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House of Assembly - Fifty-Second Parliament, Second Session (52-2)
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RETIREMENT VILLAGES

The Hon. J.J. SNELLING (Playford—Minister for Health and Ageing, Minister for Mental Health and Substance Abuse, Minister for Defence Industries, Minister for Veterans' Affairs) (15:47): I move:

That a Select Committee be appointed to inquire into and report on the Retirement Villages Act 1987, and in particular—

1. Whether—

(a) the objectives of the Act remain appropriate;

(b) the current definitions within the Act remain appropriate;

(c) the Act makes clear the obligations of residents and administering authorities;

(d) the Act provides for adequate contractual disclosure to enable residents to make an informed decisions about entering a retirement village and whether standardisation of contracts would increase transparency and assist residents in their decision-making process;

(e) the Act ensures sufficient contractual disclosure and transparency of feeds a resident will be responsible for when leaving a village;

(f) the Act provides adequate certainty, accountability and transparency for residents about their financial obligations;

(g) the Act provides sufficient transparency and consultation with residents on recurrent charges, increased in these charges and other costs for which residents are responsible;

(h) the Act provides sufficient provisions to protect the interest of residents in the event a village enters financial difficulties and whether there are sufficient provisions to enable the continued operation of a village which is in financial difficulty or which is being mismanaged;

(i) the Act provides a timely, informal and cost-effective process for resolving disputes between administering authorities and residents;

(j) the Act provides sufficient powers of investigation and compliance to the body responsible for its administrations; and

2. The relationship between the Act and other South Australian and Commonwealth legislation, including the Aged Care Act.

As Minister for Ageing, I move to establish a select committee of this house to review the Retirement Villages Act 1987. The Office for the Ageing administers the Retirement Villages Act 1987 and the Retirement Village Regulations 2006. The object of the act is to provide a balance between the rights and responsibilities of residents and retirement villages and administering authorities. There are 522 registered retirement villages in South Australia, with about 24,400 residents.

Discussion papers were released in July 2011 seeking consideration from all interested parties about the possible amendments of the regulations. The Office for the Ageing received 353 individual submissions to the paper. These submissions were discussed as agenda items at the Retirement Villages Advisory Committee Meetings in March and June 2012 and in January 2013.

Following these discussions, it became clear that many of the proposed amendments could not be fully achieved through the regulation review. An increase in tribunal hearings, from 18 in 2010-11 to 51 in 2011-12, a 183 per cent increase, has also shown that several areas in the act lack clarity. In addition, after Fernleigh Gardens Retirement Village entered administration in 2012, further shortcomings in the act were exposed.

Confining reform to the regulations would not address matters with the act raised by the Government Investigation Unit and Crown Solicitor's Office about villages in financial difficulty or their being potentially mismanaged. Regulatory amendment would also not resolve the matters of greatest concern to residents. These include matters such as exit costs associated with remarketing, management fees and capital replacement funds. Residents also frequently complained about auditing annual surplus and deficits, as well as contract disclosure.

The government believes reviewing the act should result in more transparency and simplicity for prospective and current licensees as to their rights and obligations. It should also strengthen protections to residents and plainly state the obligations for any administering authorities.

I expect the review will strike a balance between the needs of consumers and operators, providing protections to make sure these villages remain an attractive option. I encourage all interested parties to get involved in the select committee process and to submit their concerns and suggestions. I commend the motion to the house.

Dr McFETRIDGE (Morphett) (15:50): The opposition supports this motion. I inform the house that the member for Heysen and myself are the nominees from the Liberal Party to go on to this select committee. There is a need for a review of this act. It has been around for a long time. It was written in 1987. I saw recently that the Retirement Village Association and the Property Council of Australia merged and they are actually opposing a review of this act. I have not had a chance to speak to them personally, but I am sure they will present to a select committee and it will be interesting to hear their views on the future of this act and the retirement village industry in South Australia.

This is a huge industry and a very important industry for South Australians, not just for those who own the villages but more importantly I would say for the people who actually live in these villages. My mother, who is now 85, is living in a retirement village out at Elizabeth Vale, and she is enjoying herself out there. My father died a few years ago now, so mum is enjoying the company of the people that she is with in that village.

