Retirement Life

Joanita Wibowo

"It's like a slap in the face": Aussie retirees' $92K surprise bill nightmare

"It's like a slap in the face": Aussie retirees' $92K surprise bill nightmare

A number of apartment residents in Victoria have been shocked with threats of huge fines and eviction after the state government identified their buildings with high-risk combustible cladding.

Owners of 153 residences and offices around the state have been hit with tens of thousands in bills after a Victorian Building Authority (VBA) report revealed that the highly flammable polyethylene cladding in their buildings must be removed.

The same cladding was found in London’s Grenfell Tower inferno, which killed 72 people, and the Neo200 apartment building on Spencer Street, Melbourne, which caught fire in February.

Owners have been asking why they had to foot the bill for building works when they “haven’t done anything wrong”.

Pensioner Kevin Opie and wife Jennifer said when they bought their South Yarra apartment in Melbourne seven years ago, it was all signed off by proper authorities.

“We trusted building regulations at that point but now we don’t,” he told TODAY. “We were just leading a normal life, we just retired, we just had enough savings to the end of our lives when this absolute terrible nightmare has befallen us.”

The couple said they were notified that they owed $92,000, and failure to pay within three months will lead to eviction or a fine of over $20,000.

Another couple in the same building, Jess Howse and Ryan Silvagni, said the surprise bill was “almost a joke”.

“We have to come up with $90,000 to replace cladding that wasn’t disclosed on any documentation that was signed off by local councils and fire authorities, it’s like a slap in the face to be honest,” Silvagni said.

The bill is part of the state government’s Cladding Rectification Agreement scheme, which is set to offer owners low-interest loans to replace the cladding, which owners will pay back through council rates. However, most councils across Melbourne have not agreed to participate.

“You cannot create a scheme for optics and say, ‘Look how we are helping Australians’, when you make it optional and you make it flawed,” said Howse. “No one can access that scheme.”

Even if the scheme is applied, it is still inaccessible to many who cannot afford to take up new loans. 

“We don’t have any money to repay the council every month,” said Mrs Opie.

She also said selling up would be difficult, as the new owner had to bear the hefty rectification bill.

According to the VBA’s audit deputy head Luke Exell, a 2017 Supreme Court decision has established that the VBA does not have the power to order a builder or building surveyor to fix defective building works after an occupancy permit had been issued.

In a statement to TODAY, the VBA said, “This means that owners are responsible for fixing their buildings. The VBA acknowledges the difficulty for owners and will help them navigate this complex task.”

RMIT University urban planning expert Michael Buxton said the government should take responsibility to help fix “some of the world’s most dangerous buildings” in the state.

“There needs to be a new legal framework to provide a financial solution for this, with the government chipping in,” Buxton told The Age.

“I think this is turning out to be one of the greatest scandals we have ever seen in the building industry.”