Avoid Public Trustee NSW: Why Families Plan Around NSW Trustee & Guardian

The phrase "the public trustee will take over" is one of the strongest motivators for NSW families to get their estate planning done. The fear is not unfounded — once the NSW Trustee & Guardian is appointed as financial manager, the family loses control of financial decisions and pays ongoing fees for the privilege. But understanding exactly when and why the public trustee gets involved is the first step to making sure it does not happen.

What the NSW Trustee & Guardian Actually Does

The NSW Trustee & Guardian (NSWTG) is a government agency that provides financial management, guardianship, and document storage services. It is not automatically involved in anyone's affairs. It becomes involved in one of two ways: the person voluntarily appoints NSWTG as their attorney or guardian, or NCAT (the NSW Civil and Administrative Tribunal) appoints NSWTG because no suitable private manager is available.

The second scenario is the one families want to avoid. It typically happens when a person loses mental capacity without having an enduring power of attorney in place, and either no family member applies to NCAT for a management order, or the family members who apply are deemed unsuitable due to conflicts of interest, financial mismanagement history, or family disputes.

What Triggers NCAT to Appoint the Public Trustee

When a person loses capacity without planning documents, someone — usually a family member, social worker, or hospital — applies to the Guardianship Division of NCAT for a financial management order. NCAT holds a hearing, reviews medical evidence of incapacity, and decides who should manage the person's finances.

NCAT will appoint a private manager (a family member or trusted friend) if:

• They are suitable and willing
• There is no serious family conflict about who should manage
• They can demonstrate basic competence to manage the person's affairs
• There is no history of financial abuse or self-dealing

NCAT appoints the NSW Trustee & Guardian when:

• No family member applies to be manager
• The family is in dispute and no consensus candidate exists
• The proposed private manager has a conflict of interest (e.g., they stand to inherit and the person's spending affects their inheritance)
• There are allegations of existing financial abuse
• The person's affairs are complex enough that NCAT determines professional management is needed

Once NSWTG is appointed, they assume full control of the person's bank accounts, investments, property, and financial decisions. The family is consulted but does not have decision-making authority.

What It Costs

NSWTG charges regulated fees that are deducted from the managed person's estate:

• Establishment fee: $677 when management commences
• Annual account keeping fee: $132 per year
• Annual management fee: 1.1% of gross invested assets (for full NSWTG management)
• Private manager oversight fee: $150–$250 per year when a private manager is appointed but NSWTG oversees the accounts

For a person with $500,000 in assets under full NSWTG management, the annual fees total roughly $5,600 — the establishment fee in year one, plus the 1.1% management fee plus the account keeping fee. Over a decade of management (not unusual for someone who loses capacity in their 70s), that is more than $55,000 in fees.

These fees are not optional and cannot be negotiated. They are set by regulation.

How an Enduring Power of Attorney Prevents This

An enduring power of attorney (EPOA) executed while the principal still has capacity appoints a private attorney to manage finances. If the principal later loses capacity, the named attorney steps in — no NCAT application is needed, no hearing is required, and NSWTG has no role unless the attorney themselves is later found to be acting improperly.

The EPOA must be an enduring power of attorney, not a general one. A general power of attorney terminates automatically the moment the principal loses capacity, which is exactly the situation where management is needed. An enduring power of attorney survives loss of capacity by design.

The EPOA should be executed while the principal clearly has capacity. If capacity is already borderline — early-stage dementia, for example — a contemporaneous capacity assessment from the principal's GP strengthens the document against future challenges. Once capacity is gone, it is too late to sign an EPOA. The only path at that point is through NCAT.

What About the Enduring Guardian?

The NSW Trustee & Guardian can also be appointed as guardian (for healthcare and lifestyle decisions) if no enduring guardian is in place and NCAT determines that a guardian is needed. To prevent this, the person should also sign an Appointment of Enduring Guardian under the Guardianship Act 1987, naming a trusted person to make personal and medical decisions.

The Public Guardian — a separate office within the same agency — handles guardianship appointments when no private guardian is available. Like the financial management side, this can be avoided by planning ahead with the correct document.

When NSWTG Is Actually Useful

NSWTG is not always the villain of the story. For people who genuinely have no suitable family member to appoint — because of estrangement, distance, or trust issues — the NSW Trustee & Guardian provides a regulated, accountable management service. Their WillSafe document storage costs $29–$49 and is a solid option for keeping original documents secure. And they offer free document drafting and witnessing services for full Age Pension recipients.

The problem is not that NSWTG exists. The problem is when families who do have suitable private managers lose control because they did not sign the documents while they had the chance.

The Practical Step

If your parent still has capacity, the single most effective thing you can do to keep decision-making within the family is to have them sign an enduring power of attorney and an enduring guardian appointment. Both require a prescribed witness. Both can be done in a single appointment. The New South Wales Power of Attorney Kit walks through the full process, including a decision-maker selection worksheet and a signing-day checklist to ensure nothing is missed.

See more New South Wales guides →