Catherine Byrne (Dublin South Central, Fine Gael) | Oireachtas source

I am taking this issue on behalf of the Minister of State, Deputy Daly, who apologises for not being present. I thank Deputy Brassil for raising this matter.

The nursing homes support scheme, NHSS, also known as fair deal, is a statutory scheme providing financial assistance for affordable and accessible long-term residential care for those applicants who satisfied a care needs assessment.

This financial assistance scheme is means tested. Participants of the scheme contribute up to 80% of their income and up to 7.5% of the value of their assets towards the cost of care, and the State pays the balance.

Under NHSS, rental income is considered income for the purpose of the financial assessment, and is assessed at 80% less any allowable deductions. Allowable deductions include income tax and, therefore, any income tax arising from rental income should be deducted; other deductions include some health expenses, levies required by law to be paid, and interest on some loans in respect of a person’s principal private residence.

Action 17 of the strategy for the rental sector commits the Department of Housing, Planning and Local Government to examine the treatment, under the nursing homes support scheme’s financial assessment, of income from the rental of a person’s principal private residence where he or she moves into long-term residential care.

The Department of Health has received legal advice that changes to the treatment of rental income in the scheme would require changes to primary legislation. Possible changes to the scheme are being explored. However, significant further analysis and development of the options, including legal analysis and costings, is required before a decision can be made to bring forward any proposed changes to the NHSS. There is also a need to explore and consider operational consequences and any unintended consequences that might result from any proposed changes.

There are issues to be considered relating to renting out one’s principal private residence, for example, many older people in long-term care enjoy returning to their home temporarily as part of reminiscence programmes. They may also have all their personal belongings stored in their home, and bringing the home to market could possibly see the sale or discarding of their possessions. Many vacant homes would need significant improvements to be made to bring them to a rental market standard, and would therefore require significant investment. In addition, a change to the treatment of rental income could introduce inequality in the scheme, as pension income contributions will remain at 80%.

We should also consider whether someone requiring long-term residential care would be in a position to take on and manage the considerable financial and legal responsibilities that come with being a landlord.

Officials in the Department of Health are working with Department of Housing, Planning and Local Government officials in examining a number of possible options. The Minister of State, Deputy Daly, is not in a position, however, to provide detail on these as discussions are ongoing and any potential proposals have not been finalised.

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