Retire from rates fight

Warning to councils on retirement village exemption

TASMANIAN councils hoping to remove the rates exemption for not-for-profit operators of retirement villages should consider amalgamation to save money instead, former premier Ray Groom says.

Mr Groom, who is also a former chairman of Southern Cross Care Tasmania which operates eight retirement facilities statewide, warned there would be an outcry from the 2000 people who live in retirment villages and their families if the exemption was removed.

“If councils are struggling to provide essential services with the income they currently have then perhaps more serious consideration should be given to the amalgamation of at least some of the 29 councils we have in Tasmania,” he said.

About 90 per cent of aged care services in Tasmania are provided by the not-for-profit sector.

“If those organisations did not provide these services it would be left to local or state governments and commercial operators to undertake that responsibility,” he said.

In March, the High Court declined to hear an appeal by four Tasmanian councils against a 2018 Supreme Court ruling that not-for-profit organisations should be exempt from paying general council rates.

Southern Cross Care Tasmania was facing a $564,000 rates hike before the Supreme Court ruling.

Councils have indicated they may lobby the State Government for change.

Mr Groom said he could understand why a pensioner living in their own home and paying rates would be upset that someone living in a village operated by a charity did not.

“But it is wrong to say residents in retirement villages do not pay any council rates. They do. The only element they are not required to pay is the general rate,” Mr Groom said.

“They also pay directly for the upkeep and maintenance of the village in which they reside such as roads, footpaths and gutters.”

Mr Groom uses as an example the Fairway Rise Village in Lindisfarne, where residents in each villa pay about $5000 per year as a service and maintenance charge and the local council makes no contribution to the maintenance. He says the general rate on top would cost residents another $1500.

Mr Groom said claims by councils the inability to charge rates on retirement villages and homes left a hole in their budget were misleading.

“The additional income was never legally available to them,” he said. “It is false to claim that they have suddenly lost income to which they were previously entitled.”

Ray Groom