LPAs enable you (the donor) to give someone else (the attorney) the legal right to deal with your affairs should you not be able to.

There are two types of LPA – a property and affairs LPA, which allows an attorney to deal with financial issues, such as bank accounts, welfare benefits and tax and a personal welfare LPA, which allows an attorney to deal with health and welfare matters, such as where you live, when you should see a doctor and who you should have contact with.

Both types of LPA are incredibly important, particularly as they allow someone else to make vital decisions about your finances and well-being.  It is essential that they are made and managed correctly.

Whilst LPAs already offer significant security and peace of mind, their appointment and management have been criticised as being outdated and professionals have called for reform of the system.

This has led to the passing of the Lasting Powers of Attorney Act 2023, which received royal assent in September 2023.

In the main, the Act focusses on modernising and simplifying LPA registration and providing safeguards to prevent fraud and abuse.

According to government figures, the number of registered LPAs has increased drastically in recent years to more than 6 million, but the process of making one retains many paper-based features that are over 30 years old.

Here are some of the changes that will take place.

Digitalisation

The Office for the Public Guardian (OPG) is now developing a new online system and additional safeguards as well as an improved paper process for those who are unable to use the internet or who choose not to use the digital process.

It is expected that digitalisation will speed up registration time by detecting errors earlier and allowing them to be fixed online rather than having to wait for documents to be posted back and forth between the applicant and the OPG as currently happens.

At present, everyone involved in the LPA – donor, attorneys, witnesses and the solicitor drawing up the LPA has to sign the certificate before it is sent to the OPG for registration, who then returns the LPA, which is kept by the donor until it is needed.  The new system will mean that all signatures will be done online.  All in all, it is expected that registration time will be reduced to two weeks. Currently, this process can take around 20 weeks.

Identification

Proposed plans to further protect vulnerable people from abuse or fraud include enhanced identity checks.  Anyone involved in the process will need to provide ID, which will be verified by the OPG and if requirements are not fulfilled, the OPG will not be able to register the LPA.

Registration

An LPA must be registered with the OPG before it can be used. At present, this can be done by either the donor or the attorney. The new act allows only the donor to register an LPA.

A health and welfare LPA can only be used once the donor has lost capacity and, at present, it is unclear how the changes will affect registration after the donor has lost capacity and whether an LPA must be registered immediately after making it.

Objecting to an LPA

A new, simplified system will be introduced that will allow more people who have an interest in an LPA to object to it, including those who are not named in it. If the OPG thinks there is no evidence to support an objection, it will be registered.  However, if the OPG thinks there is evidence to support the objection, the attorney will have to apply to the Court of Protection before the OPG can register the LPA.

Laura Cowan, head of Graysons’ private client team says:

“Streamlining and speeding up the system is a welcome move.  However, whilst we know that the OPG is still developing the online system, there are outstanding questions about how the digital registration will work, in particular relating to those who have already lost capacity.  Also, we don’t yet know how a simplified paper system will work for those who are not digitally aware. Further (secondary) legislation will follow the Powers of Attorney Act 2023, which should set out how it is to be implemented, but no date has been set for that yet.”

Planning for your future if you become unable to manage your own affairs will undoubtedly include discussions with your family and your potential attorneys.  However, it is strongly advised that you take independent legal advice too.

Graysons’ private client experts will be happy to discuss your individual situation and offer guidance on the options you have.  Contact one of our team now to make an appointment.

Author: Laura Cowan, head of Graysons’ private client team.