Is section 1 agreed to?
Health (Amendment) Bill 2013 [Seanad]: Committee Stage
I again record my opposition to the passage of this Bill. I intend to oppose vigorously the measures contained within it. It is a major disappointment. Only now is there an emerging realisation on the part of a great number of the citizenry of what is incorporated in these proposals. I oppose the Minister's intent. It is regrettable that the only laudable aspect of the Bill is not part of an overall plan, or an outline and clearly defined plan to introduce universal health insurance. I am speaking specifically about the requirement of those availing of public hospital beds, who are privately insured, to pay the appropriate cost of their inpatient care. That is something I have repeatedly advocated but is also ill-provided for by this Bill. Other measures include a significant increase in the cost of the fair deal scheme and increased costs from €75 to €80 for patient care, which is absolutely unacceptable on top of all the other additional costs people are having to bear in these times. I, therefore, oppose the Bill and wish to indicate that at the very beginning of Committee Stage.
I have heard the Deputy, but I made my points very clearly on Second Stage. I intend to press ahead. I wish to address amendment No. 1 unless the Deputy has an objection.
Amendment No. 1 is in substitution for amendment No. 1 on the principal list of amendments dated 15 July 2013. Acceptance of this amendment involves the deletion of section 2 of the Bill.
I move amendment No. 1:
In page 3, before section 2, to insert the following new section:
2.—(1) Subject to subsection (2), this Act, other than Part 1 and sections 5, 6, 7 (but not including paragraph (e)(ii) of section 7) and 14, shall come into operation on such day or days as the Minister may appoint by order or orders either generally or with reference to any particular purpose or provision, and different days may be so appointed for different purposes and different provisions.
(2) Sections 13, 15, 16 and 17 shall come into operation on 1 January 2014.”.
Section 2 provides for the commencement of the Bill. This is a technical amendment to provide that in addition to sections 6 and 7, with the exception of paragraph (e)(ii) of section 7, Part 1 and sections 5 and 14 shall commence upon the enactment of the Bill. Other sections of the Bill shall be commenced as appropriate by way of commencement order.
Sections 13 and 15 to 17, inclusive, all refer to elements of the private inpatient charge and require co-ordination in their commencement. As a result of discussions my Department has had with the private insurance industry in order to agree a phasing in of the charges for all private patients, including those who occupy public beds, I have decided to implement these charges from 1 January 2014 to ensure the agreed additional revenue is realised.
The deferral of the implementation date of the new charge will allow time to assure the private health insurers that these new charges will only raise the intended €30 million in 2014 in line with a phased approval, by carrying out an independent assessment of private patient activity and charges. If it is necessary, I will amend the rates in the autumn by amending legislation to deliver the €30 million. I, therefore, ask Deputies to support this amendment.
What is the logic of commencing these sections on 1 September but not others? In the Department's consideration, what is the demarcation between one set of sections and others as regards their coming into effect?
In the course of his Second Stage address, the Minister indicated that charging insurers the full cost of private patients in public hospitals might not be introduced or implemented depending on how the private insurers respond. Will the Minister elaborate on that point? Amendment No. 1(2)(2) clearly states that "Sections 8, 9, 13, 15, 16, 17 and 19 shall come into operation on 1 September 2013". It seems that what the Minister indicated in his Second Stage contribution is at variance with what is now presented.
It means that if this amendment is agreed section 2 as drafted will be deleted. It is clear from the language used that section 13 shall come into operation on 1 September. Perhaps the Minister will explain the apparent contradiction between his Second Stage contribution on this Bill and what is now presented to us on Committee Stage.
The Minister might in his response clarify the basis of the €30 million of which he speaks. Many figures, in terms of how much money will accrue as a result of this provision, have been bandied around. The insurance industry has made one argument, the Department has made another and we are now being given a figure of €30 million. Perhaps the Minister might explain the basis of this €30 million.
