Minister for Health Mary Harney has said the Government could face a bill of up to €39 million to repay interest illegally deducted from money held for safe-keeping by health authorities on behalf of patients in long-stay accommodation.
The Irish Timesrevealed yesterday that Attorney General Rory Brady had advised that health authorities had no legal basis to retain interest on about 15,000 patients' private property accounts.
Informed sources said last night that €39 million was an estimate calculated by the Health Service Executive going back 30 years. It includes a provision of about €15 million to take account of increases in the consumer price index over that period.
Ms Harney said the Attorney General had advised that the HSE, and previously the health boards, had been taking an average of about €86 a year in interest from people in long-stay facilities to defray the cost of administering these private property accounts. She said it had been established that the practice was illegal and the money had to be repaid.
"It amounted to about €39 million, the total amount including retrospection. It averaged about €86. In many cases it didn't cover the cost of administration; €39 million is the total cost and total amount taken by way of interest, I understand."
The HSE's national director of finance, Liam Woods, told the Dáil Public Accounts Committee yesterday that it was taking legal advice on how far back the repayments would have to go. He said the HSE hoped to have clarification by mid-year.
Meanwhile, Age Action Ireland has called for a wider investigation into allegations of what it maintained was the inappropriate use of funds held in private property accounts.
"We have heard of cases where monies in the accounts of older nursing home residents were used to refurbish the rooms of those patients," it said. "Many of these patients were suffering from dementia and were not capable of agreeing to the use of their funds in this manner. This refurbishment was the responsibility of the State."
Mr Woods said that anecdotally he had heard such allegations but had no evidence of this.
Age Action said an investigation was needed "to establish if the wrongdoing by the State is limited to illegally keeping interest on patients' accounts or if it goes further. This investigation must be undertaken as a matter of urgency to restore public confidence."
According to the most recent accounts, the HSE held more than €72 million on behalf of patients in private property accounts in 2005. This money was generally income arising from pensions.
However this is expected to increase substantially as a result of repayments to older people because of illegal government levying of in-patient charges for people in long-stay public facilities. This repayment scheme, which is currently under way, could cost up to €1 billion.
The HSE has put in place a centralised unit to manage the accounts in the future.