The history of retirement villages is interesting though. They have been around for a long time, and the Royal Freemasons were the first providers of Australian retirement accommodation back in the 1860s. The number and size of retirement villages has obviously grown immensely since then. I understand that recent figures show that there are about 160,000 Australians living in retirement villages and that there are about 800 retirement villages. I do not know what the figures are exactly in South Australia, but I am sure a select committee will be able to determine that.

From reading the Property Council's website about the history of retirement villages, I was able to glean that South Australia was the last state to form an association of retirement village owners. I would like to think that we will be the leaders in legislation that is going to benefit both those who are putting their money into these sorts of investments—by that I mean the people who actually own the villages—but also those who are residing in the villages.

It should be very clear to all of us that this needs to be a viable industry and an industry with a triple bottom line approach, where the people who decide to go and reside in one of these villages, whether at Elizabeth, Glenelg in my electorate of Morphett—there are a number of villages down there—or any other place in South Australia enjoy the amenities that they expect from these villages.

We have heard some allegations about some charges that are being levied and some exit and entry fees that were unexpected. On the Property Council and Retirement Village Association's website there is a section talking about consumer protection. It points out that legislation in each state and territory is different and defines what is and what is not a retirement village. Other communities that fall outside the legal definition of a retirement village, such as a manufactured home park, are not regulated in the same legislation as retirement villages.

This would probably be one of those pieces of legislation where you would think that harmonisation across Australia is something that we should all be aiming for. While I am a state's rights person—I have spoken on numerous occasions in this place about not devolving the power of this parliament—I think there is room for a move towards consistency of legislation across the nation. Certainly with retirement villages, I am surprised that there is not something a bit more consistent than what I have seen in the preliminary reading that I have done on this issue.

The issue of fees and charges obviously is one that is right up the front for all people who are considering going into a retirement village. All of us will be involved in some way, whether personally or with relatives who are wanting to go into or are living in a retirement village. Certainly entry fees, service or maintenance fees and exit fees, also known as departure fees or deferred management fees, are the three at the top of the list. Entry fees incorporate a resident's right to occupy a unit in a retirement village and it typically takes one of two forms: a loan or lease agreement or a freehold title.

In Australian retirement villages, a typical loan/lease agreement provides for lifetime (99 year) occupancy of a chosen villa or apartment and use of the community facilities. Community facilities may be gyms, gardens or communal recreation areas. It just depends on the type of village and the location in many cases, whether it is beachside or more urban.

The up-front entry fee paid is usually not subject to the payment of stamp duty or any GST. However, with freehold titles there are some other encumbrances in the same way that traditional residential property is handled. So, entry fees do vary. I will be interested to see what the actual state is there; however, what I understand to be more contentious is service or maintenance fees. Again, reading from the Property Council's retirement living website about service and maintenance fees, it states:

Village residents have the convenience of paying one monthly or fortnightly service or maintenance fee or charge that covers the costs associated with the...lifestyle they enjoy at the retirement village of their choice. Depending on the state or territory in which the village is located, this fee can also be called a general services charge or recurrent charge.

Operators charge service fees on a cost recovery basis. The retirement village's legislation in most states contains protections and controls to ensure that residents are kept informed about the costs included in the service fees and changes to those costs over time...In freehold title retirement villages, residents may be required to pay owners' corporation levies or body corporate levies in addition to the service or maintenance fees.

So, different horses for different courses there. The issue with exit fees is outlined once again on the association's website:

As the service fees are for the recovery of cost only, you do not need to pay the village owner—

this is directed at people who are looking at going into retirement villages—

any additional amount representing the owner's return for building these facilities and providing to you the outstanding lifestyle available at the retirement village until you actually leave the village. This amount is paid as an 'exit fee', which can also be referred to as a 'departure fee' or 'deferred management fee' (DMF).

The DMF payable by a resident is usually calculated with regard to the number of years of the resident's occupancy at the village (for example, 2.5% per year of occupancy)...The annual DMF percentage can range from 2.5% to 6%.