What will happen if it becomes evident that the amount required is significantly in excess of €30 million? The reality is that this money will come from the pockets of private health insurance members. If the amount required is in excess of €30 million further demand will be placed on these people by way of increases in premiums. The vast majority of insurance premia in this country are being pushed beyond the reach of many families. More will haemorrhage out of the system if further increases are forthcoming.
What mechanism will be employed should the €30 million not be achieved?
The Deputies have raised reasonable points. I agree with Deputy Ó Caoláin that I did say on Second Stage that implementation would be dependent on how much co-operation there was with the insurance industry. I am happy to say that we have had good discussions with the insurers. On Deputy Naughten's point, the same applies. In other words, as a result of the discussions which my Department has had with the private insurance industry on the phasing in of the charges for all private patients, including those who occupy public beds, I have decided to implement the charges from 1 January 2014. This will allow me time, in the context of an independent assessment, to further examine costs. There is dispute between the departmental figures, which are based on the HIPE data, a survey of all hospitals, bar three, of which two were hospices, which correlate with the HIPE data in this regard and the insurers. The fairest thing to do is allow for an independent assessment, possibly by the Health Insurance Authority, of the reality in this regard and the values that need to be put in place. I hope I have explained the situation in terms of the delay in implementation. For my part, I do not wish to raise more than €30 million. If more or less is raised, adjustments will be made.
The Minister has stated that following positive engagement with the private health insurers he proposes holding the position until 1 January 2014. The Minister may correct me if I am wrong but, as I understand it, section 13 applies specifically to those who hold private health insurance. Subsection (2) of the amendment proposes that the sections shall come into operation on 1 September 2013. There is nothing about it that suggests a delay of four months. Perhaps the Minister will clarify the matter. If I am getting the wrong end of the stick, I am willing to acknowledge it. The amendment specifically provides that the charges shall come into operation on 1 September 2013, yet the Minister in his reply stated that he has the wherewithal to hold off until 1 January 2014 following further consideration. I would like the Minister to clarify the matter.
I take the Minister's point but would like to return to the logistics of the issue. The Minister may correct me if I am wrong but if his figure is wrong, one way or the other, Schedule 1 would have to be amended. Is the Minister saying that following conclusion of the assessment by the Health Insurance Authority or other intermediary, agreement will be reached by both sides in regard to how the €30 million is to be calculated? When issues have arisen in the past in relation to health insurance legislation, the Department has been slow to amend it. Can the Minister assure the House that if the figures set out in Schedule 1, as amended, are not achieved the Schedule will be amended or is he saying that the amount set out is the actual cost of these beds to the Exchequer on a daily basis? I am seeking clarity on the logistics of this provision. Is flexibility in this regard built into this legislation? If so, it is important that those changes would come before the House or, at least, the committee, for consideration before adoption.
On Deputy Ó Caoláin's question, the original amendment included a reference to 1 September 2013. However, the supplementary amendment accepted by the Ceann Comhairle on foot of the agreement with the private health insurers includes a reference to 1 January 2014. I hope that clarifies the matter for the Deputy.
On Deputy Naughten's question, the Deputy is correct that if I am required to adjust the figures up or down I will have to come back to the Dáil to do so.
I do not wish to be confrontational and am merely seeking to have an issue clarified. Is the Minister proposing by way of a supplementary amendment to change the implementation date from 1 September 2013 to 1 January 2014? Is that the net effect of the Leas-Cheann Comhairle's notification?
That clarifies that point.
I am sure the Minister's failure to respond to my earlier question was an oversight on his part. The charges set out in the revised Schedule 1 differ from those in the original text. Are the new figures based on the Department's estimated cost of a hospital bed or the need to generate an income of €30 million per annum? It is either one or the other. Does the Department expect the new charges to generate the €30 million required or does it consider these charges to be the actual cost of maintaining a bed in a public hospital?
The charges will raise €30 million.
