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The Mental incapacity project deals with several groups of issues which were raised by the Law Commission's report and the Green Paper Who Decides? Making decisions on behalf of mentally incapacitated adults. They are:
key principles: definition of incapacity, best interests, and the General Authority;
Continuing Powers of Attorney (CPAs), which would replace the current system of Enduring Powers of Attorney (EPAs), extending the powers to healthcare and welfare as well as finance;
the court jurisdiction, including the proposal to replace receivers with managers who may have different responsibilities, for healthcare and welfare decisions;
the modernisation of the judicial forum, with a structure for the new court jurisdiction governing decision-making on behalf of mentally incapacitated adults.
The purpose of the proposals is to modernise the legislation on decision-making on behalf of mentally incapacitated adults, which is largely dealt with currently by the common law. To achieve the Government's aims, there is no other option to legislation.
Key principles
The proposed definition of incapacity is designed to maximise decision-making capacity, which would empower people without capacity and enable them to have greater control over their own lives.
Guidance for deciding what is in a person's best interests would be very helpful for substitute decision-makers and benefit people without capacity.
The General Authority to act reasonably would, by providing informal decision- making with a legal context, give clarity for carers and adequate protection for those without capacity.
Continuing Powers of Attorney
The replacement of EPAs by CPAs would allow individuals to delegate decision-making powers on finance, healthcare and personal welfare to a trusted friend or relative.
The CPA scheme would provide for a number of safeguards, including medical certification when the power is executed, notification of third parties and compulsory registration, which would address most of the flaws of the current EPA system.
Decision-making by the court
The court would be able to appoint a manager to make decisions on any matter relating to the personal welfare, healthcare, property or affairs of a person without capacity.
A single court jurisdiction dealing with financial, welfare and healthcare issues would be the logical consequence of the proposed unified system of decision- making.
The principles as to the general powers of the court would support the aim of making the jurisdiction as little interventionist as possible.
Modernising the judicial forum
The proposed structure of the new jurisdiction would render the courts more accessible and facilitate the handling of urgent cases.
Key principles
The purpose of the proposals related to the key principles is to provide guidance for the assessment of capacity, for the determination of the best interests of people without capacity, and for carers acting under the general authority to act reasonably. None of these proposals imposes costs on businesses, charities, voluntary bodies, citizens or groups of citizens.
Continuing Powers of Attorney
The replacement of Enduring Powers of Attorney (EPAs) by Continuing Powers of Attorney (CPAs) would widen the scope of the powers, and ensure the registration of the powers, since registration would be a condition for an attorney to be able to act on behalf of the donor.
Substitute decision-makers are in the main trusted friends or relatives; therefore the move towards CPAs would have no impact on business, charities or voluntary bodies. The donors who would benefit from the new provisions are likely to be older people, without any distinction of sex or ethnicity. Similarly, attorneys, who are in the main aged between 35 and 65 (the attorney is often a child of the donor), have no reason to be of any particular sex or ethnic group. Altogether, the proposals would benefit the elderly and have no specific impact on any other groups of citizens.
A fee would have to be paid when an application for registration is made, thus the proposals would have a financial impact on donors. However, this impact would not, strictly speaking, be the result of the current proposals. There is already a similar charge for EPAs, which have to be registered when the attorney wants to use them and the donor is without capacity. As a consequence, the cost impact of registration as a condition for an attorney to be able to act on behalf of the donor is considered negligible.
The other proposal which would have cost implications for donors is the compulsory certification of capacity by a doctor when the power is executed. A current estimate of the cost to the donor would be £70. Indeed, the BMA's Private Practice and Professional Fees Committee recommended from 1 April 1997 a fee of £69 where a doctor completes an examination to determine whether a person is capable of making an EPA. (The recommended figures are revised annually.) A fee of £34.50 is also recommended for witnessing the donor's signature on an EPA, but the requirement for certification of capacity would remove the need for a doctor to witness the execution of the document.
Decision-making by the court
The proposals set out the jurisdiction of the Court of Protection and its general powers. They also provide for the replacement of the current receivership system by defining the role and responsibilities of managers.
None of these proposals would have financial impact on business, charities or voluntary bodies. And for reasons similar to those set out above about CPAs, the proposals would have no specific impact on any groups of citizens except people without capacity.
The only cost implications would be related to the fees paid to the administrative body responsible for reviewing managers' accounts. The body could charge a low flat rate fee for reviewing these accounts, which would have cost implications for the people without capacity affected. However, the Public Trust Office already charge fees in relation to receivership (based on the value of the estate), and if a similar system were adopted, the additional cost impact on people without capacity would be marginal.
Modernising the judicial forum
The proposals deal with the structure for a new court jurisdiction governing decision- making on behalf of mentally incapacitated adults. All the cost implications would be borne by the public sector, and there would be no financial impact on business, charities, voluntary bodies, citizens or groups of citizens.
Central Government
The estimates of costs for the Lord Chancellor's Department are set out in the table below.
| Annual costs | Start-up costs | |
|---|---|---|
| Public Trust Office | £10.5m | £0.6m |
| Likely fee income | £4.7m | |
| Court Service | £0.1m | £0.2m |
| Legal Aid | £1.0m | |
| Judicial Studies Board | £0.7m | |
| Total start up costs | £1.5m | |
| Total additional running costs | £11.6m | |
| Total additional running costs less additional fee income | £6.9m |
Local authorities
The effects on local government would be marginal:
there would be general training implications for social services in relation to aspects which touch on personal welfare issues, such as the requirement to make decisions in the incapacitated person's best interests, and the factors to be taken into account in doing so. However, it is anticipated that the costs should be contained within Social Services budgets;
local authorities could be appointed as managers to make welfare and financial decisions on behalf of incapacitated persons. However, they would not be forced to accept such appointments, and would often seek to do so for reasons of administrative convenience. Moreover, local authorities can already be appointed as receivers.
The proposals are based on the Law Commission's report on Mental incapacity (1995). They were consulted on in the Green Paper Who Decides? Making decisions on behalf of mentally incapacitated adults. Over 4,000 responses were received. The provisions which are being taken forward commanded very wide support.
It is recommended that the proposals be passed into law. The benefits of such legislation are judged to exceed substantially the marginal costs to citizens. There would be no cost to business, charities or voluntary bodies.
I have read the Regulatory Impact Assessment and I am satisfied that the balance between cost and benefit is the right one in the circumstances.
Signed by the responsible Minister:
Lord Irvine of Lairg
Lord Chancellor
Date: 14 October 1999
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