The new laws reforming South Australia’s Retirement Villages Act 2016 were passed by the state government last Wednesday evening, imposing required actions. 

“These changes mark a significant shift in the regulatory landscape, focusing on transparency, accountability, and consumer protection,” said Tammy Berghofer (pictured), Partner, MinterEllison. 

“Operators must prepare for the amendments, which will take effect upon assent or a later proclaimed date.” 

Informed by an independent review and extensive consultation with village residents, operators of retirement villages and other key stakeholders, the reforms include: 

• Codes of Conduct: Regulations may prescribe codes of conduct for residents, operators, and staff, with penalties for breaches. 

• Staff Training: Operators must ensure staff undergo training on relevant codes of conduct before starting and every 3 years thereafter. 

• Residence Contracts: Operators must include more detailed information about repair, maintenance, and reinstatement obligations. 

• Disclosure Statements: These must now include a table estimating exit entitlements for residents who stay 2, 5, and 10 years.Waiver of Disclosure Period: Prospective residents can waive the 10-day disclosure period if they obtain legal advice. 

• Premises Condition Reports: New requirements will govern the completion and submission of these reports, with regulations still to be released. 

• Exit Entitlement Payment Date: Operators must pay exit entitlements within 12 months, starting 30 business days after vacant possession, with some exceptions. This obligation applies to existing and new contracts, subject to some limited exceptions (e.g. if the resident has moved out before commencement of the section). 

• Deposits: New provisions cover the taking, holding, and refunding of deposits. 

• Recurrent Charges: New provisions limit increases to a set amount or formula in the resident’s contract, with exceptions like increases in statutory charges and insurance, increases approved by the majority of residents or by SACAT order. 

• Capital Contributions: Contributions are capped at 12.5% of market value for existing contracts or 1% per year of occupation for new contracts. 

• Residence Rules: Operators face restrictions on changing residence rules, to be defined in regulations. 

• Operator Duties: New duties include ensuring safety in common areas, insuring buildings, and providing staff training. Non-compliance will attract penalties. 

• Termination of Schemes: Provisions detail how operators can terminate a village scheme, in whole or part. 

“This milestone reflects the culmination of collaborative efforts between ACCPA, our members and key stakeholders to improve retirement living in South Australia,” CEO Tom Symondson said. 
 
“We formed a dedicated working party, including members from across the state, to develop submissions and provide detailed feedback on the Bill. We also engaged with the South Australian Government and other stakeholders including lawyers to highlight critical issues impacting both residents and operators.” 

There are currently more than 500 retirement villages in South Australia which are home to more than 26,800 residents.