for a meeting could be held by proxy, or only 1 proxy can be held by a person if the complex has under 20 units. This measure would be onerous and result in fewer quorums being reached and stunting the decision making power of bodies corporate. Anecdotally, our members have said at least 50 per cent of meetings would not reach quorum if this measure was introduced, and there have been few issues with the practice proxy stacking. In keeping with our remote meeting and electronic voting recommendations, greater participation brought about by extending this practice would go some way to resolving this issue.

In addition to these four themes, SCA (NZ) asked the Select Committee to look at some of the bigger picture themes facing the strata industry for the future, flagging a greater need for Act enforcement, clarity around short-term accommodation and exploring other minimum standards for strata managers in New Zealand.

There is general consensus in the industry on most of the changes needed to the UTA many of which are set out in the Bill, with some other additional changes which have been suggested. There can be a second phase where there is further consultation on other issues, but that should not delay the enactment of the Bill incorporating the feedback provided.

Towards this end, SCA (NZ) recommended that the government form a working group or taskforce to explore these bigger issues facing strata during this term of government with appropriate terms of reference and stakeholder participation.

Notify the Select Committee of your support for the SCA (NZ) submission:

How can you take action?
During its deliberations, the Select Committee will take note of all written support it receives for the Bill. The more written support the Committee receives the more likely the Bill will move forward with the edits requested by SCA (NZ) and other submitters. If you agree with the SCA (NZ) submission (see link above) we encourage you to send an email to fe@parliament.govt.nz endorsing our submission, recording you are a member of SCA (NZ), and noting your name/business name. Although submissions are technically closed, the Select Committee can resolve to accept late notes of endorsement. Thank you for your support.

We thanks those members who put in a huge effort in preparing these submissions.