Fair Deal causing great Stress and Anxiety for many Farm Families
Speech by Willie Penrose TD, Labour spokesperson on Agriculture on private members motion on the Fair Deal scheme and farmers.
- “Fair Deal should provide for respite care and convalescense in own home.
- “Farmers and businesses face difficulties with asset assessment in Fair Deal
- “Current rules discriminate in particular against small farmers
- “Causing great stress and anxiety for many farm families
I welcome the opportunity to speak to the motion on behalf of the Labour Party.
The nursing homes support or fair deal scheme provides support for persons who need nursing home care and are unable to afford the full of cost of same. The applicant’s income and assets are assessed and he or she makes a contribution towards the cost of care, with the State and very often family members also making up the balance. There are clear shortcomings associated with the scheme in that it does not provide for respite care or convalescence. The motion deals with a plethora of issues pertaining to the scheme and acknowledges that participants contribute to the cost of their care, according to their income and assets, and that this contribution can be considerable where an individual contributes up to 80% of his or her assessable income and a maximum of 7.5% of the value of assets per year towards the cost of care.
A key element of the motion refers to the difficulties faced by farmers and businesses where the assets of farmers and other self-employed persons are deemed to be productive assets and required to generate income. They should not be considered as a measure of an additional ability to pay. The Labour Party unequivocally supports the principle behind and the spirit of the motion. We believe small farmers, in particular, should not be categorised in such a manner as to discriminate against them. There is a significant adverse differential which could be construed as discriminatory in respect of contributions and the method of calculating same which are charged against holdings and-or farm and business assets under the nursing homes support scheme when compared to those levied against private residences. They are clearly disproportionate by any construction. The current system of assessment with a likely or potentially high liability on farm or business assets is causing great stress and anxiety for many farm families. One could see the entire family farm consumed as an asset in meeting the cost of long-term care. We are aware of the furore caused by the “dementia tax” across the water in the United Kingdom which has added frisson to that electoral contest. There is no doubt that it would be viewed similarly in Ireland where there is an even worse scenario with the absolute diminution of the farm and-or business asset or land which could theoretically take place in the absence of a cap or limitation to restrict the State’s ability to recoup the cost of nursing home care under the fair deal scheme, while the maximum figure that can be recouped against the value of an elderly person’s private residence is 22.5%.
The fair deal scheme, as it has operated for a number of years, involves a tripartite funding mechanism. The resident and very often his or her family must contribute, as does the State. In the interests of equity, a cap similar to that applied to the family residence should apply in the calculation of the amount that may be recouped again farm or business assets. In the absence of a clear indication that all assets will be treated in an equitable and similar manner, the current system, if left intact, could see farmers having to borrow to secure their assets. This could have consequential knock-on effects for farmers who are worried about and struggling to meet the cost of nursing home care. It is time to implement the commitment given in the programme for Government and end once and for all the uncertainty and unfairness.
Another issue the motion rightly highlights is the vagueness of the definition of sudden illness or disability. It provides for a three-year limit to be applied to non-residential assets, particularly when some families try to facilitate their elderly parents or relatives by keeping them at home for a short period, notwithstanding the fact that they might be in a poor state of health. This needs to be recognised in the definition of sudden illness or disability. A person may have spent three, four or five weeks being cared for at home which will disqualify him or her under the definition. As a barrister, I have read it very carefully and believe it must be clarified. It would be a shame if a haphazard and ad hoc policy on the calculation or assessment of assets was to contribute to a slowing down or retardation of the process of lifetime transfers of farms which is already too slow. This could slow down such transfers even further.
It must be recognised that farmers’ assets and those of the self-employed and other businesses are productive assets. They are distinguished and required to generate income and should not be seen as a measure of an additional ability to pay. I know that farm organisations have made a number of proposals. In particular, the IFA has proposed that a reduced charge which would be facilitated by having a relief mechanism similar to agricultural relief and capital acquisitions tax be introduced to be pitched at a level of at least 75%. This certainly would be a big help to farmers and allay their concerns. Likewise, the period of time in which an asset needs to be transferred prior to entering a nursing home should be reduced from five years to three. Like the other measures referred to, this would create a favourable environment and signal support for the family farm model which is the backbone and essential to the fabric of rural Ireland.
I understand that in the review of the fair deal scheme it was recommended that up to 90% of the value of a farm or commercial asset be excluded when calculating the cost of nursing home care. The real problem for many businesses, including farmers, is that they can be asset rich but cash poor. Therefore, the scheme, as constructed, cannot be construed, in any shape or form, as being fair for farmers or other businesses. On a wider level, I do not feel there is adequate flexibility in the current scheme. When one goes into a nursing home, there is a fairly demanding application process which can cause consternation for families and be quite serious to have to address. There is an issue whereby in some circumstances – Deputy Sherlock has spoken on this – there can be a lack of availability of nursing home spaces in close proximity to the family home. That can cause issues of disruption and separation for families.
It would be an ostrich that would not recognise that the funding of the fair deal scheme going forward represents a significant challenge with regard to its sustainability, when there are significant demographic changes afoot. It is in that context that I suggest we have to consider a scheme or at least a similar option to permit the provision of home care to the applicant or the home of the person being cared for. We are all aware that the elderly person who might be ill or infirm is far more content living in his or her own home environment among family and neighbours. I found this when I was preparing the report on carers 15 years ago. This will be a challenge, and let no-one underestimate the size of the task to devise such a scheme. I have always advocated that we should facilitate people remaining within their own homes with disabled person grants and other things. We want to remove the bureaucratic obstacles, impediments and hurdles, and we could do that at the stroke of a pen. I hope the Minister of State, Deputy Helen McEntee, will be successful in this objective. She has the unqualified support of the Labour party to make this policy objective a reality.
One other issue arises. When people go into a nursing home, many hope they will return to where they were happiest – in their own home. For some, that becomes a reality. Many others do not return home, but the home remains vacant, idle and unused. Some of these have been enumerated in the vacant home statistics. People like to hold onto their homes, particularly in this context. It might be useful for their families, who are trying to pay towards the cost of care, to encourage siblings or direct relatives to lease or let part of these houses, or the full house, to people who have nowhere to live. As an incentive, allow €5,000 or €6,000 of any rental income to be earned tax-free. Similarly, the €5,000 or €6,000 would not be assessable as part of the home owner’s income and be caught as part of the 80% contribution of a person’s total income to the cost of care. It might incentivise the availability of such houses and avoid them being left there. Sometimes they become derelict – let us be honest about that.
We need to be imaginative and innovative about how we look after people who fall ill, get old and require nursing home care in the future. If we do it right, we will only be providing for ourselves in the not too distant future.