HANSARD
SITTING CALENDAR
SEARCH
LIVE BROADCAST
Hansard Dynamic Subject Index
Legislative Council - Fifty-Fifth Parliament, First Session (55-1)
2024-11-26 Daily Xml
Contents
Xml

Retirement Villages (Miscellaneous) Amendment Bill

Second Reading

Adjourned debate on second reading (resumed on motion).

The Hon. F. PANGALLO (20:47): To go back to what I was saying before the dinner break, more than 26,000 people live in retirement villages in South Australia and that number is expected to grow substantially with an ageing population and more retirees contemplating downsizing from their existing homes and looking at alternatives before they have to contemplate aged care. The Property Council, which of course lends its support to the sector, estimates retirement villages will save around $1 billion per year in delaying entry into aged-care homes. As I said, nice to know that, except a lot of retirees are a long way from going into an aged-care facility and are still enjoying their independence.

The Retirement Living Council claims in a report that 41 per cent are happier, 15 per cent more physically active and experience reduced levels of depression and loneliness because they can make new friends and socialise in these communities. According to the Property Council, the retirement industry requires 67,000 homes to be built to meet the level of demand from older Australians. They also point out that many villages are ageing and could be hindered from being developed for other housing users by restrictions on the termination of a village scheme.

In other words, if an operator wants to expand its facilities and there is an objection from just one resident despite overwhelming support from others, the minister is unable to proceed to terminate the scheme and the operator is unable to take court action for 10 years. They want the 10-year rule removed and I note there are further amendments to be moved in this place covering this.

I still continue to get complaints from village residents. They range from the behaviour of the operators, changing the goalposts of the contract's costs and obligations, and one I had more recently was problems getting anything done about addressing the building standard in a new development affecting residents living in ground floor units. To cut corners on this particular block, the builder decided not to soundproof the floor separating the ground units and upper units. Consequently, those living below get to hear everything happening on top.

These units were expensive to buy, around $675,000. This defect, unless fixed, and at considerable cost, will ultimately affect the resale price once the residents decide to move out. Who would want to buy here when you have that kind of disturbance? Remember that in the sale process, issues like that need to be disclosed to potential buyers. The problem is yet to be resolved to the satisfaction of residents. This is a prime example where a commissioner or an ombudsman could be involved.

I would like to acknowledge the enormous input and advocacy of Mr Bob Ainsworth in reshaping this legislation so that it is not tilted wholly in favour of the operators and owners. I have known Mr Ainsworth for many years. In his working life, he was a highly respected leader in business and finance in South Australia. In his retirement, he has led the charge for better rights for people in residential villages as past president of SARVRA.

Some of the more significant changes in this bill are because of Bob's input, in particular the modification to include retrospectivity to proposed changes to section 28, the capital funds contribution amendment. As it stood, it would have put departing residents at the On Statenborough village in Leabrook at an enormous disproportionate financial disadvantage. During debate in the other place, Minister Picton, at the lobbying of Mr Ainsworth, agreed to a retrospective amendment to section 28 which caps CFC at exit to 12.5 per cent or 1 per cent of the market value multiplied by the number of years of occupancy, whatever is less.

For residents at On Statenborough, the savings in CFC from this range from around $30,000 departing after 10 years to $100,000 for 15 years and almost $200,000 at 20 years if you take into account an initial sale price of around just over $1 million. These are significant savings which are not taken from the departing resident who may need to have funds to enter an aged-care facility.

But that is not the worst of what would have applied at On Statenborough. Operators use what I would describe as an unconscionable tactic in asking potential residents to submit their best offer. In effect, it is a blind offer and they really have no idea what they are bidding against. In some cases, they could be bidding against themselves if the operator's property agent comes back and says, 'Well, there is another offer on the table and you may be required to up your offer because of a demand in places.'

In one recent instance at On Statenborough, one person who was keen to reserve his place submitted an offer which in hindsight he says might have been somewhat higher than what it was worth. He got the shock of his life when he saw the estimated exit entitlement calculation based on the same resale price as his original purchase. After the operator took out all their fees and charges, he would have come out with $810,000 less from his original investment after just 10 years—$810,000 less. As this person said:

As you can see, they are quite outrageous and quite beyond their intent of providing accommodation in retirement villages.

As you can see, the ball is firmly in the court of the operators. Residents at On Statenborough and other villages will be thankful for Mr Ainsworth's contributions and insights into rectifying an unfair imposition. So well done, Bob.

I will also just briefly highlight another issue my attention was called to by constituents at another residential village facility, at Kingswood. Again, the operator decided to change the goalposts for the residents. They lost a kitchen that had been operating in there and that was required, where the operator was required to provide meals for these residents, who had applied for that and were paying for it. The operator decided that because of the costs they would remove that benefit of having meals provided for the residents in a dining room. It was also because the operator claimed there were not enough takers for the meals so they were not going to provide them. That was in direct contravention of the contract and agreement residents had signed when they went into that place.

Furthermore, there was a requirement to have an overnight caretaker at the place in the event there were any incidents where residents may have required some kind of assistance. The operator decided that no, they were not going to maintain the overnight caretaker because of costs, and that caretaker ended up being removed. So if something happened to one of the residents they had to call another emergency number before they could expect somebody to come and see them. It did happen to one of the residents: she suffered a collapsed and had to wait a considerable amount of time before assistance came. Again, it just demonstrates that the owners of these villages will certainly take the advantage, if they can, over residents.

There was another one I went to south of Adelaide. The residents there were alarmed that the operator, once a resident had moved out, would then remove beautifully kept gardens that were there. They would totally raze them, and it went from being a visually attractive place to one that lacked the proper amenity and outlook that other residents had enjoyed. Of course, that is part of the contract situation where the operator can then return the unit or the residence there to what it was before the previous resident had moved in. Of course, who pays for that? The outgoing resident.

