PAA gets 'no' vote

PAA’s Holiday Home Legacy Trust could eventually be used to help fund the work of Financial Advice New Zealand - but first the association's members, including its own board, will need to change their minds about its trust deed.

The trust is being set up to manage the $2 million left over from the sale of the PAA’s holiday houses.

President Bruce Cortesi said the trust had been worked on over the past three years. 

But at a special general meeting last week, members, including PAA board members, voted against the first version of the trust deed. Cortesi did not reveal the final vote count tally.

Cortesi said, despite that outcome, it was a “very good meeting”. It went ahead even though the deed was not set to get sign-off to enable the next stage of the process to happen.

The objective had been to either have the trust deed as it was presented signed off, or to determine what the alternative should be.

“The trust deed in its current form was not approved but that doesn’t mean to say it was wrong,” he said. “The foundation of the trust deed is solid.”

But he said it needed further work and changes to account for some of the feedback received.  The board will now enter into another 60-day consultation period, after which another SGM will be held to have that approved.

“It’s an end result I’m very pleased with, it’s progress,” he said. “It’s new territory for the PAA, to create a trust is something new.  We are all learning through the process.”

In a message to members last month, he said it was imperative the meeting happened because, if it did not, it could hold up the process of winding up the PAA and forming Financial Advice NZ.

Cortesi said the trust could be used to help fund Financial Advice NZ's work.

“We have gone with quite a broad approach in defining what the objective of the trust can be.”

In a document outlining the trust purpose, it says it can work with other organisations with similar objectives - even if that is a simple as increasing participation in professional associations by financial advisers.

PAA chief executive Rod Severn had previously denied that the money would be used to fund the establishment of Financial Advice NZ.

Some advisers have raised concerns about the inequity of how the money from the holiday houses will be used.

Adviser Geoff Wilson is one.

"I, and many others that held holiday home credits, are professionals in this field of financial advice, and have been for many years. We would like to see a strong industry in the future, and have therefore come to the realisation that the majority of the accumulated profits from the sale of the holiday homes should be re-invested back into the industry," he said.

"What I am asking for, along with other holders of holiday home credits, is some financial recognition for our contribution towards the strength of the industry. The present trust deed may be called the Holiday Homes Legacy Trust, but there is no acknowledgment in the trust deed of our sacrifice. We provided the $2m fund, and everyone seems to be lining up to use our money - the PAA and Financial Advice NZ, but we have been ignored."


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