Lasting Powers of Attorney – Could well meaning government scheme put your welfare at risk?07-12-2016
What is a lasting power of attorney (LPA) and do I really need one?
These two questions are, for me, the crux of an issue that has become the subject of a nationwide campaign.
Because they are questions a great many people would ask about these complex documents. And it is this lack of awareness, in my view, which makes the Government rash to encourage people to DIY their own.
There are two different types of LPAs.
Property and Financial LPAs. These are powerful legal documents that allow you to appoint people you trust to make important decisions about care and finances on your behalf; they can be used before, if the document permits, and after the person who has made the document loses mental capacity.
Health and Welfare LPAs enable the attorneys to make decisions about personal care matters, but only if the person who made the document does not have the mental capacity to make the decisions themselves.
The fact that more people know about them, and the vital protection they provide in difficult times, is a good thing. However, the downside of the growing hype is that people could end up creating something that won’t do its job when they need it most or, worse still, that they don’t really need in the first place.
That’s why professional advice has an invaluable role to play. If someone calls or visits me and asks for a LPA, the first thing I ask is ‘what assets do you have?’ LPAs are only really necessary if you own a property, or if you have significant savings or investments. Unless either of both of these are true for you, the cost and effort of setting up a LPA won’t be justified by the benefit.
Similarly, when it comes to care decisions, the likelihood is that medical staff would defer to your family’s views in any event.
So encouraging people to plot their way through the process of creating a LPA themselves, without guidance, is a risky thing to do. Yet that’s exactly what the Government is currently trying to achieve, following the launch of its online LPA tool in 2014.
Calling for a re-think
Believing that this do-it-yourself option could leave people at risk of financial abuse and fraud, we’re backing a campaign led by the Solicitors for the Elderly (SFE) awareness organisation – as are Action on Elder Abuse, Anchor, Contact the Elderly and SOLLA.
The Government’s Office of the Public Guardian (OPG) claims its online LPA tool allows people to create these documents without the need for professional advice from a solicitor.
But the campaign warns that anyone creating an LPA without taking specialist legal advice faces a significantly higher risk of being left with an ineffective legal document, incurring additional application fees, and even becoming a victim of fraud or coercion.
It also raises concerns around the potential for fraud or financial abuse in the completely digital system proposed by the OPG, which no longer requires ‘wet signatures’ for authorisation.
A study conducted by the SFE for the report invited participants to create LPAs using the OPG’s online tool and other ‘DIY’ methods. This revealed that:
- Some of the forms did not accurately express the way in which participants would want their affairs and welfare to be handled in the future
- Documents made using DIY methods were more likely to contain mistakes, rendering them ineffective and requiring additional application fees
- Following consultation with a solicitor, most participants made significant changes to their documented decisions on who should manage their affairs, and how.
June McSparron, a 75-year-old who participated in the study, said: “You’re exposing yourself to a lot of risk by filling this form in on your own. There are so many bits you can get wrong, and you can easily be pressured into making choices that you’re not entirely comfortable with.”
The number of LPAs being registered has increased steadily since the launch of the online tool, with over half a million in 2015/16 alone. The OPG wants the service to account for 30 per cent of all applications from April 2016 to March 2017. In its latest Annual Report, it admits it is willing to take ‘risks’ in striking a balance between ‘empowering and safeguarding’. Yet we and the other organisations involved in the campaign believe the level of potential risk is unacceptable.
This is because a LPA is by far the most powerful and important legal document an individual can have, allowing you to pass possibly life-changing decisions about your affairs on to a third party.
It’s absolutely right that people should be planning ahead for the future, and LPAs can form an important aspect of this, but granting someone this sort of authority over your affairs is an extremely big responsibility for all parties involved. This is a specialist area of the law, and we recommend that anyone considering an LPA goes to a legal expert to ensure they get the right advice, consider all the options, and safeguard themselves for the future.
To download the report ‘The Real Cost of DIY LPAs’ go to: http://www.sfe.legal
If you are planning for the future and could do with some advice on what provisions you need, why not call me on (01482) 974 477 or email email@example.com.