In the last week there have been several developments of note for the retirement village and aged care sector:
Pay parity funding announcement
In a long awaited but welcome move, Cabinet has agreed to address pay parity for aged care workers. Funding has been approved to bridge the gap between nurses and healthcare workers in public hospitals, and those in the “funded sector” (private and non-Government organisations that get Government funding to provide healthcare). The funding is expected to ease some of the challenges faced by the aged care sector in attracting and retaining nurses. It is estimated that the $200m of annual ongoing funding will provide a pay rise to 20,000 healthcare workers. While this is undoubtedly a step in the right direction, much of the detail is yet to come, as are the funds which will be provided through changes to providers’ contracts with Te Whatu Ora.
Read the Government announcement here.
Review of Retirement Income Policies released
Te Ara Ahunga Ora Retirement Commission has released its 2022 Review of Retirement Income Policies. A review of New Zealand’s retirement income policies occurs every 3 years. This year's review is the first to be released under Retirement Commissioner Jane Wrightson, and has a specific focus on superannuation, housing, and the retirement experiences of Māori, Pasifika and women. In total, there are 35 recommendations, including that the superannuation age must remain at 65 (to maintain confidence, stability and equity for those accessing it).
While retirement villages are not specifically mentioned in the review, village operators may be interested in some of the following points taken from the report:
- 40% of people aged 65 have virtually no income other than New Zealand Superannuation, and another 20% have only a little more.
- By 2048, 40% of those aged 65 and over will be renting, which equates to 600,000 people.
- The conclusions drawn around what ‘wealth’ in retirement means is for different cultures.
- The research which forms part of the report into the housing intentions of people living in New Zealand aged 45-65.
The above will be pertinent when considering the size and shape of villages in the future including different models, and creating more inclusive and diverse villages.
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