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- 16 March 2004
Retirement Villages Amendment Bill
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Page: 7269
Second Reading
The Hon. IAN MACDONALD (Minister for Agriculture and Fisheries) [8.50 p.m.]: I move:
That this bill be now read a second time.
I seek leave to incorporate the second reading speech in Hansard.
Leave granted.
This bill introduces reforms to the regulation of the retirement village industry in New South Wales.
Retirement villages play an important role in the housing choices for our seniors. They enable retirees to live with people of a similar age group in a safe community environment, enjoying a range of facilities and activities. There are more than 700 retirement villages currently operating in New South Wales, accommodating around 40,000 residents. That's approximately 3 per cent of the New South Wales aged population.
This figure is expected to climb as the baby boomers reach retirement age and are attracted to the lifestyle offered by retirement villages. It is important the legislation keeps pace with developments in the industry and continues to provide adequate protection for consumers and clarity and certainty for village operators.
The Government introduced the Retirement Villages Act in 1999 following extensive consultation and a review of the regulatory environment at the time, which consisted mainly of an industry code of practice. The Act represented the most significant reform to the regulation of the industry since retirement villages first began in New South Wales in the 1950s.
Certain reforms to update and improve the Act are now being proposed for introduction. The main purpose of the bill is to address a number of legislative interpretations in recent judicial decisions and to bring forward the statutory review of the Act.
I turn now to the specific detail of the bill.
The bill aims to bring forward the statutory review of the Act. Currently, under section 208, a review of the Act is required to be undertaken five years from the date of assent. The Act was assented to on 3 December 1999, meaning that the review would not be scheduled at this stage until the first half of 2005.
Since becoming Minister I have met with a wide range of interest groups involved with the retirement village industry. Many are happy that the Act was introduced and the substantial improvements to the industry which have occurred since 1999. However, changes are now required to provide greater protection to residents and those contemplating moving into a retirement village. It is argued that there are certain unfair and inequitable practices within the industry that should be further addressed. The complexity of contracts, the standard of village management, excessive fee increases and who should be responsible for the cost of repairs are some of the more frequent issues raised by consumers.
All those involved in the industry agree that it would be beneficial for the review to be brought forward. Bringing the review forward would provide residents, village operators and other interested parties the opportunity to comment on the legislation as soon as possible.
The Government intends to amend the Act to bring forward the review to commence upon assent being given to this package of amendments. A report on the outcome of the review is to be tabled within 12 months from this date.
Another measure contained in the bill is designed to overcome a potential anomaly with the legislation. Within the retirement village industry there is a small number of villages that operate on a leasehold basis, where residents enter into a lease for 99 years or 199 years which is registered on the title of the property. In some villages, when the resident dies or vacates, the existing lease is surrendered and a new lease entered into with the incoming resident. However, at other villages the contract gives the resident the right to assign the remaining portion of the lease to the new resident.
A problem has been identified with those residents with assignable leases. Under the current legislation when a resident dies or moves out the contract of the resident is terminated. The concern is that termination of the contract may nullify assignment rights as it is argued that there is nothing left to assign.
Usually, under the terms of such a contract, payment to the outgoing resident or to their estate is dependent on the assignment of the lease. If the lease cannot be assigned there is a potential for residents in these situations to lose significant amounts of money. Termination of the contract also means that the resident could have their interest removed from the title of the property. This could jeopardise the important protection afforded by the registration of the resident's interest.
The Government is proposing to amend the legislation to clarify this issue. The amendment will make it clear that a resident who has a lease with a right to assign can continue to exercise that right. Such a contract will no longer be terminated on death or vacation of a residence but continue on until the end of the original lease. Only the outgoing resident's right to occupy the premises will terminate upon the assignment of the lease. The existing powers of the Consumer, Trader and Tenancy Tribunal to terminate an assignable lease in certain situations will not be affected by this amendment.