The other issue was solar panels. On this particular unit the outgoing resident had spent a considerable amount of money putting in solar panels on that roof. Once they moved out there was a requirement that those solar panels be removed. Not only that but repairs had to be undertaken to the roof. No opportunity was given to the incoming resident in saying, 'There are solar panels on the roof. Do you want to take them over? Would you like them?' No, they had to be removed, along with modifications and renovations also to the interior. That sometimes can be understandable. When you sell a place you want to make it as attractive and new looking as possible.

After consultation with Mr Ainsworth I have seven amendments that I will outline here, and I trust they will get the support of members in this chamber. First up, my amendment No. 1 introduces requirements for operators to disclose any special levies in place, including the purpose, amount, frequency of payments and the proposed date of the final payment. Additionally, operators must provide information on any major capital expenditure projects planned within the next two years, including the cost and funding methods. This will enable residents and prospective residents to make informed decisions regarding their long-term financial commitments.

Amendment No. 2 ensures that prospective residents receive copies of the minutes from any resident meetings held within the previous two years. This allows incoming residents to gain an insight into recent decisions, financial issues, the operational history and ongoing concerns within the village.

Amendment No. 3 reduces the maintenance fee payment period for vacated residences from six months to three. This maintenance fee is comprised of water rates, council rates and other maintenance for the village. We all know that most village departures are sadly involuntary. They are triggered by entry to an aged-care facility or the passing of a resident. The transition from a village into an aged-care facility is the most stressful time in an old person's life.

Quite frankly, it is unconscionable that six months after a resident has moved out they are still liable for these maintenance fees. My amendment helps alleviate the financial burden on former residents or their families during the transition period following a departure. I am sure that the Property Council would be stridently opposed to this amendment because it does not favour the operator or the owner of the village. However, again, it places an unfair burden on the resident who is departing.

Amendment No. 4 prohibits operators from passing certain operational costs, such as industry accreditation expenses, on to the residents. These costs relate to sales and after sales service functions. Again, they have no place in being passed on to residents. If you cannot afford to operate without passing on these costs, you should not be operating at all. My addition ensures that only relevant costs are borne by the residents.

Amendment No. 5 provides a 10 business day deadline for meeting minutes to be provided to all residents of a village. This ensures transparency and that residents have timely access to important information discussed, like major works or a deterioration in the financial health of a village. I honestly cannot see why there would be members in this place who would oppose this. It is a transparency measure to ensure that residents remain fully informed about the status of their village.

Amendment No. 6 extends civil liability protections to subcommittees appointed by residents' committees, ensuring they, too, incur no liability for acts or omissions made in good faith. Again, why would you oppose an amendment like this? Finally, amendment No. 7 requires that operators provide each resident with a certificate of insurance for every current policy relating to the village. It also mandates that within 10 days of a request residents be supplied with a copy of any insurance policy in place. If this is not complied with, a $2,500 penalty should apply.

Residents, as funders of the village, have a right to know they are covered for insurable events. Very few operators will currently provide copies of their policies to residents. We have been advised of a situation where a resident committee at a village was explicitly instructed by the operator not to inform residents of personal contents insurances in case they make a claim. This amendment is practical and promotes transparency and peace of mind for residents.

My amendments are sensible, logical and provide a fundamental step towards fairer more transparent retirement village operations. I urge the council to support these amendments to ensure that the interests of residents remain the priority.

The Hon. D.G.E. HOOD (21:05): I rise on behalf of the opposition to indicate that we will support this proposed legislative reform. I might say at the outset that I believe that this is the parliament acting at its best in a way because this bill was somewhat different when it was originally presented to the House of Assembly, and it has undergone substantial change during its passage through that chamber. I think both the opposition and the government, as well as I believe a number of the crossbench in the other place, have reached a consensus-type position.

It is important to acknowledge that these changes were introduced as a response to the PEG Consulting report that was triggered by the third anniversary of the Retirement Villages Act. This bill is certainly an important and necessary step towards providing greater consumer protection for prospective residents of our state's retirement villages, the immediate improvement of current residents' rights, and to enhance the overall transparency of disclosure of documents and contracts relevant to those environments.

There are some 520 villages in South Australia, which I think is surprising, and they are run by various large and sometimes small operators spread right throughout metropolitan Adelaide and, of course, in our regions, which house some 26,000 South Australians. For perspective, that is the equivalent of an entire lower house constituency or entire lower house voting base in a lower house seat.

The Retirement Villages Act and accompanying regulations apply to all retirement village schemes operating throughout our state, setting out the legal responsibilities of developers, managers and owners in an attempt to clarify the rights and responsibilities of all parties involved.

Consultations with various stakeholders has been thorough in the opposition's estimation, with general feedback indicating that there is broad support for most of this amendment bill if not all. I am aware that during the statewide consultation period, 373 unique submissions were made on the draft amendment bill, and the Liberal opposition commends the efforts of those who have made these important contributions which have served to guide the debate on this bill in the other place.

I note that the largest village in South Australia has some 347 units, and that is known as the Golden Grove Lifestyle Village, and the residents in this particular village have been especially active in making their concerns known throughout the consultation process and in the lead-up to this bill being introduced and thereafter. Indeed, I have had the opportunity to meet a number of these residents personally and to listen to their concerns with the provisions in this act firsthand, and I believe we have come to a position that is satisfactory to most.

The bill we are dealing with here seeks to incorporate new regulations for prospective future residents' contracts and more informative disclosure statements, including defining and explaining contractual terms, occupancy information, residential rights and, of course, the associated responsibilities.

This bill proposes how changes are calculated and how these fees can vary depending on the length of time the resident lives in the particular village and by providing calculations based on a resident leaving a village at two, five and 10 years after occupation. Retirement village contracts have historically been technical and very challenging for consumers to understand adequately and this bill rightly aims to address this significant concern and the imbalance therein.

I know that the shadow minister for ageing has worked diligently in her efforts to ensure that both the grievances of current residents in retirement villages are considered, whilst balancing this with the importance of creating an investment environment that will foster more housing options for our ageing population. During her own consultation process the shadow minister certainly remained cognisant of the financial implications any legislative amendments may have on villages, including their valuations and, importantly, the cash flows, with many operators raising concerns that certain retrospective clauses may undermine future investment confidence.