I move amendment No. 2:
In page 4, to delete lines 1 to 4 and substitute the following:
"(b) In administering the Scheme the Executive shall ensure that it is user-friendly and that applicants are assisted at every stage in the making of their applications and that application procedures are as straightforward and comprehensible as possible.".".
The proposition in subsection (3)(b) did not receive any political, not to speak of public, attention prior to the publication of the Bill. I certainly did not pick up any signal that it would be included in the legislation. The paragraph reads as follows: "The Executive may enter into an arrangement with a person under which that person may perform any part of the Executive’s function arising under paragraph (a) on behalf of the Executive." In simple terms, it is a mandate for the privatisation of the executive function of administering the nursing homes support scheme, otherwise known as the fair deal scheme. The insertion of this paragraph is incredible and tantamount to a vote of no confidence in the public service. I do not know for what reason it has been included but it can only have one purpose, namely, to accommodate an intent which has not been presented or explained heretofore.
The purpose of the amendment is to delete subsection (3)(b) and substitute the following paragraph: "In administering the Scheme the Executive shall ensure that it is user-friendly and that applicants are assisted at every stage in the making of their applications and that application procedures are as straightforward and comprehensible as possible." I included this series of requirements, not by reaching to the clouds but based on some not inconsiderable experience of helping people deal with what is a complex process. I seek to delete that part of section 4 which provides for the privatisation of the administration of the nursing homes support scheme. As I stated, this provision had not been signalled previously and amounts to another brick in the wall of the Government's privatisation measures, which have been especially visible in the Minister's stewardship of the health services.
The Minister of State, Deputy Kathleen Lynch, has confirmed that means testing and charges are in prospect for people requiring community-based services such as home care. This alarming prospect, which was only signalled in recent days, constitutes a further attack on older people and people with disabilities, notwithstanding the Minister's attempt in more recent commentary to row back in the latter area.
Last year, when the Minister published the so-called reform framework, Future Health, I pointed out that the types of charges to which the Minister of State alluded were in prospect. According to the Future Health document, social care services such as services for older people, people with a disability and those who need mental health services will be outside the universal health insurance system. Under the strategy, the so-called fair deal scheme of funding nursing home care may be extended to the disability and mental health services. These were the early signals of what is currently transpiring and I strongly oppose any such proposition.
As I indicated, we have the prospect of means testing for community-based care and charges arising from the extension of the so-called fair deal scheme to incorporate these other areas of care need for older people. This has potentially serious consequences, notably in respect of demand for residential care in future.
In addition, under section 4, we now face the prospect of privatisation of the administration of the fair deal scheme. I reiterate the question I put to the Minister on Second Stage - from where has the proposal to privatise the administration of the fair deal scheme come? What is the motivation behind its incorporation in the Bill? Will the Minister provide a clear answer and indicate precisely his intention in this regard? In my view, the issue is bare-faced and, therefore, requires an open and fully frank elaboration. The Minister must share with the House any plans he may have in this regard, however far back in the pipeline they may be. What research or consultation has taken place in respect of any proposal to remove the administration of the nursing home support scheme from the public service?
The fair deal scheme is a key State scheme, which requires great care, sensitivity and scrupulous fairness in its implementation. The right of citizens who qualify under the scheme must be vindicated. I have experience of assisting people with the process of applying to the scheme and they describe it to me as complex, confusing and drawn out. In tandem with the ever deepening economic crisis of recent years, the application process has becoming increasingly complex. It has become a bureaucratic and legal nightmare and needs to be simplified, streamlined and better fitted to the needs of citizens who require the service.
The purpose of my amendment is to oppose what is, I presume, the Minister's intent in subsection (3)(b) and replace it with a firm commitment to an administration of the scheme that would be commensurate with the needs of ordinary service user applicants, specifically those who are at a stage in life where they need all the compassion and understanding our State systems can provide.
