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Fair Deal changes will free up family homes for sale

Family-owned farms and businesses will no longer be factored into calculations of nursing-home care costs, under new legislation.

The Nursing Homes Support Scheme (Amendment) Bill 2021 has passed through the Oireachtas and will now be sent to the president for signature.

It amends the nursing-homes support scheme, commonly known as Fair Deal, to protect family farms and businesses from nursing-home care costs, where a family successor commits to working the farm or business for six years.

After three years, the value of family-owned farms and businesses will no longer be taken into account when calculating the cost of a person’s nursing home care.

Three-year cap extended

The bill also extends the existing three-year cap on contributions to the cost of care, based on the value of a principal residence to the proceeds from the sale of that residence.

The department has said that this is consistent with the scheme’s core principle of fairness, by treating the home and its proceeds of sale in a similar way.

It is intended that this change will also remove any disincentive for people who want to sell their vacant home while in Fair Deal, an important consideration in the context of the housing crisis, the department has said.

‘Fair Deal fair for all’

Mary Butler (Minister of State for Mental Health and Older People), said: “This change is essential to the viability and sustainability of family farms and businesses, allowing them to be passed down to the next generation.

“Ultimately, the bill seeks to alleviate any unnecessary financial pressures placed on these families by updating the current law. It will ensure that Fair Deal is fair for all, enhancing accessibility and affordability of the scheme for more farm and business-owning families.”

Another change is the introduction of the right for any person, when attending an interview under the scheme, to be accompanied by another person over 18. There is also a provision for the bill, once enacted, to come into operation within 90 days.

‘Hugely emotive issue’

Ms Butler continued: “Progressing this bill, as quickly as possible, has been an absolute priority for me since I was appointed last July. This has been a hugely emotive issue for farm families and business owners in communities across Ireland, and one that the Programme for Government sought to deliver on. I am delighted to have now made this critical step forward with the full passage of this historic piece of legislation.

“The bill received broad, cross-party support, and I would like to thank all Oireachtas colleagues who have engaged with this bill and for supporting it through the Houses of the Oireachtas. I would also like to thank the many non-Government stakeholders who have contributed to the development of this legislation, including advocacy groups and organisations representing older people.

“I am fully committed to the timely and effective commencement of this legislation,” she said.

Annual cost of €1 billion

The Nursing Homes Support Scheme has been in operation since 2009 with 22,755 people participating, at year-end 2020, at an annual cost of just over €1 billion.

Participants contribute up to 80% of their assessable income and a maximum of 7.5% per annum of the value of assets held.

In the case of a couple, the applicant’s means are assessed as 50% of the couple’s combined income and assets. The first €36,000 of an individual’s assets, or €72,000 in the case of a couple, is not counted at all in the financial assessment.

Participants contribute to the cost of their care according to their means, while the State pays the balance of the cost.

Where an individual’s assessed weekly contribution is greater than the cost of care, they do not qualify for financial support.

The capital value of an individual’s principal private residence is only included in the financial assessment for the scheme for the first three years of their time in care.

Currently, this unqualified three-year cap does not apply to productive assets, such as farms and businesses, except in the case where a farmer or business owner suffers a sudden illness or disability and, as a result, requires nursing-home care.