Farm owners to benefit from rule change in Fair Deal nursing home scheme

Three-year cap on assets claimed from family home to be extended to farm or business

Farm families claimed that a continuous contribution of the farm asset was discouraging children from continuing to run the farm, as the value of the asset was diminishing. Photograph: Getty Images

Farm families claimed that a continuous contribution of the farm asset was discouraging children from continuing to run the farm, as the value of the asset was diminishing. Photograph: Getty Images

 

The State is to place a lower limit on the assets it can claim from elderly people who have farms or small businesses and are in the Fair Deal nursing home scheme.

The Government on Tuesday decided that people who live in State nursing homes who had previously run a family farm or a small business could avail of the same rules as those whose main asset was the family home.

The scheme was set up over a decade ago by then minister for health Mary Harney. Under the scheme, people going into nursing homes run by the State contributed up to 80 per cent of their income, and up to 7.5 per cent of the value of their assets.

If the asset was the family home, there was a three-year cap on the contribution that would be made from its value.

However, that provision did not apply to non-home assets such as farms and businesses.

Draft legislation

On Tuesday Minister for Health Simon Harris and Minister of State for Older People Jim Daly got Cabinet approval for draft legislation to extend the cap to these families.

Mr Harris said: “This will make a substantial difference and finally remove the discrimination many of these families faced under the existing law.”

For his part Mr Daly said: “This is a big step towards reducing the stress and uncertainty experienced by family farm and small business owners and their future generations, helping to keep the family farm and business running and contributing to local communities.”

The Government decision will extend this three-year cap to farms and businesses where a family successor continues to operate the farm or business for six years.

It said the plan was in keeping with retirement and succession planning for farming and business families, to ensure continuity.

Discouraging

The change was included in the Programme for Government. It came after farm families, in particular, claimed that a continuous contribution of the farm asset was discouraging children from continuing to run the farm, as the value of the asset was diminishing.

It is understood that the change will cost the state upwards of €10 million per annum, when it comes into being.

The Bill to give effect to the change is expected to be published in full by the end of the year.