I reject out of hand the contention that the Deputy is trying to make that we are privatising the administration of the scheme - we are certainly not. The subsection states:
(b) The Executive may enter into an arrangement with a person under which that person may perform any part of the Executive’s function arising under paragraph (a) on behalf of the Executive.”.
The effect of the Deputy's amendment would be twofold. First, it would delete the provision which would enable the HSE to outsource some of its functions under the scheme. Second, it would insert a provision requiring the HSE to ensure the application process for the scheme is user-friendly and that applicants are assisted at all stages.
The programme for Government makes a commitment that a Government-wide review will be carried out to identify and eliminate non-priority programmes and outsource, where appropriate, non-critical functions. I have stated previously that this provision is only enabling in nature and that there are no specific functions under consideration for outsourcing at this time.
However, should it be deemed appropriate or desirable in the future to outsource any elements of the scheme, this provision would facilitate that process. We all know the State's financial situation. We cannot say that circumstances would never arise whereby services could prudently and efficiently be provided in the private sector. Moreover, if a case could be made that outsourcing a certain function would free up existing staff to assist in other areas or facilitate the recruitment of additional frontline staff, this would have to be considered.
With regard to the provision that this amendment proposes to insert, I argue that terms such as "user-friendly" and "straightforward and comprehensible" are subjective and, as such, cannot be legislated for. In addition, applications are processed by local nursing home support offices which are available to assist applicants, or potential applicants, with any queries they have. The legislation also enables various categories of representative to assist a person with the application process.
The HSE is always striving to ensure that the application process is as user-friendly as possible. The documentation for the scheme has been revised in the past and will be revised again after the Bill is enacted. Furthermore, the review of the nursing homes support scheme will include consideration of the ease of use of the application process. For these reasons, I cannot accept the amendment.
The Minister starts by rejecting the case I have made and then after a trickle of sentences uses the language of "at this time" and "if in the future". This is exactly what I have described. It is provision for the privatisation of the administration of this scheme or any part of it. No amount of wriggling will get away from the fact that the only reason this is here is that consideration is being given - however cursory at this point in time and even that I am unconvinced of because it may be much further advanced than that - to taking away the administration of all or any part of the nursing homes support scheme. To my mind that is a very serious prospect. I am absolutely opposed to the privatisation of public services or public service administration. I have every confidence in the public service. I want to see it strengthened and supported. I do not want legislation going through this House that provides for its dismantling at any time in the future under any guise or excuse. I stand foursquare behind public services and those who work in providing them.
Some time ago I reminded the Minister of something he said when addressing the Nursing Homes Support Scheme Bill in 2008. I believe I incorporated it into my comments on Second Stage of the Bill. He said: "We must be mindful of what happened with the HSE. We cannot allow that type of mess to be inflicted on people." He was of course speaking from this side of the Chamber at that time. He made considerable sense when he was an Opposition spokesperson on health. I was very much of a similar mind on a whole range of issues on which we each presented our respective parties' positions. How that has changed since he has crossed the floor to take up his position as Minister. Nowhere is it more evident than in the reference to the Nursing Homes Support Scheme Bill at the time.
What could the so-called outsourcing of the scheme as provided for in section 4 possibly achieve? The Minister has talked about freeing up staff into a range of other roles or services. This is a role and service that our public servants are there to oversee and administer. I believe that is where it should remain. We have seen so many people removed from the public service. Does this indicate intent of further reductions in public service numbers? We have seen a significant reduction across a range of public service responsibilities. It has been a traumatic time for people employed in the public service and their dependent families. What is this meant to achieve apart from cutting out the public service element and bringing in private contractors with staff likely on lower pay and enriching privateers? That is exactly what happens. It is not that there will be a real saving; it is that others will make money out of it. That is why they stand forward as private investors in terms of what we have traditionally viewed as public service provision.