The amendment does not give any greater rights to residents in respect to assignment. It does not mean that other residents who have contracts under which they have no right to assign will be able to do so.
This proposal has relevance to only a relatively small sector of the industry. In a practical sense leases have continued to be assigned since the Act began but there has been doubt as to the legality of this practice. The amendment the Government is now proposing will remove any uncertainty and restore the original intention of the parties when entering into an assignable lease.
The Government is also seeking to clarify the rights of residents who own their premises within the village to let or sublet following a decision of the Supreme Court. The court decision may jeopardise this important right.
Under the Act, residents who are owners are given the right to let or sublet the premises on a temporary basis for up to three years. Units in retirement villages can be difficult to sell. Being able to rent out the unit allows the former resident, or their estate, to receive rent to help pay ongoing costs until the unit is sold. This measure assists in expanding the supply of suitable and affordable rental housing for seniors.
However, in the Supreme Court an operator challenged the right of an estate to sublet the premises on the basis that it had not delivered up vacant possession and handed the keys back to the operator. The estate argued that returning the keys would remove its ability to provide possession to their tenant. They needed the keys in order to sublet. The court found in favour of the operator.
It is important to note that the court itself, in making the decision, commented that it had come to the conclusion with reluctance, as the interpretation contended for by the defendants was one that more generally accords with the policy and intent of the legislation.
The Government intends to amend the Act to restore the original intent of the provision. The bill will make it clear that a resident, a former resident or the estate of a deceased resident can let or sublet without first having to hand back possession to the operator.
The amendment will change the definition of "permanently vacated" to ensure that all residents who are owners under the Act permanently vacate upon the death of the resident or when they move out. Delivering up possession to the operator and handing back the keys will no longer be required in these circumstances.
This will ensure that residents who are owners, and the estates of such residents, will continue to be able to exercise their intended right to let or sublet the premises.
The bill addresses another issue raised by consumer groups following another judicial decision. It relates to the circumstances in which an operator may seek the consent of residents to amend the statement of approved expenditure, commonly known as the budget, agreed upon before the start of each financial year at each village.
Under the current Act an amendment may only be sought if unforeseen requirements for expenditure arise. This was meant to give operators some leeway if unique or exceptional circumstances arose which could not have been reasonably foreseen when the expenditure statement was being put together. For example, if the award rates for village staff change unexpectedly there may be insufficient funds in the wages budget.
An overly broad definition was applied in the tribunal as to what constitutes unforeseen circumstances. The tribunal found that if an individual operator simply underestimated the cost of certain items or forgot about the need for expenditure in certain areas, an amendment to the expenditure statement could be approved by the tribunal against the wishes of a resident. This was even if a prudent operator would have been reasonably expected to foresee the expenditure need. Some of the 'unforeseen' expenditure related to stockpiling parts, pay increases, extra stationery, accountancy fees and additional painting costs. The case was further compounded by the fact that the operator in question did not even seek the consent of residents to the changes first. They just spent the extra money, which created a larger budget deficit and sought the approval of the tribunal once the year was over. This is not how it is meant to be. The current legislative provisions were designed to provide residents with transparency and accountability and to curb the inclination of some operators to overspend on discretionary items.
The Government proposes to amend the legislation to restore the original intention of the Act of an accountable process. The bill will ensure that the consent of residents is sought for any proposed variation in an approved expenditure statement. If the residents agree with the need for the change then it can be implemented. If the residents do not consent then the operator will be required to either accept the decision or appeal to the tribunal. In considering such an application the tribunal will be able to overrule the decision of the residents only if it is satisfied that there is an urgent need for the extra expenditure and that it was not reasonably foreseeable.
The bill will also address a degree of uncertainty and confusion as to which residents are 'owners'. The Act distinguishes between residents who are owners and those who are non-owners in a number of key areas. Caps apply on how long ongoing charges can be levied on a non-owner and the timing of refund payments. Residents who are owners have the right to set the asking price and appoint a selling agent of their choosing.
