Health (Repayment Scheme) Bill 2006: Second Stage.

Question proposed: "That the Bill be now read a Second Time."

I am very pleased to introduce the Health (Repayment Scheme) Bill 2006. A significant and long-standing feature of our health system of publicly funded long-term care has been the principle that it is fair and reasonable that people should make some contribution to the cost of their long-term care. The Government, however, accepts fully the Supreme Court decision which found as unlawful the retrospective imposition of charges on fully eligible persons for their publicly funded long-term care.

This Bill provides for the legal framework for making repayments to those wrongly charged for inpatient services in publicly funded long-stay residential care. This legislation must be passed at the earliest opportunity by the Oireachtas to ensure that those due a repayment receive it as soon as possible. We are also proposing legislation to regulate patient private property accounts. It is considered efficient to address both issues in the same Bill.

Charges for publicly funded long-stay residential care have been raised by health boards from people under two sets of regulations, namely, the Institutional Assistance Regulations 1954, as amended in 1965, which applied to all, including those with full eligibility, and the Health (Charges for ln-Patient Services) Regulations 1976, as amended in 1987, from which medical card holders and those with dependants were exempt.

The Supreme Court judgment in the Mclnerney case in 1976 narrowed very significantly the grounds on which a charge could be raised for institutional assistance. It could only be made for shelter and maintenance without any medical or nursing care being provided. A circular from the Department of Health to the health boards in 1976 authorised a practice by which the CEO of a health board could regard patients as not meeting the criteria for full eligibility while being maintained in an institution, since necessary general practitioner and surgical services were being provided for them, and so withdrew their medical card. The withdrawal of full eligibility in this way allowed a charge for inpatient services to be raised.

The health boards, with the knowledge of the Department of Health and Children, continued to raise charges under both sets of regulations up to 9 December 2004. On the basis of advice from the Office of the Attorney General, the Department instructed the health boards to cease charging all fully eligible persons in receipt of inpatient services in public long-stay institutions and in contract beds in private nursing homes, solely by virtue of a contractual arrangement with a former health board, with effect from 9 December 2004. By way of a goodwill gesture, the Government agreed to have ex gratia payments of up to €2,000 made to those wrongly charged and who were alive on 9 December. 2004. The Health Service Executive made payments in excess of €21 million to approximately 10,800 individuals.

The Health (Amendment) (No. 2) Bill 2004 was passed by both Houses of the Oireachtas on 17 December 2004. The purpose of the Bill was to provide a statutory basis for the imposition of charges on those to whom inpatient services were being provided in public long-stay institutions. It also contained a retrospective element which provided that charges levied prior to the enactment of the legislation were also lawful. This Bill was referred to the Supreme Court for a decision on its constitutionality. The retrospective element provided that a relevant charge levied under section 53 of the Health Act 1970 for long-stay care prior to the enactment of the legislation was lawful. The Supreme Court decision of 16 February 2005 found this retrospective element of the Bill to be unconstitutional because of the property rights of citizens.

The charging for long-stay care was put on a statutory footing under the Health (Amendment) Act 2005 and is being implemented by way of the Health (Charges for ln-Patient Services) Regulations 2005. These regulations were signed on 14 June 2005 and reinstated charges for inpatient services and provided for the levying of a charge in respect of the maintenance of persons in receipt of inpatient services. The regulations were prepared following extensive consultation with the HSE and others.

The Supreme Court in its decision of 16 February 2005 did not consider the exposure of the State or the magnitude of the sums involved to justify the extinguishment of a property right. A Cabinet sub-committee was subsequently established to consider the implications of the Supreme Court judgment. It was agreed that money which was received by the HSE as a result of the imposition of unlawful charges would be repaid.

ln light of the amount of repayments which would be due to individuals in certain cases and the overall amount of money involved, it was agreed a repayment scheme to repay fully eligible individuals, who paid inpatient charges while in publicly funded residential care, would be established and placed on a statutory basis. On 11 May 2005, the Government agreed the key elements of the scheme for the repayment of these long-stay charges, one of the key considerations being to ensure that those eligible for repayment received them as quickly as possible with the minimum possible imposition of bureaucracy. It is regretted that, due to the detailed and complex nature of the issues involved and the need to consult with a broad range of agencies and interests, the drafting of this Bill has taken longer than anticipated.

It is estimated that up to approximately 20,000 people who are still alive and a further 40,000 to 50,000 estates will benefit from repayments under the scheme. The overall costs arising from the long-stay charges repayment scheme have been estimated at approximately €1 billion and an appropriate allocation for 2006 will be made when the legislation is passed by the Houses of the Oireachtas.

The unfortunate reality is that a high proportion of those patients due a repayment have varying degrees of mental impairment, meaning that any scheme would clearly require appropriate safeguards to be put in place to prevent fraud and exploitation of those who receive repayments and are not in a position to manage their own financial affairs. ln these instances the legislation will allow repayments to be placed in patient private property, PPP, accounts. These PPP accounts need to be regulated given the significant amount of money which may be in these accounts as a result of repayments of long-stay charges.

Patients' private property refers to money and personal possessions that patients have with them on admission to care. In the case of long-stay patients, the property also includes regular pension payments. Patient private property accounts are operated by the HSE, and formerly by the health boards, in supporting clients in managing their financial affairs and assisting them in dealing with various aspects of daily living. The patient private property account system manages the private money of long-stay patients, which may include pension income, maintenance charges, spending money, comfort payments to patients-clients and lodgements to clients accounts.

This account provides the patients with an ability to exercise their autonomy through such activities as choice of clothing, recreational activities and so on. The account may be administered by an institution as a service to patients who are not in a position to administer the property themselves or have a relative or other person do it on their behalf. The Department of Health and Children accepts the need for clarity and consistency in the area of patient private property accounts and is introducing a statutory framework for these accounts to protect patients interests, particularly in the context of large repayments under the scheme being placed in these accounts.

Due to the nature, volume and complexity of the repayments involved, it was decided, in line with the Government decision, to appoint an outside company with appropriate knowledge and experience in dealing with mass repayments. Such a company is being engaged by the Health Service Executive to manage the repayment scheme within the agreed Government parameters. This company will also provide an independent assessment of the amount of repayment due to each applicant under the scheme, which will help to reassure the public that the scheme is being operated in the most equitable and effective way possible.

