I don’t like to think about the point where I cannot manage my financial and health affairs. However, I’m realistic enough to know that it is likely to happen in the future. The last thing I want is for my family to be powerless to carry out my wishes and to endure the stress of the situation. Many of my clients feel the same way, so I advise them to consider Lasting Powers of Attorney (LPAs).
I find many of my clients are familiar with Enduring Powers of Attorney (EPAs) and LPAs for property and financial affairs. They are less familiar with LPAs for health and welfare.
There are two key issues with EPAs and LPAs for property and financial affairs:
- Whilst EPAs remain valid, they had to be fully completed no later than 30 September 2007. Did you and all the attorneys sign and date the EPA no later than that date? Any later date invalidates it.
- Does your EPA or LPA for property and financial affairs appoint at least one attorney from a younger generation? I often find that spouses have just appointed each other. This tends to work okay prior to the first death, but leaves the survivor without a valid power of attorney.
An EPA or an LPA for property and financial affairs only confers powers on the attorney(s) to deal with financial matters. Therefore, an LPA for health and welfare is also required if you want your attorney(s) to deal with health and welfare issues.
There are three key reasons for having an LPA for health and welfare. These only come into operation if you have lost capacity to make these decisions yourself:
- With the NHS, you need to consider who should decide what treatment is or isn’t to be given, including end-of-life decisions. In my experience, I’ve found the NHS reluctant to have far-reaching discussions, even with close family members, in the absence of an LPA.
- With the local authority, you need to decide who should select the best care package for you. In the absence of an LPA, the local authority is likely to rely on their statutory duty and override or ignore the wishes of close family members.
- With care providers, you’re looking to cover disputes over standards of care. The Victoria Derbyshire programme on the BBC recently highlighted cases of care providers exercising draconian powers, including banning close family from visiting. In the absence of an LPA for health and welfare, families may find it difficult to combat such tactics.
Scotland and Northern Ireland
The situation in Scotland is very similar. Continuing Power of Attorney deals with money and property and a Welfare Power of Attorney covers matters of health and wellbeing. A Combined Power of Attorney covers both.
Complications can arise with people moving across borders. A Scottish Power of Attorney can be used in England if an organisation (e.g. a bank) accepts its authority. They are under no obligation to do so, unfortunately. It is possible to obtain an endorsement of the Scottish Power of Attorney from the English authorities [Office of the Public Guardian] but this carries no legal weight and a Scottish Power of Attorney can become a worthless document.
The reverse is different. A non-Scottish Power of Attorney is automatically valid in Scotland and consequently there is no legal requirement to have it formally endorsed, although some organisations may request one. The Office of the Public Guardian provides a Certificate which can be printed and presented along with the Power of Attorney to assist in getting a non-Scottish Power of Attorney accepted in Scotland.
Northern Ireland is yet to modernise their arrangements. It still uses their version of the EPA, which only deals with property and financial affairs.
This article is for general information only and does not constitute advice. If you are not sure whether your existing EPA or LPA is either valid or sufficiently robust, or if you don’t have an LPA for health and welfare, talk to your Wren Sterling adviser.
Fix any gaps in your National Insurance record before April 23 and boost your state pension
If you have any gaps in your National Insurance record, now is a very good time to plug them. The mo...
Managing the Money Purchase Annual Allowance limit
As new pension drawdown options grow in popularity, earlier this year the Government implemented a c...
If you’re self-employed, is your State Pension at risk?
Self-employed workers tend to have lower levels of pension savings, and a greater reliance on the St...
Why one size doesn’t fit all when it comes to your pension fund’s default option
Workplace pensions are a great place to start building your retirement savings. But is a 'one size f...
The balance of retirement income planning
Are annuities making a comeback? The increase in gilt yields over the past six months particularly h...
Living the Future Life – should we be planning to live to 100?
How does increasing life expectancy affect people planning? We look at a report by the Pension Polic...