Q&A: Why lobby groups fought for three-year limit

What is Fair Deal?

Fair Deal is the shorthand for the ‘The Nursing Homes Support Scheme’, which provides financial assistance for people who require long-term nursing home care. It is operated by the HSE.

The scheme covers private, voluntary and public nursing homes.

What sort of financial assistance does it provide?

An assessment of all your income and assets is carried out in order to work out what your contribution to your care will be.

The HSE will then pay the balance of your cost of the care.

There are two elements to your contribution.

You will pay 80pc of your income (eg a pension) and 7.4pc of the value of your assets every year towards your care.

If your assets include land and/or residential property in the State, the 7.5pc contribution based on those assets can be deferred.

This means it does not have to be paid during your lifetime and will be collected from your estate.

Is the family home included in my assets under Fair Deal?

A person’s principle residence will be counted as an asset, but only for the first three years.

This is known as the 22.5pc, or ‘three-year’ cap.

Why have farmers and small business owners been unhappy?

Lobby groups have argued that the family farm and in some cases business should also qualify for the three-year

cap. They have said that by forcing somebody to pay 7.5pc of the farm’s value indefinitely this affects the ability of young people to take over the family business. Minister Jim Daly (inset) will today propose that the three-year cap is applied to farms and businesses if they continue to be operated by a close relative.

Couldn’t this system be abused?

The minister plans to introduce a number of safety mechanisms, including a ‘claw-back’ rule that will allow the State to recoup some funds if the land is sold within six years.

When will the changes take place?

Mr Daly is expected to get approval from Cabinet to proceed to the legislative stage today.

The Dáil is on its summer break until September so nothing will happen before that.

There is broad political support for some form of change, so the minister and lobby groups will be hoping the necessary legal changes can be made by the end of the year.