I urge the Minister to dispense with that part of section 4 and adopt my amendment, which I believe to be reasonable. Whatever about its language construction, that is the language that people I represent understand. It reflects their current dissatisfaction with access to the fair deal scheme. It places a clear obligation on those administering the scheme to act as I have spoken of in a straightforward and comprehensive way in dealing with applicants in need of that support. That is what citizens need and, most especially, older citizens and people with disabilities who seeking access to residential nursing home care out of necessity because they are no longer able to remain in independent living settings. We certainly do not need another aspect of this or any other scheme to be farmed out to privateers.
There is no wriggling. This section leaves room for options to use the private sector as required into the future when it is to benefit of the service and the patients using it. The Deputy has alluded to a quote on the mess that was the HSE. The mess that was the HSE is being sorted out.
I point out to Deputy Ó Caoláin that the function of the scheme is to ensure long-term nursing home care is accessible and affordable for everyone and that people are cared for in the most appropriate settings. The overall objective of the reviews we are carrying out is to examine the future sustainability of the nursing homes support scheme, taking account of Government policy, relevant demographic growth trends and the current and projected fiscal situation, and to make costed recommendations on how the scheme should operate in the short to medium term to ensure it best supports Government policy and, more important, that it best supports people.
Certainly, some people need long-term care, but many would much rather stay in their homes. They need supports to live in dignity and with independence in their homes and communities for as long as possible. We want to review the nursing homes support scheme to see how best the funds we have can best support the maximum number of people. Therefore, I do not intend to accept Deputy Ó Caoláin's amendment.
There is no getting away from the fact that the subsection I have referred to and that I seek to amend is a provision for privatisation, either in whole or in part, of the scheme's administration, which is currently within the public service ambit and which, I strongly believe, should remain there. I support the review of the overall administration to improve it and make it more applicant-friendly and more easily understood. However, I will not and cannot support the provision, irrespective of the intent today or tomorrow. Clearly, the provision is for an intent, perhaps at some time in future, to move the administration of the scheme, in whole or in part, from the public service to private overseers. That is simply wrong. Those who currently seek access through the fair deal scheme and those who will present in future should not have to deal with private profit-motivated interests in having any part of their application or entitlements assessed. The process should stay wholly and solely within the public service, where it properly belongs. My amendment is important because it seeks to remove the offending section and reiterates the importance of straightforward and comprehensible applications procedures. Many of those who are presenting no longer have the same comprehension abilities that they once enjoyed throughout their youth and adult lives. The process should be simplified and made more understandable. Sadly, aspects of it are not ticking those boxes today. I believe my amendment achieves both purposes.
- Bannon, James.
- Breen, Pat.
- Bruton, Richard.
- Butler, Ray.
- Buttimer, Jerry.
- Byrne, Catherine.
- Byrne, Eric.
- Cannon, Ciarán.
- Carey, Joe.
- Coffey, Paudie.
- Collins, Áine.
- Conaghan, Michael.
- Conlan, Seán.
- Conway, Ciara.
- Corcoran Kennedy, Marcella.
- Creed, Michael.
- Deasy, John.
- Deenihan, Jimmy.
- Deering, Pat.
- Doherty, Regina.
- Donohoe, Paschal.
- Dowds, Robert.
- Doyle, Andrew.
- Durkan, Bernard J..
- English, Damien.
- Feighan, Frank.
- Ferris, Anne.
- Fitzpatrick, Peter.
- Gilmore, Eamon.
- Griffin, Brendan.
- Harris, Simon.
- Heydon, Martin.
- Humphreys, Heather.
- Humphreys, Kevin.
- Keating, Derek.
- Kelly, Alan.
- Kenny, Seán.
- Kyne, Seán.
- Lawlor, Anthony.
- Lynch, Ciarán.
- Lynch, Kathleen.
- Lyons, John.
- Maloney, Eamonn.
- McCarthy, Michael.
- McHugh, Joe.
- McLoughlin, Tony.
- McNamara, Michael.
- Mitchell O'Connor, Mary.
- Murphy, Eoghan.
- Nash, Gerald.
