Icelandic municipalities back state-funded nursing home construction plan

The chairman of the Association of Icelandic Municipalities supports the proposed change for the state to bear all costs of nursing home construction. The new arrangement would have the state manage the provision of housing through lease agreements based on tendering.

Plans are underway to remove municipal involvement in nursing home construction and for the state to bear all costs. Heiða Björg Hilmisdóttir, chairman of the Association of Icelandic Municipalities, says the Association supports the change as these are projects over which the municipalities do not have full control.

Current health service laws require municipalities to participate in the construction of nursing homes, contributing at least 15% of the capital cost, with the state contributing 85%. Municipalities are responsible for providing plots and bearing the cost of incidental road construction.

The new plan involves the state managing the provision of housing through lease agreements with real estate companies and other specialized parties based on tendering, which leads to the most economical outcome for the state. Heiða Björg states that municipalities running nursing homes have often pointed out that the state does not account for the operation of specialized housing.

“This can be simplified and the state can entirely manage this part. We have many plots around the country that are available to the state if they want to build nursing homes. I believe we just need to evaluate where it should ideally be and then we just need to expedite the construction so that people get the care they need.”

The Government of Iceland stated in an announcement that the aim of the legislative change is to increase execution speed, flexibility, and specialization. It will also ensure funding for maintenance and improvements each time, thus preventing delays and maintenance backlog.

The plans are made because the construction of new nursing homes has been on hold for several years, in addition to difficulties in finding plots for their construction. If the current arrangement is not changed, there will be uncertainty about the obligation of municipalities in the construction of nursing homes.

Heiða Björg says the Association is aware of the long waiting list for such care services. Municipalities have generally accepted to participate in the cost of nursing home construction, but it would be far better to have clearer lines about who does what.

“It also becomes easier for the public to understand who is responsible for the lack of maintenance in elementary schools, or nursing homes, or a sufficient number of rooms, or such like.”