It is important that the line between non-owners and owners be clear and unambiguous. To be entirely accurate such a determination would require a detailed examination of the provisions of an individual resident's contract by a legal practitioner. This is a costly and time-consuming exercise which most residents do not undertake. They often accept the view of the operator as to which category they fall into, which may not be correct. A resident who mistakenly acts as a non-owner misses out on setting the asking price and appointing an outside agent. Likewise, a resident who mistakenly acts as an owner may have their refund unnecessarily delayed by many months.
Most residents of retirement villages have a simple licence or rental agreement, where the operator retains ownership of all the village property. Outgoing residents of these villages commonly get back only the amount of money they paid upon entry, less certain fees and charges and without any interest. Regardless of how long they reside in the village the outgoing residents receive little or none of any capital gains. There is no justification to classify such residents as owners. The bill will remove the current definition of 'owner' in section 150 (1) and replace it with a new one. The new definition will clarify which residents are non-owners and which are owners. A resident will remain an owner if they have purchased the premises, such as in a strata scheme or company title village. If they have not, four conditions will need to be met before the resident will be considered to be an owner.
Firstly, the residence contract will need to be in to the form of a lease. Secondly, the lease will need to be for a period of at least 50 years or in the form of a lifetime lease. It is common within the retirement village industry for such leases to be for 99 years or 199 years. Thirdly, the lease will need to be registered on the title under the provisions of the Real Property Act 1900. Fourthly, the lease will need to contain a provision entitling the resident to 50 per cent or more of any capital gains. This percentage is a minimum standard within the leasehold sector of the industry. If any of these requirements are not met the resident will be considered not to be an owner.
The bill also proposes to reduce the period during which a resident who passes away or moves out remains liable to pay recurrent charges for personal services. 'Personal services' are those optional services provided to a resident on an individual basis and includes the provision of meals, laundry services and the cleaning of the resident's premises.
Residents of retirement villages who receive personal services commonly pay for the services as part of their overall weekly, fortnightly or monthly payment to the operator. Due to the high cost of providing personal services those who receive them pay considerably more in charges than residents of self-care units. It is not uncommon for residents receiving personal services to pay up to $2,000 per month or more. Under the current Act charges for personal services must cease no later than 28 days after the resident has died or moved out.
Many operators, particularly those in the not-for-profit sector, already have a practice of not billing residents who move out or pass away for personal services. These operators agree that charging residents, or the estates of deceased residents, for personal services which are no longer being supplied or received is an unfair and unjust practice. The Government agrees with this position.
The Government intends to amend the Act to provide that in a situation where a resident has passed away or moved out all charges for personal services cease immediately. That is, from the date the resident moves out or from when the operator is notified of the resident's death. This amendment will remove a financial burden from those residents who leave or the estates of deceased residents.
As Australia's five million baby boomers reach retirement age and are attracted to the lifestyle offered by retirement villages more people will be affected by this legislation. With an evolving industry it is important that we ensure our legislative framework continues to meet its aims of protecting some of the most vulnerable members of our community.
The Retirement Villages Amendment Bill 2004 introduces reforms to enhance protection for consumers who live in retirement villages and provide greater clarity and certainty in the legislation. The five specific changes to the Act being proposed are important reforms and will be of benefit to both operators and residents. Bringing the review forward will enable any other issues in the industry to be considered as soon as possible. I commend the bill to the House.
The Hon. MELINDA PAVEY [8.51 p.m.]: The Liberal-Nationals Coalition does not oppose the Retirement Villages Amendment Bill. The object of the bill is to amend the Retirement Villages Act 1999 in order to clarify the operation of that Act in relation to the assignment of residence contracts and the rights of residents or former occupants to sublet premises. It provides for circumstances in which the statement of approved expenditure in relation to a retirement village may be amended in order to authorise further expenditure. It will make it clear that any liability to pay recurrent charges for personal services, except those already provided, ceases in the case of a resident who has moved out or who has died, when the resident moves out, or when the operator of a retirement village is notified of the death of a resident.