- Neville, Dan.
- Nolan, Derek.
- O'Donnell, Kieran.
- O'Donovan, Patrick.
- O'Mahony, John.
- O'Reilly, Joe.
- Perry, John.
- Phelan, Ann.
- Phelan, John Paul.
- Rabbitte, Pat.
- Reilly, James.
- Ring, Michael.
- Ross, Shane.
- Stagg, Emmet.
- Stanton, David.
- Twomey, Liam.
- Wall, Jack.
- Adams, Gerry.
- Browne, John.
- Calleary, Dara.
- Collins, Joan.
- Colreavy, Michael.
- Cowen, Barry.
- Crowe, Seán.
- Daly, Clare.
- Ferris, Martin.
- Flanagan, Luke 'Ming'.
- Fleming, Sean.
- Healy, Seamus.
- Healy-Rae, Michael.
- Mac Lochlainn, Pádraig.
- McDonald, Mary Lou.
- McGrath, Finian.
- McGrath, Mattie.
- McGrath, Michael.
- McGuinness, John.
- McLellan, Sandra.
- Murphy, Catherine.
- Ó Fearghaíl, Seán.
- Ó Snodaigh, Aengus.
- O'Sullivan, Maureen.
- Smith, Brendan.
- Troy, Robert.
- Wallace, Mick.
May we have some silence, please, in dealing with the rest of the Bill? Members who wish to have conversations should do so outside the Chamber.
The Minister should elaborate on what precisely is the Department's thinking in this regard. It is about the abolition of the backdating of the nursing homes support scheme to those who were in care prior to its commencement. The reason I ask is that presumably, at this stage only a handful of people would fall into this category, that is, those who are not in the fair deal scheme at this stage or perhaps would have been in the nursing home subvention scheme.
What is the need for this provision?
The Deputy is right. Very few people could apply for the scheme at this point in time. We need certainty and it has been decided to close the scheme. Some four years have elapsed within which time people could have availed of the facility put in place. The Exchequer needs some certainty on its figures and liabilities.
I do not disagree with the Minister, but surely it would make more sense to set a date 12 months from now and allow people to apply for the scheme. I presume only a handful of people would fall under the provision. It may cause financial hardship; I do not know. I know of a case which will not fall under this provision because the person is already in the scheme. Significant arrears, which would put an undue financial burden on people, have to be addressed. Could a date be set to ensure no financial hardship arises?
The scheme has been running for four years. The Nursing Home Support Scheme Act 2009 provided for a person in nursing home care when the scheme commenced who applies for the scheme to have his or her State support backdated to 27 October 2009. There has to be a cut-off point. One can always argue that another 12 months should be allowed, and I accept from where the Deputy is coming, but there comes a point when a scheme has to be closed. This is the appropriate time to do so. The manner in which it has been administered to date has been more than fair.
The only issue I have is that people receive notice.
Amendments Nos. 3 to 6, inclusive, are related and may be discussed together.
I move amendment No. 3:
In page 5, line 36, to delete “7.5 per cent” and substitute “5 per cent”.
My amendments seek to delete the Minister's proposal to increase the asset contribution to 7.5% and retain the current position of 5%. I do this with some reluctance. An increase from 5% to 7.5% is a 50% increase on the calculable asset value of the recipient of the fair deal scheme. It is very instructive that the Government, in particular Fine Gael, has set its face against any increase in income tax. It makes almost a high moral position of this in repeated statements and assurances from the Taoiseach and others in Fine Gael that it will not contemplate any increase in income tax for the highest paid in the State.
I cannot refer to Fine Gael alone because whatever about the position of the Labour Party on higher levels of income tax for the highest paid or a wealth tax, when it comes to squeezing more money out of older peoples' pockets there is no reluctance whatsoever. An increase from 5% to 7.5% is what this amounts to. Many of the citizens concerned - we should remind ourselves of this fact - have spent their working lives paying significant income tax to the Exchequer. They or their spouses paid taxes over many years at a time when low and middle income PAYE workers bore a hugely excessive burden of the cost of providing for the services of the State.
