The Retirement Villages Amendment Bill 2008 passed through Parliament on the 10th December, 2008 and will amend the existing Retirement Villages Act 1999 which regulates the retirement village industry in New South Wales.
The Bill seeks to protect vulnerable consumers and set clear guidelines for operators of retirement villages with the following amendments:
- The Bill removes the current treatment of capital maintenance and capital replacement where residents are responsible for maintenance and operators are responsible for replacing capital items. This amendment means that the cost of all capital works, including maintenance, replacement or new improvements are to be shared between the residents with no more than 50% being funded by residents.
- Operators will now be required to meet any budget deficit at the end of each financial year and will no longer be able to roll them over or ask residents to pay a special levy.
- Residents of retirement villages will be able to add or remove fixtures, or make alterations to the premises with the consent of the operator, which can not be reasonably refused.
- The Bill introduces new disclosure requirements in relation to the information that must be provided to retirees thinking about moving into a retirement village. Under the amendments prospective residents will be given a general inquiry documents when they make an initial inquiry followed by a detailed disclosure statement if they express an interest in a particular unit.
- A ninety day settling-in period for incoming residents has been introduced. If during this period the resident dies, moves to a nursing home or elects to move out then they will only be liable for fair market rent for their period of occupancy and a reasonable administration fee.
- The Bill reduces the amount that a resident can be charged if they move to a nursing home or hostel from a maximum period of six months to a maximum period of six weeks.
- In the event that a retirement village operator goes bankrupt residents will now be given priority over certain other registered interest holders in the event of a Supreme Court ordered sale of the village.
- The Bill will lift some of the compliance burden from smaller retirement village operators allowing those with an annual recurrent income of less than $50,000.00 the option of not having a yearly audit nor the provision of quarterly accounts to residents.
- A number of responsibilities of operators will be removed including the obligation to seek the consent of residents for the continual appointment of the same village auditor every year and the lifting of the obligation to seek the consent of residents for increases in recurrent charges that are at or below the rate of inflation.
The Bill aims to protect the rights of residents of retirement villages and provide a legislative framework that will enable the industry to continue to meet the needs of Australia's ageing population.