Having said this, the Liberal opposition would argue that there has been an imbalance for residents over many years and that that imbalance needs to be rectified. Most South Australians have aspirations of ensuring that they have set up well enough for retirement and may well seek the option of spending their twilight years in a retirement village, where they can afford a safe and comfortable lifestyle.

Our parliament has the opportunity to ensure South Australian retirees are treated fairly when entering into contracts that may have considerable financial impact upon themselves and their families in the event their circumstances change and they need to exit the agreements they have entered into, whilst ensuring retirement village operators are afforded the ability to continue their businesses without disproportionate disruption. The Liberal opposition believes this bill is an appropriate move towards striking the right balance in these competing interests.

I would also like to foreshadow that there are a number of amendments to this bill. We have heard the Hon. Mr Pangallo outline some of his amendments. We are inclined to support a couple of them at this stage. Of course, we will listen to the debate, but our indication at this stage is that we are inclined to support a couple of them.

The Hon. Mr Simms has also filed some amendments, which we are not inclined to support at this stage. Of course, we will look forward to listening to his arguments. The Hon. Ms Bonaros has also tabled some amendments which we are open to considering, and we look forward to the further explanation on those as it unfolds. As I say, we are inclined to support the bill.

The Hon. R.P. WORTLEY (21:10): I rise to speak on the Retirement Villages (Miscellaneous) Amendment Bill 2024. The bill seeks to enhance the consumer protections of residents of retirement villages in South Australia while also supporting the growth and sustainability of this sector. The bill will help establish a contemporary, balanced and comprehensive framework for the regulation of retirement villages in South Australia, which puts consumer protection at the forefront while also minimising any unnecessary impacts on retirement village operators.

Retirement villages provide an important accommodation option for older South Australians. There are more than 500 retirement villages across South Australia, which are home to over 26,000 residents. The Retirement Villages Act 2016 commenced in 2018. It replaced the Retirement Villages Act 1987 and introduced significant reforms aimed at balancing consumer protections with the interests of operators and established a contemporary legislative framework to modernise the regulation of retirement villages across South Australia.

In 2021, an independent review of the act was completed by PEG Consulting, with 187 submissions made by residents, operators, peak bodies and other interested parties. The independent review found that many of the provisions of the act were appropriate, effective and operating as intended. However, it also identified that there is room for improvement and made several recommendations for legislative change.

A draft amendment bill introducing important reforms recommended by the independent review was drafted and provided for public consultation, along with several additional reforms aimed at enhancing consumer protections. A public consultation period of seven weeks was held last year, with the Office for Ageing Well hosting 13 information sessions across metropolitan and regional South Australia, including Tea Tree Gully, Adelaide CBD, Aberfoyle Park, Findon, Mount Barker, Victor Harbor, Berri, Kadina, Barossa, Murray Bridge, Mount Gambier, Port Lincoln and an online session, which in total were attended by over 420 residents, operators and interested stakeholders.

The consultation resulted in 373 unique submissions. Following the consideration of feedback provided by the consultation, the bill was finalised and introduced by the Minister for Health and Wellbeing in February this year. The amendments include:

a greater regulation of resident contracts and disclosure statements, including defining and explaining contractual terms, occupancy information, residents' rights and responsibilities, the presence of embedded networks, how fees and charges are calculated, and how those fees can vary depending on the length of time the resident lives in the village, by providing worked calculations based on leaving a village at two, five and 10 years;

a new offence of representing that a resident or prospective resident purchases a title to a residence if they do not;

earlier provision of the premises condition report;

additional clarity regarding financial reporting and resident consultation;

strengthened rights and participation for rental tenants;

a framework for managing residence contract deposits;

improved dispute resolution processes;

an obligation for operators to provide safe premises and maintain adequate insurance;

enhanced standards for operators and staff, including mandatory training and disqualifying offences;

additional information-gathering powers for the registrar and expanded capacity to publish relevant information on the register;

additional enforcement actions, including enforceable voluntary undertakings, increased expiable offences and more appropriate timelines for prosecution; and

some administrative and technical amendments to clarify the operation of the act.

The bill also includes additional measures that were subject to extensive community consultation and aimed to increase consumer protections for existing residents. These include:

reducing the statutory buyback period from 18 months to 12 months so that vacating residents and their families can receive their exit entitlements sooner. The 12-month buyback period is based on similar provisions in place or being introduced in other Australian jurisdictions and will provide certainty for residents while remaining feasible and achievable for operators;

where not addressed in the residence contract, capping increases on recurrent charges within the operator's control to the same rate as the consumer price index to keep charges affordable for residents during the cost-of-living crisis; and

a cap for the amount a resident or their family pay for capital maintenance when they leave a retirement village to a maximum of 12.5 per cent of the outgoing sale price.

With all of these amendments, it is important to note that if the resident has more favourable conditions within their existing contract, the more favourable conditions will continue to apply. The Malinauskas government are committed to ensuring the Retirement Villages Act provides a contemporary, balanced and comprehensive framework for the regulation of the retirement village sector, which puts consumer protection at the forefront while supporting the growth, sustainability and diversity of the sector.

The Hon. C. BONAROS (21:17): I rise to speak in support of the Retirement Villages (Miscellaneous) Amendment Bill 2024. The bill, as we have heard, brings forward critical recommendations from the review conducted some three years ago after the act's commencement, incorporating additional consumer protections informed by extensive community and stakeholder consultation. While I will not delve into the detailed provisions, I do endorse the enhanced protections for residents, noting of course that there is always room for further improvement.

With over 500 retirement villages in South Australia—a number that will only grow as our population ages—I think it is absolutely critical that we get this balance right. Without these protections, we risk creating a power imbalance between residents and operators or at least worsening a power imbalance between residents and operators.

As we know, residents in these communities can be especially vulnerable, often with limited resources and difficulties in having their voices heard. That brings me to the amendment that I will be moving today. Can I just say, the amendment itself has been the subject of extensive back and forth with government since this bill was first introduced in an effort to land on a reasonable outcome without detracting from its objective. I believe we have effectively reached that point.