When people who worked for the greater part of their lives, or their dependent surviving spouses, in later life seek help from the State, they are asked to shoulder a further burden having contributed to services throughout decades of their lives. This goes to the heart of what is wrong with the Bill and the original Nursing Homes Support Scheme Bill. Despite Government claims that it is going in the opposite direction, the fact of the matter is that it is moving us away from universal entitlement to hospital and residential care. That is no longer the case and has not been for some considerable time.
Such charges post one's death do not fit with a universal entitlement to hospital and residential care. As we have seen, care is being contracted out and patients are made to pay, a situation which is continuing. Instances of it have been demonstrated in terms of the intent of the Government, as I said earlier, in the recent comments of the Minister of State, Deputy Kathleen Lynch.
We constantly hear the refrain about money following the patient but in this instance, and given what is involved in section 7 of the Bill, what we are actually looking at is more money being taken from the patient who may be old, infirm and no longer able to live independently. Once again we are taking more from a person's net worth. That is completely and absolutely wrong.
I utterly reject the last contribution. The Deputy referred to income tax in regard to the Bill. There is no relationship, but as he mentioned it, increases in income tax are increases in taxes on work. We want to get people back to work because that is how the country will recover.
The contention of the Deputy that the proposal is taking money from older people is not the case. It is taking money from their estates which they leave behind to a maximum of three years. Nobody will pay more than the cost of care, but the Deputy probably believes nobody should pay anything towards his or her care and that a fantasy fairy will come from somewhere to support health services and social care costs.
The first €36,000 of a person's assets, or €72,000 for a couple, is not taken into account during the financial assessment. The principal residence is only included in the financial assessment for the first three years of a person's time in care. Where an individual's assets include land and property in the State, the contribution based on such assets may be deferred and collected from his or her estate. This is the optional nursing home loan element of the scheme.
Individuals keep a personal allowance of 20% of their income or the maximum rate of the State non-contributory pension, whichever is the greater. Certain items of expenditure called allowable deductions can be taken into account during the financial assessment. These allowable deductions include health expenses. There is a financial review mechanism which takes account of the fluctuating value of assets and the fact that cash assets will naturally deplete over time as payments are made to nursing homes, etc.
Section 7 provides for an increase in such contributions from 5% to 7.5%, as announced in the budget. The proposed amendment seeks to retain the current asset contribution of 5% per annum, yet we all know how the value of assets has collapsed in the past five years. The latest CSO projections anticipate a significant increase in the over 65 population the coming years. The number of those aged over 80 years who makes up approximately 70% of the long-stay nursing home population is expected to increase even more dramatically.
Simply put, the funding available for services for older people is not increasing at the same rate as the population. The budget for the nursing home support scheme this year is €974 million. The State has limited resources. However, the demands being made of these resources continue to increase.
The increase in the asset contribution is necessary to ensure the sustainability of the scheme. When the legislation is enacted, the increase will only apply to new entrants to the scheme. Anyone who is already in receipt of financial support under the scheme will not be affected. The scheme contains several safeguards which ensure both the person in the nursing home and his or her spouse or partner, if applicable, will be adequately provided for. These safeguards are unaffected by the provisions of the Bill. The proposed amendment does not take account of the fact that section 7(h) provides that in the case of a couple, the total contribution based on the principal residence shall not exceed 22.5%. The amendment, if accepted, would create an anomaly in the legislation. As a result, I do not propose to accept it.
Sadly and despite all his protestations, which I cited in respect of amendment No. 2, one did not expect the Minister to do so. Talk about performing a volte-face. The position he holds now is a complete reversal of that which he held when he was on the Opposition benches. Essentially, he is a cheerleader for all he opposed when he was an Opposition spokesperson on health. His position is no longer recognisable. The only thing which is recognisable is his face. What is happening here is extremely sad because it will feed into the loss of confidence among so many people in the political process. Citizens cannot believe in or depend on voices in this House because what those voices are saying changes to suit the moment. There must be a restoration of confidence in order that people can believe that a position taken while in opposition is one which will be followed through on in government.