The HSE has supported the decision to engage an outside company as the nature of the work is not one of its core functions and in any event, it would not be in a position to administer a repayment scheme of this magnitude within existing resources without having to divert staff from their normal function of delivery of health services. The HSE is already committed to providing resources for the implementation of a unitary system for the delivery and management of health services at local, regional and national level following its establishment in January 2005.

An initial procurement process undertaken by the HSE in the latter half of 2005 resulted in 11 expressions of interest being received for the design and administration of the repayment scheme and these were short-listed to three. Following consideration of all the issues, the initial procurement process was terminated in December 2005, as the HSE considered the tenders were unsuitable for a number of reasons, including value for money.

The HSE decided that in these circumstances it was necessary to put a new procurement process in place and subsequently placed a further advertisement in the Official Journal of the European Union on 2 February 2006. The public tendering process has been implemented and the HSE decided on the appointment of a preferred service provider at a meeting of the board on 1 June 2006. No information can be made public on the preferred service provider until an interval of 14 days has elapsed and there has been no substantial query or objection from any of the unsuccessful bidders, that is, there is no impediment to appointing the preferred bidder.

Consideration bad been given to the involvement of public sector staff to assist in administering the scheme. However the HSE informed the Department that the time constraints of the procurement process and the potential for significant logistical difficulties and protracted delays, with consequent implications for the commencement of the repayment scheme, did not allow for this option to be implemented. There would also have been a requirement to assign dedicated HSE resources to train and supervise such staff thereby removing them from their normal duties with a subsequent effect on service provision.

However, in recognition of the importance of progressing repayments, the Tánaiste has asked the HSE to identify all those living patients who were wrongfully charged and to calculate the details of the repayment due to them in as many cases as possible during the period prior to the selection of the outside company. This will ensure that a significant proportion of patients should receive their repayments within a short period of the company becoming operational. The HSE has indicated that the details of 7,600 living patients have been calculated by the appointment date of the outside company. In addition, the HSE will also have completed 3,500 calculations in respect of those who are deceased, making an overall total of 11,100 calculations.

Extensive discussions have taken place with the Office of the Attorney General, the Department of Finance, the Office of the Revenue Commissioners, the Department of Social and Family Affairs, the probate office of the High Court, the office of the wards of court, the Law Reform Commission, the Office of the Ombudsman, the Courts Service, the Data Protection Commissioner, the Mental Health Commission and the Health Service Executive on the provisions contained in the Bill. The Tánaiste appointed a national oversight committee, representative of service users, including Age Action Ireland and the Irish senior citizens parliament to provide an independent input into the design of the repayments scheme and to monitor the operation of the scheme in order to ensure it is being implemented quickly and in the most equitable and effective way possible. It is chaired by Professor J. Bernard Walsh, consultant physician, St. James Hospital, and reports directly to the Tánaiste.

The committee usually meets on a monthly basis and has examined such issues as mental capacity, appropriate appeals systems and the protection of patient private property. The committee is also in the process of obtaining independent legal advice to assist it in its task. The chair of the committee has met with the director of reform and development, the Courts Service, to discuss in detail a possible framework for making repayments to persons with diminished capacity. The committee is fully briefed on all aspects of the scheme and has provided valuable input into the legislative process at each Stage to date. The draft Bill has been agreed with the oversight committee. The first report from the oversight committee to the Tánaiste which confirmed the committee's satisfaction with all aspects of the processes and procedures undertaken by both the HSE and the Department of Health and Children to date on the establishment of the repayment scheme was submitted on 25 April 2006.

The Health (Repayment Scheme) Bill 2006 provides a clear legal framework for a scheme to repay recoverable health charges for publicly funded long-term residential care and also regulates patients private property accounts. All those fully eligible persons who were wrongly charged and are alive, and the estates of all those fully eligible persons who were wrongly charged and died since 9 December 1998 will have the charges repaid in full.

The decision to limit repayments to estates of those who died since 9 December 1998 reflects the reference in the Supreme Court judgment to the possible application of the Statute of Limitations, namely, "The State has available to it a defence of the Statute of Limitation, that is, a six year limit". The Government has a responsibility, in view of the very substantial sums involved, to have regard to what the Supreme Court said about the Statute of Limitations in order to place appropriate limits on the scale of total repayments which today's taxpayer will have to fund. I am satisfied that the scheme strikes a fair balance in this regard.

The national repayment scheme will refund all those fully eligible persons who were incorrectly charged for publicly funded long-stay residential care. Medical card holders, and those aged over 70 with effect from July 2001 are considered to be fully eligible for the purpose of this scheme. Given the vulnerability of those in long-stay care, and cognisant of the fact that the former health boards did not make a determination on eligibility status in many instances, based mainly on the incorrect assumption that full eligibility could be removed from long-stay care patients as set out in the Department of Health circular 7/76, it has been agreed that those not having a medical card on admission but who fell within the income-means threshold for a medical card, that is, those in receipt of the non-contributory old age pension, will be regarded as having full eligibility for the purpose of this scheme. This will ensure that the scheme is broadly inclusive and is implemented in a fair and equitable manner.

All those wrongly charged for in-patient services will be repaid in full. For the purpose of the scheme, community hostels which provide either medical or nursing care on a rostered basis are considered inpatient services, and residents will have any unlawful charges repaid in full.

Priority in making repayments will be given to those who are still alive to allow these people to benefit from the repayment, by availing of comforts which they may not otherwise be able to provide. In the case of estates, those who actually paid the charges will not receive any benefit from the repayment, due to their death. Many of these living patients have already been identified as a result of the ex gratia scheme which was announced in December 2004. As mentioned earlier, at the Tánaiste’s request, the HSE has already begun proactively calculating the amount of repayments due to living patients in advance of the selection of an outside company. This will allow prompt repayment to begin in many cases following the appointment of a company.

The repayments will include both the actual charge paid and an amount to take account of inflation by reference to the consumer price index. The consumer price index is a widely accepted tool for monetary calculation over an extended period of time. Consumer price index data is also available on a regular basis thereby facilitating a match with periods when payments are due. The consumer price index isalso used by the Department of Social and Family Affairs in dealing with underpayments of social welfare entitlements. Under current social welfare legislation, any moneys received by non-contributory pensioners and other social assistance recipients are assessed as capital, subject to the existing disregard of the first €20,000 of all capital owned. Repayments to some living patients, depending on the amount of repayment due, could therefore have significantly reduced their entitlements. In the case of those who were wrongly charged and are still alive, or their spouses, repayments under the statutory scheme proposed in this Bill will be exempt from tax and will not be taken into account in assessing means for health and social welfare benefits.