There is perhaps one issue that I would liked to have pursued a little further in relation to the issue of cost; however, I can readily understand that that would be difficult given that a village could have many residents and there could be a hefty legal bill at the end of that. Notwithstanding that, I think that is something that we can look at further, subsequent to this bill passing.

In essence, the amendment seeks to clarify and codify existing case law, giving the Supreme Court clearer guidance when faced with applications for termination or partial termination of a village scheme. Recently, in the case of Caton Holdings Pty Ltd [2024] SASC 66, the Supreme Court considered an application to partially terminate a scheme under section 58 of the Retirement Villages Act, and this case involved a proposal to construct an aged-care facility on the village land. In the absence of explicit guidance in the act, Justice McIntyre accepted the submissions of Caton and the minister regarding relevant considerations.

At paragraphs 60 and 61, Her Honour outlined these considerations, which my amendment aims to make explicit in legislation, providing future cases with greater clarity and consistency. I have to say what sparked this was a particularly concerning situation brought to light by a very brave individual, Linda Knock, who, unfortunately did visit us during the last sitting week to be here for this debate, so passionate was she about what we were debating tonight, but given the urgency with which we have brought this on this evening, and the short timeframe, I was not able to have her back here today.

I know she wanted to be here to see us debating this, but can I just say what an immense pleasure it was, and has been, to spend time with Linda Knock. She is a 73-year-old retiree who invested her savings and super to buy into Bellara Village in 2013 expecting a stable community-focused home for her retirement years. For Linda, and indeed other residents, that expectation was absolutely shattered when they found out only after the fact that the village's owner, Crawford Giles, had secured approval to subdivide the property and build a petrol station and fast-food outlet on part of the village land. That was a shock to the residents, as the residents were only informed after the development application had been approved, with the operator citing a desire to avoid creating unnecessary anxiety.

When you buy into a happy place in which you expect to see out your years of life, and find out after the fact—well, you have kind of been sitting back and scratching your head and trying to figure out what is going on at the village for awhile, and then find out afterwards that half of it is effectively being sold off to become a petrol station and a fast-food outlet. I can tell you that is going to cause you some pain and anxiety, so anything that Mr Giles may have wished to avoid, I think, was actually compounded in this instance.

Under the act, any proposal to terminate a retirement village scheme requires the consent of all residents or, failing that, an application to the Supreme Court. Mr Giles did apply to the court, and Linda, with the limited resources available to her, was left to contest this matter on her own, with the general assistance of a pro bono legal counsel.

When I met Linda, and I have been out there a few times now with her, and visited Bellara, I saw firsthand the unoccupied, poorly maintained units earmarked for development. It really is day and night in terms of the village. On the right-hand side there is very unkempt, messy, empty units. The actual so-called display unit is a hollow shell with a ripped-out kitchen and the rest of it. There is a couch sort of upside down sitting there, and then there is a sign on the door that says 'display unit' and a number. On the other side, so looking over to the left, is a well-maintained nice garden and the homes that were to be kept under the development.

There is no question in my mind—absolutely none—that that particular purchase was made for one reason, and one reason only. It is quite sad in my mind to think that you have elderly, vulnerable people living in these villages and we are effectively waiting for them to die off for the financial gain that comes off that piece of land. That is why these amendments are so critically important. I am sure others may disagree with me with my assessment about that, but it is hard to think otherwise if you visit that village and actually see how many of these individuals are left there, and what the extent of the application was.

I will say that Linda herself took on this fight, and she said, 'If I didn't fight this it opens the door for other retirement village owners to take advantage.' When she moved there, there were 28 living units for permanent residents, and now I think there are, in total, around 14 that are still occupied, with only a handful of those in the same situation as Linda herself.

It is fair to say that it has had a devastating impact on her wellbeing, mental health and health all round, and I do not think it is just her. She is the person who has put herself out there in this instance. I know how desperately she wants to save other people from going through what she has been through, but I do not think she could ever have envisaged seeing out the rest of her years in this sort of environment, knowing that she had put everything into the village that she initially bought into.

It left me thinking that there is absolutely no question that, if that matter had continued, it would have set a very dangerous precedent, moving forward, for vulnerable members of our community, and it could very well just be the tip of the iceberg in terms of what is being proposed. So I think that is why these amendments are particularly important. It has become very clear to me that more robust protections are needed for retirees, who deserve stability and community and not uncertainty and profiteering.

The amendments that I will be moving aim to provide this protection, and I will speak to them now by establishing clear considerations for the Supreme Court when deciding whether to terminate a retirement village scheme. While Mr Giles, as I have said, has since withdrawn his case, which is a positive outcome, for what it is worth we do need to prevent such situations from arising in the first place. I do regret that that damage has been already done in this instance, and I think Linda's courage in coming out has come at great personal cost. But it is something that she is extraordinarily passionate about, in ensuring that other people do not face what she and her neighbours in her village have faced, particularly when it comes to things like retribution and everything that goes along with that.

I am very thankful for her advocacy to ensure others do not face the same ordeal. I am very thankful that she has put in the time and the effort. Indeed, we have had the assistance of others and pro bono work in terms of getting this done to strike a fair balance—as far as we can within the parameters of what I know will be acceptable, at least—between the rights of operators and the protections and needs of residents.

With those words, I indicate my support for the bill. Indeed, I hope that there is more work to be done in this space once we have had the opportunity to review how these particular provisions are operating after some time.

The Hon. K.J. MAHER (Minister for Aboriginal Affairs, Attorney-General, Minister for Industrial Relations and Public Sector) (21:28): I thank all honourable members for their contributions tonight and particularly the demonstration of goodwill that has gone into this bill. As members have spoken about, this has been a very involved review, a very involved piece of legislation, with a lot of work that has gone into where we have got to now. I look forward to continuing that thoughtfulness in that area. I think changes in here will have a significant positive impact on people's lives.

Bill read a second time.

Committee Stage

In committee.

Clauses 1 and 2 passed.

Clause 3.

