Mr. Lammy: I ought to emphasise that the attorney in this regard is there, most often, to give consent to treatment, not to care for the person; nurses and doctors will be caring for the person in a care home or a hospital. The hon. Gentleman slightly conflates those matters. The attorney is there to act as that extra legal safeguard; their role is about consent, not about caring for the person in the care standards situation, as the hon. Gentleman suggested.
Mr. Burstow: I accept that the two things may be running in parallel. They are remarkably close; indeed, in terms of what I am trying to address they are sufficiently close to allow an argument that the Minister ought to consider a little further. In order to ensure that appropriate safeguards are in place, a person who still has capacity and is making an important decision about who they wish to act as their doneefor example, on welfare mattersshould be able to know that the donee is not on the POVA list. The POVA list does not deal only with those who provide hands-on care, but with those who are responsible for the management of services for vulnerable adults. We are talking about people who in
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some respects will be taking decisions about the welfare of people in their charge. That is why there are grounds for pressing the Minister a little further.
Mr. Lammy: None of my comments should prejudice the Bichard report, recommendation 19 of which said that the Government should introduce new arrangements across the board to protect children and vulnerable adults, and that a register could provide more information relevant to an individual's suitability in a particular respect. We are considering whether LPAs and deputies would come under the scope of such a register, notwithstanding my point about the consent role as opposed to the care role. However, as I said, I am sympathetic to the hon. Gentleman's general point.
Mr. Burstow: That is probably as far as we are likely to get on the issue today. That is helpful; I shall take what the Minister says about the amendments as important comfort. There are issues that we would like to return to, but I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 10 ordered to stand part of the Bill.
Lasting powers of attorney: restrictions
Mr. Burstow: I beg to move amendment No. 167, in
clause 11, page 6, line 31, leave out from 'to make' to the end of line 35 and insert
'a decision on behalf of P in relation to a matter if he knows or has reasonable grounds for believing that P has capacity in relation to the matter'.
The Chairman: With this it will be convenient to discuss amendment No. 168, in
clause 11, page 6, line 43, at end add
Mr. Burstow: The amendments are intended to ensure that proxy decision making in respect of lasting powers of attorney are firmly anchored in the principles of clause 1 and that, in discharging his responsibility, a donee keeps in mind that he is on shifting sands as regards the issue of capacity, as that may change from one decision to another. It must be asked whether a person has capacity. That always has to be at the forefront of a person's considerations when they are acting as a proxy decision maker.
'(8) Where a lasting power of attorney authorises the donee (or, if more than one, any of them) to make decisions about P's property and affairs the authority does not extend to making a decision on behalf of P in relation to a matter if he knows or has reasonable grounds for believing that P has capacity in relation to the matter, unless it has been specified on the instrument that the donee may make such decisions whilst P has the capacity to make decisions about P's property and affairs.'.
A person with an LPA ought to ask, ''Does the person for whom I am about to act have the capacity to make this decision?'' Amendments Nos. 167 and 168 would put the fact that that obligation exists in clear terms by linking clause 11 back to clause 1, and by clearly stipulating how those principles should work in respect of both clause 11 and the restrictions that
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should apply to a lasting power of attorney. Given all that has been said so far about the pre-eminence of presumption of capacity, I hope that he Minister can give us some reassurance on the subject.
Mr. Lammy: I understand the desire behind the amendments. It is, of course, important to emphasise that incapacitated people should be given every help and encouragement to make their own decisions; that is part of the underlying ethos of the Bill, and I have said much about it already.
Clause 11(6)(a) already makes it clear that an attorney's authority to make decisions about someone's personal welfare extends only to circumstances in which the person lacks capacity. That paragraph was added in response to recommendations made by the Joint Committee.
Amendment No. 168 would limit an attorney's ability to make property and affairs decisions on the donor's behalf to times when the donor lacks capacity, unless the donor states otherwise on the LPA document. However, many people find it helpful to appoint an attorney to deal with their property and affairs while they still have capacitya matter that we discussed this morning.
I have said how EPAs work at present. The difference under the Bill is that LPAs will have to be registered before they can be used for the first time, so the tracking process will be a lot better. A donor who wishes to limit the authority of the attorney to times when the donor lacks capacity can already do so, because the Bill makes provision for the attorney to specify any restrictions or conditions in the LPA document. The hon. Member for Daventry mentioned the roles of professionals earlier. In drawing up that document, many people will call on solicitors and professionals, who also have a duty of care to ensure that such things are done in the right way. On that basis, I hope that the hon. Gentleman will feel able to withdraw the amendment.
Mr. Burstow: I thank the Minister for his response. He says that existing custom and practice and the consultations that already happen with lawyers and other experts in drafting an EPA will carry on with LPAs, and that that should provide sufficient safeguards. If I felt that that was the case, I would not have tabled the amendments. I feel that it would be appropriate to go further than that and to be clearer about what the duties might be.