The normal tax and means assessment arrangements will apply to those who benefit from repayments to estates. Currently beneficiaries of the estates of others are, for social welfare purposes, assessed with the value of inheritance received from the estates, regardless of the original source of any of the capital or property inherited. It is consistent with existing provisions to treat repayments in the hands of beneficiaries of estates as inheritances and assessable in the normal way.

The procedure for obtaining a grant of probate in the case of an estate of a deceased person can be arduous, time consuming and expensive with the process taking in many instances up to 18 months to complete. For the purpose of the repayment scheme, a streamlined procedure is being developed in conjunction with the probate office of the High Court for a person applying for repayment on behalf of the estate of a deceased person. This procedure will allow an individual to obtain the documentation necessary to receive repayment in a timely, cost-effective and efficient manner. This process is solely for the purpose of receiving repayment under this scheme. Where there are other assets of the estate involved or where disputes arise among potential recipients, the normal procedures and requirements for obtaining a grant of probate will continue to apply.

The scheme will include an independent, transparent and user-friendly appeals process which will be independent of the HSE and the company engaged to administer the scheme. The Minister will appoint suitably-qualified independent appeals officers to consider appeals and the appeals process will allow both written and oral submissions to support an appeal. Applicants to the scheme will be advised of the outcome of their application as soon as possible and will be provided with details of their entitlement to appeal, if their application has been rejected or if they dispute the amount of the repayment. Applicants will also be informed of their right to bring a complaint to the Office of the Ombudsman. The legislation allows for regular reports on the operation of the appeals process, which will be laid before the Oireachtas.

The scheme will include a provision to allow those eligible for a repayment to waive their right to all or part of the repayment, and have the money donated to fund one-off service improvements for older persons and persons with disabilities. Many people may feel that their mother or father was well cared for, and as a result might wish to donate their payment to help those less fortunate. The fund will be specifically established for this purpose to ensure any money donated will be expended for the purpose for which it was intended. This fund will be audited by the Comptroller and Auditor General and the HSE will submit an annual report to the Tánaiste on the operation of the fund. The individual, when making a donation to the fund, can specify how he or she would like the money to be applied within the health services. The HSE will have regard to the wishes of the person making the donation, but due to practical and administrative difficulties, the HSE cannot provide an assurance that the money will be used for the specific institution requested. However, it can provide an assurance that the money will only be used for service improvements in the area of older people or the disability sector.

The HSE, in association with the scheme administrator, will operate a helpline and advice centre to deal with queries and correspondence from patients, relatives, estates, members of the public and so on. Advertisements highlighting the establishment of the scheme and where to apply or seek advice will also be placed in the media and arrangements will be made to ensure that all information relating to the scheme will be available in the Irish language.

An area of particular concern in the drafting of this legislation and in the administration of this repayment scheme relates to those patients who may have mental capacity issues. The unfortunate reality is that a high proportion of patients in long-stay care have varying degrees of deteriorating mental impairment and special arrangements are required for such persons given that they will be in receipt, in certain cases, of significant amounts of money but may not have the capacity to manage their financial affairs. As part of the legislation, a statutory framework is being put in place to protect patient interests, particularly regarding the receipt of substantial repayments. Where doubt may exist about the capacity of an individual, a certificate issued by a registered medical practitioner who has examined the relevant person in the past six months prior to the application, will be required to be submitted with the application form.

In developing the framework for protecting vulnerable patients, consideration was given to the work of the Law Reform Commission, which is currently preparing a comprehensive report on vulnerable adults and the law, which it expects to publish later this year. The provisions were also discussed with the Courts Service and the oversight committee devoted extensive time and input to the drafting of these provisions. Where a doubt exists as to the capacity of an individual, repayments can only be made into that individual patient's private property account, pending a decision on the capacity of that individual. Clearly, this would only apply where the patient is not already a ward of court, or has no other legal representative.

Moneys lodged to these accounts will be used specifically for the benefit of the individual patient. In order to protect these moneys, in the case of persons with mental capacity issues, no moneys in excess of €5,000 per year can be used for the benefit of the patient without the payment being approved by the Circuit Court. Day-to-day expenditure for personal purposes can be made without the necessity of court application but the expenditure of large sums of money will be regulated. Moneys may also be invested by the HSE, on behalf of the patient, in financial institutions authorised by the Financial Regulator.

The legislation also provides for the appointment of an independent person to be appointed by and to report to the Minister for Health and Children on patient private property accounts to ensure that these accounts are administered in an appropriate fashion and that any moneys expended are for the benefit of the patient. Patient private property accounts will be administered in line with national guidelines, which are to be developed by the HSE, to ensure consistency in their application throughout the country.

Section 3 of the Bill allows the Health Service Executive to enter into an arrangement with persons to provide services on their behalf, which will enable the HSE to engage an external company to administer the repayment scheme within the agreed parameters. The Government decision indicated that an outside company with experience in dealing with mass claims would be engaged to manage the scheme. I have already referred to the tendering process currently being undertaken by the HSE in this regard. As I have outlined, the HSE has decided on the appointment of a preferred service provider and it is anticipated that the company will begin work on the scheme before the end of June. This company will also provide an independent aspect to the validation of claims and to the repayment scheme generally.

Section 4 of the Bill outlines the type of forms and other documents which the scheme administrator may require for the purposes of the Act. Section 5 outlines the application process for a repayment using the forms mentioned in section 4. It also outlines the grounds for refusing an application and the closing date for receipt of applications. The legislation allows for applications to be accepted until 1 January 2008. This date can be extended by regulation if required.

Section 6 sets out the process for determining if an applicant is entitled to a repayment and the amount due. In the event of there being insufficient information available on the amount due for repayment, the scheme administrator can make a determination on repayment, based on a formula linked to the patient's non-contributory old age pension for the period in which the patient was in care. However, a separate lower or higher rate would be fixed in cases where there was evidence that a reduced or increased charge was paid. It has been suggested that a deadline of 28 days be allowed for the determination of eligibility under the scheme, and consideration was given to the inclusion of a deadline in the legislation but was not included for practical reasons. In terms of eligibility under the scheme, many patients did not have a medical card on admission to long-stay care but fell within the income means threshold for a medical card and to ensure equity will be regarded as having full eligibility under the scheme. In certain instances determination of eligibility may not be straightforward.