The proposal to increase the contribution from 5% to 7.5% will act as a deterrent. I am concerned about the impact it will have on families engaging in a consideration of the needs of their loved ones and alternatives to residential care. The latter is not the first choice or option for families in the context of loved ones who are in their later years. The normal and natural inclination is to do everything possible to allow loved ones to remain in their homes, where they are happiest and in familiar surroundings. If they are able to offer an opinion - some cannot do so as a result of a deterioration in their circumstances - I am of the view that the overwhelming majority will indicate that they want to remain at home. Sadly, however, there comes a time when residential care becomes a real option. In some instances, it is not an option at all but is rather a requirement. It is a sad point in the life of any family when a parent, elderly sibling or whoever must have recourse to residential care.
I am concerned on a number of levels. A distinction should not be made between the provision of care to people with dementia, Alzheimer's and a range of other degenerative and life-impacting conditions and other areas of care in respect of which asset charges do not apply. Such charges have, however, applied in this area since the introduction of the scheme in 2008. We should consider the health care of all citizens equally and provide universally on the basis of need alone rather than on the basis of ability to pay or geographic location. Those are principles.
My amendments do not do what I would like them to do. However, they acknowledge the situation which obtains and seek that there will not be a two-tier system whereby those already in the scheme will only pay a contribution of 5% while those whom enter the scheme subsequent to the passing of the Bill will be obliged to pay 7.5% in respect of the net asset value of their estates. It is important we should treat everyone equally and that we should not create two-tier approaches in this or any other area relating to meeting the health care needs of and providing supports for citizens. All people should be treated equally and respectfully.
I again urge the Minister to retain the current contribution of 5%. He made an excuse to the effect that as a result of the reduction in the value of property, there is no alternative to imposing the increase in order that the level of intake will subsequently increase. The Bill does not provide for the Minister to revisit and reduce the asset contribution at some point in the future when matters might come full circle. Damn right he will not revisit and reduce it if there is an upturn in fortunes - as we hope there will be - in the short to medium term. Sadly, the position is that, once imposed, the increase will be here to stay. For all of the reasons I have outlined, I believe amendments Nos. 3 to 6, inclusive, should be accepted.
I have some concerns about to the section to which the amendments relate. Perhaps the Minister might clarify a few issues because the position is quite confusing and there are quite a few calculations involved. To whom will the provisions of the section apply? Will they apply to someone who is currently in a nursing home and who has not applied under the fair deal scheme? I refer, for example, to a person who has been paying for a private residential scheme and who might come under the category ruled out under section 6 or who may already be contemplated under the nursing home subvention scheme. Will the provision apply to someone who has made an application in respect of the scheme and in respect of whom a decision is pending? Under the revised rules, the scheme does not kick in until approval issues in respect of the national waiting list rather on the day on which someone enters a nursing home. Will the Minister clarify the logistics relating to this matter?
I understand the 7.5% will kick in on the date on which someone's application is approved. The 5% contribution used to kick in on the original date on which a person entered a nursing home. There is probably not much of a difference in this regard. On the basis of the value of the capital asset, however, there is a substantial difference between a contribution of 5% and one of 7.5%. The capital asset disregard will remain unchanged. As a result, someone who enters the scheme will - on the basis of capital assets decreasing in value - be disproportionately better off than a person who entered the scheme when it was originally devised. The reason for this is that value of capital assets was significantly higher in 2008.
Where a capital asset is generating income, will that asset be disregarded and the income calculated or will there be a double whammy whereby the income and the value of the asset will both be taken into account? If that is the case, surely that is a double charge on a single asset. Is that not unfair?