Bank denies halting loan bid over Fair Deal fund shortage

BANK OF IRELAND (BoI) has denied the reason it halted the loan application of a new nursing home in Co Kerry is because funding for the State’s Fair Deal nursing home support scheme has run out.

Architect John Phelan and developer Michael Ronan, who have been working on plans for a 73-bed private nursing home in Dingle for more than two years, claim they were told last Friday that a loan of almost€4 million from BoI was not going to be provided.

They maintain they were told this was down to financial difficulties in Fair Deal, a HSE scheme which funds nursing home care for the elderly.

They claim their information came from a senior person within BoI who has direct knowledge of the bank’s attitude to risk.

However, Anne Matthews, director of communications with BoI, said the bank is not operating a blanket policy to withdraw support from new nursing homes, and said it was continuing to work with the sector.

However, Ulster Bank did admit to having misgivings, saying that 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.

Last night, the Minister for Health Dr James Reilly refused to comment in depth on the situation.

A spokesperson for Dr Reilly said he is waiting on the outcome of a review which is looking at the “deeper issues” surrounding the collapse of the scheme.

The men behind the Dingle venture believe their situation may replicate around the country.

“This situation has already resulted in the loss of up to 150 jobs in Dingle,” Mr Ronan said. “But nationally this will affect thousands over the next few years unless clarity and stability returns to the market.

“Dingle demographics in the 65-plus age bracket are 30% higher than national or regional average, which indicates a stable long-term population base to feed into the home. It has a defined catchment with a strong local identity and tradition that will support a local facility.”

According to their business plan, new HIQA guidelines and standards mean that there will be a loss of 15% of the 22,000 elderly care existing beds over the next three years.

“This means that at least 65 new 60-bed nursing homes will be required over next three years to meet current demand,” Mr Phelan said.

“So, you can see, even the short-term impact of a freeze on funding will have enormous consequences for the hospital system with overcrowding of emergency wards.

“Couple this with the cutbacks in respite care and home care funding and you have a crisis of serious proportions.”

Further to this, the business partners said that, over the past year, they have been in contact with key personnel within Kerry Health Service to identify demand for beds in Dingle.

“The results are very encouraging, with the consensus being that Dingle is an area where there is a critical shortage of private nursing home beds.

“We believe this is not an isolated case and this is the ripple effect of the situation with Fair Deal. Right across the country, jobs will be lost and projects put in jeopardy. We are calling on the minister to act immediately.”