Section 7 allows for applications from living persons to be prioritised over those from estates of deceased persons. This is designed to allow patients to benefit from repayments while still alive.

Section 8 is designed to make the repayments scheme more beneficial to the applicant than litigation, and relates to other legislation on which the proposed legislation impinges. This section allows for repayments to a living person or his or her spouse to be disregarded for income tax purposes. It was suggested that a deadline of 28 days should be included for making repayments following receipt of an application. A deadline was not included with regard to making repayments, as some patients may have been in a number of institutions over an extended period of time, and in these circumstances a 28-day deadline may not be practical.

Applicants will also be given the opportunity to appeal the determination of an application before a recoverable health charge is repaid. Applications will be processed as quickly as possible after they are received and the uppermost consideration will be to ensure that relevant persons receive the full amount of repayment due to them. The section also allows for repayments under the statutory scheme to living persons or their spouses to be disregarded in means assessments for health or social welfare benefits. It also allows for any tax relief claimed for medical expenses in respect of payments, or for any probate tax liability that may arise to be disregarded. Repayments under the scheme will not be considered when assessing entitlements to subvention. The section allows for a streamlined process for the normal probate requirements for estates, for the purpose of facilitating repayments through the statutory scheme. It also provides that a final repayment will be net of any ex gratia payment made or any outstanding charges due for long-stay care arising from the imposition of the charges for inpatient services in 2005.

Currently, beneficiaries of the estates of others are, for social welfare purposes, assessed with the value of inheritance received from the estate regardless of the original source of any of the capital or property inherited. The scheme will be consistent with existing provisions, to the effect that repayments to beneficiaries of estates, as inheritance, will be assessable in the normal way.

Section 9 regulates patient private property or PPP accounts. These accounts consist of money and personal property managed on behalf of the patient by the HSE. Where there are no legally appointed representatives for a patient with capacity issues, the repayment due will only be paid into a PPP account, which will be administered on the patient's behalf by the HSE. This is to protect patients who may be in receipt of large sums of money and who are not in a position to manage their own financial affairs. In other cases, the money may be lodged with a financial institution or may, at the patient's request, be lodged to a PPP account.

This section allows the Minister to appoint a person to oversee the administration of PPP accounts and to report to the Minister on these matters. It allows the HSE to invest money in PPP accounts on behalf of patients. It also allows the HSE to use money in these accounts for the benefit of the patient and provides for the HSE to make an application to the Circuit Court to use sums in excess of €5,000 per patient in any calendar year for such purposes.

Section 10 provides that persons who accept repayments under the scheme waive the right to sue for recovery of that charge. Persons who have received a court settlement in respect of a repayment are disallowed from making an application to the scheme. It allows the HSE to make a lodgement to court of the amount rejected, or any other amount that the HSE deems appropriate, if an applicant decides to reject repayment under the scheme and pursue action through the courts.

Section 11 allows for the HSE to establish a donation fund to enable those due repayments under the scheme to donate all or part of the repayment, and such donations will be used specifically for improvements in public health services for elderly persons and persons with disabilities, the costs of which are non-recurring.

Any such donations will be exempt from capital acquisition tax or from any probate tax liability. The HSE has provided initial broad indications of how it proposes to administer this fund. For example, any funding allocation by the HSE will, in so far as is possible, seek to assign funds in accordance with the wishes of the applicant subject to legal and practical constraints. The fund will only be used to provide for improvements which would not otherwise have been met by an allocation from the Minister for Finance or other Minister. It is the intention to specify this on the application form.

Section 12 will facilitate the operation of the scheme and allows the HSE, or any person administering the scheme on behalf of the HSE, to have access to the records required to enable it to process claims. It protects those to whom the records relate by providing for the imposition of penalties on those who breach confidentiality around any aspect of the scheme. It prohibits the disclosure of information except for the performance of the functions of the relevant person under the Act. It also compels publicly funded bodies to co-operate with the scheme through the provision of relevant records. The Revenue Commissioners may request the scheme administrator to provide them with details of repayments made.

Section 13 provides for the establishment of a special account to facilitate repayments being made under the Act and to ensure transparency regarding the repayments or any costs associated with implementing the scheme. The account shall only be used for this purpose and funds will be issued by the direction of the Minister for Finance. All repayments will be paid out of this account, which will be subject to audit by the Comptroller and Auditor General.

Section 14 provides for governance arrangements for the repayment scheme. It allows for reports to be submitted to the Minister by the HSE, on request or at regular intervals, on the operation of the scheme and the operation of PPP accounts, and allows the Minister to lay such reports before each House of the Oireachtas. It also requires the chief executive officer of the HSE or a representative of the scheme administrator to give evidence on the scheme before any Oireachtas committees. It also details the information to be kept in respect of applications for repayment.

Section 15 provides that the scheme administrator will inform the applicant of the outcome of the application as soon as possible and will give applicants notice of the reason for the decision and their right to appeal. The notice will also include a summary calculation of the total repayment due to an individual.

Section 16 provides for an independent and transparent appeals process by allowing the Minister to appoint suitably qualified persons to determine appeals. It also outlines the grounds on which a person may appeal. The Minister may request reports on the operation of the appeals process and copies of these reports shall be laid before each House of the Oireachtas. The process also allows for appeals to the High Court on a point of law. Applicants will also be informed of their right to bring a complaint to the Office of the Ombudsman.

Section 17 allows for the recovery of any overpayments and payments fraudulently obtained under the scheme. Section 18 provides that the accounts of the scheme administrator in so far as they relate to the scheme may be audited by the Comptroller and Auditor General. The accounts of the special fund established to make the repayments, patient private property accounts, and the fund established to receive donated payments can also be audited and reports shall be laid before each House of the Oireachtas.

Section 19 outlines the penalties and offences which can be imposed on persons who make fraudulent applications or on persons who disclose confidential information. Section 20 allows for regulations for the purpose of administration of the scheme and the administration of patient private property accounts. Section 21 allows for regulation to remove any impediment or difficulties which may emerge, within a year of commencement of the Act, which may prevent or delay any provisions of the Act from becoming functional.

