The revamp of the power of attorney system is long overdue and represents a victory for those left powerless, an industry expert has said.
Shaun Moore, financial planning expert at Quilter, was reacting to the Ministry of Justice and Office of the Public Guardian’s consultation response on modernising the lasting power of attorney process.
“A revamp of the power of attorney system is long overdue and represents a victory for many who have been left financially powerless due to crippling civil service delays that were becoming all too familiar," he said.
The slowdown in those registering LPAs during the pandemic was a wake-up call for the government to look at how the process could be streamlined, and yet issues still remain, he added.
“The current system risks leaving numerous vulnerable people unable to manage their finances in a timely manner, as well as being left exposed to fraud risks that are becoming ever harder to spot.
“For those considering registering an LPA, it is vital to do so sooner rather than later to ensure it is in place should the worst happen.”
The consultation paper was introduced in July 2021 with proposals to make the LPA process more efficient, while maintaining safeguards.
The Ministry of Justice's response included a rejection of the suggestion that an urgent service should be introduced, as it would slow down the process more generally.
The idea of merging financial and health LPAs was also rejected, but the bodies said they will look at how to reduce duplication of data when both are in place.
A paper channel will also be maintained for those who need it.
The government will develop the accepted suggestions through amendments to the Mental Capacity Act 2005 through primary legislation when parliamentary time allows.
Helen Morrissey, senior pensions and retirement analyst at Hargreaves Lansdown, said LPAs are vital in making sure people’s affairs can be handled should the time come that they are unable to make decisions for themselves.
However, she added, the process is complex and time consuming and it is easy to make mistakes.
“Even when an LPA is registered attorneys can be frustrated by different approaches adopted by third parties such as banks and there is confusion around how to lodge complaints if you have concerns.”
“The response recommends identity checks before the registration of an LPA to improve security and is considering whether they should be registered as soon as executed to cut down instances where there are problems with the LPA, but the donor has lost mental capacity.”