Justice Committee - Minutes of EvidenceHC 636-i

Oral Evidence

Taken before the Justice Committee

on Tuesday 23 November 2010

Members present:

Sir Alan Beith (Chair)

Mr Robert Buckland

Chris Evans

Mr Elfyn Llwyd

Yasmin Qureshi


Examination of Witnesses

Witnesses: Mr Martin John, Public Guardian and Chief Executive of the Office of the Public Guardian, and Mr David Thompson, Director, Royal Courts of Justice Group, Her Majesty’s Courts and Tribunal Service, gave evidence.

Q1 Chair: Mr John, Mr Thompson, welcome. The session today is part of our post-legislative scrutiny of the Mental Capacity Act 2005, but I think it also arises from the general public interest in the accountability of the Public Guardianship Office and the fact that the Public Guardian and the Court of Protection are involved in the daily lives of large numbers of our constituents who have in their family people with incapacity. It tends to be something people are not at all aware of until it hits them in some way and until they become responsible. Then they are very aware of it and quite often have a lot to say to their MPs if they find the service difficult to cope with.

One of the suggestions that has been put to you-I think, by the Public Guardian Board-is that the office should see itself as having more of a role as a champion of the Mental Capacity Act, as a publiciser of what it all means. Is that something you ought to be doing or would have time and resources to do?

Mr John: It’s an area we have considered and discussed with the Public Guardian Board for some period of time. For me as Public Guardian sometimes I have to differentiate between the Mental Capacity Act as an overall piece of legislation and my role within it, particularly as the Mental Capacity Act, although sponsored by the Ministry of Justice, contains policy that spans a number of different bits of Whitehall. That is the first issue or difficulty with saying, "Okay, here is one body or one individual or one part of Government machinery that can sponsor that or can champion that whole Act."

Having said that, I think there is definitely a role for me and my organisation in raising awareness of the issues of mental capacity, and particularly in encouraging people to think about the potential for future loss of capacity. That underlies very much the work that we want and need to do about promoting lasting powers of attorney, about encouraging people to make choices now while they have capacity rather than waiting until a future point in time when capacity may be at risk. That is definitely a theme that we want to build into how we work as an organisation going forward. It’s not something we’ve been able to do and take forward actively thus far in the three years that the OPG has been in existence.

Q2 Chair: More generally on the Act, the MoJ said that they thought there were "only small and technical areas" where there were unsatisfactory features in the legislation. Do you agree that there are just some drafting issues, or are there some bigger issues which need to be revisited?

Mr John: From my point of view-David may want to add on behalf of the Court-there are no fundamental issues there. The Act is a very strong framework. A big job that I’ve had and the Court has had is to translate that strong policy framework into services that users receive. There are a couple of areas which are a kind of lacuna. They are small but material to what I do as Public Guardian. One that is perhaps more significant is in terms of financial information. I have powers to require parties to provide health and social care information to me as Public Guardian, but a large proportion of my work, particularly investigative work, still involves property and affairs matters. Without powers to compel third parties to provide financial information, sometimes investigations can take longer, or I need to apply to the Court for an order.

I recognise the issues about personal information, etc. That is one area that we would want to look at going forward. It’s not a big issue because we find ways of working with banks and financial institutions to access information. A smaller one, which we would like to try and find a solution to-there may be solutions in secondary legislation-is around my role in the registration of lasting powers of attorney. I have very little scope to inquire into how a lasting power of attorney was made and in the process of registration to say, "Hang on, I’m not sure I should carry on doing that." There are very defined prescribed circumstances where I can do that, but largely, once somebody has applied to register their power of attorney, as long as there is no defect in the papers, I carry on to register it even if there may have been a concern raised by a third party. What I do in practical effect is, having registered it, I then immediately take action to consider whether or not I might suspend that registration and apply to the Court.

Q3 Chair: Are you saying it would be better if you could delay registration until you were satisfied?

Mr John: In certain circumstances, and circumstances beyond those that are narrowly prescribed already, that would be an area, yes. But of course, these aren’t significant enough to seek a major legislative vehicle: it’s about the point in time we might be able to make those corrections in the context of other legislation.