I now wish to outline some of the major developments the Government is pursuing to improve services for older people. It has been the policy of successive Governments to endeavour to help older people maintain themselves in the community while at the same time providing for residential care which is not prohibitively expensive. The policy of the Government on the development and delivery of services for older people is to maintain them in dignity and independence at home for as long as possible in accordance with their wishes.

The last 12 months have seen an increased focus on services, particularly regarding long-term care, whether residential or community based. Additional funding for services for older people and palliative care of €150 million has been allocated in the last budget. A total of 1,366 home care packages is currently in place, 249 of which have commenced since January, 2006. The Health (Nursing Homes) Amendment Bill was also recently published, which will ensure that the existing subvention scheme for private nursing home care is grounded in primary legislation and will help the HSE to implement the scheme on a standardised basis across the country. This Bill is currently on Second Stage in the Dáil.

The general scheme of the Health Information and Quality Authority Bill will also be published within the next few weeks as part of a public consultation process. The draft heads provide for the establishment of the Health Information Quality Authority, HIQA, the establishment within the authority of the office of the chief inspector of social services and the establishment of a registration system for residential services for children in need of care, for persons with disabilities and for older people. The establishment of HIQA and the office of the chief inspector of social services demonstrates the Government's commitment to the health service reform programme. A working group has been established to develop standards for residential care for older people, which aims to have draft standards available in July.

The Tánaiste, together with the Minister for Social and Family Affairs, established last year an interdepartmental group to examine the whole area of long term care for older people. The group included senior officials from the Departments of the Taoiseach, Health and Children, Social and Family Affairs and Finance. The group was chaired by the Department of the Taoiseach. The group had a number of reports available to it including the Mercer report on the future financing of long-term care in Ireland which was commissioned by the Department of Social and Family Affairs and was published in 2002. Having examined the range of benefits and services currently in place and also examining various issues regarding the financing of long-term care in residential and community settings, the group has now reported to the Government, which is currently considering the report.

The issue of funding long-term care needs for older people, both residential and community-based, is among the most difficult and complex areas in the health sector. The demographic challenges facing all countries must be tackled and sustainable programmes put in place. While many different approaches are taken by governments in addressing these challenges, no easy or simple answers to these matters exist. The pace of change from a demographic, social and clinical aspect, requires of society generally and the Government to respond in a coherent way so that appropriate funding and service delivery programmes can be implemented.

The Bill will provide an appropriate mechanism to allow for repayments in an uncomplicated manner to those wrongfully charged for publicly funded long-term care. The Bill's provisions will significantly reduce bureaucratic imposition on patients. The oversight committee has made valuable inputs to the scheme and will continue to do so for the foreseeable future to ensure the scheme is implemented quickly and in the most equitable and effective way possible. The committee will submit reports at regular intervals to the Tánaiste and Minister for Health and Children on the scheme's operation. I am confident the safeguards put in place with the regulation of the patient private property accounts will prevent the exploitation of those who receive repayments and are not in a position to manage their affairs. I commend the Bill to the House.

I will not go into the background of the disgraceful events surrounding the Bill. It is amazing that a year and seven months later we have returned to the matter. There is, however, still no idea of when exactly these payments will be made to those affected. Many will have passed on in the intervening period. The Fine Gael Party welcomes the Bill but has reservations about its implementation. The Government's tardiness is shocking particularly when one considers the Supreme Court's ruling on the Health (Amendment) (No. 2) Bill 2004. It read:

The Bill will affect very many people who are old, or poor or disabled, mentally or physically, or in many cases all of these. As already stated, persons so situated will almost certainly have had little or no capacity to understand their rights under the legislation or to protest at the unlawfulness of the charges.

It is shocking that a year and seven months after that, the Health (Repayment Scheme) Bill 2006 is just being introduced but the Minister of State can give no indication as to when those affected will get the money into their hands. What do these lovely phrases, such as "shortly", "imminently" and "in the near future", actually mean? At a health committee meeting a suggestion for an interim payment was made. All the patients affected were wrongfully charged and they are owed these moneys. Many of them would have used it to go Lourdes or Medjugorje for a last trip before they passed on. Many cannot now do that and will unfortunately be dead before the payments are made available.

The Minister of State did not refer to the time bomb of those who were unable to secure a long-term public nursing bed and, as a result, went into private nursing homes. I understand several court cases are pending in this regard. If the courts rule in favour of the people affected, this issue will be more explosive and affect far more people. Ultimately the taxpayer will end up paying for the Government's incompetence. Will the Minister of State clarify the status of those who are querying whether they should have had to pay private nursing home charges when public beds were not provided?

The Government has a bad record in schemes similar to the repayment one. Its response to the matter was lethargic. It was warned in September 2005 of the issue but only rushed through flawed legislation against which the Supreme Court ruled in December. Shortly after this, the fiasco of the PPARS emerged which involved €150 million of taxpayers' money being squandered on a computer system that did not work. Has the Government learned lessons from this, particularly concerning the administration and distribution of the refund scheme? How can it be ensured that what happened with PPARS will not happen with the nursing home refunds system?

Recently, there was the example of the Health Service Executive using some creative accountancy when it threw €50 million from capital funding into current expenditure. It did not inspire confidence. The final example is the disastrous deal negotiated by the former Minister for Education and Science, Deputy Woods, for the residential institutions redress scheme. Initially it was to cost the taxpayer €200 million and the religious orders €100 million. It will now cost the taxpayer €1.1 billion. A series of mistakes has been made. I appreciate everyone can make a mistake. If the Fine Gael Party is in government in a year's time, I accept it will make mistakes. The challenge, however, is to recognise when a mistake is made and to learn from it. I am not convinced the Government has that capability. Will the Minister of State reassure this side of the House that it has learned from past mistakes in schemes?

The explanatory memorandum was too short, particularly in comparison with the speech of the Minister of State. A more detailed memorandum would have assisted Members to a better understanding the Bill.

The Minister stated the tendering for the contract for the design of the repayment scheme system was advertised. I have received information that there were serious difficulties with the process. I have made a freedom of information request on the process but I have to see whether it will reveal much. The Health Service Executive advertised in the latter half of 2005 with 11 expressions of interest received for the design and administration of the repayment scheme. This was short-listed to three. Following consideration of all the issues the initial procurement process was terminated in December 2005 as the executive considered the tenders unsuitable for several reasons, including value for money.

