Recently, the matter of retirement villages has come to the fore in the media, led by investigative journalist Adele Ferguson on ABC 7.30 Report. Ferguson’s report and case studies raised the question of “what protections should be put in place to protect the residents from the avarice of owners and operators of retirement villages?”
Since Ferguson’s report has the retirement village industry running for cover and likely regrouping. They may try to re-badge and re-market themselves (as did BP “the quiet achiever” whilst continuing to plunder our natural resources and the environment). After all, retirement villages are ultimately about making money and they are presently the low hanging fruit for canny investors.
One can only hope that the various state governments are going to put “Retirement Villages” onto the agenda of the next national meeting of Attorneys General from around the country. Most importantly, we need all governments when addressing the housing crisis to include the needs of older community living in retirement villages.
As we know, these older Australians move into retirement villages because they are often tired of the duties and responsibilities associated with running their own home; or they have become frail or lonely but not ready for residential aged care. Residents will have many and varied criteria and reasons as to why they may choose to live in a retirement village. It is the unregulated costs, and the loss of capital which are the major concern.
Whatever the reason for choosing a retirement village, residents need legislative protection. In all likelihood, they will have sold their family home; and they can only hope that when the time comes to moving into residential aged care they will have sufficient capital to afford a comparatively comfortable place. For many residents, this may not be the case. It is not acceptable that the Federal Government should have to pick up the tab for Residential Aged Care because Retirement Villages keep the capital gains.
Every state and territory needs a strong Retirement Village Act. The current Acts all allow the owners and operators to set any fees and charges without any transparency or accountability. Retirement villages can and do charge residents what they like, when they like and for what they like! They will also charge without necessarily delivering what was undertaken.
In early 2024, after much lobbying by the Vintage Reds, the ACT Attorney General Shane Rattenbury established a Retirement Villages Working Group to identify changes that need to be made to the Territory’s Retirement Villages Act and hopefully lessen the egregious effects of the business plans and operating model of Canberra’s retirement villages industry.
Residents need an Act which protects their interests as well as the owners and operators. They need a transparent regulatory system and they also need to know who is overseeing the retirement village industry which is their home. We have a responsibility to relieve the aged community’s anxiety.
The cornerstone of any Retirement Village Act should be to protect the residents whilst maintain the viability of these businesses. Presently the Act fails the residents badly. The ACT Retirement Villages Act is similar to every other jurisdiction’s act in that it to protect the interests of the industry and the residents have become commodities. To redress the imbalance, the Objectives of the Act should be expanded to create a (a) Registrar; (b) a Register; (c) Standard Contracts and (d) a share in the Capital Gain for residents and other matters.
A Retirement Villages Registrar: There should be a Statutory Officer appointed by the Government as the Retirement Villages Registrar to establish and maintain the jurisdiction’s Retirement Village Register; to oversee the operation of the retirement villages industry; to make orders, recommendations or determinations for operators and residents; and/or make recommendations to the Government; and/or to impose any fines or penalties.
A Mandatory Retirement Villages Register: Each Act should establish a mandatorily Register of all retirement villages operating in the jurisdiction. The register will contain details of every village, its owners and operators, along with all fees and charges to residents, and the percentage share of the capital gain paid to residents and any other relevant matters. The Register will be accessible on-line to any interested parties.
Standard Contracts: The legislation should be amended to establish standard contracts between retirement village vendors and purchasers. (It should be noted that when moving into a retirement village, residents buy a right to occupy a specific space or unit in the complex. Currently, all contracts are drawn up by the individual village or groups of villages.) The amendment should be similar in its effect to purchasing real estate in the jurisdiction.
A Share in the Capital Gain: Some retirement villages do offer a share in the capital gain. The share of the capital gain should be required of all retirement villages starting at 30% and phased in over 10 years until the capital gain reaches 50%. Should there be any exceptional ‘not-for-profit’ retirement village, then the villages should apply for an exemption determined by the Registrar.
Other matters: Amongst the many things needed to be changed in the Retirement Villages Act include for example, the adoption of a star rating system; a transparent and fair residents’ committee structure; the inclusion of retirement villages into the schedule of the Working with Vulnerable People Act; a maximum time limit for any refund of residents’ capital when they leave the village. There are of course many other changes also needed, but they are for another day. All of these changes could be achieved by imposing a modest annual registration fee for each independent living unit in each retirement village.
Jane Timbrell
Jane Timbrell is a retired trade union official, she is the Deputy Convenor and Campaign Manager of the Vintage Reds of the Canberra Region (an organisation of retired progressive trade unionists). In 2023, Jane was appointed to the ACT Government’s Retirement Villages Working Group and in 2024 she was reappointed to the ACT Ministerial Advisory Council on Ageing.