The health levy has been increased from 2 per cent to 2.5 per cent to help fund long-term care initiatives for the elderly, the Minister for Finance announced in his Budget today.
The new rates will apply on income exceeding €1,925 per week or just over €100,000 per year.
Brian Cowen said the extra money would be used to fund long-term care initiatives for the elderly. In his speech Brian Cowen said: "We need to act now to secure such funds and I believe it is only right that those best able to afford it make an increased contribution."
He said the move would raise €34 million in a full year and said it was "only right that those best able to afford it make an increased contribution".
Mr Cowen said the Government would spend €255 million in full-year terms on to improve the level and quality of services for older people.
He said the would also provide for an increase in the number of residential care places and make significant improvements to the Nursing Home Subvention Scheme.
Mr Cowen said the details of these measures will be announced by the Minister for Health and Children.
He said these improvements would be part financed by a 25 per cent increase in charges for private beds in public hospitals. This measures will raise €50 million in a full year, Mr Cowen said.
The Minister for Finance said that the focus of the Government's care policy will continue to be on helping older people to stay in their own homes for as long as possible.
"For those who can no longer live at home, we will progressively improve long-stay residential services. The number of elderly citizens is increasing and we must prepare for this."
Funding is also being provided for the development of primary care teams. "Where these have already been established, they are making a real difference in terms of the availability of quality, around the clock services", Mr Cowen said.
He said these measures will cost €40 million in full year terms. The additional funding on health measures will bring the overall spending in the Health and Children area to almost €15 billion next year, Mr Cowen said.
