Consultation on mental capacity small payments scheme – deadline 12 January

A Ministry of Justice consultation seeks views on a set of changes around accessing limited funds belonging to an individual who lacks mental capacity (without a Lasting Power of Attorney or Court of Protection order).

The consultation foreword explains that it is a long-held legal principle that an adult must have proper legal authority to access or deal with property belonging to another adult. Where an adult has mental capacity, this legal authority can be provided by an ordinary power of attorney. In cases where the adult lacks mental capacity, the Mental Capacity Act 2005 provides the framework for them to grant legal authority by appointing a lasting power of attorney while they still have mental capacity, or for third parties to obtain legal authority through applications to the Court of Protection.

The case for change

Concerns have been raised regarding the Court of Protection process for obtaining a property and affairs order, including the length of forms, and the time taken between completing the application to the final order being made. Other concerns describe the Court of Protection process as “disproportionate” to the small amounts of money concerned and could have a detrimental impact on delaying the ability of the account holder to benefit from their fund, adding to the stress of looking after a disabled adult or child.

It is for this reason the Ministry of Justice has been examining the case for legislation to enable third-party access to smaller funds without the need to obtain the form of legal authority currently required under the Mental Capacity Act. This consultation seeks views on the proposals for potential changes to the legislation.

Summary of proposals

• Payments would be permitted for a six-month period from one account

• Payments would be allowed up to a value of £2,500

• A single extension to the access period, of a further six months, would be permitted only if the value of £2,500 had not been reached

• The same account or other accounts belonging to the individual could not be accessed again by the same or a different applicant

• The scheme would be run by financial services firms such banks, building societies

• Applicants will be asked to consider whether a deputyship is necessary or appropriate for longer-term management of accounts and encouraged to apply to the Court of Protection where necessary

Have your say

The consultation closes on Wednesday 12 January 2022. You can respond by completing the online survey here.

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