I am sure the committee will be able to look at this fee because there is some degree of concern about it. In fact, I have been provided with information by the South Australian Retirement Villages Residents' Association. Some of the concerns that they have expressed—and I do not know whether these are general concerns or concerns of individual villages or individual residents—are that they want clarification as to whether retirement village residents are owners or leaseholders. If they are leaseholders they should not have to pay the owners to sell their own houses. The residents' association says that this was probably not the intention of the act but, due to loopholes, owners and administrators have been able to interpret it that way. The residents' association also states:

Public Information Documents and contracts should be in separate documents. The PID should be given out when prospective residents pay their second deposit, to enable them to obtain legal advice well before they arrange to move into the village.

The residents' association also states:

All fees and charges payable at the time of settlement should be documented in the Act and the PID.

That is the public information document. The residents' association has about 16 different issues that it has outlined that the committee, I am sure, will look at, and I am sure that the residents' association will want to present to this select committee. I look forward to learning more about the retirement village industry, both from the industry's point of view and more so from a resident's point of view.

As I said, my mother is in a retirement village at the moment. I visit her not as often as she would like and not as often as I should but, when I do visit her, certainly the other residents in the place seem very comfortable with their lifestyle. My mother is more than happy to participate in the village community.

We must remember that it is a community within a community, and we should make sure that those communities are able to function as effectively and efficiently as they possibly can for all those involved, whether they be the owners or whether they be the residents. With that, I can tell the house that the opposition is supporting the motion. We look forward to the setting up of the committee and a fruitful report coming to this place so that we can amend the Retirement Villages Act if required, so that those involved in the associations—both the residents' and the owners' associations—can have confidence that their sector will continue to prosper and provide a vital service for all South Australians.

The Hon. S.W. KEY (Ashford) (16:01): I rise to support the motion and to say that, judging from the inquiries and issues that have been raised at the Ashford electorate office, this is a very important review. Many of our constituents, and also the retirement villages' management themselves, were very keen to participate in the review that minister Snelling has just mentioned with regard to those regulations. In the Ashford area we put in our submission, which was a collation of all the issues that have been raised by individuals, groups or villagers themselves and also owners and management; so, I think this is going to be a very important select committee.

I would also say, just on a personal level, that my friends and I used to joke about setting up our own retirement village. We thought that it might be in our best interests to do that. As time has gone on, they are now also talking about the nursing home that we might need to set up as well; so it just goes to show, depending on where you are in life, what ends up being a priority. I am very pleased that this select committee is going to happen and also that the opposition is supporting this further investigation.

The Hon. I.F. EVANS (Davenport) (16:02): As the member for Davenport and the paired member for Fisher I rise to support the setting up of a select committee into the Retirement Villages Act. Sam Duluk, the Liberal Party candidate for Fisher, has done a lot of work with retirement units within that particular electorate. We will be meeting with the various residents' associations within Fisher (and I will handle Davenport) with regard to this matter because there have been a lot of issues raised by Mrs Jill Kennard, who is the secretary of the state residents' association and who lives in Fisher.

It goes to a number of issues which the member for Morphett has raised, but particularly entry and exit fees and the capacity to charge for land. In one case I understand the allegation is that they were charged for land that was by agreement council land where the retirement village operator by agreement was to pay all the rates and charges and upkeep on that land and then that operator then passes those charges onto the residents. That was a matter of some court action and is still to be resolved totally. With the ageing population and more people moving into retirement village-type accommodation and with community expectations about the quality of the units, the transparency of costs and operations, we think it is important that this select committee is formed and meets. As I say, with the hardworking candidate for Fisher, Sam Duluk, I look forward to various—

The Hon. J.J. Snelling: Who? Sammy Duluk?

The Hon. I.F. EVANS: Sam Duluk; remember that name. We look forward to putting in submissions so that the residents' concerns can be properly dealt with by the committee.

Mr GRIFFITHS (Goyder) (16:04): I also wish to support this motion. I was advised late on Friday afternoon that it appeared on the Notice Paper, and I must admit my initial thought was that we would say yes to that, so I was pleased that, when the Hon. Rob Lucas took carriage of it and a paper was presented and considered at the range of meetings we held yesterday, that was a recommendation, and it was unanimously supported, too.

