Retirement village giants have vowed “improvements” to the sector after a Government minister, a commission and Consumer NZ called for change.
Graham Wilkinson, president of the Retirement Village Association – the giants’ lobby group – today announced changes to the complaints system and the length of payback time once people die or go into different village properties, like a hospital.
At the association’s national conference in Auckland, Wilkinson cited “providing residents with a stronger voice, strengthening the complaints process and working with the Commission for Financial Capability to monitor re-licensing times”.
His announcement comes after Associate Housing Minister Poto Williams called for the industry to clean itself up, offering clearer contracts and a better complaints system.
The association’s statement follows a White Paper issued by the commission examining areas where the sector could make big improvements.
Consumer NZ has also called for major changes, saying terms and operations are not transparent or fair for some.
Yesterday, Williams said: “There are some changes the industry could start to make themselves around strengthening the complaints processes and reviewing contracts to ensure residents are fairly treated.”
Wilkinson announced that the retirement village sector had launched a comprehensive blueprint for a range of improvements to the industry.
“The association will also explore establishing an ombudsman to hear and resolve complaints and invite an independent member of the public to sit on its executive to represent residents’ interests,” a statement out today said.
The ombudsman would be industry funded, like in the insurance and banking industries.
Retired High Court judge John Priestly QC is already the independent chair of the association’s separate disciplinary authority to look at complaints about egregious operator behaviour.
But Wilkinson today said the association had not yet decided who the new ombudsman should be.
“We accept there is always room for improvement and refinement around certain practices as our sector and our offering evolves. This blueprint sets out the tangible and definitive steps we will be taking to achieve that goal,” said Wilkinson, who owns 100 per cent of national retirement business Generus with villages in Auckland, Tauranga and Christchurch.
“There is a role for continuously education operators and residents about the re-licensing process and to encourage best practice including dealing with potential drawn-out re-licensing times,” he said.
He was referring to the length of time it takes to pay out families and beneficiaries of estates once a retirement village resident dies.
Not only do villages often keep the money for months after a death, or when someone goes from a villa to the hospital, but they also charge weekly fees following death.
That leads to complaints from families owed the money.
Villages also have a conflict of interest: those expanding their buildings have an interest in selling new rather than established, sold places, so families have to wait even longer.
“The blueprint sets out plans to review occupation rights agreements to address any perceived unfair terms or confusing clauses and ensure clarity around what the resident and operator are responsible for, in particular repairs, maintenance and replacement of operator-owned chattels,” Wilkinson said.
Stoves or heat pumps that break down, for example, are not owned by residents who only have a licence, not a title to the property. Yet operators force them to repair these fixed chattels.
Wilkinson’s opening conference speech said “the best way to show that there is nothing to see here is to show that there is nothing to see here”.
He also referred to the recent resignation of company chief executives: Ryman’s Gordon MacLeod, Arvida’s Bill McDonald, Metlifecare’s Glen Sowry and Summerset’s Julian Cook.
The sector was in a “golden age” with around 100 Kiwis every week moving into villages.
But this was changing: “The RVA executive is now considering and will shortly consult with members on issues that are clearly ones that both residents and regulators would like to see some action over.
“These include charging fees after exit, although this once-common practice is now a minority,” Wilkinson said.
Dealing with operators’ chattels and re-licensing times were other issues, he said.
Retirement village consultant Troy Churton, also at the conference, wrote the commission’s White Paper.
That recommends stronger protection for the population which real estate agents and property consultants JLL estimate number at least 45,000 New Zealanders, with a further 12,000 places now under construction.
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