Consultation on Small Payments Scheme

The Ministry of Justice has launched a consultation to review third party access to funds belonging to those who lack mental capacity without the need to get permission from the Court of Protections.

The consultation has been launched following concerns over the “length and complexity” of the Court of Protection process, citing a “disproportionate and overly-burdensome” process for where relatively small funds are needed.

A new process could see limited funds, up to £2,500, be made available to third parties to

“support the specific needs of a person without mental capacity but may feel a Court of Protection order is not appropriate or find the application process for a one-off order off-putting, too complex or disproportionate to the amounts of funds involved.”

The payments would be available for a fixed period, proposed to be 6 months and only one extension would be permitted if the full allocation of funds had not been requested.

The proposals recommend that access to the following accounts would be within scope

  • Current accounts
  • savings accounts
  • Children’s savings accounts including Child Trust Funds
  • Cash ISAs
  • Investments

Additionally the proposals recommend the person applying would have to prove their suitability to access the money – rather than limiting it to family members, and the consultation will consider whether to limit access to ‘named contacts’ on the CTF or DWP appointees, or to ask people to explain their suitability.

Other considerations include

  • Submitting medical evidence showing the account holder lacked mental capacity to manage their financial affairs.
  • Explanations for what the money is for
  • Whether and how the applicant would verify that the money would be used in the best interests of the account holder
  • Records of spending in case of any problems further down the line.

The scale of work undertaken by the Court of Protection is outlined in the consultation proposals. In 2020, the Court of Protection made 12,846 deputyship orders and 2,031 one-off property and affairs orders.

The consultation was launched on 16th November and closes on 12th January 2022 with a response due to be published in April 2022.

CLICK HERE to view the consultation in full and respond

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