The feedback from villagers was simple: change must be retrospective.
“It will not be fair if 50,000 residents do not get the benefit of the law changes along with any findings by the Commerce Commission,” he said.
Nigel Matthews, association chief executive, also welcomed the commission’s involvement.
Consumer NZ chief executive Jon Duffy said of the commission’s move: “We’re very pleased to see this.
“It’s really good news for retirement village residents and those considering buying into a village that the commission is picking up what we understand is a multi-pronged investigation into industry practices. We understand those investigations to be about misleading representations, common amongst the bigger players that have rest homes and village facilities.
“Once you enter such a facility, the industry creates the impression that it can support and accommodate your needs for the rest of your life. They say they can move you to rest home care when in fact the small print makes it very clear that will only occur if there’s a suitable bed available and other conditions are fulfilled,” he said.
It wasn’t as simple and clearcut a progression as suggested in advertising by the sector, Duffy said.
“That’s concerning for residents believing they can rely on rest home care and thinking they will be able to stay with a spouse in a village. They may not be able to,” Duffy said.
Clauses in occupation rights agreements that were fundamentally unfair and breached the Fair Trading Act needed to be investigated by the commission, he said. That had ramifications for the fundamental basis of how the entire retirement industry operates.
All documents signed by about 50,000 New Zealand retirement village residents might need to be reviewed “so this is high stakes but well overdue”, he said.
The Retirement Villages Association, which lobbies on behalf of owner-operators, says it has brought in a voluntary code of conduct which has resulted in changes.
Most residents in villages are happy and don’t like hearing that the sector needs to change, that association has said.
It took out advertisements in the media last month to lobby against change.
But the association representing residents says it was concerned with the unfairness of the Retirement Villages Act 2003, regulations and codes of practice which never contained a clause for review and no longer protects the consumer rights of residents, given the changes in the economy, the care sector and expectations of residents.
It is worried about 10 practices but owner-operators say those are not used by larger businesses and nor are they widespread.
Graham Wilkinson, president of the Retirement Villages Association business lobby group, said if any of the 10 were practised, it was only by a few smaller operators or was disclosed upfront so people know before buying.
Residents and those considering buying into villages have attended meetings where the 10 practices are listed, with information being handed out on flyers.