The Hon. R.A. SIMMS: I move:

Amendment No 1 [Simms–1]—

Page 4, after line 2—After line 2 insert:

(a1) Section 4(1)—after the definition of annual meeting insert:

approved alteration means an alteration to a residence authorised under, or otherwise approved in accordance with, the residence contract applying in respect of the residence, and includes an alteration approved under section 43B;

The Hon. K.J. MAHER: I rise to indicate the government will not support this amendment. While the proposed amendment will not on its own have a substantive impact on the operators or residents of retirement villages, it is the first of a series of amendments proposed by the Hon. Robert Simms relating to the arrangements governing alterations to residences. It will have, in the government's view, a serious and potentially negative financial impact on both operators and residents as a whole. We will not support this amendment, and I do not think it will come as a surprise that, as a result of that, we will not support the suite of amendments the honourable member is moving.

The Hon. D.G.E. HOOD: The opposition will not be supporting it either.

Amendment negatived; clause passed.

Clauses 4 to 13 passed.

Clause 14.

The Hon. R.A. SIMMS: I assume that my amendments Nos 2 and 3 would both be considered consequential; is that right?

The CHAIR: Apparently 2 is consequential, 3 is not, so you will not move 2?

The Hon. R.A. SIMMS: Yes, that is right. Therefore, I move:

Amendment No 3 [Simms–1]—

Page 8, lines 16 to 19 [clause 14, inserted section 20(1)(c)(vi)]—Delete subparagraph (vi)

Amendment negatived.

The Hon. R.A. SIMMS: I move:

Amendment No 4 [Simms–1]—

Page 9, after line 2 [clause 14, inserted section 20]—After subsection (1) insert:

(1a) A residence contract must not include any of the following terms:

(a) a term requiring a resident to pay an amount in relation to the remarketing of the resident's residence;

(b) a term requiring a resident to be responsible for the reinstatement of a residence to the condition it was before an approved alteration was made to the residence.

(1b) A term included in a residence contract in contravention of subsection (1a) is void and of no effect.

I will not talk through what all the amendments achieve as I did that at the second reading stage.

Amendment negatived.

The Hon. F. PANGALLO: I move:

Amendment No 1 [Pangallo–1]—

Page 10, after line 40 [clause 14, inserted section 21(1)(b)]—After subparagraph (ii) insert:

(iii) any special levy in place and payable by residents of the retirement village, including the purpose of the special levy, the amount and frequency of payments and the proposed date of final payment; and

(iv) any major capital item expenditure project in place or planned for the next 2 years, including the cost of the project and how it will be funded; and

I will just go through it briefly even though I have already said what it was about previously. This is all about transparency and requires operators to disclose special levies in place as well as operators providing information on any major capital expenditure projects that might be planned within two years, including the cost and funding methods. Again, this will be for the benefit of residents and any incoming residents who can make informed decisions about their long-term financial commitment.

The Hon. K.J. MAHER: I rise to indicate that the government will be supporting this amendment. A key focus of the bill is to ensure that comprehensive and transparent information is provided to prospective residents. It is essential that prospective residents are informed and provided a disclosure statement of all fees and charges that they will be responsible for.

I might for the benefit of the committee indicate that we will be supporting the Hon. Mr Pangallo's amendments Nos 1 and 6. When the honourable member moves No. 2, I might explain briefly that we will not be supporting that and the other amendments on the basis that this bill attempts to strike a balance between the administrative burden it can place on operators and the rightful expectations and needs of residents. So we will support Nos 1 and 6 but not the other amendments of the Hon. Mr Pangallo.

The Hon. D.G.E. HOOD: I might indicate that the opposition takes exactly the same view, in fact, that we will also be supporting amendments Nos 1 and 6 but not the others from the Hon. Mr Pangallo.

Amendment carried; clause as amended passed.

Clause 15.

The Hon. F. PANGALLO: I move:

Amendment No 2 [Pangallo–1]—

Page 11, after line 32—After subclause (1) insert:

(1a) Section 22(c)—after subparagraph (ii) insert:

and

(iii) a copy of the minutes of any other meeting of residents convened by the operator within the preceding 2 years;

This amendment is quite a simple one and it is bizarre that nobody wants to support it, and I would like to know the reason why they are not supporting it. It is basically to provide a copy of minutes of any meetings that have been convened by the operator with residents for the preceding two years of going in there, just to ensure that people who are either contemplating buying or about to sign contracts in there have a fair idea about the history of what they are going into. For the life of me, I do not know why you would oppose something as simple as that, that provides information to prospective buyers. There is nothing sinister in it.

The Hon. R.A. SIMMS: I rise to indicate the Greens will support the amendment. It seems to me to be a pretty commonsense measure. As the Hon. Mr Frank Pangallo says, when people are making a major purchase like this they should get access to all of the relevant information. I think this information is relevant. It should be made available to a prospective buyer. I understand his pain. I was shocked to see my very sensible amendments met with such underwhelming support but know, the Hon. Mr Pangallo, that the Greens support you in that endeavour.

The Hon. K.J. MAHER: In supporting the first amendment, the government will not be supporting this amendment. It is the government's view that, in conjunction with the proposed amendments Nos 5 and 7, they will operate to increase the administrative burden on the operators of retirement villages, including many small operators and not-for-profit operators, and I am advised that the overwhelming majority of these facilities are not-for-profit.

Together, it is the government's view that the amendments will significantly increase the amount of administrative paperwork that must be prepared by an operator and distributed to residents and/or prospective residents, having a resource impact for that overwhelming majority who are not-for-profit operators, which may then be subsequently recovered from the residents in the form of recurrent fees or charges.

Under the current Retirement Villages Act an operator is already required to give prospective residents a copy of the minutes from at least two annual general meetings of residents of the village if two or more such meetings have been held or at least one annual general meeting if only one such meeting has been held.

The Hon. F. PANGALLO: Can I ask the minister: were they lobbied by the Property Council to oppose this amendment?

The Hon. K.J. MAHER: My advice is that is not the case.