As a regional member, I have been contacted on a reasonably regular basis by people who are looking for some level of update of the regulations in the bill that controls this. I am lucky enough to come from an area that is seen as a great opportunity to retire to. It has been serviced predominantly by not-for-profit organisations to create facilities for aged care services, but there is an increasing trend where business activity has been recognised and investors have come in and constructed properties. One I know of is about 75 different homes in the Moonta area, where it is wonderful; truly wonderful. If I was old enough and could move there, I would.

Mrs Redmond: I am.

Mr GRIFFITHS: The member for Heysen says she is. We should put on the record that it was her birthday yesterday; happy birthday for that too.

Mrs Redmond: You only have to be 55 to go into that too.

Mr GRIFFITHS: That's right. With the baby boomer generation—and that is anybody from 1946 onwards to about 1964—an increasing number of people are considering what their futures are. Some are choosing to stay in the communities in which they have been long-time based; some are choosing to move a bit or to be close to younger generations in their family. It is creating opportunity, and where opportunity is created it is important that the state also ensures that the regulations and the laws that control those developments, the management of them and the fee structures that are in place for them, are appropriate.

I have also been contacted by the association that the member for Morphett and the member for Davenport have referred to, and I have offered to meet with them because I am interested in some of the concerns that they have, and from a consumer affairs and a residential tenancies tribunal point of view I am interested in that. As a local member, I believe it is very important that this motion is supported and that we have good people on the committee who have the capacity to understand the issues and the capacity to ask the right questions and to make the right recommendations for improvements to occur.

I was particularly pleased when the member for Heysen and the member for Morphett were nominated by the Liberal Party to serve on this select committee as part of the work that it will do, because I have total faith in—I think there was a term given for their inquisitive nature, youthful vigour and intelligence. I might have ad-libbed a little bit on some of those things, but collectively the people who will be in that group will make sure that the work is done so that South Australia in the future can have some confidence, not just from those who choose to live in those units, but those who chose to invest in them and the construction and management of them to provide opportunities for South Australians too.

There are several sides to this argument. It is important to find some level of middle ground that will give some surety to all sides of the argument to ensure that the industry prospers in South Australia, that it has a great future and that South Australians can choose to live in, and are able to live in, very comfortable facilities that provide for their physical needs, and importantly their social needs too. I look forward to the passage of the motion.

Mrs REDMOND (Heysen) (16:07): It is my pleasure to rise to support this motion and indeed to be one of the Liberal Party nominees to the committee. I was very surprised when I heard on the radio this morning that this is the first review of this legislation in 10 years, because I remember when the member for Ashford invited me to participate in an initial review back when she was the minister, and I believe the current Premier engaged with me in a further review, so there have been at least two tranches of reviews in the time that I have been in this parliament over this very legislation; and rightly so, because it having been introduced in I think about 1987, things have changed and moved on a great deal.

There are very many aspects to consider and I believe that, although we have looked at the legislation in some detail on two previous occasions that I have been involved in, there are many aspects that are still most unsatisfactory. The reason for my enthusiasm for being on this particular committee is that before I became a member of parliament in this place I was quite involved in two particular areas, one a retirement village run by the Stirling District Hospital, where I served as a board member for 28 years. That retirement village had been created by local interests as a not-for-profit but was failing financially. It was taken over by the hospital and was run very well thereafter. It continues to be run very well and has been expanded. That is, I think, a good model of what goes on. But, another particular retirement village up in Stirling was a source of great difficulty.

Under the Retirement Villages Act as it stands, if you have a dispute that you cannot resolve within the confines of the village, the matter is then heard in the Residential Tenancies Tribunal. In a period of six months in one year, there were 19 matters around the state that went before the Residential Tenancies Tribunal under the Retirement Villages Act, and, of those 19 around the state, 13 came out of this one village in Stirling. I know that because I acted in all of them.

There was a great deal of financial detriment to a lot of people because of some of the provisions of the legislation. For those who are not familiar with it, most retirement villages operate on the basis of what is called a 'licence to occupy', where you purchase the right to occupy a unit but you do not actually own it; so, it is not like owning a strata titled unit in a block of flats, you own merely the right to occupy a unit. Typically, what happens is that you have a retention fee charged up to, I think, a maximum of 20 or 25 per cent of what you have paid over the period, and then once you get beyond a certain number of years there will be no further money taken—that is the typical mechanism.

