Comments on need for integration of superannuation and aged accommodation and care
Andep director, Dennis Barton, posted the following to a LinkedIn discussion entitled
Super is indeed only one part of the picture.
It’s not well publicised, but there is a similarity between the retirement village industry and longevity protection. Both involve spending the kids’ inheritance now. Financial products are pretty generic, but retirement village accommodation is less so. Hence we get the ABC and Fairfax complaints when people want to move out. Not that the operators are without blame.
Respected retirement village commentator, Chris Baynes, in Village News of 17 October, reported on a “town hall meeting” as part of a NSW review into retirement village legislation.
Of about 80 attendees he reported show of hands responses of
“1. Did your operator act honestly? Yes 8 No 4
2. Did your operator act diligently? Yes 8 No 12
3. Did your operator act fairly? Yes 4 No 12
4. Would you join a village again? Yes 12 No 12”
Although the audience was probably somewhat self selected, there appear to be some unhappy campers. One thought the banks had a problem with unhappy customers!!!!
Incredibly, only “40% of attendees said they had got a solicitor to check the contract before entering the village.” The question about actuarial or financial advice didn’t make it to his report if it was asked.
We continue to have the chicken and egg circus around CIPRs. The Government is unclear because it doesn’t know what the industry wants and the industry is generally silent on proposals because the legislation is unclear. The way out of the circle is to fit something into existing legislation, which fortunately, can be done.
The concept of Refundable Accommodation Deposits (RADs) is at odds with longevity protection. Just when people are approaching the time when they will make their contribution to the longevity pool of either an annuity or a Mutual Pension, they have a temporary need for a large amount of money, which, when refunded (not used up), a few years later, isn’t available to the pool.
Town planning issues also impede efficient housing. Retirement village communities need to be where the people live, not on the outskirts.