The Hon. F. PANGALLO: Were they lobbied by the Retirement Living Council or SARVRA or COTA?

The Hon. K.J. MAHER: My advice is that is not the case. As members have spoken about in their second reading speeches, in the development of this legislation there was obviously a lot of consultation that has occurred, but I am advised that not supporting these amendments is not a result of lobbying from the two bodies that have been suggested by the Hon. Mr Pangallo.

Amendment negatived; clause passed.

Clause 16 to 21 passed.

Clause 22.

The Hon. F. PANGALLO: I move:

Amendment No 3 [Pangallo–1]—

Page 17, after line 38—After subclause (3) insert:

(3a) Section 29(5)—delete '6 months' wherever occurring and substitute in each case '3 months'

(3b) Section 29(6)—delete '6 months' and substitute '3 months'

As I said briefly, it is quite unconscionable that six months after a resident has moved out they are liable for these ongoing maintenance fees. I thought the reforms that we have been debating here and that were also debated in the other place were to try to minimise the expense that is being placed on residents when exiting retirement villages. We have already seen instances—and members in here have spoken of instances—of the financial hardship that can be put upon residents when they go into these places. What this is intended to do is ease that financial pressure on them.

You only have to see the report on ABC TV that demonstrated the extent of the difficulties created by these measures that villages put in their contracts that make it difficult for the residents to be able to move on with their lives and still have some reasonable amount of money when they exit these villages. Again, I think moving it down to three months is fairer on residents.

The Hon. K.J. MAHER: As I indicated, the government will not be supporting this amendment. It is the government's view that the independent statutory review specifically considered the topic of recurrent charges payable after exiting a village and did not make any recommendations with respect to the lowering of a timeframe. The bill before us already includes significant consumer protections with respect to financial liability when a resident vacates a village, and it is the government's view that the amendment bill strikes the appropriate balance with respect to ensuring robust consumer protections and responsibility for costs after a resident vacates a residence; therefore, the government does not support the amendment.

The Hon. R.A. SIMMS: The Greens support the amendment. I think the Hon. Mr Pangallo has outlined a sound rationale. It is certainly my view that residents in these retirement villages are often in quite a vulnerable position. There is a significant power imbalance that exists between them and the retirement village, so anything we can do to redress that I think we should.

Amendment negatived; clause passed.

Clause 23 passed.

Clause 24.

The CHAIR: There are amendments in the name of the Hon. Mr Pangallo and the Hon. Mr Simms. However, the Hon. Mr Simms, yours seem to be kind of redundant now.

The Hon. R.A. SIMMS: Are they? Because I thought the latter—

The CHAIR: So now you want to challenge the Chair, the Hon. Mr Simms, do you?

The Hon. R.A. SIMMS: No, I am not challenging the Chair. I am querying the rationale, but I will follow your guidance. If that is the view of the Clerk and the Black Rod, I am happy to not proceed with those.

The CHAIR: We will just check that, but that is the advice at this point. In the meantime, we can move on with amendment No. 4 [Pangallo-1].

The Hon. F. PANGALLO: I move:

Amendment No 4 [Pangallo–1]—

Page 18, after line 9—Insert:

(1) Section 31(3)—after paragraph (b) insert:

(ba) costs incurred by the operator in obtaining and maintaining an industry accreditation for or in relation to the retirement village; and

(bb) costs incurred by the operator in relation to employee recruitment and the education and professional development of employees; and

As I outlined in my second reading speech, the intent of this amendment is to prohibit operators from passing certain operational costs, like industry accreditation expenses, onto residents. Why should residents have to pay for these costs on top of whatever else is put upon them?

The Hon. K.J. MAHER: As indicated, the government will not be supporting this amendment. Industry accreditation is voluntary and not regulated by states and territories. In response to the recommendation of the independent statutory review, the government carefully considered the industry standards and code of conduct and determined that, as observed by the review report, the diversity of the operator market and types of villages operating in South Australia means it is not reasonable to expect all operators to subscribe to them and would likely pose an unnecessary cost burden upon the residents.

The Hon. R.A. SIMMS: I feel a bit like Cilla Black on Instagram. I have been seeing those 'surprise, surprise' videos at the moment. I am not surprised that once again the Labor Party do not support it, but I think the Hon. Mr Pangallo's suggestion is a good one and the Greens are happy to support it.

Amendment negatived.

The CHAIR: The Hon. Mr Simms, we have been advised that your amendments are consequential so they are redundant.

The Hon. R.A. SIMMS: Yes, I will not be moving them then.

Clause passed.

Clauses 25 to 27 passed.

Clause 28.

The Hon. F. PANGALLO: I move:

Amendment No 5 [Pangallo–1]—

Page 21, lines 42 to 43 [clause 28(1)]—Delete subclause (1) and substitute:

(1) Section 34(4)—delete subsection (4) and substitute:

(4) The convener of a meeting must ensure that written minutes of the meeting are provided to each resident within 10 business days after the meeting.

Again, this is all about providing information to residents and potential residents. It asks that there is a 10-day deadline for meeting minutes to be provided to all residents of a village. I cannot see what is wrong with a village providing that information within an acceptable timeframe of 10 working days. As I have said, this is all about transparency so that the residents know what is going on with their village. I mean, they are important stakeholders. Why should they be denied this information? I just do not understand the government and the opposition—unless of course they have been lobbied by the Property Council, which I expect they would have—

Members interjecting:

The Hon. F. PANGALLO: Well, I am sure they would have. I do not understand why they would not support something like this, which is a transparency measure that provides information to people. What is wrong with it? I cannot see it incurring great costs on them, despite what the government is saying.

The Hon. K.J. MAHER: As I indicated when I spoke at amendment No. 2 [Pangallo-1], the government will not be supporting this amendment. The act currently provides that the minutes of the annual general meeting must be distributed within 10 business days and all other meeting minutes must be made available for residents to inspect at a place that is easily accessible. We think this strikes an appropriate balance already.

The Hon. R.A. SIMMS: Surprise, surprise! Unfortunately, the government are not supporting that amendment, but I think it is a sensible suggestion and the Greens are happy to support it.

