Page 3268 - Week 08 - Wednesday, 22 August 2012
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In addition to congratulating my colleague Ms Porter on her decision to introduce this bill, I want to thank those stakeholders for the assistance they have provided to me and to my officials in informing the government position.
From the government’s perspective, the best approach is one which strikes the most appropriate balance between the rights of the affected parties and addresses their concerns. The best approach is also one which encourages, rather than deters, investment in this important industry, and which has minimal effects on current arrangements and the market.
Following discussions with stakeholders, and after careful consideration, the government is satisfied that this bill achieves those ends.
Firstly, in discussion with industry representatives, including the Retirement Village Association and individual operators, it became apparent that a large number of operators in the ACT either have established villages in both New South Wales and the ACT or are considering establishing operations in both jurisdictions.
Many of the operators who have moved into our market from New South Wales have imported the contracts and management practices that have been developed in New South Wales in accordance with that state’s act. Operators who have cross-border interests or who wish to invest in New South Wales have indicated that ACT legislation that is consistent with legislation in New South Wales is the most sensible approach as it will reduce compliance costs that would otherwise be associated with two different regulatory schemes. This bill achieves that purpose. It brings the ACT into line with legislation in New South Wales and ensures that investment across the border can occur with minimal compliance costs.
Secondly, individual operators, both those who operate only in the territory and those with cross-border interests, have indicated to my directorate that they are already largely compliant with this bill. This may be as a result of the New South Wales legislation having evolved from a code of practice similar to the ACT code, so that a number of the requirements in the code, such as the obtaining of resident input into the setting of budgets, are provided for in the New South Wales act and in this bill. Also, the higher level principles in the ACT code are accommodated in a comprehensive and detailed way in the New South Wales legislation.
For example, the ACT code requires operators to exercise sound management, which includes managing the village cost-effectively and in a financially prudent manner and ensuring that financial accounts have been prepared in accordance with recognised accounting standards. The bill expands on the code principle by providing a number of detailed rules about matters such as the maintenance, repair and replacement of capital items in a village. It also contains detailed rules about budget setting and the accounts of the retirement village. The bill provides for the code requirement that residents approve the annual budget and that audited annual financial statements be provided to residents. Certain requirements that are additional to the current code requirements, such as the provision of unaudited quarterly financial accounts to residents, are unlikely to impose high costs on operators. A number of village
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