It was re-advertised and today the Minister of State informed the House that on 1 June a contract was awarded to a particular company. Will that company come in cheaper than the three short-listed companies? If it does not, a serious question hangs over the process. This is not just a concern on this side of the House. Deputy Glennon has put down a parliamentary question on the matter. There is much unease about why the procurement process was advertised, applications received, a shortlist of three created but then scrapped. I have made a freedom of information request but I am not confident about its results as FOI does not work well in the health area. There is an innuendo that one company, which the Health Service Executive preferred, did not apply initially. By cancelling the initial process, it may have suited that company. I will be pursuing this matter.

Could the tender process be open to a court challenge? Will there be a repeat of the events surrounding the awarding of the second mobile telephone licence to Esat? Those unsuccessful licence bidders challenged the basis of the award in court. A similar course of action in the repayment scheme would delay its administration and expose the taxpayer to further fallout.

I was amazed to hear the Minister of State say in the opening paragraph of his speech "This legislation must be passed at the earliest opportunity by the Oireachtas to ensure that those due a repayment receive it as soon as possible." It is amazing that 19 months later we are debating the Bill.

The Minister of State explained some of the preparatory working under way at present, even in advance of the firm getting the contract. Can he ensure that people who have applied for a refund would receive a simple letter acknowledging receipt of their claim and explaining the process to date? That should not be too difficult to organise. I receive many telephone calls, as I am sure does everyone in the House, from people who have applied for the funding who are not too sure where exactly they stand. At this stage I ask the Minister of State to ensure that those who have applied would get a letter updating them on the following: the appointment of a firm from 1 June; the preparatory work done by the Department; and the fact that priority will be given to those still living. Even that information would be of considerable benefit to those awaiting funding under the scheme.

It is shocking to think that people in their twilight years are being treated in this way by the Government. If this was any other scheme one would state that it was fair enough because people have time on their hands, but the people concerned are those in their twilight years, who do not have much time left and many will have passed away by the time they are awarded final compensation.

I ask the Minister of State to explain why it has taken over a year to prepare this legislation, particularly in light of the fact that in December 2004 the Government was capable of bringing in legislation overnight. As it happens, that legislation was flawed. The Government was capable of rushing that legislation through, yet it has taken it over a year to bring forward this legislation.

It took the HSE five months to advertise for the first tender for the provision of these services. Fine Gael has questioned why the HSE is unable to do so. Although the Minister of State skirted over that issue in his speech, it shows that the Government does not have confidence in the HSE administering the scheme. The HSE should be well able to perform this function. In his speech the Minister of State admitted the HSE has already managed ex gratia payments of over €20 million. Therefore, the Government is contradicting itself again, as usual. The Minister of State might refer to this in his reply.

The Minister of State spoke of this being a simple scheme and being user-friendly. I hope it will be but we must ensure that elderly people who apply——

To what contradiction is Senator Browne referring?

Senator Browne without interruption.

The contradiction is that while the Government is not allowing the HSE to administer the scheme, to date the HSE has administered €20 million in ex gratia payments to 10,000 people. I am normally used to Senator Minihan heckling me.

I am waiting. I have been listening.

Another contradiction is that sections 5(3)(a) and (b) provide that applications made after 1 January 2008, or such later date as the Minister may prescribe, will not be considered. That is fair enough and I understand its logic, but the Bill does not contain a specific date putting pressure on the HSE or the Department of Health and Children to pay up. While the Government is telling people they cannot apply after a certain date, it is not giving them any indication of when they can expect a repayment and that should be rectified in the Bill.

Can the Minister of State give any indication of exactly how many people are involved in the scheme? We have heard numbers, ranging from 60,000 to 80,000. Can he give us an accurate figure at this stage? He mentioned social welfare and the Taxes Consolidation Act 1997. I am a little confused by the Bill because while the Minister of State is stating that people who get the payments will not be liable for tax, the information is being passed on to the tax authorities. Why is that being done?

I have made my party's case. I welcome the Bill but I am concerned about the Government's ability to ensure that the payments are managed correctly. I wonder if this will be another example of what occurred with the redress board where the bill will increase five-fold during the administration of the scheme.

Fáiltim an Aire Stáit go dtí an Teach. I welcome this Bill which is putting right something that should not have happened in the first place. While it may have taken some time, in this case we should not sacrifice accuracy for speed. It is important that we get it right.

I welcome the ex gratia payments made, which are a gesture of goodwill on the part of the Government to address the matter. Listening to Senator Browne, one would swear on a mass book that his party had never been in Government. Convenient amnesia is a wonderful state of mind and a marvellous defence mechanism, which I suppose we all should employ from time to time.

Getting back to the reality of the matter, I welcome the Bill. I hope that, with the co-operation of all concerned and with mature debate in this House, we will be able to tease out what various contributors view as not in the best interests of those concerned and find a consensus on how to address the issue.

I preface my remarks with the following. We are speaking in the main about people who have spent quite a long time in institutions. As one who in a former occupation would have had quite a good deal of contact with such people, nothing I have heard and experienced over quite a long number of years has changed my view. Although I recognise it is not the purpose of the Bill, I would dearly like to see something done about regular visits to patients in long-stay institutions. I recall that in my time working in long-stay wards, months and years would pass in which many of those patients never received a visitor. The rest of what I have stated about certain relatives is on public record.

I strongly applaud those who regularly visited their relatives in an institution. In many cases, but for the activities of the Society of St. Vincent de Paul, patients would never see a face other than those of the nursing, ward and catering staff, or indeed their fellow residents. I put on record my sincere appreciation of the Society of St. Vincent de Paul whose members unselfishly gave of their time to visit such people.

The Health (Repayment Scheme) Bill will provide for the repayment of public nursing home charges to all those who were wrongly charged and are alive, and the estates of all those who were wrongly charged and died since 9 December 1998.

This scheme will be simple to use and has been designed following consultation with and input from the oversight committee, which played a pivotal role in the compilation of this Bill and the process of ensuring that those repayments are made with the optimum effectiveness and efficiency.

The general scheme of the Health Information and Quality Authority Bill, which will be published in a few weeks' time, will also be part of a public consultation process. That Bill will provide for the establishment within the Health Information and Quality Authority of the office of the chief inspector of social services and a registration system for residential services for children in need of care, for persons with disabilities and for older people.

As I may have mentioned previously in other contributions, we are speaking of people in public institutions who were charged and whose charges were found to be illegal. We must put up our hands and say nostra culpa, and this Bill is all about addressing that irregularity.