The Hon. D.G.E. HOOD: Just for the record, I think we have made our position clear on this but I have some sympathy for what the Hon. Mr Pangallo was saying. It seems simple but the fact is that when we were doing our consultation on this issue, with residents and owners and the various associated bodies, no resident groups suggested to us that this was an important issue for them.

But, on the other side of that, there were a number of the owner groups that did present an argument to us that said that this was an administrative burden particularly on the smaller villages. They are not-for-profits, most of them, of course, so there are barriers in that regard. I think the Hon. Mr Pangallo makes a sound point, but in fact when you consult with the groups relevant here, there did not appear to be a compelling need or a strong push for it on the residents' side. I would say also just for the record that I have not been lobbied by the Property Council at all on this issue.

Amendment negatived; clause passed.

Clause 29 passed.

New clause 29A.

The Hon. F. PANGALLO: I move:

Amendment No 6 [Pangallo–1]—

Page 22, after line 10—After clause 29 insert:

29A—Amendment of section 38—Residents' committees

Section 38(14)—after 'residents' committee' insert:

, or a sub-committee appointed by a residents' committee,

I thank the members in this place for agreeing to at least support this one which extends civil liability protections to subcommittees that have been appointed by residents' committees so that they do not incur any liability for acts or omissions that had been made in good faith by those committees, so I am glad of that.

Can I just point out that I am not suggesting that the Hon. Dennis Hood was lobbied by the Property Council, but I am sure that the Property Council and Mr Gannon and perhaps even Mr Bruce Djite may well have been lobbying the Liberals and the government on some of these amendments.

New clause inserted.

Clauses 30 and 31 passed.

Clause 32.

The Hon. F. PANGALLO: I move:

Amendment No 7 [Pangallo–1]—

Page 23, lines 9 to 16 [clause 32(2)]—Delete subclause (2) and substitute:

(2) Section 42—after subsection (2) insert:

(3) The operator of a retirement village must—

(a) provide each resident of the retirement village with a certificate of insurance for each current policy of insurance that is in place in relation to the village; and

(b) within 10 days of a request made by a resident for a copy of a policy of insurance that is in place in relation to the village, provide the resident with the requested copy of the policy.

Maximum penalty: $2,500.

Note—

This does not include policies of insurance taken out by individual residents of the village.

I know it is going to go down with the ship but, nonetheless, again I think this is all about disclosure and protections for residents in villages. It requires that operators provide each resident with a certificate of insurance for every current policy relating to the village. Again, I do not know why residents—who have bought into the place, who have a significant financial interest and an investment in the place—should not know what insurance cover applies to the village and perhaps even extends to them. Again, I just do not understand why this would be opposed.

The Hon. K.J. MAHER: The government will not be supporting this amendment. We do not believe it provides a benefit commensurate with the increase in administrative burden. The bill already introduces amendments that require that the operator must maintain adequate insurance cover, and it also makes insurance information, according to the bill, available free of charge to a resident upon request. A request for information must be responded to within 10 days, so we think rather than having to provide it to everyone—who does not necessarily want to see it—and increase that burden, this strikes a much better balance.

The Hon. R.A. SIMMS: The Greens support the amendment. I do not find this argument around the administrative burden of printing off a certificate really compelling, particularly when one considers the huge amount of money that people are investing when they are moving into these retirement villages. I do not think it is huge impost to say they can get access to this information as a matter of course. It is a pretty significant financial decision that people are making. Why not ensure that they are furnished with all the relevant information and make it a proactive thing? It is not a big, onerous requirement to run off a photocopy of a document.

The Hon. F. PANGALLO: I just want to point out that in the nearly seven years I have been in this place I have actually had a lot of interaction with residents in retirement villages—a lot of interaction. Every year, I am seeing people or they are calling me. In my previous career, it was the same thing: people complaining about the way that they were being treated and these onerous contracts that were placed upon them in relation to that.

The thing that struck me about many of these residents who have gone in there is that they were not familiar with contractual law or with contracts. These contracts are quite complex, and there were not people who were able to explain it to them. I found a lot of them did not understand them. In fact, even their own family members did not understand a lot of them until there was an issue with them.

I can tell you something, Mr President. I will not name this person, but a very eminent person who contacted me as recently as this week—a very knowledgeable person—even was flummoxed at the complexity of these contracts. He asked me not to name him and I will not, but I can tell you he is an extremely well-respected person, and extremely knowledgeable, and even he found it difficult to comprehend some of the language in these contracts and the conditions that were being placed upon them. That gives you an idea of the complexity.

This has been mentioned. There are something like 26,000 people in these residential villages, and there are something like 500 villages. You have a wide range of people in these villages. Some of them may not have been well educated or have university degrees or whatever, and they find it very difficult to understand. I have a woman who still contacts me on a regular basis, who says, 'Frank, I just don't understand why these exit fees are so expensive. Why do I have to lose a significant amount of my investment, particularly when there is really nothing wrong with my place? I am going to leave it that way. Why do I have to lose so much money as a result?'

I say to them: 'These are the contracts that you have signed.' She says she did not understand them. It was not explained to them properly. That is another issue that faces people today. As I said, this amendment is just all about disclosure and protections for those people. I thought the intent of the reforms of this bill was all about more protections for people in there, not making it difficult or some excuse that it is too onerous and it is too costly and if they want them they can ask for them.

No, they should be given to them as a matter of course when they sign contracts. When they are putting a considerable investment into these places, they should be able to access as much information, or be given that much information, about these places that are going to impact on their lives.

I am disappointed that it is not going to get the support. I am sure that I will get more complaints about this bill. Even though there are some considerable and good reforms in it, I know that there are going to be some unintended consequences or others who are not going to be happy with it. Again, I am disappointed that it does not have the support, but I thank the chamber for at least supporting two of those amendments.

Amendment negatived; clause passed.

Clauses 33 to 37 passed.

Clause 38.

