Consumer New Zealand has backed a campaign to urgently review the Retirement Villages Act after numerous stories of unjust treatment of residents.
Chief executive Jon Duffy told MPs today in a select committee that many residents were not being treated fairly, saying agreements were often one-sided and riddled with terms that may violate the Fair Trading Act.
It follows a petition launched by the Retired Village Residents’ Association to address an imbalance between operators and residents.
The association’s president, Brian Peat, said much more justice needed to be done in the way residents were treated and that the Old Age Homes Act was now obsolete.
He told Checkpoint controversial issues included payback – after either the death of a resident or a resident who left the village for some other reason.
He said it should be reduced to 28 days, while the Pension Villages Association has proposed nine months with a small amount of interest added to the money being repaid.
Right now, it could take months or even years for some residents to get back the money they owed after they moved, Peat said.
The residents were like tenants in every other situation except that when they moved they had to keep paying their rent until the unit was re-licensed.
“And that’s just not fair.”
Consumer NZ’s Duffy told the select committee about 80-year-old Mary having to keep paying for nine months after she moved.
“There are countless examples of Mary’s situation, which is very sad,” Peat said.
Feedback he had received showed overwhelming support among the elderly over a 28-day limit.
Another pain point was the language used in the contracts between residents and the village operators, which was confusing even for legal specialists, he said.
Also, about 40 percent of the villages have included repair and maintenance costs in their agreements.
“We don’t own the houses, we don’t own the land, so why do residents have to pay for repairs and maintenance?”