Mr Thompson: Certainly from a Court perspective I think the Act in reinventing the Court applied the civil procedure rule concept to the Court rules and practice directions. That has certainly given a great deal more structure to case managing through the Court the contentious applications before it. I think the difficulty though, and this is picked up in the report by Mr Justice Charles and Mrs Justice Proudman published in the summer, is that one size fits all is not right. It’s too blunt an instrument. Ninety-four per cent. of all applications before the Court do not require a hearing. They are consensual in nature, and essentially the Court is being asked to exercise its empowering authority by agreeing to the application before it. We need to stand back from the current structure in those rules and the practice directions and recognise that we need to build a simpler process for those where there is no family disagreement and there is no issue at all, except the Court needs under the legislation to appoint somebody to act as deputy. We need to move much, much quicker on those.

Q4 Chair: So it would need legislative change?

Mr Thompson: No; we don’t need that. It was secondary legislation. It’s just in the rules and we are now working with MoJ lawyers to develop those rule changes and simplify the forms. We hope to go out to consultation on a major form change this side of Christmas. They are overly complex. There is a lot of repetition in those forms. The users are very clear with us about those concerns. The report we got from the two lead judges back in the summer reinforces that.

The other thing is that there are so many applications before the Court that are essentially not contentious. There is a suggestion from the Committee that we utilise the experience and skills of some long-serving members of staff to make those decisions far quicker than we can by pushing everything we’ve got through a small cadre of judges. We are very keen to act quickly on those and provide a much swifter turnaround.

Q5 Mr Llwyd: The Court of Protection in its 2009-10 annual report identified some problems. One of them was the volume of work and the paucity of judges to deal with it. Are you happy that these problems have been addressed and were there any others at the time that you think needed addressing?

Mr Thompson: By and large, as a result of the surge of work that came the Court’s way after the implementation of the Act, there were a lot of transitional orders required at that time to put receivers who were in place beforehand into a new deputyship regime with more enhanced powers. There was a lot of revisiting of cases that the Court couldn’t contain very well. At that time we also had a lack of judges. We now have a full complement of judges. The vast majority of that transitional work-the revisiting of older cases-has now ended.

Our state of work at the moment is relatively stable. We are beginning to make inroads into the speed issues and the accuracy issues. I think by and large the difficulties that we had within the first 18 months to two years after the legislation came into force have now been resolved, but we still have some way to go before I would be satisfied that we’ve got to where we need to be.

Q6 Mr Llwyd: Could you give us some idea of the number of applications per annum?

Mr Thompson: There were 20,000 in 2008-09 and 19,000 in 2009-10. The anticipated volume going into the legislation was only about 11,000, so the business planning in advance of the legislation coming into force was some way adrift; 93% of those, as I say, don’t need hearings.

Q7 Mr Llwyd: How many judges would there be allocated to those?

Mr Thompson: There are six now.

Q8 Mr Llwyd: The Court of Protection is now part of the HMCS.

Mr Thompson: Yes.

Q9 Mr Llwyd: It’s been a fairly big change. Has this affected the way you work? Has it in any way created problems?

Mr Thompson: It certainly hasn’t created problems, no. We had a nine-month pre-merger or pre-transfer planning period, when Martin and our teams worked in close co-operation to effect that transfer. Since that move we’ve begun to pull all the processes at the Court apart to identify all the waste or delay within that process, to try and build much more streamlined and speedier processes.

Q10 Mr Llwyd: You will of course be aware of Sir Mark Potter’s recommendations. How is the work of implementing these going forward? Is it now progressing?

Mr Thompson: It is. We’ve taken the report from Mr Justice Charles and Mrs Justice Proudman. We are working with MoJ lawyers to turn some of those recommendations into secondary legislative change. The form design is under way. Importantly, I think some of it is simply about how we actually do the work within the Court. That is the ripping apart of the processes to identify where we have, if you like, inbuilt waste or repetition. Equally, the simplification of the forms will not only be a benefit to our users but also a benefit to the Court and the court staff in processing those applications.