So, by way of example, if you, for instance, years and years ago bought a unit for $100,000, each year that went by there might be 4 per cent deducted from what you would have returned to you if you sold out or moved on to a nursing home or whatever it was. At the end of the time, if you had been there for, say, four years, then four years at 4 per cent would be 16 per cent; they would sell the unit and you would get back whatever the unit was sold for less the 16 per cent retention.

The particular units in Stirling that became a problem operated on a different basis. Some units are done by way of a loan, but their basis in particular said, 'Rather than giving you back an amount of the new resale price less the retention amount, we will guarantee to give you back the amount you purchased for, but the administrator of the village will keep the whole of the benefit or profit on the resale value.'

The disputes that arose in that village largely came from the fact that the new value that it was being sold for was not actually returning the owners enough money, and so they decided they would then charge what was effectively a depreciation, so that, instead of giving people back 100 per cent as they had promised to do, they were giving them back 100 per cent less what they declared to be the depreciation of the value of the premises.

We had quite a number of court cases involving that, so a number of issues were thrown up for me in relation to these various matters in which I acted, not the least of which, of course, was the fact that, but for the fact that I never made much money out of being a lawyer and did not charge people what they probably would have been charged by others, they simply were not able to pursue their claims and get justice.

There are some fabulous retirement villages around the state, but I think we need to bear in mind that there are retirement villages which are run, like the one run by Stirling Hospital Board, which is a not-for-profit sector where there is no intention to do anything in terms of making a profit. Then, there is the other group that are run for specifically the business of making a profit for the proprietors. I think the first major issue is going to be distinguishing the intent of those things.

The member for Ashford mentioned the baby boomers. Indeed, like the member for Ashford, my friends and I often think about becoming the Golden Girls as we get older and sharing some nice accommodation somewhere. I cannot imagine having too many of us in our village, and I suspect it will be a very private affair; I do not think many people would put up with us. But, there are some fabulous accommodations.

I had the privilege of going to the US on a study tour and I was particularly studying the issue of ageing. I studied at the Catholic University of America and did a couple of units on a certificate in ageing there. On the way home, I called in and lectured at the University of Hawaii medical school on ageing in Australia. Through that connection, I then managed to visit some retirement places over there.

Let me tell you, they offer a lifestyle that is unbelievable; they are like 5-star accommodation, and, indeed, they are based on a concept which we would understand as timeshare, where you have time there, but if you want to go and visit your friends or family in Pennsylvania, then this same organisation had hundreds of these complexes around America, and you could simply move to Pennsylvania and visit your family there, while still having the same facility. But, they are run on an entirely different basis from that which we have here. Nevertheless, they have a happy hour every day. You did not need transport because they had a continual double shuttle bus going to wherever it needed to go. Everything was taken care of.

There are some fabulous lifestyles and, indeed, my observation of places that I have visited around our state has been that, particularly as the baby boomers come through, there is an increasing expectation as to what people are going to want, and many of them want to have their retirement village set by a golf course, or nice bowling greens, tennis courts, swimming pools and other facilities, because the motivation, I suspect, for people going into a retirement village is going to be multiple.

Some people want to go in because they want to feel more secure. We do not have many gated communities in this state at this stage but it does offer a level of security and it also offers a level of enjoyment of community with others who are at a similar stage in life, so those lifestyle and community issues come into it. For some people, of course, there is a financial issue as they may not have been able to afford to buy a house and, typically, buying into a retirement village unit has been cheaper than buying one's own house. That is not always the case and there are examples of retirement village accommodation which are more expensive than the average house price anyway.

I think the big questions will arise in relation to how are disputes sorted within the village, and if they cannot be sorted within the village, how are they then reasonably addressed outside the village? To give an example, one of the cases in which I acted many years ago ran for a week in the Residential Tenancies Tribunal, which is not really equipped to have a case that runs for a week—they do not have transcribing and court reporting facilities—but the other side—that is, the administrators of the village—engaged not just a solicitor but a barrister at considerable expense.

