KEY POINTS:
Diana Clement's article "Retirement decisions can be a minefield" (Business Herald, November 22) contained inaccuracies about the residential care subsidy.
The article wrongly states that if there is a spouse involved who doesn't need to go into a rest home, that person is entitled to the use of the house and car for the rest of their lives, but the capital is owned by the Government on their death.
In fact, a married client with a partner remaining in the family home can choose to have their home and car exempt from the financial means assessment. While the home and car are exempt from this assessment, there is no call on that capital by the Government.
If the client's circumstances change the financial means assessment may be reviewed to include the house and car, but only from the date of the change in circumstances such as if the partner in the community passes away, enters residential care or their marital status changes.
Information regarding capital gifts to trusts was also incorrect. All gifting is taken into account regardless of when the gifts were made. The amount of allowable gifting deducted depends on whether the gifts were made within five years of applying for a residential care subsidy or outside the five years.
The article refers to a "personal needs payment" paid to older people whose rest home costs are paid for by the Government.
The correct term is the personal allowance. As stated in the article, this allowance is set at $33.73 a week. However, clients are also entitled to retain assets of up to $180,000 (or $85,000, excluding the home and car, if one partner remains living in the community) while still being eligible for a residential care subsidy.
The information given on means testing for home-based care provided by the Government also needs some clarification. Some home-based care provided for older people is means tested. The applicant must qualify for a Community Services Card to be eligible for home-based care and for clients in receipt of New Zealand Superannuation, there is an income test for a Community Services Card. Some home modifications are not free and the client may be expected to contribute towards their cost.
Barry Shea
General manager of Senior Services, Ministry of Social Development