Q11 Mr Llwyd: My next question is linked to what you have just said. Are you happy with the level of openness in the Court of Protection? Are you happy with the way the media report cases? I say "happy" meaning content rather than happy.

Mr Thompson: I think some of the emotive language used-the word "secret"-is unfortunate and unhelpful. It is not a secret court. It is private, essentially. With regard to every one of our clients, it is a human tragedy in every case; 93% don’t require a hearing in any event and it’s purely consensual within the family.

The Court has the powers to open the Courts up, either by way of a hearing or in the publication of its judgments, but the secondary legislation makes it clear that the starting point should be that the Court will start in private and either of its own motion or on an application of anybody it will consider opening up the Court as an open Court. But these are personal matters of some of the most vulnerable in society. I am not certain in my own mind that it’s right simply to throw the doors open for anybody to listen in to what are essentially private matters.

Q12 Mr Llwyd: But in terms of educating, in the best sense, the public and also practitioners, anonymised judgments must surely be helpful?

Mr Thompson: Indeed; and they are now made available. They are on the BAILII website, which is a free-to-access website for all judgments. We are working with the administrators of that site to try and raise the profile of those judgments so that it is much easier to find them within what is a very large database of judgments. I think there are nearly 30 anonymised judgments now available. They deal with some of the really high principle issues and are invariably judgments where the High Court judge has actually sat in the Court of Protection jurisdiction to make some really difficult judgment calls.

Mr John: If I can just add on that point, we recognise there is also a level of decision making at a more working level of the Court that is helpful to practitioners. In OPG, we have a page of information for the professionals and we anonymise some of the types of orders so that they wouldn’t normally be judgments that are public, to give guidance to practitioners particularly around power of attorney applications, defects the Court has accepted as valid or otherwise and things like that. Between the big ticket judgments that the High Court makes, which are on BAILII, and the working level for practitioners there are two modes that we can give guidance on and help make sure the law is working in practice.

Q13 Chris Evans: I want to focus on the Public Guardian’s workload. The volumes of work have been described as "overwhelming". I notice that in the last year the number of lasting power of attorney application forms has doubled, yet the board has said that the number of LPAs needs to be raised further. Under the present system how would you manage that?

Mr John: There are a couple of points within that. We won’t be able to manage that with our current operating model, so we’ve been doing a lot of work to prime the organisation to move in a direction that allows us to deal with greater volumes. We are projecting to receive in excess of 165,000 applications to register in the current financial year, through to March next year. We see that going up the following year to 185,000 and through to in excess of 250,000 applications per annum by the end of the spending review period. So even without significant activity to raise awareness looking at the underlying growth that we’ve seen thus far, and comparing it with other jurisdictions, particularly in Scotland where the adults with incapacity legislation has been in force for some time, we do see a natural growth trend.

Within that though, and I come back to my opening point, a key role for me as Public Guardian is raising awareness and encouraging people to think about the issues of capacity and to plan ahead. With that opportunity, where we want to move is that we are driving that demand and we are managing that demand much more proactively, rather than waiting for the cases to come through. That, again, underpins the kind of changes that we need and we are seeking to make to our operating model.

I make no bones about it. Our IT infrastructure will be key to that. Our process is quite bureaucratic but our opportunity to change that and make that simpler for users is constrained. We are very keen to e-enable much more of the process where possible and certainly to be able to deliver a much slicker service. These are all elements of how we see the OPG of the future over the spending review period, where we will be making significant progress.

Q14 Chris Evans: You mentioned IT. Isn’t that going to take a significant investment? I notice that to catch up you have introduced a second shift in Birmingham. Under the present financial climate, for how long is that sustainable, do you envisage?

