Retirement village residents are set to get a fairer system. Photo / Andrey Popov
A new retirement villages complaints and disputes resolution scheme has been proposed which could make it easier and fairer for approximately 63,000 residents.
Retirement Commissioner Jane Wrightson said the Dispute Resolution Centre had been asked to propose the new system.
The centre is a nationwide provider of private commercial dispute resolution and conflict management services in New Zealand.
Retirement village residents currently need to apply for the escalation of issues they have complained about. The recommended scheme would make that easier to do.
Timeframes could also be imposed on village owners, putting a 10-working-day period on them to resolve issues.
The existing system is perceived as not being user-friendly and owner-operators often have lawyers representing them in disputes, leading to power imbalances.
Under the proposed system, legal representation would be minimised.
The role of statutory supervisors could also be changed. These people are funded by owner operators, creating a potential bias. But the proposed new dispute system would be funded by operator levies.
Privacy could also be changed, with dispute panel hearings held in public. Confidential outcomes could be possible under the changed system.
Wrightson said the system needed changing.
“The existing complaints and disputes system does not meet best-practice standards, and both the Retirement Commission and Te Tūāpapa Kura Kāinga – Ministry of Housing and Urban Development want to address these issues as part of the broader sector review under way,” she said today.
“We recognise the unique dynamics and challenges of the retirement sector, where residents often cannot easily move out of their villages.
“Therefore, the scheme must prioritise restoring and preserving relationships, be accessible, and provide efficient and trusted dispute resolution as early and as close to the source of the issue as possible.”
A commission spokeswoman said there had been stakeholder engagement, including with the owner/operator lobbyists, the Retirement Villages Association and residents’ lobbyists, the Retirement Village Residents Association.
Aspects of the proposed scheme needed refining, but generally, what was put forward would be fairer than the existing system, the spokeswoman said.
Wrightson has long fought for a better system.
In 2020, she published a white paper with suggestions for “urgent reform” of the sector.
Operators taking ages to resell the property after a death, no shared capital gains and weekly fees continuing after death or hospital admission were the most widely discussed issues, Wrightson said.
“Residents are neither owners nor tenants and their consumer protections are limited. It is therefore important that fit-for-purpose legislative protections are in place,” she said in 2021.
Peter Carr, who was in 2021 the Retirement Village Residents Association president, said such a powerful call for change “makes a mockery of the industry operator’s view that 96% of retirement village residents are living in an aura of violins and kumbaya”.
But the Retirement Villages Association objected, saying the call for an urgent law review was unnecessary and excessive.
Wrightson noted today that the Ministry of Housing and Urban Development had accepted her recommendation that a full review was overdue.
The ministry subsequently issued a discussion paper in 2023, which received more than 11,000 submissions, Wrightson noted today.
Others have called for a reform of retirement village law, including Consumer NZ.
In 2021, Consumer NZ chief executive Jon Duffy said a review of contracts found terms which unfairly favoured villages and risked costing residents money.
“Retirement villages promise the good life in your golden years. However, the agreements consumers must sign before they move into a village can have a nasty financial sting. Some also risk breaching consumer law,” Duffy said.
Terms which made residents responsible for the costs of maintaining and repairing items in their unit – even though they didn’t own them – were a worry, he said.
Anne Gibson has been the Herald‘s property editor for 25 years, written books and covered property extensively here and overseas.