Who’ll decide for you when you can’t decide for yourself?

It’s frightening to think that old age or an accident could rob you of the ability to make life-affecting decisions for yourself. Peter Sutherland of Andersons Solicitors in Nottingham explains how the new Mental Capacity Act enables people to plan ahead in case the unthinkable should happen.

With an increasingly ageing population it’s likely that more people than ever will be affected by some kind of mental or physical infirmity that prevents them being able to take control of their own lives. Yet research by the insurance company Standard Life shows that three out of four people have made no arrangements to enable someone to manage their affairs should failing mental health make it impossible for them to do so themselves.

This is in spite of the fact that it can be difficult and time-consuming to unfreeze the assets of a family member who suddenly becomes mentally incapacitated.

The Mental Capacity Act 2005, now coming into effect, tries to address the problem by improving and expanding the ways we can prepare for the future.

Until now the way to do this has been to sign an enduring power of attorney (EPA) which enables you to nominate someone to look after your financial affairs when you are unable to do so yourself. It must be signed when you are still healthy and able to understand its purpose but need not be used until it’s required should you become mentally incapacitated. At that point it is registered at the Public Guardianship Office.

However, from October onwards, enduring power of attorney will be replaced by the new lasting power of attorney. They sound similar but there are several key differences.

The current EPAs only cover such things as financial matters, property and business affairs. They are relatively inexpensive. Many people sign them at the same time as writing a will.

The new LPAs will be broader and come in two forms. The Property and Affairs LPA will fulfil a similar role to the old EPA by allowing you to appoint someone to manage your financial affairs. In addition, however, there will also be the Welfare LPA which will allow your appointed attorney to make decisions about your health care - even to the point of whether or not you should be given life-saving treatment.

Any such decisions to be made by your attorney will have to be made in your best interest and meet a checklist of criteria set out in the Act.

You can choose to make one or both types of LPA and you can appoint different attorneys to deal with financial matters and welfare concerns.

The new LPAs will need to contain a certificate filled in by an Independent Certificate provider such as a doctor or a solicitor. The certificate provider will be obliged to interview you first to make sure you understand what you are doing and that you are not being subjected to any undue pressure to appoint someone as your attorney.

Lasting powers of attorney will also have to be registered at the Court of Protection. This will make them more expensive than EPAs but it will also make them more secure and so possibly more attractive to many people. When similar changes to powers of attorney were introduced in Scotland in 2001, the take-up rose from 5,000 a year to more than 22,000.

The new system will be more wide-ranging and offer people more choices. However, the current system is less complicated and so may provide a less expensive option for people who only need to make simple arrangements for the future.

EPAs will no longer be available once LPAs take over in October but those already made will still stand. It means that for the next few months, people have a choice as to which arrangement they think would suit them best. Those who feel they only need to make basic arrangements covering financial matters may prefer to save money by arranging an EPA before they are phased out in October. Those who prefer to make more comprehensive arrangements, including their future welfare, may prefer to wait until the LPAs become available.

For further details contact Peter Sutherland 0115 988 6714 psutherland@andersonssolicitors.co.uk