Does the Government's delay in implementing Lasting Powers of Attorney open a window of opportunity? Some clients may want to take advantage of the brief extra chance to create an Enduring Power of Attorney which would enable a trusted friend, family member or professional to manage your financial affairs if you became unable to do so yourself.
The Government's planned introduction of Lasting Powers of Attorney (LPAs) has been postponed from the end of March this year until the early Autumn. This gives an extra six months or so in which you can create an Enduring Power of Attorney (EPA) if you do not already have one. Once the new LPAs have been introduced, it will no longer be possible to grant an EPA, though existing EPAs will remain valid indefinitely.
So why may it be wise to hasten to make an EPA, for surely the new LPAs will be better than the old EPAs? The new LPAs may be better for some people, particularly those with lifelong learning disabilities. The classic reader of this newsletter is, however, more likely to be someone who has managed their own finances throughout their adult life, and expects to go on doing so in their retirement, unless misfortune strikes. We believe that the old EPA can often provide better protection for these individuals than the new LPA, because it makes it less easy for funds to be wasted or frittered away, and allows clearer and more direct financial management.
So what is an EPA?
Many readers of Individual Matters will already have an EPA. This means that if they were to lose mental capacity, perhaps as a result of a stroke, or because dementia strikes in old age, then a trusted friend, family member, or professional would be able to look after their financial affairs on their behalf. If they did not have an EPA, the family would have to use the relatively cumbersome and expensive alternative of applying to the Court for a ‘Receiver’ to look after their affairs for them. Usually the deed creating the power of attorney is simply kept in safe storage, unused, but the family has peace of mind in case the worst should happen. If you do not already have an EPA, you now have an extra few months in which to organize one. After that, you will have no choice, if you want to guard against possible loss of mental capacity, but to make one of the new LPAs.