It brings forward the due date for the review of the Act. The Act was originally due to be reviewed in 2005. That review is now due to commence after this amended bill has received royal assent. The bill will make various other minor changes. Currently, more than 700 retirement villages operate in New South Wales. Those villages house around 40,000 residents, or approximately 3 per cent of the New South Wales aged population. There are approximately 1.3 million aged people in New South Wales. As a resident of the State's North Coast I am aware that the establishment of retirement homes is a growing industry in that area. There are many excellent examples of retirement home living and some expected major developments in the Port Macquarie, Coffs Harbour, Ballina and Tweed areas.
Many people throughout New South Wales and Australia are now deciding to retire to the North Coast. When it is no longer suitable for them to live in an apartment or a house, they are making the decision to live in the friendly atmosphere of a retirement village. That is evident throughout Sydney and in other parts of the State. On a percentage basis, retirement villages are increasing on the North Coast. There are some sensible changes in this legislation but there are also a few concerns that I will raise and that were raised by the shadow Minister for Fair Trading, Katrina Hodgkinson, in the other House.
As I said earlier, there are approximately 1.3 million aged persons in New South Wales. As Australia's population is ageing, that figure will continue to rise substantially in the coming years. It is vital that the New South Wales Government keep up with industry and provide protection for those people wishing to become part of the retirement village lifestyle. New sections inserted by schedule 1 [3] will amend the Act to provide that, if residents of a retirement village do not consent to the statement of approved expenditure being amended by the operator, the operator may apply to the Consumer, Trader and Tenancy Tribunal for an order approving the proposed amendment. That is in response to the decision of the tribunal in Dennison Investments v Beauty Point Resort Residents Committee, in which consideration was given to what constitutes "unforeseen circumstances".
The Minister noted that that was contrary to the object of the Act. The tribunal may approve the amendment only if there is an urgent need for further expenditure and that expenditure was reasonably foreseeable when the statement was initially approved. In some retirement villages, when a resident dies or vacates a premise the existing lease is surrendered and a new lease is entered into with the incoming resident. However, at some villages the contract gives the resident the right to assign the remaining portion of the lease to the new resident. The issue that arises is whether the termination of the contract nullifies assignment rights. If the lease cannot be assigned there is the potential for residents to lose money.
In interpreting the Act the Supreme Court of New South Wales held that executors of an estate did not fall within the definition of "owner" or "resident" under the Act. Therefore, the bill provides that an assignable lease does not terminate on the death or departure of a resident, but will continue until the end of the original lease. The outgoing resident's right to occupy will terminate upon assignment. The bill extends the definition of "owner" for the purposes of part 10, which deals with the vacation of premises. The bill will insert a new section to include an owner as being a person who does not own the premises but whose residence contract is in the form of a registered long-term lease. It includes a provision that entitles a resident or former occupant to at least 50 per cent of any capital gains in respect of the premises.
The definition of "permanently vacated" will also be amended to include someone who owns the premises or who is taken to be the resident of the premise by the operation of new section 4 (2), or who is taken to be an owner because of new section 150 (1) (b)—that is, the person vacates the premises or dies. The Legislation Review Committee, when examining this legislation, did not identify any issues arising under the Act. However, I point out that the shadow Minister has had extensive consultations and discussions with the Aged and Community Services Association [ACSA]—a body that represents the interests of members operating 386 not-for-profit retirement villages in New South Wales and the Australian Capital Territory.
Those retirement villages are generally operated on the basis of a loan licence tenure. Some villages operate on a combination of a loan licence and rental villages, and a small number operate on leasehold. I bring their concerns to the attention of the House. New section 117 will amend "statement of approved expenditure", and the organisation points out:
In the case of amendment that relates to further expenditure, the Tribunal is not to make an order under subsection
(3) unless the Tribunal is satisfied that:
(a) There is an urgent need for further expenditure, and
(b) The further expenditure was not reasonably foreseeable when the statement of proposed expenditure was approved under section 116.