The Hon. C. BONAROS: I move:

Amendment No 1 [Bonaros–1]—

Page 31, after line 8—After subclause (3) insert:

(3a) Section 58—after subsection (2) insert:

(2a) In addition, the following persons are entitled to appear in proceedings before the Supreme Court under this section:

(a) a resident of the retirement village the subject of the application;

(b) any other any person who, in the opinion of the Court, has a sufficient interest in the proceedings.

(2b) Subject to subsection (2c), a person who proposes to apply for the termination of a retirement village scheme or part of a retirement village scheme under this section must, before making the application—

(a) give notice in writing of the proposed application and termination to each resident along with any prescribed information relating to the proposed termination; and

(b) allow a period of 60 days after giving the notice for residents to make representations to the person in response to the notice; and

(c) keep a record of representations made by residents in response to the notice.

(2c) The Supreme Court may, on application, dispense with the requirement to comply with subsection (2b) if satisfied that it is appropriate in the circumstances of a particular case.

(2d) Notice of an application to the Supreme Court under subsection (2c) must be given to each resident.

(2e) An application for the termination of a retirement village scheme or part of a retirement village scheme under this section must include information about the results of consultation undertaken in accordance with subsection (2b) (if any).

(2f) In determining whether to approve the termination of a retirement village scheme or part of a retirement village scheme under this section, the Supreme Court must have regard to the following matters (insofar as the matters are relevant to the proposed termination):

(a) the views of residents of the retirement village (including the results of any consultation undertaken in accordance with subsection (2b)) and the operator in relation to the proposed termination;

(b) whether the proposed termination would be likely to benefit residents of the retirement village or may result in detriment to residents;

(c) whether the proposed termination would be likely to affect the capital value of residences in the retirement village;

(d) whether the proposed termination would be likely to involve a breach of any residence contracts;

(e) the conduct of the operator and residents of the retirement village,

and the Court may have regard to any other matter the Court considers to be relevant in the circumstances of the particular case.

I have already spoken to this amendment insofar as it relates to clarifying and codifying existing case law, giving the Supreme Court clearer guidance when faced with applications for termination or partial termination of a village scheme and effectively, as far as reasonably possible, reflects the judgement that I referred to earlier, the submissions of Caton and the minister regarding what ought to be relevant considerations in these instances.

The Hon. K.J. MAHER: The government will be supporting this amendment. It is this government's view that it is consistent with provisions in the bill and provides clarity to what is intended.

The Hon. D.G.E. HOOD: The opposition will also be supporting this amendment for exactly the reasons as outlined by the Attorney.

The Hon. R.A. SIMMS: The Greens are also supportive of the amendment. Might I just make the comment that, whilst I am disappointed that my amendments were not successful, I do welcome the fact that many of the amendments advanced by the Hon. Mr Pangallo and the Hon. Connie Bonaros have been accepted by the government. I think they do strengthen the bill and, indeed, the bill itself is a positive advance forward.

The Hon. F. PANGALLO: I rise to say that I will be supporting the amendment.

Amendment carried.

The Hon. C. BONAROS: I move:

Amendment No 2 [Bonaros–1]—

Page 31, after line 10—After subclause (4) insert:

(5) Section 58—after subsection (4) insert:

(5) A reference in this section to a resident includes a person who is not in occupation of a residence but is, under a residence contract, entitled to payment of an exit entitlement and has not received payment of the exit entitlement.

I think I can speak to all of them. Effectively, the subsequent two amendments are consequential. They are all part of the one package.

Amendment carried; clause as amended passed.

Clauses 39 to 48 passed.

Schedule 1.

The Hon. C. BONAROS: I move:

Amendment No 3 [Bonaros–1]—

Page 40, after line 25—After clause 7 insert:

7A—Termination of retirement village scheme on application to Supreme Court

Subsections (2a) to (2f) of section 58 of the principal Act, as inserted by this Act, apply only in relation to proceedings commenced under section 58 of the principal Act after the commencement of section 38 of this Act.

Again, this is a consequential amendment and is related to the other two.

Amendment carried; schedule as amended passed.

Title passed.

Bill reported with amendment.

Third Reading

The Hon. K.J. MAHER (Minister for Aboriginal Affairs, Attorney-General, Minister for Industrial Relations and Public Sector) (22:03): I move:

That this bill be now read a third time.

The Hon. D.G.E. HOOD (22:03): I want to acknowledge the comments of the Hon. Mr Pangallo throughout this debate. I want to say to him, through you, sir, that I understand his disappointment. I think a number of the amendments that he has put before the chamber are indeed sensible, but in the end, speaking for the opposition, during our consultation they were seen as—I say this respectfully—lesser matters, if I can put it that way, for the broad consultation that we did.

This bill, I am sure the Hon. Mr Pangallo would acknowledge, makes some very significant steps forward for consumers, for those people who are investing in retirement villages. From the opposition's perspective, we saw this as the right balance at this time. That said, we will be watching this space closely, and should the bill need to be revisited and the sorts of amendments that the Hon. Mr Pangallo has put to this chamber be further considered, then we are absolutely open to that.

The Hon. F. PANGALLO (22:04): I would like to acknowledge the input from all the members in this place, and I would like to commend the minister, Chris Picton. This has been a piece of legislation a long time coming. As I mentioned in my second reading speech, I can recall attending a meeting back in 2018, and it was a packed meeting, of residential village people in Pilgrim Church, I think it was, with the minister at the time—sorry, he was shadow minister at that time. He showed a lot of empathy and compassion for the problems that residential village people were feeling at the time, and he gave the commitment that they would look at it.

I know it has been nearly six or seven years, but it has come through. I welcome it, and I am sure there are many in the community, families as well, who have members in residential villages who would also welcome these changes. It was a pity the changes could not go a little bit further, but nonetheless there has been significant progress. Again, I thank the government and the minister for their input, and also the other members who have taken a strong interest in this.

Bill read a third time and passed.

PARLIAMENTARY BUSINESS
MEMBERS
GET INVOLVED
ABOUT PARLIAMENT
VISIT
LEGISLATIVE COUNCIL
HOUSE OF ASSEMBLY
CONTACT