Tuesday 24 April 2018

State takes €56m from pensioners' property to pay for nursing home care

'UCD academic Dr Michael Collins said pensioners hold a third of all household wealth in the State, and there was huge potential for a State-backed scheme that helped them get an income from their homes' (stock photo)
'UCD academic Dr Michael Collins said pensioners hold a third of all household wealth in the State, and there was huge potential for a State-backed scheme that helped them get an income from their homes' (stock photo)

Eilish O'Regan and Charlie Weston

The State has clawed back nearly €56m from the property of elderly nursing home residents to pay for their care under the Fair Deal scheme, new figures reveal.

Another €4m is still outstanding under the scheme, which began in late 2009 and involves a joint weekly financial contribution from the HSE and the residents, based on their income and assets.

The payments from the assets of elderly residents frequently involve the sale of their homes after death. The payments ranged from under €5,000 to more than €50,000. The State spends around €1bn a year subsidising the scheme.

However, figures obtained by the Irish Independent now highlight the extent of the payouts from residents themselves.

It means people are paying for their care from beyond the grave.

The Revenue Commissioners recovered €11.9m in 2015 and €13.8m last year. This included considerable interest of €178,210 last year. This was due to delays in probate and other issues.

Repayment needs to be within 12 months of a resident's death and six months during their lifetime when an asset is sold or transferred. Most Fair Deal residents pay for their care during their lifetime without any of their assets being called on after death.

The new figures were revealed as the Government has been called on to look at setting up a scheme that would allow older people to tap some of the wealth locked in their homes to boost their incomes.

UCD academic Dr Michael Collins said pensioners hold a third of all household wealth in the State, and there was huge potential for a State-backed scheme that helped them get an income from their homes.

Dr Collins said his scheme could be a win-win for pensioners. This is because pensioners would enjoy a higher standard of living, and the costs to the State and families of financially supporting older people would be lower. However, he conceded his scheme would mean families would end up with smaller inheritances.

Dr Collins, assistant professor of social policy at UCD, has proposed older people with homes worth more than €200,000 would effectively sell a portion of it to the State.

The scheme would be backed by the State and operate in a similar fashion to the Fair Deal nursing home support scheme.

Accessing between €5,000 and €10,000 a year for someone over the age of 70 would relieve the financial strain on many older households.

"The funds could be recouped by the State from the estate of the individual and the entitlement of the State to these funds could be structured in the same way as the Fair Deal scheme currently works," he said in a paper presented to the Citizens' Assembly.

He said although most pensioners enjoy a reasonable standard of living, his scheme could address issues for poorer pensioners, and future generations of pensioners. He said data from the Central Statistics Office shows State pensions were the most important part of the income of pensioners.

Irish Independent

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