Consumer NZ said that an influx of signatures has joined the call for fair repayments for retirement village residents.
The petition has urged the government to introduce new laws requiring full repayment of residents’ money within three months of the agreement ending, and interim payment of 10 percent of NZD 50,000 (whichever is higher) within five working days of the agreement ending, interest on late repayments, and public disclosure of repayment timeframes, so residents know what to expect before they move in.
“More than 41,000 people backed our call for fast and fair repayment for all residents after they leave a retirement village,” said Consumer NZ chief executive Jon Duffy.
Consumer is seeking to address the current power imbalance whereby residents who exit a retirement village can be left waiting many months, or even years, to get their money back from the village.
The government has proposed a 12-month deadline for repayment, but Consumer says this is too long to wait. Consumer is also concerned that the proposed repayment timeframe would only apply to future residents. This means the 55,000 residents currently living in retirement villages could still have to wait too long to get their money back.
“We understand the government is working on amendments to the Retirement Villages Act, but the proposed changes are not good enough,” said Duffy.
“The volume of petition signatures indicates this issue matters, and we urge the government to pay attention to that.”
Duffy added that some villages will express concerns that the changes Consumer NZ are calling for would lead to higher costs for residents; however, he didn’t expect any associated price increase would be significant.
“Right now, the sector’s funding model relies on departing residents’ capital, interest free, for extended periods. That can’t continue.”
Consumer said any villages facing genuine financial constraints could apply for payment extensions, and those sharing at least half of the capital gains would be exempt from the repayment rules.
The petition was presented on the steps of parliament at 1pm, Tuesday 23 June.
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