{"id":712589,"date":"2026-06-03T12:56:13","date_gmt":"2026-06-03T12:56:13","guid":{"rendered":"https:\/\/www.newsbeep.com\/au\/712589\/"},"modified":"2026-06-03T12:56:13","modified_gmt":"2026-06-03T12:56:13","slug":"victoria-strata-laws-apartment-owners-lash-out-at-state-governments-failure-to-ban-insurance-commissions-and-kickbacks","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/au\/712589\/","title":{"rendered":"Victoria strata laws: Apartment owners lash out at state government\u2019s failure to ban insurance commissions and kickbacks"},"content":{"rendered":"

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Apartment and townhouse owner advocates have lashed a long-anticipated state government blueprint to overhaul Victoria\u2019s strata sector, saying it \u201cinsults the intelligence of apartment owners\u201d.<\/p>\n

While the government response to the independent expert panel review into the Owners Corporations Ac<\/a>t drew a furious reaction from lot owners on Wednesday, the corporate strata management industry warmly welcomed the changes, praising the state for holding back on insurance commission<\/a> bans.<\/p>\n

\"ApartmentApartment owners have criticised Victoria\u2019s long-awaited strata overhaul.Dan Peled<\/p>\n

Susan Chandler, general manager of Strata Community Association Victoria \u2013 the lobby group for professional strata management firms \u2013 backed the government\u2019s decision to pause a recommended ban on lucrative insurance commissions and broker fee sharing until more research was done.<\/p>\n

\u201cSCA (Vic) has consistently advocated that the focus of reform should be on transparency, informed consent and consumer choice, rather than an outright prohibition on any particular remuneration model,\u201d Chandler said. \u201cWe therefore welcome the government\u2019s decision to undertake further market impact analysis before making a determination.\u201d<\/p>\n

The expert review<\/a> \u2013 carried out by former Labor consumer affairs minister Marsha Thomson, economist Karen Chester and prominent strata lawyer David McKenzie \u2013 was given to the government six months ago and made 51 recommendations.<\/p>\n

The government, in its response<\/a>, supported 17 of the 51 in full. The rest were either categorised as supporting \u201cin part\u201d, \u201cin principle\u201d or not at all.<\/p>\n<\/p>\n

On Wednesday, the government introduced legislation to parliament to enact a first tranche of changes, including giving unit owners struggling to pay their owners\u2019 corporation fees a standardised right to a payment plan.<\/p>\n

The new laws will also lower the threshold for enforcement of basic rules in owners\u2019 corporations from 75 per cent of all owners in a building<\/a> back to 50 per cent or a simple vote of the smaller appointed committee, and loosen the voting threshold for owners to sell an older building for redevelopment.<\/p>\n

However, among the 34 recommendations not fully committed to or those the state wants further time to consider were major ticket items owners\u2019 advocates have long called for, including banning insurance commissions and other kickbacks, and banning developers and strata managers from harvesting proxy votes.<\/p>\n

Advocates have also long called for an independent strata commissioner, matching NSW. Instead, the review proposed a new dedicated unit set up within Consumer Affairs \u2013 a recommendation the government said it was open to but was subject to funding.<\/p>\n

On Wednesday, The Age pressed Consumer Affairs Minister Paul Edbrooke \u2013 who has been in the portfolio for only six weeks \u2013 on how Consumer Affairs Victoria (CAV) could be trusted to be the watchdog for strata. The expert review explicitly laid out how CAV had failed to execute a single enforcement measure, laid zero charges, and cancelled no strata manager registrations since 2019, despite nearly 1000 complaints and requests for help from owners each year.<\/p>\n

Related Article\"Strata<\/a><\/p>\n

In response, the minister claimed there was \u201cno evidence\u201d the regulator was failing.<\/p>\n

He argued that a gentle \u201ccarrot instead of the stick\u201d approach sufficed because \u201cmost OCs [owners\u2019 corporations] are doing the right thing\u201d \u2013 seemingly mixing up volunteer owners\u2019 corporation committees with the multi-million-dollar commercial management firms accused of rorting them.<\/p>\n<\/p>\n

Financial Counselling Victoria said while payment plans were welcome, the review and the government response had left severe regulatory gaps that allowed commercial agents to slap in indiscriminate \u201clate and administrative\u201d fees and charges onto owners\u2019 levies.<\/p>\n

The organisation cited a case where a Melbourne apartment owner had a $1500 administrative penalty fee tacked onto a basic $3000 arrears notice. Many such fees have been ruled unlawful<\/a> by VCAT on multiple occasions, but continue to be issued.<\/p>\n

Owners\u2019 advocates warn that strata living is unlikely to get any cheaper for Victorians, citing a failure to rein in kickbacks and tackle unlawful fees.<\/p>\n

\u201cThe review is a dog\u2019s breakfast and has failed to listen to owners,\u201d said Adam Promnitz, founder of volunteer-run Strata Owners Alliance. \u201cThe government has consulted with the industry while completely ignoring owners who will have to pay for their incompetence with higher strata fees.\u201d<\/p>\n

Sam Reece, the chief executive of Australian Apartment Advocacy, said 1.6 million Victorians living in strata schemes had been left exposed to predatory corporate managers due to the state\u2019s failure to establish an independent strata commissioner or eliminate structural insurance commission-sharing.<\/p>\n

\u201cWith Consumer Affairs Victoria taking no action against strata managers in the last six years and owners waiting 52 weeks for a VCAT hearing, it is clear that the system is broken and urgent action is required,\u201d Reece said.<\/p>\n

Opposition consumer affairs spokesman Tim McCurdy reiterated on Wednesday that a Liberal and National government would consider establishing an independent commissioner if it won government.<\/p>\n

\u201dWe will not tolerate dodgy deals, hidden fees or unlawful charges,\u201d he said.<\/p>\n

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\"RachaelRachael Dexter<\/a> is a journalist in the City team at The Age. Contact her at rachael.dexter@theage.com.au, rachaeldexter@protonmail.com, or via Signal at @rachaeldexter.58Connect via Facebook<\/a> or email<\/a>.From our partners<\/p>\n","protected":false},"excerpt":{"rendered":"Save You have reached your maximum number of saved items. Remove items from your saved list to add…\n","protected":false},"author":2,"featured_media":712590,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[64,63,44],"class_list":["post-712589","post","type-post","status-publish","format-standard","has-post-thumbnail","category-australia","tag-au","tag-australia","tag-news"],"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/712589","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/comments?post=712589"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/posts\/712589\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media\/712590"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/media?parent=712589"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/categories?post=712589"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/au\/wp-json\/wp\/v2\/tags?post=712589"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}