However, there were other people who, because they could not find a bed in a public institution, had to go to a private institution. I have met quite a number of people in such circumstances who have come to my office stating that they had to use scarce resources. In one case, the total gratuity an individual received from a local firm was spent on paying for a private nursing home for his late wife because a place was not available in a public nursing home. A test case has been taken, or is due to be taken, in this regard and as the matter is sub judice I do not wish to muddy the waters. This matter must be addressed.

The establishment of the Health Information and Quality Authority, HIQA, and the office of the chief inspector of social services demonstrate the Government's commitment to quality patient care as a key driver of the health reform programme. Part of the work of the chief social services inspector will be to inspect for the first time, public nursing homes as well as private nursing homes, which are currently inspected by the HSE. Clear and uniform standards will be set down for all nursing homes and inspections will be based on compliance with these standards.

Many of our nursing homes, both private and public, provide an extremely high standard of care. However, I regret that in some cases making money has been the main objective. I do not have to remind Members what I am talking about. In some instances, standards were found to be at an outrageously low level. The local councillor or health board member provided a great service in those institutions. I previously made this point to the Tánaiste. It was a great opportunity for them to visit people known to them who were in nursing homes or hospitals and it was a familiar and friendly face for the patients concerned. Perhaps the Minister of State could re-examine this matter.

The repayments will include both the actual charge paid and an amount to take account of inflation. That is only correct. Otherwise it would be a case of giving with one hand and taking back with the other. All repayments to living persons will be exempt from income tax and repayments will not be taken into account in assessing means for health and social welfare benefits. This is to be welcomed. The normal tax and means assessment arrangements will apply to those who benefit from repayments to estates.

The scheme includes a provision to allow those eligible for a repayment to waive their right to a repayment and have the money assigned to fund one-off service improvements for older persons and persons with a disability. That might appear to be a nonsensical provision but a number of people have approached me and stated they do not intend to claim any money back. I admit there are not many people in this category but they do exist.

The application process will be as simple and user-friendly as possible while also providing appropriate safeguards against fraud and preventing the exploitation of those not in a position to manage the repayments which they will receive. The scheme has been designed and will be managed with the aim of ensuring that those who are eligible for repayments receive them as soon as possible. Priority will be given to those who are still alive, and the HSE has begun proactively identifying and drawing up details of repayments due to living persons to enable prompt repayments to be made.

Even when the deduction scheme obtained in long-stay institutions, the portion of the pension or social welfare benefit that was retained was to provide for extra comforts for the patient or resident. The utmost speed should apply in the making of payments so as to ensure the maximum number of living persons are compensated. The application process for estates has been streamlined with the assistance of the probate office. We should applaud the probate office for stepping into the breach as it will help to ensure repayments are made with the utmost speed.

Senator Browne inquired about the number of people involved. It is estimated that approximately 20,000 people who are still alive, and a further 40,000 to 50,000 estates of those who have passed on to their eternal reward, will benefit. The scheme will cost approximately €1 billion and an appropriate allocation for 2006 will be made when the legislation is passed by the Houses of the Oireachtas. There will be an independent and transparent appeals process. I do not know how the appeals process will deal with those people who had to send their relatives to a private nursing institution because they could not get a public bed but I hope a sympathetic view will be taken of the matter.

The Minister may appoint an independent overseer for the administration of the accounts of people who are not in a position to administer them. The governance of the scheme will allow the Minister to receive reports on the operation of the scheme, the appeals process and the fund established to receive donations. These reports shall be laid before each House of the Oireachtas. Legislation also provides that all accounts and funds related to the scheme may be audited by the Comptroller and Auditor General. The system cannot be more transparent than that.

The oversight committee appointed by the Tánaiste to provide an independent input into the design and monitoring of the scheme has been fully briefed on all aspects of the scheme and has provided valuable input into the legislation to date. The committee has approved the contents of the Bill. The establishment of the Health Information and Quality Authority on a statutory basis was one of the recommendations of the health service reform programme announced in June 2004. It was also proposed in the health strategy — Quality and Fairness: A Health System for You. That is another promise on which the Government has delivered.

The general scheme provides for the establishment of the office of the chief inspector of social services as a statutory office within the HIQA. This meets the commitments made in An Agreed Programme for Government in 2002, the health strategy and Sustaining Progress to establish the social services inspectorate on a statutory basis. The office will also monitor standards, except those set in regard to the personal social services which will be monitored or inspected by the Chief Inspector of Social Services. The office is being given the powers to investigate, at the request of the Minister or the executive, the safety, quality and standards of any service, except those registered and inspected by the Chief Inspector of Social Services and the Mental Health Commission, provided by or on behalf of the executive and to make any recommendations it deems necessary.

The office will also have the role of accrediting services and will be able to provide an accreditation service for the private sector. The HIQA will also advise the Minister and the Health Service Executive on the effectiveness of health technology. In addition, the HIQA will have a role in setting standards in regard to information and data on services provided by the Health Service Executive and on its behalf, and the health and welfare of the population, as well as identifying deficiencies in such information.

The chief inspector will continue the social services inspectorate's work of inspecting the child welfare and protection services. It will also be assigned responsibility for the inspection of residential services for persons with a disability and for residential services for older people, including private nursing homes.

I accept that 19 months have passed but it is never too late to do the right thing. This matter has dragged on for 30 years. Various arguments have been made about what was known but as far as I am concerned it was one of the best kept secrets in the public service. In any event, the legislation is before us and we must deal with it. We should try to deal with it as quickly as possible so that the people who were wrongly charged in our institutions — the people who built this State, namely, the elderly — receive the appropriate refunds as soon as possible.

May I share time with Senator Norris?

Is that agreed? Agreed.

I welcome the Minister of State to the House. It must be somewhat embarrassing for the Government that, for the second successive week, this House is considering a Bill the purpose of which is to undo a mistake which could have been avoided in the first place. While I have no particular wish to create more embarrassment for the Government, I would like to focus my contribution on the somewhat creaky nature of the administrative machine that seems to operate in this country.

This Bill became a necessity because of a serious and long-standing administrative failure, a failure that went on for a much longer period than that covered in the redress scheme created under the Bill. Since the 1970s, the twilight years of many old people were made more difficult than they needed to have been because they did not get their due entitlements under legislation. Very many of these people are long since dead and there is nothing we can do to redress the wrong that was done to them.