We won the case. My clients were awarded over $40,000 in further compensation that they were owed by the village, but in terms of the costs, there was a question as to whether or not my reasonable legal costs would be paid, and they were restricted to only Magistrates Court even though it was well beyond the jurisdiction of Magistrates Court costs. But, more importantly, those administrators having engaged a solicitor and a barrister at considerable expense for the week, and having lost their case, then decided to take the bill from those legal costs and apply those as part of the costs of the village that the remaining residents of the village had to then pay.

There are lots of issues that are going to come up that I am sure will be live questions for this committee. I am going to be delighted to participate because I have held a long-term view that it is an issue that we are going to need to address, and we are going to need to keep this legislation under review consistently. I am delighted to be invited to participate and I look forward to the deliberations of the committee.

Mr GARDNER (Morialta) (16:18): I am very pleased to have the opportunity to speak this afternoon in favour of the establishment of a select committee to inquire into and report on the Retirement Villages Act and, in particular, a number of issues which I will go into briefly, and also the relationship between the act and other South Australian and commonwealth legislation including the Aged Care Act.

In Morialta, as many members do, I have a number of retirement villages and so a number of constituents of mine for whom these are very live issues. I am very pleased that the select committee will see representation from this side of the house from the member for Morphett, Dr Duncan McFetridge, and the member for Heysen, Isobel Redmond.

I commend to anybody who is casually reading the Hansard of the debate in this chamber the speech just given by the member for Heysen, and those reading the Hansard would not be able to tell that she gave the speech entirely without notes for 10 minutes. I thought it was an extremely thoughtful contribution and an example of why she has such a strong grasp of the issues facing this sector and issues confronting residents in this sector, which I think provoke the significant benefit to the community of this select committee taking on board the views of residents and those who invest significant capital and significant personal risked wealth in establishing these facilities and, of course, those from the charitable sector and everyone else who is a stakeholder in this area. It is terrific that this review is taking place.

As I said, I have discussed this issue with a number of my constituents, and one of them in particular wrote to me a little while ago and has kindly given me permission to quote directly from her point of view, which I think is representative of a number of the other residents in retirement villages in the area. It goes directly to the point, so with the indulgence of the house, I will read this letter which is from Mrs J. Francis of a retirement village in Rostrevor, one of a number of retirement villages in the Morialta electorate:

At a recent Members' Meeting of the South Australian Retirement Villages Residents Association Inc. (SARVRA) it was agreed to submit a Report to the Office for the Ageing making a recommendation that the Retirement Villages' Act 1987 be opened for review by the Government.

I am writing to you as our Liberal Member for Morialta to advise you of this recommendation, and to request that you take up and carry forward with fellow Parliamentarians the issues as listed below whereby it is hoped a Review of the Act will be conducted prior to the State election early next year.

Issues that residents would like addressed and resolved are as follows:

1. The Act came into being in 1987—26 years ago.

2. At the time the Act was introduced retirement villages were mainly operated by church and charity organizations.

3. Today they are operated by big business and conditions which were acceptable to residents in the early days are not as acceptable by residents of today.

4. The Act was last reviewed in 2006 at which time the Premises Condition Report was added to the Regulations.

5. Some sections need to have much clearer interpretation as the wording is open to a variety of interpretations.

6. The use of funds needs to be clearly set out—what they are to be utilised for, etc.

7. Retirement Village residents need an Advocacy Service, similar to the Aged Rights Advocacy Service (ARAS) so that residents may receive authoritative advice when needed. We need to push for this service.

8. As it stands, the Act appears to favour village operators.

I would be very much obliged if you would accede to my request to look into the matter of a Review of the Retirement Villages' Act in the near future.

I hope to hear from you shortly.

I have discussed the matter with Mrs Francis and also a number of my colleagues on this side of the house. Having discussed it with the shadow minister for ageing (Hon. Rob Lucas), the shadow minister for consumer affairs (Mr Steven Griffiths) and indeed the member for Heysen as well, I had no hesitation in thinking a select committee would be a very worthwhile initiative. I think that the Minister for Ageing, in taking this recommendation that has come from SARVRA and bringing it to this house, has expedited affairs in a very positive way and I thank him for that work.

