Caring image takes a knock in pensions controversy

After cultivating a caring image, the last thing the Government needed was the news that it has been complicit in fleecing the…

After cultivating a caring image, the last thing the Government needed was the news that it has been complicit in fleecing the elderly, writes Mark Brennock, Chief Political Correspondent.

If you are trying to tell voters that you are now a caring and compassionate government, you should try not to appear soft on those who would take money from the bank accounts of the elderly to pay for a service which is supposed to be free.

However, the Government has now put itself on the wrong side of a dispute between on the one hand, some 20,000 of the more vulnerable members of society, and on the other, the authorities who illegally confiscated their money.

Having initially suggested it wasn't a problem, the Government has now agreed it is. Rather than arranging for the money to be given back, the Government has rushed legislation through the Oireachtas saying it is all right to charge elderly people up to 80 per cent of the non-contributory old age pension for their nursing home care.

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More than that, the legislation - the Health Amendment (No 2) Bill - says that while this was indeed illegal up to now, well, it has been legal all along.

This retrospection is designed to ensure nobody can claim a refund of money paid in the past. As what it calls a gesture of "goodwill", the Government has decided that those illegally charged in this way in the past will be given €2,000 each. For most this "go away" money amounts to just a fraction of the amount they have been charged illegally.

The Government says it has been assured that the retrospective legislation will close off any prospect that those illegally charged can get their money back through a legal challenge.

It could be right and therefore legally very clever indeed. But thumbing your nose at the elderly is not a politically clever pose to be pictured in: in the season that's in it, the word Scrooge comes to mind.

Rushing the legislation through the Oireachtas in the last sitting week before Christmas might have seemed like a way of putting away this unpleasant issue quickly. However, nobody had thought of the President, and her right to refer legislation to the Supreme Court for a decision as to whether it is constitutional.

So today, the Council of State meets to discuss the Health Amendment (No 2) Bill 2004. Mrs McAleese has until Friday next, Christmas Eve, either to sign the Bill or refer it to the Supreme Court. Before referring any legislation to the Supreme Court, the President must consult the Council of State, although its role is purely advisory: the President has absolute discretion in deciding whether to refer legislation for a test of its constitutionality.

Her spokeswoman said yesterday that she will consider what the Council of State has to say on the matter this afternoon. But a decision is expected quite quickly, possibly tonight or else at some stage tomorrow.

It is unusual for the President to summon the Council of State at all. She has convened it on just three previous occasions during her time as President. The first was on Part V of the Planning and Development Bill of 1999, which obliged developers to allocate part of their sites to social and affordable housing; the second on aspects of the Illegal Immigrants (Trafficking) Bill 1999 concerning the treatment of asylum-seekers; and the third on the Housing (Miscellaneous Provisions) (No 2) Bill designed to increase the availability of affordable housing.

In the case of the first two pieces of legislation, she decided to refer them to the Supreme Court, which found them to be constitutional. In the case of the third piece of legislation, she chose not to refer it to the Supreme Court.

If she refers the current legislation to the Supreme Court, that court has 60 days in which to pronounce as to its constitutionality. For the Government, this extends the period in which this politically damaging issue will remain in the public domain. If the Bill is struck down, of course, a new political controversy will emerge as the Government seeks another means of dealing with the issue.

The way this issue has turned into a political mini-crisis has not allowed for a reasoned political debate on the issue of how society should look after its elderly, and who should pay for it. In recent years, the Tánaiste, Ms Harney, has questioned whether the State should have to pick up the bill for long-term nursing home care for individuals, only to see them pass large sums of money to relatives when they die.

There is an argument that taxpayers on modest incomes should not be asked to fund free nursing home care for wealthy individuals, who will keep their own money to pass on tax-free to their relatives upon their death. Yet Ms Harney has also opposed the notion that upon death, the estates of well-off individuals should be subject to inheritance taxes. "If one generation has earned the wealth and worked hard, it is reasonable to say that they should make the decision on who benefits from that," she said earlier this year.

The practice of deducting money from the elderly who are availing of nursing home care is not new. What brought it to a head was the granting in 2001 of medical cards to all aged over 70. Medical cards entitle the holder to free in-patient hospital care, including nursing home care. Nobody seems to have seen the implication that this had for costs, until the move drove State subventions to nursing homes from €15 million to €115 million in three years, an increase attributable to the fact that only part of the cost of care was being recouped from nursing-home residents.

It was 18 months ago that the Department of Health received legal opinion stating that the practice of charging such patients may have been legally unsafe. This opinion had been obtained by the South Eastern Health Board. Mícheál Martin tells us he wasn't aware of "the details" of this opinion, and that he was late for a meeting which discussed it a year ago.

The continuation of these charges despite this 18-month-old advice is what has caused the Government political damage, and threatens the new caring image that has been so carefully cultivated for the past six months.