I was interested in what the Minister said about a person being able to stipulate that they wish the LPA to be exercised only if they lacked capacity. That poses the question that, inarticulately, I tried to pose this morning: when would that be stipulated, and how would a third partythe bank, or another personknow that capacity had been lost? Without that clarity in the system, I suspect that there will be occasions on which other parties will feel unable to act on the instructions of a donee. That dilemma is still to be resolved. The amendments are not about resolving that issue, but about making things clear on the issue of capacity. I am grateful for the Minister's response.
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Again, we will probably find an appropriate time to come back to the issue. I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
Clause 11 ordered to stand part of the Bill.
Scope of lasting powers of attorney: gifts
Mr. Boswell: I beg to move amendment No. 27, in
clause 12, page 7, line 4, after 'gifts', insert
'(including the sale of assets at a discount or at less than money's worth.'.
The Chairman: With this it will be convenient to discuss the following amendments: No. 210, in
No. 211, in
Mr. Boswell: The provision is designed to curtail the powers of an attorney to make gifts under an LPA. There is, perhaps, an understanding, consistent with Committee members' arguments, that there need to be safeguards in that direction. It is one thing to be generous with one's own money, but another to be generous with somebody else's, particularly when there is an overriding duty to act in that person's best interests.
I shall speak to the amendments and their implications in turn. Amendment No. 27 is small and designed to obtain Government confirmation on one kind of situation. It is by no means uncommon within families to decide to reduce the price of an assetfor example, a house owned by a family memberinstead of charging the full price. Perhaps that would be done for a young person who could afford some of the cost, but not the whole cost.
There is also the separate issue of cases in which the attorney himself might be in receipt of property. That might be a perfectly proper transaction, at arm's length and at full market value. However, the situation would be difficult if the attorney manipulated things so as to receive a property or asset at less than market value. I am sure that the Minister can imagine lots of other situations in which, instead of charging the full market price, a reduction was envisaged.
I do not seek to open wider issues about the taxation of retirement equity release schemes, for example. We could spend the whole day on such matters, which would not be appropriate. I just say to the Minister that if he is making provision for gifts, he ought to pause on whether it is desirable to consider assets sold at a discount or at less than market value. That is the purpose of the amendment.
The numerical order of amendments Nos. 210 and 211suggests that they are afterthoughts, tabled after I revisited the matter on the advice of a colleague. There
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is a potential difficulty with the clause. I understand that the Minister seeks to confine gifts made by the attorney, who is acting on behalf of the person without capacity, to what might be termed normal acts of charity and ordinary, decent family relations. The person, when he had capacity, would have wished to make provision for birthday presents to his spouse or child or a friend and would have wished to subscribe modest, regular amounts to a charity of which he was fond. That is not an issue. However, there is apparently a bar at that point.
The Minister, who has been so liberal and non-interventionist in his constraints on the use of the power of attorney, is saying, ''Thus far, and no further.'' He will rightly draw my attention to the fact that the explanatory notes signpost us to clause 23(4), under which the court could give permission for a more substantial gift. The example in relation to the clause is that if the older person has substantial assets, there might be a good reason in terms of tax planning for making a larger gift. Surely that would be the case if the person were asset rich, but no longer able to administer their assets, and somebody with a lasting power of attorney to administer them could say that it made little sense for the person to hang on to them; it would be more tax-efficient, and, perhaps, useful to other family members, if they were to divest themselves of them. There would then be the safeguard in going to the Court of Protection.
That is not the only scenario that could arise. I can imagine one in which two siblingsbrotherswere sadly seriously injured and lost mental capacity as a result of their injuries in a car accident. If one had substantial life insurance, or insurance against permanent disability, and the other had none, the one would be in receipt of a large sum from the insurance companyassuming the claim were legitimate, which I suspect it would beand the other would receive nothing.
An attorneyperhaps the joint attorney for bothmight say that provision should be made for both, or that if the younger brother survived the death of the older, it would be a comfort to know that the assets could be spread around, because it was probable that both brothers, if they had a good relationship, would want that to happen. This is not simply about tax planning and fat cats. There might be various scenarios, large and small.
There is provision for the assets to be the subject of an application to the Court of Protection for permission to divest them. I do not say that that procedure is unreasonable, but it will be expensive and may delay things for a time. It would not be possible to get a decision quickly, although a quick decision on some assets would be desirable, particularly in respect of a house or property and perhaps in relation to stocks and shares. Amendment No. 211 would merely facilitate or define a way to do that.
The exceptions to clause 2(10) provide that if the person drawing up the power of attorney against an eventual loss of mental capacity wished to specify that
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the attorney should have the power to make giftsand if they gave a definite set of instructions to the attorney, as they might on other matters, such as their health care or financial arrangementsand if they said that they wanted to make a gift, it is reasonable in principle that they can do that without reference to the court.
The donee of the power of attorney would still have an obligation to consider the person's best interests and not give away assets when it became dangerous to do so, regardless of the instructions they might have received. Nevertheless, that would be a sensible prior indication of something that somebody might want to do and the Minister should consider it.
Amendment No. 27 is designed simply to get the Minister to define what is and is not a gift. Amendment No. 210, which is accompanied by amendment No. 211, is intended to get him to give the flexibility that he has given in other parts of the Bill to the issue of gifts. I hope he will consider them seriously.