There were a number of other issues that were not mentioned in the letter that I have just quoted that SARVRA has raised, and a number of them are in fact dealt with by the motion. While the letter that I quoted puts a particular point of view from residents, and that has provoked the issues, it is important that all points of view are heard and, in taking evidence, the select committee will do that, and I think that hopefully it will very wisely be able to work together.

I support those members in doing that and I hope that they will be able to come together with a set of recommendations unanimously supported that will contribute to the considerations of the parliament. I commend the motion to the house. I look forward to its passage and I look forward to the deliberations of the select committee.

Mr PEGLER (Mount Gambier) (16:23): I rise to support this motion. I think a select committee inquiring into and reporting on the Retirement Villages Act 1987 is a great step forward for this parliament. In relation to the formation of this committee, no doubt the results will be that it will make recommendations on how we can make changes to the act. These changes should not be seen as threats to either the residents of retirement villages or the administering authorities.

I think it is time that this act was looked at properly. As has been said before, it is some 26 years since the act came into being, so it is a great step forward. I certainly support the fact that there has to be adequate certainty, accountability and transparency for residents about their financial obligations. I also strongly support the fact that both the residents and the administrating authorities must know what their obligations are to each other and to the corporate body. We have several retirement villages in my electorate of Mount Gambier, and I quite often have residents come to see me that have concerns about how their constitution and management committees work. So, I would also recommend to this committee that they look at some draft constitutions that spell out very succinctly what the powers are of those management committees in setting fees and their voting processes in those management committees, so that everybody knows exactly where they stand.

I am sure that if we consult widely with the community, and particularly those people that live in or administer retirement villages, we can come up with an act that will suit everybody and certainly give transparency and accountability to the community. I certainly support the formation of this committee.

Mr PENGILLY (Finniss) (16:26): I rise to indicate my support, as well. It is a matter of a good deal of importance to me. I would have happily gone on the committee, if it is successful in getting through the house, which it will be of course, but not everybody can go on it. I have a number of substantial retirement villages in my electorate. I have many hundreds of residents in those retirement villages, particularly in Victor Harbor and Port Elliot, and I also have some over on the western side of the Fleurieu.

The last couple of years, I have not had a lot of angst come out of those villages. We did have a fair bit to deal with two or three years ago, but things seem to have settled down. They operate particularly well, but there are a number of issues that surface from time to time. One that I have been dealing with lately, which the committee might want to have a look at, is in regard to water billing and the billing that the residents are charged. There are things like rate issues, ownership issues, and there is dispute resolution.

I would ask that, when the committee is formed, if they wish to do a regional visit, they may consider having a regional hearing down in my electorate, perhaps at the Victor Harbor council chambers or something like that. I am sure that there are residents who would like to give evidence—

Mr Gardner: The Finniss electorate office.

Mr PENGILLY: No, we won't fit in there. I think it would be useful, as indeed the select committee on farming has held regional meetings and continue to. So, I would invite the committee to come down. I think it is probably a good thing to review this particular act. It has been in place for a long time, and as has been said in this place and other places, it is a way of living for many, many retired South Australians. They are extremely active within the villages, some of them. I know that Elliot Gardens is a very comprehensively run facility and the residents of that village are very actively involved in the wider community in things like bowls clubs, but they are also focused on activities within their villages.

I enjoy meeting with the residents from time to time, but, as I say, there have been some dramas in the past and there probably always will be as long as people are involved in these things. But, I look forward to hearing the findings of the committee after it is completed and brought back to the parliament, and I wish every member on the committee the best of luck and hope that they come back with some useful findings. I support the motion.

Mr BROCK (Frome) (16:29): I also rise to, first up, congratulate the minister for bringing this to the house. I think it is a tremendous idea, and certainly as the member for Goyder and other members here have indicated, it is a growing trade. When I say trade, it is a growing request out there for people to go into lifestyle villages, retirement villages and things like that. In my electorate of Frome I have numerous retirement villages. In fact, one from Moonta came to Port Pirie and set up there. It is a very popular location. Everything is supplied for you and there is security and all of that.

The opportunity to have a select committee to look at anything at all I think is a great idea. I have been on a couple of select committees and even on standing committees. We have the opportunity to look at things in great depth without any time constraints. It is always done in a bipartisan way of looking at it, and I hope that this select committee will do exactly the same thing.

