Mental Capacity: Accessing Accounts Without a Court Order – The End Of The Road?.

The government has just published its response to the small payments scheme consultation.

The consultation, which ran between November 2021 and January 2022, invited responses to a potential “small payments scheme”. The scheme would allow third parties legal access to limited funds held in bank and building society accounts by persons lacking capacity, without the need to obtain legal authority from the Court of Protection (CoP) under the Mental Capacity Act 2005.

The proposed scheme followed concerns from financial services and those representing older people and those with disabilities, that the process for obtaining a CoP order where someone lacks capacity is disproportionate in terms of complexity and delay, for accessing small funds or arranging simple payments. Concerns had also been raised by the parents and carers of children and young adults who lack capacity about the challenges of accessing matured Child Trust Funds on their behalf.

The proposals under the scheme would: 

  • permit payments from a single account, limited for a six month period
  • allow payments up to a total sum of £2,500 (an amount which is sufficient to include the majority of matured Child Trust Funds)
  • permit a single extension to the access period of a further six months, but only if the value of £2,500 has not been reached
  • prevent access to the same account or other accounts belonging to the individual by the same or a different applicant
  • be run by financial services firms (such as banks, building societies and e-money institutions), allowing payments or withdrawals primarily from cash-based accounts
  • grant access to someone who could prove their suitability, rather than just family members
  • ask applicants to consider whether a CoP Deputyship was necessary or appropriate for longer-term management of accounts, and encourage them to apply to the court as part of the process

The published consultation outcome identified “operational barriers” with the existing system (principally delays in the CoP) and a lack of awareness of the Mental Capacity Act 2005 as two significant issues. 

However, the published consultation outcome provided no clear consensus regarding the inception of such a scheme, concluding:

“The Ministry of Justice believes that the CoP digital application process and raising awareness of the MCA will address the root cause of the problem (operational barriers and lack of awareness) and resolve many of the challenges raised by respondents to the consultation. As a result, the Ministry of Justice will focus on addressing the key barriers to accessing payments, and not seek to develop a small payments scheme. Taking these measures will ensure that we protect the legal principle that an adult must have proper legal authority to access or deal with property belonging to another adult, while ensuring that those who need to obtain that legal authority can do so in a straightforward and timely way”.

The response refers to a new CoP digital application process that has been underway for only a matter of weeks. The extent to which it will remove the concerns of care givers concerning swift, easy access to low value accounts and Child Trust Funds remains to be seen.

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