ECLC welcomes the Morrison Government’s announcement on 5 October 2020 that it is supporting older and disabled Australians and their families by providing a targeted Capital Gains Tax (CGT) exemption for granny flat arrangements where there is a formal written agreement in place.

The Australian Human Rights Commission and other advocates had been arguing that current arrangements had undermined efforts to prevent elder abuse.

When faced with a potentially significant CGT liability, families may opt for informal arrangements which can expose older and disabled people to financial abuse and exploitation if relationships breakdown.

Age Discrimination Commissioner Dr Kay Patterson AO said that when it comes to preventing financial elder abuse, family agreements, along with enduring documents, play a vital role in ensuring that an older person’s wishes and best interests are protected.

The changes come as the Human Rights Commission has warned elder abuse is on the rise and launched a new awareness campaign.

The commission says it is not enough to just hear about elder abuse and that we all need to value and respect older people to prevent elder abuse happening in the first place. It takes a whole community to do this.

In a SBS radio interview which coincided with International Day of the Older Persons on 1 October 2020, the Age Discrimination Commissioner and ECLC CEO Michael Smith spoke about the rise and impact of elder abuse in our communities during the Coronavirus pandemic. They also discussed the different types of abuse that can be experienced by older people.

While elder abuse can be psychological, financial, emotional, sexual, or neglectful, financial abuse is the most common form of elder abuse. The financial pressures on adult children can be a driver of financial abuse and with the economic fallout of the Coronavirus pandemic, it is a perfect storm as they try to borrow money to get by.

The commissioner said she been talking with people responsible for state health lines and there’s been an increase in elderly abuse reports during these difficult times.

“One of the problems is that people aren’t getting out to their doctor. They are doing telehealth for example so they are not out and about in places where they can talk to someone confidentially so any abuse could be hidden.

“There’s a lot of pressure on families, sons and daughters losing their jobs – ‘I’ll come back and live with you Mum,’ ‘I can’t afford my rent’ or ‘Mum you’ve got some money, you can help me through this difficult time.’

“The other thing that’s a pressure is isolation and so COVID has accentuated all of those pressures that increase the likelihood of elder abuse,” the commissioner said.

Michael said ECLC has seen financial abuse cases increase over the past six months and the legal options when there are no agreements in place can be very limited.

“One woman came to us and basically her son was experiencing financial trouble so she sold her house and loaned most of that money to her son to build a house with a granny flat out the back.

“But they didn’t have an agreement in writing and that was OK for a little while but then there were issues and she had to move out. The woman ended up in a tent, then in a caravan and never got into the granny flat.

“The relationships broke down and all the money that she’d had over her life and that went into the house for her son was lost, said Michael.

If you know someone or you are at risk of or experiencing elder abuse, please contact ECLC’s ROSE or ELSA.

Find out more:

Listen to the SBS radio interview.
Know the signs of elder abuse.
Removing CGT from granny flats.
Formal family agreements will protect older people.
Inspiring stories by older people who have participated in ECLC’s OPERA project