State and territory consumer affairs ministers will consider allegations of unfair practices at retirement villages, Consumer Affairs Minister Michael McCormack announced on Tuesday.
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The move follows a joint Fairfax Media and Four Corners investigation that put the spotlight on the retirement village industry, particularly Aveo, one of the biggest operators.
The investigation uncovered a litany of questionable business practices at Aveo, including churning of residents, fee gouging, safety issues and misleading marketing promises, such as safety and emergency services, made to some of the country's most vulnerable people.
"I was concerned about recent media reports drawing attention to alleged unfair practices being imposed on residents of retirement villages," Mr McCormack said.
"Like many Australians, I have family and friends in these villages."
- Michael McCormack MP
Mr McCormack says he wants older Australians to get the care and residences they deserve, without unnecessary stress or worry.
"So I am going to work with my state and territory counterparts to discuss this important issue," he said.
He says he is concerned by revelations of overly complex contracts, excessive fees and charges, high-pressure sales tactics, high exit fees and exorbitant refurbishment costs.
Mr McCormack says although retirement villages are regulated by state legislation, retirement village contracts are also subject to the Australian Consumer Law, which prohibits unfair contract terms.
"It is important that when older Australians make the life-changing decision to enter a retirement village, they can be confident they have made the right decision and are supported by strong consumer protections."
He will raise the issue of retirement villages at a meeting of consumer affairs ministers in Melbourne on August 31.
The ministers will consider the effectiveness of current legislation and enforcement arrangements covering the retirement village industry.
The government's response follows calls from Labor and the Greens to urgently review the retirement village sector after the Fairfax and Four Corners investigation.
The Australian Competition and Consumer Commission has launched an inquiry it says will look at some of the more serious allegations raised, including whether contracts are unfair and unconscionable.
