FREQUENTLY ASKED QUESTIONS

Who can join a Letsystem?
What can I contribute?
Are there limits applied to my trading?
Must I trade?
What happens if someone goes away leaving a negative balance?
How do people value goods and services within a LETSystem?
I value myself, but don't I have to be measured by market rates?
Can people profit from our trading?
What about potential abuse?
Are there any risks?
What about the DSS?
What about the Taxation Department?
Who guarantees the goods and services offered?
What charges are applied?
What are the Renewal fees?
Dormancy
What if I move away from the area?
Moving? Want to transfer your current balance to another LETSystem?
Confidentiality
Inappropriate behaviour






Who can join a Letsystem?
Anyone can join a LETSystem:
aged people, builders, unemployed, sole parents, lawyers, craftspeople, people with disabilities, teachers, small business operators, healers, shops, children.
Anyone who abandons thoughts of "what's in it for me" and instead thinks "what can I contribute to society".

Who SHOULD join a LETSystem
Everybody !!
Anybody who is time rich and cash poor.
Anybody who has the ability to think outside the square.
Anybody who would like to see a greater sense of time-value placed on their skills.
Anybody who has a sense of social justice.
Anybody who would like to increase their network of friends and interact with like-minded people.

Who SHOULD NOT join a LETSystem
People who want to get something for "free".
People looking to exploit others.
(The committee has the right to veto any membership which they consider not be to in the best interests of the group.)

What can I contribute?
Your time and energy will be the greatest contribution. An unskilled worker will be just as valuable as a trained professional. Think about what skills and abilities you have and enjoy using that a community could appreciate. What are your hobbies and interests? Do you want to spend more time outdoors; walking dogs, gardening or mowing lawns? Do you enjoy sewing? Or shopping? Are you willing to do ironing while you watch TV? Are there good clothes your children have outgrown? For more ideas look at the Register to see what other people are contributing, as well as what they are looking for.

Are there limits applied to my trading?
There are no limits on account holder's local currency and no repayment or spending schedule is applied to members. In LETSystems no one has the right to interfere with the ability of another to spend or earn. However if the committee considers that a member is abusing their membership, it may take appropriate action to rectify the situation.

Must I trade?
There is never an obligation to trade if it is not in your interest to do so.

What happens if someone goes away leaving a negative balance?
Not much, provided that the rest of the members carry on trading with each other. Members can't take local units with them and can't spend them outside the system. This question reflects a justifiable concern about cheating within a co-operative activity. They have simply taken more goods and services from the trading community than they have given. However, with conventional money this would be a problem - if a cheque bounces, the money is not available to the payee. With local units, even though the member leaving is in the negative, the member who they traded with is in the positive and they have those units readily available for their next trade. Turnover is the key to a successful system, not the level of credits or commitments. Turnover reflects the amount of transfers happening within the community and also reflects the efficiency of administration in facilitating these trades.

How do people value goods and services within a LETSystem?
As LETS uses a philosophy of "time" and "energy" and each members time is equally valuable, Sydney LETS suggests a base rate of 20 operas per hour regardless of skilled or non skilled labour. In this way activities which are traditionally low-paid tend to be rewarded more generously. As there is never an obligation to trade, if you consider the market value to be too high or too low you can decline to trade. By using a 'local currency' that is abundant, people are able to value each other's time, skills and energy more appropriately.

I value myself, but don't I have to be measured by market rates?
When you use a LETSystem, you are participating in an internal market, which is subtly different from the national or regional markets, which use conventional money. Everyone is still keen to get as much cash as possible. But the ability to earn LETSystem money is enhanced and there is pressure to spend it rather than hoard it. These factors can combine to give a much lower spread between low price and high price services. People who overcharge find that their trading slows up dramatically and their ability to earn is reduced.

Can people profit from our trading?
LETSystems are ethically based trading systems in that they are community based and controlled and no person can profit from the LETSystem itself, though anyone can benefit from any trading they do in the system. Local currency is also ethically driven in that its worth is derived from a member’s commitment to return the value of goods and services received to other members of the LETSystem. If a person attempts to "rip off" a LETSystem, other account holders can simply refuse to trade with them. To ensure this, each member is allowed to know the balance and turnover of any other member, but no other trading information. LETSystems are cost-of-service, not-for-profit systems run and operated by the members. No person or organisation outside the system can profit or benefit from the system, either in dollars or local currency.

