“ARCO Conference – Regulation”

This is my fourth report from the ARCO conference – July 2016. (See my earlier blogs “ARCO Conference Demographics”, “ARCO Conference Dementia” and ARCO Conference Marketing” in the archive dated July/August 2016.)


The discussion on this subject was made up of a number of talks which embraced not just regulation but also funding models.   It’s the use of different charging approaches, many of which can be difficult to understand, that has led to the increased interest of the regulators.

The first problem is that there is no clear definition of where retirement communities fit in to the historical regulatory structures.   Many of the providers use different models and different terminology to describe their provision, but at the same time there are significant overlaps between providers.  This make comparison of schemes difficult.

The size and shape of schemes provided by different developers varies enormously.   As do the level of services offered.   This all makes it doubly difficult for the Regulators to see how accommodation provided by the ARCO members should be regulated.  The Care Quality Commission has in the past been preoccupied with residential care homes.  More recently they have broadened their remit to include hospital accommodation and at the other end of the spectrum, domiciliary care provided to people in their own homes.

Although many retirement housing and care providers now go beyond the provision of sheltered housing, they generally stop short of providing 24/7 care.   This means that essentially they are only providing domiciliary care to a limited number of residents, who continue to live in their own homes.

The Regulator seems to have concluded that in these circumstances they only have a “domiciliary care” remit and should not be involved in the physical fabric of the homes themselves.

However, where things get more difficult, is when you start to look at how people are charged to live in this accommodation.    The different financial models have in some cases led to criticism and claims of exploitation by residents who have purchased homes without realising the financial commitments they were entering into.   This has attracted the attention of a different Regulator, namely The Law Commission.

Different providers have all sorts of different ways of maximizing their charge for a property.   There are a host of different terms used which come under the collective title of “Events Fees”.   These can include:-

  • “Exit Fees” or “Transfer Fees” – this refers to charges made when you leave the property either to move elsewhere or when you die.
  • “Deferred Management Charges” – these usually relate only to the deferred charge for planned maintenance which has the effect of lowering initial service charges.   Providers charge these out at different rates, some of which are seen as punitive.
  • “Assignment Fees” – this is a charge that goes to the freeholder whenever a property is sold on.  It is usually a charge of 1% of the purchase price although there seems little justification for this.
  • “Sub Letting Fees” – this is a charge if someone chooses not to live in the property but to let it to someone else, or more frequently perhaps to sub-let it if relatives are unable to sell the property after the owner’s death.  Again these are typically charged at 1% of the rental value.

There is more information about these charges in my earlier reviews of some retirement housing providers which you can find by clicking on RETIREMENT HOUSING in the TOPICS LIST and looking for Retirement Housing Reviews.

My observation on the whole of this subject is that there is little appetite by the Regulators for more regulations in the sector.   However, there needs to be much more transparency about charges, particularly those where there is an element of deferment until the property is resold.   As the market stands currently, it is wide open to exploitation by unscrupulous developers who have their eye on immediate returns rather than long-term value for money for their customers.

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2 Responses to “ARCO Conference – Regulation”

