Residential Parks Amendment (Register) Bill 2011

25-August-2011

Mr CRAIG BAUMANN (Port Stephens—Parliamentary Secretary) [10.53 a.m.]: I make a brief contribution to debate on the Residential Parks Amendment (Register) Bill 2011. I commend the Minister for Fair Trading for introducing this bill, which is the first step in delivering on the Government's election commitment to improve the governance of residential parks. In a short space of time the Minister for Fair Trading has achieved a lot on behalf of consumers in this State, and this bill is yet another demonstration of his determination to address the problems left by the former Government. I also commend the member for Albury, a former shadow Minister for Fair Trading, for the extensive work he did on this issue prior to the election. As a number of my colleagues have already pointed out, this bill will enable a register of all the residential parks operating in New South Wales to be established for the first time.

I am aware of a number of residential parks in my electorate, most of which are well-run facilities providing an affordable and enjoyable lifestyle choice for many residents. When the public register becomes available it would not surprise me to see that there are more residential parks in my electorate than in any other electorate in New South Wales. The establishment of a register as proposed by this bill will settle this debate once and for all. More importantly a register will, for the first time, provide accurate statistical data on the size and scale of the residential park industry. It will let the Government know where residential parks are located, who is running them and how many people live in them. The register will provide also a comprehensive mailing list of park owners, park managers and resident representatives. Such a mailing list will be vital in honouring the Government's election commitment to improve the governance of residential parks.

This commitment includes carrying out a thorough review of the Residential Parks Act, in particular, looking at licensing of park operators, better education for new operators and ways to improve the current process for resolving excessive rent increase claims by residents. I want to focus on how to better resolve disputes over rent increases in residential parks. Recently I made representations to the Minister on behalf of residents of the Bayway Village at Fern Bay who are facing a rent increase of close to 40 per cent in some cases. Most of the residents at Bayway are on fixed incomes and will find it very difficult to afford the increase, especially at a time when electricity prices are rising along with the general cost of living. At present all that the residents can do is to take the matter to the Consumer, Trader and Tenancy Tribunal. While the tribunal is a relatively informal process, it is still a daunting prospect for many elderly residents who may never have been to a court. Under the current Act each resident has to apply individually to the tribunal. Some may choose not to fight the increase which could divide the residents and cause further disharmony. Those that apply to the tribunal have the onus of proof. This involves a lot of work investigating and gathering evidence of similar rents in similar parks. The current system is unfair on residents and unnecessarily confrontational. Surely there is a simpler and more effective way of resolving such disputes.

When I wrote to local residents earlier this year outlining the Liberals-Nationals proposed plans for the industry, I was overwhelmed with the outpouring of support. People said that finally someone was listening to them and they felt that they would have a chance to have their say without fear of recrimination from the park owners. I have sat in the immaculate but modest lounge rooms of park residents while they poured over documentation regarding their rate increases. They appealed to me for help when it seemed that they had nowhere else to go when the tribunal failed to help them as it was working under the current legislation. I received a letter from a resident in a park in my electorate whom I will not name but to whom the writer refers as "Stalag". That letter states in part:

My wife and I have lived in a residential village for the past 30 years to this month of May. We chose this style of living as this was the only opportunity of affordability available to us at the time due to our circumstances. We were very grateful for the opportunity to make our home in this way of life until the Wran government decided to end this way of life by legislation, this happened in around 1982-83 which set our lives in a new stressful situation.
The ground work was conducted by Kevin Stewart re the Residential Park Act but since then this industry has grown beyond belief and has attracted many rogue and greedy business people who have no conscience in the ripping off pensioners financially and by threats and intimidation, fear by stand over tactics.

Residents all over the State of NSW are relying on your government to strengthen the act so as to give us peace of mind and a balanced playing field, to give the CTTT the power to stop these rogue owners charging exorbitant rent increases in the fact that we own the residence and we maintain the premises, pay our electricity a/c and water usage, the only service that they give us is the service supply to our premises and garbage collection every week but they speak to us and treat us without any respect.
There is a great dissatisfaction within this industry that thousands of retired pensioners have chosen to make this style of life to finish out their years because of many reasons but a great many because it appeared to be affordable but is now becoming out of the reach of many. Most of all, the intimidating and threatening attitude to residents and power of park owners over the lives of the elderly is becoming a great threat to the health of the elderly for which the Government have a duty of care for.

This is from an advocate who regularly represents park residents at tribunal hearings:

I witness all too often the frustration and sometimes desperation that park residents experience when tribunal members repeatedly ignore or misinterpret the provisions of the Residential Parks Act and other relevant statutes.

May I offer you some examples of the real problems that our members frequently encounter?

In a recent tribunal hearing all 35 park residents of a park claimed that a rent increase was excessive, because the proposed rent was higher than the rents at other local parks that had been identified as "comparable parks" (see section 57 Residential Parks Act 1998).

The residents' advocate—

The writer says "not me"—

argued that their park was not comparable with the other local parks, all of which had a variety of amenities: Community halls, community buses, sporting facilities, such as tennis courts and bowling greens. They provided evidence that their park had no such amenities, other than a swimming pool that they shared with a large adjoining tourist park. All the other parks had a swimming pool but they did not share it with tourists.

The park owner argued that he could not afford to provide any amenities because there were only 35 residents in the park. The tribunal chairperson ruled that the park owner's contention that he could not afford to provide the missing amenities was "reasonable". She then allowed him a rent increase that put his park's rents as much as $8.00 per week above the "comparable parks".

But what could the residents do about the obvious failure of the tribunal chairperson to provide a decision that was, as the CTTT Act requires, "fair and equitable"?

They could apply for a re-hearing of the matter, but their application for a re-hearing would be decided by the Chairperson, with the advice of a senior tribunal member.

Or, they could appeal to the District Court or the Supreme Court, assuming that they had the financial capacity to do so. Legal Aid is not available for most residential parks issues.

There have been only a few appeals by park residents to the Courts. There have been many by park owners.

Right now I am preparing applications for re-hearings of two matters that, as it happens, concern the same residential park. But these are not about rents.

One matter is an attempt by a resident to have the park owner replace his concrete driveway that has broken up because of subsidence caused by the failure of a storm water pipe owned by the park owner. The Residential Parks Act is absolutely clear that the park owner is responsible for the maintenance of a resident's site yet two tribunal members have ruled that the park owner does not have to replace the failed driveway. So we are now trying for a third re-hearing.

In the 2009-2010 financial year the tribunal dealt with some 2,439 residential park applications, which is a record number in the residential parks division. Of those applications 1,741, or more than 70 per cent, involved claims of excessive rent and excessive rent increases. That just shows the extent of this problem in parks and why we need to reform the process. The process could be improved in a number of ways to reduce the incidence of disputes. An intermediate step could be introduced whereby a park operator must present the case for a rent increase to an officer from Fair Trading who would assess whether the increase is either justifiable or excessive and make a recommendation to the parties. Another option could be to retain the existing role of the tribunal but shift the onus of proof from residents to the operator.

If that option were adopted the operator would have to justify a rent increase above the consumer price index and present evidence in support of the rise. These are just two possible options. I am sure that many other options are available to deal with this issue. The register will become particularly useful because will enable direct consultation with those affected by the legislation. The park owners, park managers and resident representatives will have the opportunity to voice their opinions on the various options or suggest alternatives to deal with the rent increase and other matters. I support the Minister's commitment to ensure that the right balance is struck between park residents and operators, so that residents can feel secure within a viable and vibrant industry. The establishment of a register is a simple and practical measure that will provide a range of positive benefits. It is the first step on the road to improving the governance of residential parks. I commend the bill to the House.