UNCERTAINTY OVER future funding for the State’s Fair Deal nursing home support scheme has resulted in a bank refusing to lend money to businessmen planning to build a private nursing home in Co Kerry, it was claimed yesterday.
Architect John Phelan and developer Michael Ronan said they had been working on plans for a 73-bed private nursing home in Dingle for over two years, had bought a site and obtained planning permission for the facility.
They were depending on getting a loan of €3.96 million to finance the €7 million project which would have created 80 jobs during the construction phase.
But on Friday they said they were informed by Bank of Ireland that it would not provide credit for the project given the Fair Deal scheme, introduced in late 2009 to fund long-term care for older people, was in financial difficulty.
Minister for Health James Reilly is reviewing the scheme after it emerged two weeks ago that the €1 billion allocated for the project in 2011 will only be sufficient to fund the care of the 22,000-plus older people already in the scheme.
New applicants for funding will have to go on a waiting list unless the funding crisis is resolved.
Mr Phelan said he and his business partner had already invested €1 million in the Dingle project and they were angry at the manner in which the funding crisis in the scheme was allowed to suddenly develop and how it was being played out in public between Dr Reilly and the HSE. If their care home could not go ahead as a result of the debacle “we would be personally wiped out”, he said.
Mr Ronan said Dr Reilly needed to bring stability to the scheme and the nursing home sector. He said he understood the decision by Bank of Ireland not to lend money for the project was part of a new blanket policy being adopted by the bank in the wake of controversy over funding for Fair Deal.
However Anne Mathews, director of communications with Bank of Ireland, said the bank had no blanket policy not to support new nursing homes. “We have six new builds and 23 extensions we are working with at the moment. We are continuing to work with them . . . Fair Deal is not a deal breaker,” she said.
AIB likewise said it had not adopted any new policy to stop funding nursing home projects. “We would lend on a case-by-case basis,” its spokeswoman said.
Ulster Bank said while it will continue to look at all nursing home financing proposals, a speedy resolution of the issues around funding for Fair Deal “will be important for all stakeholders in the sector” to ease uncertainty.
It has been that confirmed 629 people were blocking acute hospital beds as a result of their discharges being delayed on May 16th. Some 477 were at some stage in the application process for funding from the scheme.
Three people who refused to apply for Fair Deal funding or refused to move to a nursing home after their applications for funding were approved were being charged the full cost of a public nursing home bed – about €1,200 a week – while they remained in hospital.
The decision to suspend approvals under the Fair Deal scheme was made by the HSE on May 13th.