SELECT COMMITTEE ON A REVIEW OF THE RETIREMENT VILLAGES ACT 1987

Wednesday 29 October, 2014

Mr TARZIA (Hartley) (11:41): I also rise to speak in favour of this. Like the member for Schubert, I have a number of constituents in my electorate of Hartley who use these villages. At last count, there were over 15. They seem to be growing in number, as is the industry. This is an extremely popular issue. Before the election, I hosted what you would call an aged care forum for people over the age of 60. Over 100 people attended, and the day was well supported by the member for Heysen.

Mr TARZIA (Hartley) (11:41): I also rise to speak in favour of this. Like the member for Schubert, I have a number of constituents in my electorate of Hartley who use these villages. At last count, there were over 15. They seem to be growing in number, as is the industry. This is an extremely popular issue. Before the election, I hosted what you would call an aged care forum for people over the age of 60. Over 100 people attended, and the day was well supported by the member for Heysen.

Like the member for Schubert, I also empathise with people who have worked hard and paid taxes all their life, and when they seek accommodation such as a retirement village later in life, a lot of the time they come across these contracts that are quite lengthy and complicated. I think it is unreasonable that these elderly people, some of whom are quite vulnerable, need to engage lawyers, in some instances, just to go through these things. So the review of the Retirement Villages Act has a number of recommendations which I will, in turn, talk to.

All members of the house will agree that retirement villages are an essential pillar of aged-care services. The member for Morphett also put it earlier that the act provides the right balance between the rights and responsibilities of aged-care residents and the administration. It goes without saying that the baby boomer generation is retiring, and it is important to review the way in which the state manages its elderly people. South Australia, and Australia in general, has to constantly review our existing retirement system framework to explore new ideas, identify best practice, and look at how our system can be improved to cope with high demands for aged-care services not only today but also in the decades to come.

The villages have been around for a long time. There are over 500 registered villages and about 25,000 residents in the state, but only recently has the industry taken off even further. I suppose we could also attribute that to rising house prices. Of course, the rising cost of living and the cost of doing business and owning property is not aided by the government's recent ESL hikes.

This section of our economy is very important for South Australians, not only for the owners of the villages but also for the people who reside in them. It is important that people who live there enjoy the amenities they expect from villages. The select committee received a number of submissions from various sources, and I would like to draw the attention of the house to some of the recommendations in the review.

As one of the largest industries, the financial management of villages is one of the most important points to make as it greatly concerns both residents and governments. In particular, recommendation 14 (relating to financial management) is very important. When a surplus is obtained by virtue of the recurrent charges, it is a good thing that it is up to the discretion of the residents as to how that surplus is apportioned under the residence agreement.

I certainly agree with the thrust of recommendation 4, regarding precontract disclosure. At the moment, it has been a constant complaint from many consumers in the area that some of these contracts are quite different from each other and that there is no real standard form. It is a point of much confusion, and I think it is unreasonable that elderly people should have to engage lawyers or advisers to weave their way through the constant rigmarole and bureaucracy in these precontracts. If we are able to ensure that disclosure documents are introduced and that they are consistent, it would be a good thing as it will allow people to best inform themselves, and that would be assisted if we can standardise that.

Recommendation 10 creates 'a unique retirement village CPI', and recurrent changes would have to be approved by residents or by the RTT on appeal from the management authority. I believe it is vitally important that any increases in recurrent charges remain fair and must be in the best interests of the residents. At the end of the day, it is the residents who pay for these services, and it should ultimately be a matter for them.

It is in the vein of resident empowerment and residential awareness that I would also like to mention recommendation 9, in particular, as an important recommendation from the committee to ensure that all minutes of any residents' meetings be provided to all residents within 14 days. I think that is quite appropriate and reasonable; there should not be any mystery in relation to this. I have learnt in my travels that a lot of retired people travel more than their younger counterparts. It would be a common-sense recommendation, and I would support it.

Speaking to recommendation 12, it is very important that any changes to the act provide greater transparency to administration and management fees. It is reasonable to expect any organisation or village to provide the method in which they appropriate costs and to show where those costs were spent and how those costs affect the residents of any retirement village.

In relation to council rates, it is important to develop the valuation of retirement properties when it comes to purchasing the licence to occupy a retirement village, and more should be done in that area. It is very important that criteria be created to control this factor, and I would also support the recommendation in relation to that issue.

Recommendation 1 restricts the use of the term 'retirement village' and prevents deceptive information about a facility that may mislead elderly people before they enter a village, and this is extremely important as well. In some cases, there is a lot of mystery concerning whether the person who moves into one of these villages actually owns the asset or is buying a licence. What is the situation here? It is a common point of confusion, and different laws can apply depending on what exactly the people are buying into. So, I also support more information that provides better transparency in that regard.

The objective of reviewing the act was to result in more transparency and simplicity for not only prospective licensees but also current licensees as to their rights and obligations. Equally, the report is about empowering residents of retirement villages to make their own decisions about the lives they lead in retirement, and I fully support the recommendations listed in the report.