What about potential abuse?
The potential exists for an individual to take and not return. However, even if this does take place, the people who have received payment will be able to trade unimpaired. This has no effect on the structural integrity of a LETSystem. If too many people do this the others will simply slow their trading down, as their ability to spend will be reduced.

Are there any risks?
Not unless you want to take some. Participation does not make you liable for the affairs of the other members or for the LETSystem itself. Treat LETS work as if you were obtaining a quote from a tradesman from the Yellow Pages. If it is a major household project, ask for a written quote for work, prior to the work being done. As with all business dealings, it is advisable to negotiate an exchange of operas prior to the trade taking place. Members are advised to take out Work Care cover (approx $10.00 per year), as household liability insurance may not cover household workers employed on your property.

What about the DSS?
The Dept of Social Security supports the idea of non-profit community trading systems and exempts all LETSystem income from declaration, ie. it will not affect any benefit or pension. However you should not allow LETSystem trading to interfere with your obligations to be available for work or training programs. Negotiations are underway to have LETS administration work counted as part of the "Work for the Dole" requirements for single parent pensioners and unemployed.

What about the Taxation Department?
Accountability for taxes incurred by members is the obligation of those involved in an exchange. The LETSystem has no obligation or liability to report to taxation authorities or to collect taxes on their behalf. The official ruling states that if you earn local units whilst providing a service which is your main profession you must pay tax on all profits OVER 300 units as if you had earned dollars. Units are also deductible so if you spend operas on your business expenses you may declare it. For example: if your main profession is a plumber and you do some plumbing work to the value of 700 operas then 400 operas is considered taxable at the normal rate. If however you spend those 400 operas on bookkeeping or other business expenses then the profit you have made in that year is only 300 operas and the tax department don’t want to know about it. Also if you earn operas as a handyman (ie put up a chook shed) then this is not considered as earnings under your main profession (plumber) and is exempt from income tax.

Who guarantees the goods and services offered?
There is no control, or monitoring by the LETSystem itself, of either the rates people charge or of the quality of work performed. However normal consumer affairs and small claims tribunal rules do apply and if there is conventional protection for services performed (eg. Law Society, Master Builders Assoc. etc.), these also apply with local currency trading. Sydney LETS provides no warranty or undertaking as to value, condition or quality of the items exchanged is expressed or implied for claims for injury or damages of any nature arising from trade between members.

What charges are applied?
An administration fee of 0.5 opera per transaction will be deducted from the debit members account to cover continuing office management. It is in this way that we are able to pay our office staff and these office positions are available to all members.

What are the Renewal fees?
All members renewal fees are due on 1st October. Your membership will become "Inactive" if you fail to renew by this date and you will not be allowed to trade with active members. Any cheques written or received by you, whilst your status is inactive will be dishonoured by the LETSysytem. Annual Renewal fees of $5 and 20 operas are charged to cover such things as postage, paper, telephones and photocopying.

Dormancy
If you are going to be out of the area for a period of time, and do not wish to receive newsletters or registers, please notify the office in writing before you leave. If your membership has lapsed you may renew it at any time within two years and retain your original balance. After two years your balance will be absorbed by the LETSystem and upon rejoining, your account will start at zero unless prior permission has been sought from the committee.

What if I move away from the area?
You should try to bring your account as close as possible to zero. If you intend to move from the area permanently, please advise the office before the move.

Moving? Want to transfer your current balance to another LETSystem?
Permission from the other LETSystem will be required but usually a simple Interlets transaction is all that is required to transfer your balance. You may be asked to pay membership fees to the new system.

Confidentiality
All account and trading details are confidential, except that any account holder may know the balance and turnover of another. This enables everyone to participate in regulating the system. Members phone numbers are printed in the newsletters and register but all other personal information is confidential.

Inappropriate behaviour
Should any member behave in an abusive, improper or inappropriate manner, toward another member, the committee could invoke cancellation of memberships. The members concerned are encouraged to employ a mediator, but should this process fail to reconcile the issue, cancellation of membership may occur. Any behaviour which may fall in the jurisdiction of the Police Dept. should be reported.