I wish to be precise about the nature of this wrong. I would never argue that older people in State care should not contribute to some extent to the costs of their maintenance if they are able to do so. This is not the issue. However, what was wrong in this case was that money was taken from people illegally. Not to put too fine a point on it, this money was stolen from them. Even worse, the entity which stole from them was the State itself, the very body that should have been standing up for them and defending their rights.

I am profoundly worried by this blatant instance of the State breaking its own laws because I think it has the direst implications for the health of our democracy. Above all else, a democracy essentially concerns rule by law, a rule which should apply to the State as well as the citizen. The principle that the law applies to everyone is the strongest defence of all the freedoms we hold dear.

I am not suggesting that any member of the Government or these Houses wishes to set aside the law or act contrary to it but the fact remains that in this case all the powers of the State were harnessed over a period of many years to break the law. What made it even worse was that the people who suffered under this illegal activity were among the weakest and most vulnerable in our society. We know about this so I am repeating what has been said before.

We should be so concerned about this lapse that we should take very good care that it never happens again. Yet, I see no evidence of any action that will ensure this outcome. The Bill before us seeks to make redress to some of those who were offended against but it does nothing to reduce the possibility of a similar mistake happening again. I would like to hear the Minister of State's views but it appears that this is the case.

This was basically an administrative error and much of it was compounded over the years by political neglect from successive Ministers. We have a mechanism in place that is meant to address such errors and prevent their recurrence, namely, the Office of the Ombudsman. To their eternal credit, this particular problem was identified by more than one Ombudsman and signalled to the political establishment and to the public in the appropriate way. Yet, despite all this signalling, no notice was taken of it by anybody and so, year after year, the State went on blithely breaking its own law.

The fact that this happened and was allowed to happen surely reveals a fundamental defect in our system. We have burdened the Ombudsman with the responsibility for identifying administrative defects but, incredibly, we have burdened nobody with the responsibility for seeing that such defects are speedily addressed once they have been identified. I would like to hear the Minister of State's views on this matter. We can and, hopefully, will pass this Bill but we cannot buy our way out of this problem so easily. Until we address the issue directly, we are just asking for the situation to happen again and again.

I look forward to hearing the Minister's response and will listen intently to it. The Bill must and, I hope, will be passed but I would like to find out how we can take steps to ensure such a scenario never happens again.

I thank Senator Quinn for allowing me to share time with him. I welcome the Minister of State to the House and welcome this legislation. I was surprised that the Minister of State's speech contained no expression of regret because, as Senator Quinn noted, this was an illegal action on the part of the State that, in his words, amounted to theft by the State from the most vulnerable. Despite the fact that most of provisions in the Bill are purely technical, there was room in it for an expression of regret.

The Minister of State also detailed arrangements for the appointment of an outside company to administer a repayment scheme. I understand that there are possible legal reasons why information on the company appointed on 1 June cannot be made public until an interval of 14 days has elapsed, presumably to allow complaints and for the Minister of State to tell the House today the name of the company. I expect that it will be a reputable company.

I am not entirely sure if the decision to appoint an outside company is correct because other Departments have been successfully involved in the repayment of other moneys. I am aware that the amount of money in question is approximately €1 billion, which is a very significant amount, and that there may be up to 60,000 or 70,000 recipients, both living and deceased. However, in light of the fact that there are over 100 administrators in the health services receiving salaries of over €100,000 and that many of them are duplicating work, it does not seem beyond the bounds of possibility to properly employ them in administering this scheme. I do not think there is very much else for these people, or at least, those individuals who are duplicating work, to do.

The Minister of State also referred to a consultation process and listed the various people, including the Ombudsman, with which he, very appropriately, has consulted. The Ombudsman has, obviously, been very unhappy with the situation for a considerable period of time. I also noted that Age Concern is not among the non-governmental organisations consulted. Would the Minister of State consider including this very valuable group in this process?

Yesterday, the Office of the Ombudsman published on its website a reprint of an article that appeared under the name of Emily O'Reilly — the Ombudsman — in The Irish Times on 5 July 2005. The title of the article was “A system that leaves the door open to injustices”. In the article, the Ombudsman listed three specific cases. According to the article:

Several factors are common to all three. The mothers were placed in nursing homes only when they had become so ill that not even assisted home care could meet their needs. All three have medical cards and were therefore entitled to public care. In each case, no public bed was available and all three were effectively forced into private care, with fees of up to €3,500 per month.

These were caring families whose mothers possessed medical cards and were, therefore, entitled to public care. No public beds were available to them and they were forced to go into private care. The article then goes on to state:

In all three cases, the value of the mother's residence has been taken into account by the health authorities as it assessed the level of State subvention to be provided, a relatively small fraction of the cost in most cases, but of critical importance to families struggling to pay the huge private fees.

The Ombudsman described how in one case, the mother's house remained the only home of her single middle-aged son. This is a very human situation yet the house was taken into calculation. She wrote that if the house was sold to help defray the nursing costs, he would be forced into the private rental sector. This is not a socially constructive approach. According to the article:

In another case, the mother part owns the home with her son. It has been suggested that he might "buy out" the mother's share in order to increase the subvention, but this could bring his borrowings to an unmanageable level.

This, again, represents a very severe squeeze of an innocent individual.

The third case involved a relatively recent transfer of the ownership of the family home, which allowed the authorities to assess its value. This was a mean-minded way to approach the situation.

Subsequently, the Ombudsman investigated the subject and indicated that the reason was the unusually large and steady flow of complaints. More than 150 had been received since the commencement of the scheme in September 1993. She made the serious point that the complaints received since then "reflect not just the actions of individual offices or public bodies; rather they reflect the corporate response of virtually an entire sector". We are not talking about mavericks or an unrepresentative situation. Instead, there has been a concerted approach.

Under the Act of 1970, every citizen has the right to avail of legislation——

As it is now 5 p.m., will Senator Norris move the adjournment of the debate?

I will finish my point. These measures were taken due to financial constraints. The Ombudsman states that the Department was well aware of the situation and lists a series of doubtful practices, including the use of regulation without recourse to the Oireachtas. The Minister of State will be aware of these criticisms and the doubtful practices, which are serious. The attitude of the Department and the unreasonable promulgation of discussions with the Ombudsman are a reproach to us all.

Debate adjourned.