The association highlights the point that providers are currently required to commence preparing the statement of proposed expenditure three months before the commencement of the financial year. That is in order to comply with the 60-day time allocation to present it to residents. The difficulty that arises is accurately forecasting costs that far in advance. That new section further aggravates the demands on operators to accurately define costs and future expenses three months before the commencement of the financial year. The ACSA is also concerned that in the unlikely event of an operator failing accurately to predict costs, and residents disagreeing to an amendment, the tribunal, on application, cannot make an order for non-urgent expenditure, even if that expenditure was reasonably foreseeable.
In addition, in the absence of a definition of "urgent", stakeholders may be faced with inconsistent tribunal outcomes on this matter. It is the view of the ACSA that the reference to urgent need should be removed. However, that is not the view of all stakeholders. I refer to new section 150, which deals with references to "owner" and sale of "residential premises". The ACSA is concerned that by removing existing section 150 and replacing it with proposed section 150 (1 (b), there will be a substantial effect on some operators of loan licence villages with particular contractual arrangements with residents.
While the ACSA understands that the intent of the bill is to clarify the meaning of "owner", it has reservations that it will not have the unintended consequences of removing benefits accorded to certain loan licence operators under new section 80. The ACSA believes that the proposed amendment will effectively mean that under new section 80 those residents will be considered to be non-owners for the purposes of part 10 of the Act. If there is no incoming resident the operator would be required to make payment to the former occupant six months after vacant possession had been granted by the outgoing resident.
The calculation of the refund of the incoming contribution to be paid at that time would need to take in account the capital gain figure, which cannot be known if there is no incoming resident at the expiry of six months. The ACSA would like to see that new section become part of the upcoming review of the Act. It seeks to have that issue deferred until it can obtain an input from members as to the likely number of villages that will be affected. The shadow Minister asked the Minister to raise that issue in her reply , but that issue was not adequately addressed. The ACSA points to a lack of resources and reliance on volunteers. It believes the bill is relatively onerous and is concerned about the future of affordable housing options as a result of the bill's heavy compliance requirements.
The Retirement Village Association [RVA] is another peak organisation that represents operators of private retirement villages in New South Wales. It, together with other organisations, was not able to have input into this amending legislation. However, the RVA has concerns similar to those of the ACSA, especially in relation to new section 150. It states:
Currently Section 150 (1) (b) has the effect that a resident who shares in any capital gain on the turnover of the premises is treated as the "owner".
It is proposed to change the definition of an "owner" to "a resident who holds a registered lease and that has the provision to share at least 50% of any capital gain". This change in definition excludes from the current definition of owner the following groups of residents
• Residents may have preferred to enter into any of the above arrangements having taken account of other factors such as the level of the departure fee and the amount of the incoming contribution.
• Those residents have entered into contracts with the operator based on their assessment of the facilities, services and financial arrangements better suited for them. They have made a choice.
This choice has been made based on information included in the disclosure statement made available to them under the present regulation.
To alter that relationship is to strip those residents of the benefits they perceived as owner at the time they entered that Village.
The RVA also raised questions as to the retrospectivity of the bill. New section 150 will apply to all existing contracts and the financial impact on the industry could be substantial. A representative of the Retirement Village Residents Association, Mr Neville Carnegie, also corresponded with the shadow Minister. He agrees with much of the legislation and believes there should be greater protection for residents. However, he is concerned that the onerous burden placed on operators could cause more problems than it solves.
It is important that the forthcoming review considers the views of all stakeholders. Our population is ageing. There are 1.3 million aged people in New South Wales and approximately 40,000 residents live in retirement villages. It is important that they receive some guarantee as to the security of their investments and their lives, which change somewhat when they enter retirement villages. We must also take account of the needs of operators and those who are willing to invest in this important industry. The necessary retirement villages and related facilities will be provided not by the Government with government money but by the private sector. We must listen to the concerns of private operators and balance their needs with those of residents and other operators. The Opposition will not oppose the bill.
