Retirement village posts record loss
The Mid Richmond Residents Village in Coraki has posted a financial loss of $712,688 for the 2005/06 financial year.
Chris Smith, who was part of the community management committee which was sacked by Richmond Valley Council at the beginning of the year, said he questioned the competence of Councils financial management of the village.
For the 2004/05 financial year the village posted a surplus of $162,000.
On the surface it would appear that (Council taking over) hasnt been a resounding success, he said.
However, Richmond Valley Council financial manager James Brickley said only $134,000 correlated to an actual operating loss. The remainder was a paper loss stemming from a recent re-valuation of the village buildings, which was more than half a million dollars less than what was recorded in the books.
Mr Brickley said there had also been a $200,000 increase in staffing costs over the last financial year due to an increase in workers compensation premiums as well as a wage increase. He also said staffing had more or less been put in place for the new dementia unit, which was not yet up and running.
So theres no extra revenue (coming in from the dementia unit), just extra cost, he said.
Mr Smith was surprised to hear that Council had taken on staff for the as-yet unbuilt dementia wing.
If Council have made the decision to employ people for a service that hasnt been built yet, it also reflects in an interesting way on their ability to manage, he said.
Mr Smith is part of a newly formed community committee which has just put in a proposal to take over management of the village from Council.
He said occupancy rates were down last year because of uncertainty hanging over the villages future, which started when Council advertised the village for potential sale last year.
Council is saying We want to offload this place. Meanwhile, they sack the committee that ran it for 30 years, he said. Theyre also considering handing the village over to the NSW Department of Health for a multi-purpose service. Its hardly surprising it would have an impact on the occupancy rates, therefore effect the revenue, therefore the profitability.
Mr Brickley said there had been vacancies at the Mid Richmond Residents Village through the year.
However, our understanding is that there were vacancies at other (aged care) facilities in the local area. Not just at the Mid Richmond Residents Village.