  1. a little time to think is what is required

  2. hear all, see all? please digest
    Well Dear John, you have disturbed my peace, and tranquilities, let alone my sanity to be logical.
    You discussed Regulation as a point of order within your association ARCO (Associated Retirement Community Operators), and you now come to beg for clarity, in this minefield of bits and pieces with respect as to whom or what should there be a regulatory body with its own inspection, legal statute regime, with acts and other requirements?
    You have personally caused me no end of scan reading, some of which I have digested, but some I suspect I have misinterpreted! As Solomon you must be the judge?
    I have read the Gov.Uk site with respect to Funding for retirement villages, care homes etc., and while there is no mention of an overall regulator, I would be inclined to let sleeping dogs lie.
    The key to the problem/discussion in my opinion is what is it you ARCO are trying to protect, and then project as an acceptable image to the population of the elderly within the UK?
    Here the story becomes blurred, I assume funding that is mentioned within this Gov.UK document is government funding both central and local governments (Councils-public bodies).
    From the Funding issue comes the definitions of a retirement village, care home, refuge excreta for vulnerable adults and children within the UK, especially housing for these groups-elderly/substance abusers/domestic physical abuse/ mental health issues/migrant housing Etc., one can add to the list endlessly. What is certain is the question that once the issue or subject matter is funded, by an authority! Then that Authority has the moral right to house its unfortunate citizens within that or those funded schemes.
    ARCO should beware of what it wishes for? And have a clear vision of what its objectives are?
    The Elderly especially under consideration,
    There is no age restriction to the funding provided for the elderly (Younger age Limit), and there is no clear definition of an ideal client within a retirement village, or care and nursing home, or housing in general for the elderly. Here society has the responsibility to be fair and equitable, with respect to vulnerabilities.
    That endeth this side of the discussion, for me, personally.
    I now come to my prejudices, and personal wishes for a retirement village
    John we have gallivanted around over the years, talking many subjects and coming to many a conclusion, some serious some light hearted, this subject and ARCO’s wish for regulation scares the pants off me, and makes me very wary of what ARCO are about?
    Alzheimer’s and Demetria strikes all persons, of whatever class/group(s) one defines for society, and I am worried if these two disabilities become the overriding cause for future government funding, then my understanding of elderly retirement housing, care homes/nursing homes, and retirement villages becomes distorted, and my fear of a ‘GHETTO’ like culture becomes a real reality in however the government and local governments of the day solve, or help solve this problem.
    Nitty Gritty of Funding, under the existing Gov Uk Document-guidance
    I am reluctant to take individual providers, and discuss direct comparisons. It is difficult to compare like with like, I can only quote my personal experience.
    In the GOV UK paper on funding and housing for the elderly, in either sheltered housing/retirement village, there is a requirement for a central washing facility, a lift (If multi-storey) wet room- not a bathroom, a kitchen/bedroom, and dayroom, and a private access to one’s personal abode?
    This is is the minimum standard required, and is met.
    This applies to all rented properties, and Shared properties Shared properties have a further funded clause- they can be excluding ‘staircasing’. i.e., a long term fixed share percentage agreement-If I am correct?
    What the wise developer has done within this mix has added total leasehold private occupation mixed in with rented (Social-council) Shared ownership, to maximise the attraction of a retirement complex village to the wider retired population, with may I say successes, and sold a way of living to the elderly.
    It is not all plain sailing and roses and sunshine, one has to be realistic and the shared and leased properties are permitted to be shared or leased on a buy back agreement with the property owner/developer, which if one looks hard it has its financial drawbacks, but does offer stability to the elderly concerned and one as always has to consider not ‘What is a bargain’ but what is a reasonable and equitably financial arrangement, and come to terms with the agreement as far as one can foretell.
    Funding by altruistic benefactors is the key, and one solution does not serve all. How ARCO progress is one for their own association. Looking at the list of members there is a wide variety of subscribers, and they should be able to come to some agreement on the way forward. Many provide a under their own logo’s many solutions to care in in the UK, from care homes/nursing homes/retirement villages, refuges from various social abuses , mental and physical and then the migrant s.
    I Trust they chase the $ or the green eyed monster, with common sense, so that we the elderly can select and live within ourselves and within the community as good Christians.

    The Care Project/Problem
    This is perplexing to me? The agreement I have is with the landlord/owner of the retirement village, at present. They as an organisation provide domically care on a pay as you go contract/agreement which I assume in time of need I agree too!
    So far so good: Now are ARCO asking my contract is all subsuming and encompasses Care as well as habitation? If so whom is my contract with and which legal body is it drawn up under? For instance:
    1/ is it with the landlord, or is it
    2/ With the local government provider of the service legislation, or
    3/ Is It with solely the care provider and with who do I comply with, after paying my monies for the service? Is this not governed by the common law of contract?
    if there is such a thing, or are there hard, and fast rules and guidance on dealing with vulnerable persons, whom the elderly are deemed to be?
    Security, integrity of business intent, delivery of service, staff vetting and training come to the fore, which cross over in words with the retirement Homes for the elderly, and general housing by that provider. Here I am a little confused, and the all-encompassing responsible body for Housing/accommodation and care? Separation might be a positive action.
    For instance one member of Arco may provide one specialised service to the community, and fellow membership organisations (Say Housing), while another provides care contracts to associated members, the whole organisation of ARCO works as a co-operative? Do they have to be within the same remit within the same company/organisation? Governed by a single regulatory body
    Are we, am I a complicating the scenarios so that they become unworkable.
    The Extracare Charitable Trust as a body belonging to ARCO have some very worthwhile Objectives, and encompass both the private and public sector housing, as I am sure other members who provide services to the elderly and vulnerable. The current objective is to find an equitable and reasonable solution that satisfies the majority of the forthcoming elderly in the UK, without creating centres of excellence for all the elderly, who may suffer from dementia Alzheimer’s, mental/physical ailments, and social abusive aggression to fellow persons, whether drug-alcohol or behaviourally induced.
    As one grows old with friends and neighbours one becomes aware of their physical and mental foibles, and provided they cause no harm to others or themselves, then I welcome life in a retirement village with the exchange of stories and lifetime experiences that we all individually have, but share during our normal social intercourse, as life goes about its way.

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