Ms SYLVIA HALE [9.02 p.m.]: The Greens support the amendments proposed in the Retirement Villages Amendment Bill, particularly the strengthening of subleasing provisions for retirement villages and the clarification of tenancy rights for residents. Most of the bill's elements, such as the cessation of charges for services on a resident's death, are commonsense. However, they raise the question of why such fundamental issues were not addressed when the Retirement Villages Act was drafted in 1999.
At present people who live in retirement villages are covered by consumer protection legislation, but considerable misunderstanding and confusion surrounds tenancy agreements. The largest number of complaints to the Consumer, Trader and Tenancy Tribunal about retirement villages concerns budget increases and recurrent charges, followed closely by complaints about subletting. Because subletting is not covered in the Retirement Villages Act 1999, residents or the estates of deceased residents are left without legal recourse when unscrupulous operators take advantage of the lack of clarity concerning residents' rights and subletting provisions. Unfortunately, this bill does not address the issue of refunds to deceased estates or to departing occupants.
Problems stem primarily from the nature of the contract between the operator and the residents. Residents are generally neither the owner nor the lessee of the accommodation, and this severely limits their legal rights—particularly their right of appeal. This is especially problematic if or when residents leave the accommodation in order to avail themselves of more intensive forms of support and care. Sometimes they lose their right to the accommodation even if the move is temporary. This bill will not address some fundamental problems, but hopefully a full review of the Act will do so. For this reason, the Greens support the bill in its current form and look forward to a full review of the Act later this year.
Reverend the Hon. Dr GORDON MOYES [9.05 p.m.]: I speak on the Retirement Villages Amendment Bill with some trepidation as retirement villages have been very much a part of my life for 35 years. As has been said, some 40,000 people live in retirement villages across this State. Retirement villages mean a great deal to many people: They are their homes and their future. They are the only security that many people have. In Melbourne in the early 1970s I developed five large retirement villages that were the first of their type in the city at that time. Some 26 years ago I developed three other large villages, involving the expenditure of several hundred million dollars, in New South Wales.
I have always operated on a whole-of-life tenancy lease. This means that we will take care of people, if they so desire, for their whole lives and they will have tenancy in the place where they live on the basis of a lease. Actuarial studies that were conducted to work out the return to a person who leased a property found from the earliest days that, if up to 10 per cent was deducted for heavy maintenance in the first 10 years of the lease, at the end of that time sufficient money would be made from capital gain on the property to return the entire cost of the unit to the person who entered the unit. The trouble was that after a while building companies and private landowners developed their own businesses as investment-for-profit ventures. That is when the problems started.
The Retirement Villages Act, which came into force in 1999, sought to protect residents of retirement villages from abuse and exploitation. I gave evidence during the development of that legislation and there was no question about the number of organisations in business at that time that were exploiting the residents of aged care accommodation. I have always proceeded on the basis that budgets must be discussed with residents. To that end, I insisted that special budgetary meetings be held at least twice a year to allow the nearly 2,000 residents of the villages for which I was responsible to ask questions, to discuss the information, to eventually approve of and vote upon the budget and to set any maintenance fees to be charged.
A number of residents of retirement villages operated by the not-for-profit sector moved into those villages with no ingoing capital. Although many retirement villages are operated for profit and people pay ingoing capital ranging from $500,000 to several million dollars, not-for-profit organisations such as Wesley Mission run retirement villages some of whose residents pay no ingoing capital at all, dependent upon a means test. The bill also has to take into account that some people are not owners or do not have vested interests in a capital return, because after all they did not put any capital into the development. It is important that these for-profit people make sure that there is sufficient money left over from the weekly income of all residents after their personal needs are adequately catered for.