I will refer to some of the issues on this notice of motion, 'that a select committee be appointed to inquire into and report on the Retirement Villages Act 1987, and in particular' certain items. One thing the minister has put on is 'whether the objectives of the act remain appropriate'. This act has been in place for 26 years and is it still appropriate?

Do the current definitions within the act remain appropriate? That is a big issue. I think the member for Mount Gambier referred to the adequate contractual disclosure to enable residents to make an informed decision about entering a retirement village. That provides peace of mind not only for the people going into retirement villages but also for their families who are very passionate about looking after their parents who are going into the retirement villages.

The other point is whether the act provides sufficient provisions to protect the interests of residents in the event of a village entering financial difficulties. I think that is very important. We need to protect those people who go in with good faith and we need to ensure that we look at all opportunities. The last point that the minister has identified is the relationship between the act and other South Australian and commonwealth legislation, including the Aged Care Act. We have to ensure that everything gels and that everything relating to everything is there. Again, I congratulate the minister for bringing this motion to the house and I certainly will be fully supporting it.

Mr SIBBONS (Mitchell) (16:32): I also rise briefly to support this motion and certainly thank the minister for establishing the select committee. Like many who have spoken here today, we have all had a number of constituents who have contacted our offices. They are very confused and concerned with some of the legalities that they go into when they enter into these contracts and so on. It is a very complex area for them and it can be very frustrating and very time consuming for them as well.

I am hopeful that this committee will give many an opportunity to identify some of these concerns and hopefully remedy some of these issues. I am hopeful that the minister will name me very shortly as a member of the select committee.

The Hon. J.J. Snelling: It will cost you a chocolate frog.

Mr SIBBONS: A chocolate frog. I certainly would be honoured to be on the committee to understand this issue more. I do have a very strong advocate who lives in my electorate. His name is Brian Mowbray. I thank Brian for his advocacy and knowledge when it comes to retirement villages. He has certainly been talking to me for the last 16 months about this particular issue and about getting action around retirement villages and so on. I certainly thank Brian and I am sure he will be very pleased today with this announcement. I am sure many other South Australians will also be very pleased that parliament is taking an interest. Hopefully the recommendations that come out of the many hearings will be very fruitful to the state and the people who live within it. With that, I very much support this motion.

The Hon. J.J. SNELLING (Playford—Minister for Health and Ageing, Minister for Mental Health and Substance Abuse, Minister for Defence Industries, Minister for Veterans' Affairs) (16:34): I thank all members for their contribution to the debate and I thank both sides of the house for their support. Following up on the comments from the member for Mitchell, I indicate that really it was a meeting with me, the member for Mitchell, the member for Ashford and Mr Brian Mowbray that was actually the instigation for this motion to establish a select committee. So I would like to pay tribute to the member for Ashford, the member for Mitchell and Mr Brian Mowbray for coming to see me about this important issue and to ensure that it was progressed. I would like to thank all members for their support of the motion.

I indicate that I will move that the committee report by 28 November, but I would expect that the committee would report much sooner than that to enable legislation to be drafted and hopefully introduced to the parliament very quickly.

Motion carried.

The Hon. J.J. SNELLING (Playford—Minister for Health and Ageing, Minister for Mental Health and Substance Abuse, Minister for Defence Industries, Minister for Veterans' Affairs) (16:35): I move:

That the select committee consist of Ms Breuer, Mr Sibbons, Mr Brock, Ms Redmond, Dr McFetridge and the Hon. J.D. Hill.

Motion carried.

The Hon. J.J. SNELLING: I move:

That the select committee has power to send for persons, papers and records and to adjourn from place to place and to report on 28 November 2013.

Motion carried.

The Hon. J.J. SNELLING: I move:

That standing order 339 be and remain so far suspended as to enable the select committee to authorise the disclosure or publication as it thinks fit of any evidence presented to the committee prior to such evidence being reported to the house.

The DEPUTY SPEAKER: I have counted the house and, as an absolute majority of the whole number of members is not present, ring the bells.

An absolute majority of the whole number of members being present:

Motion carried.

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