This bill, as others have mentioned, will ensure that charges for personal services cease on the date a resident moves out or when the operator has been notified of a resident's death. In order to put a not too fine a point on it, most people who go into a retirement village do so on the understanding that they will be cared for, for the rest of their lives. Most people who move out of retirement villages—except those who move within the first couple of weeks or months because obviously they are not happy in this new environment—only do so to be taken to a place for more intensive care, a nursing home or a hospital, or they actually die. When that shift is made—when a person has either left or died—there can be no justification for continuing personal and care expenses.
There are 386 not-for-profit villages, with a much smaller number of organisations providing that care around this State. The cost of care varies because the kind of care that is given is varied. For example, in works for which I am responsible there are probably 800 persons in self-care. They look after themselves. They get their own meals. They go out on their own shopping excursions. They participate in sporting activities and use our swimming pools, bowling greens and the like. Other people have flexi-care. They live within their own unit and are provided with some sort of help—someone comes to their unit to dress and shower them, to give them medication and to support them. Perhaps they prepare meals for them or go down the street to buy certain items for them. That type of flexi-care comes at a cost.
Then there are those who need quite heavy nursing care. They might require people with them at night or require 24-hour care and eventually have to move into a nursing home or hospital. In all those cases the cost of providing such care and staff is quite dramatic. Last night I attended a meeting with a number of managers who work with me in 53 villages in which we have a concern. I examined some of the issues that they are now faced with in light of this legislation and some other activities. For example, a case to decide whether nurses should receive a 15 per cent pay increase is before the appropriate court. In the villages with which I am concerned not one is prepared for a 15 per cent wage increase for its nurses at its next budget round. If such an increase is approved, the budget exercise for each of these villages will be very difficult. On such issues individual committees have to be transparent in their dealings and have good relationships with residents in order that they understand the cost of care.
I also point out that most of the villages are approaching an age of 20 to 25 years. In ordinary budgeting it is normal to take into account the cost of new carpeting, repainting and getting units ready for a new occupier. However, the cost of what we call heavy maintenance on villages of 20 to 30 years of age tends to become extraordinarily difficult to budget for in advance. All village members must have contracting rights. I encourage all proprietors to make sure—and this is an objective of this legislation—that every resident is able to continue his or her rights; that there is transparency in any financial transactions with residents and that they share with residents any benefits that may come their way.
The really vexed problem between the not-for-profit sector and the for-profit sector arises with regard to a capital increase that is found when there is a turnover of units or housing estates. That is always a problem. I have no hesitation in saying that residents on strata title arrangements have the right to share in the capital benefit and growth of their centres. However, a matter of concern in this bill for the operator of retirement villages is the assignment of leases, or the assignment of rights to other persons. People who move into retirement villages do not do so in order to have just anyone live next door to them. They want neighbours of a similar age, with a similar outlook and similar interests. It would not be reasonable for a lease to be assigned to, say, the grandchildren of a resident, which would allow those grandchildren to move into a retirement village, given that the way of life of those grandchildren—their music and general noise, for example—would be completely different to that of the elderly people who live around them.
There are also some other ticklish issues. For example, I remember being called as an expert witness in a case involving a Jewish organisation that had a very fine record of providing care for elderly Jewish people. In that case a number of young Palestinians applied for positions within the Jewish retirement village. Of course, they were claiming the right to be employed in that Jewish community. One can imagine the problems that would arise with Palestinians working with elderly, retired Jewish people, many of whom lived through the Holocaust. Those residents were fearful of losing peace of mind and the quiet way of life that they expected to enjoy while living in that retirement village. There have been a number of cases similar to that; people have sought to try to take advantage of the law to prove a point. By and large the Christian Democratic Party agrees with the provisions of this bill. We support the bill and look forward to monitoring its development over the ensuing year.
The Hon. HENRY TSANG [Parliamentary Secretary] [9.17 p.m.], in reply: I thank all honourable members for their contributions and I commend the bill to the House.
Motion agreed to.
Bill read a second time and passed through remaining stages.
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