Mr John: We have a double-edged sword of being funded by fees. The OPG is 100% funded by fees, so in terms of the day-to-day running costs we have some financial protection, for want of a better phrase, but of course in regard to the timing of that money, we get a delay. When we see the kind of large surge of interest that we had at the beginning of this calendar year on the back of media interest, we are playing catch-up to deal with that as the resource comes in-being able to recycle that and put people and process to that. There is definitely a question for us, and an ongoing conversation for me and OPG with the Ministry of Justice, about how over the spending review period we are able, through a combination of our fees but also with financial support from the Department, to make the kind of investments that we need in the right areas of transformation. The sums do not necessarily need to be huge but, yes, they are significant enough that it would be difficult for me to argue, "Well, we should raise the fees for a year to pay for it in the first year." We need to look at ways, and we’re in those conversations, as you would expect in the context of the spending review allocations, which we have yet to work through fully.

Q15 Chris Evans: When we are talking about IT systems, are we talking about a massive investment or just tweaking with the existing systems we’ve got at the moment?

Mr John: No, I’m firmly of the view that we need to replace the systems that we have. We’ve done quite a lot of tweaking in terms of the process but there are capacity limits. Where our process is predicated on still receiving lots of paper from applicants by way of deeds and application papers, and then being able to process those and scan those so that we can deal with them electronically, it’s not just the IT infrastructure; it is about our process and the offering, if you like, to customers and how we engage with them. We do see they need to be replaced, but what we don’t see as necessary is a very large, all-singing, all-dancing new case-management system. It’s thinking about how technology has developed and how we can use that in proportionate ways. I think e-enablement is a big part of that. It doesn’t need to have huge degrees of technical sophistication. If you look at the banking and insurance sectors and what you can do online with information protections, etc., it is those elements that are at the core of how we see developing the system.

Q16 Chris Evans: At present what is the average time to register an LPA?

Mr John: It is now 11 weeks. It was as high as 14 weeks-nearly 15-earlier in the summer, at the peak when volumes from the spring were coming through. We have steadily knocked that down over the period. Our ambition is to keep improving that performance through to the end of the financial year. That will depend on the work load that we have. We are still just ahead of profile, so in terms of our projections for the year we are still getting in just ahead of what we expected.

Q17 Chris Evans: What is the target then, ultimately?

Mr John: Our published target for this year was that we set a key performance indicator for nine weeks. Because of the work load that came in at the beginning of the new financial year, it was very clear very quickly that we were not going to be able to achieve nine weeks over the whole year. Our ambition is to get as close to that as possible, subject to the resources and subject to the cases coming in. We are at 11 weeks now, but I am keen that we don’t prioritise the new cases at the expense of the cases we’ve already got in hand. It is making sure that we do keep working through those cases that we have, where there are errors that still need to be corrected with clients, but at the same time as new cases come in we are managing those as well as we can.

It’s worth bearing in mind when we talk about nine weeks or 11 weeks that six weeks of that is a statutory waiting time. This is again one of those things we continually need to reinforce in customers’ minds. When they apply to register a lasting power of attorney it is not an overnight process. Even if our administration turned round all it needed to do, front end and back end, in a short period of time, there is still that six-week waiting period.

Q18 Chris Evans: What I am interested in is what impact that second shift has had on taking it down from 14 or 15 to 11 weeks, and how long do you see that second shift having to stay in place?

Mr John: The evening shift was crucial, and it was our key means to be able to respond very quickly to the bow wave of work that we knew was coming. We were able to get that in place much more quickly than the other approaches that we had taken in times past. It has been very successful. We’ve continued its life longer than we originally expected. We thought we’d put it in for a short period of time, but it’s become part of how we do things now. As we continue to move our business out of London and consolidate in the Midlands, there’s an active question for us about whether we retain that evening shift, because it fits with individuals’ personal circumstances, about work-life balance, about us being able to flex to demand where there is media interest that we need to respond to, and because it has worked as well as it has. It is sustainable and certainly it is in our minds to retain it through to the end of the financial year and, as we continue to consolidate our operations in the Midlands, looking at whether that is a long-term feature.

Q19 Chris Evans: One final question. Do you think a change in the regulations, especially to the statutory waiting time, would move things along far quicker?

Mr John: Of course, if we mechanically said, "We don’t need six weeks; we need four weeks", we don’t have the evidence base yet. We are not confident in the evidence base that if we were to reduce six weeks down to four weeks, for argument’s sake, whether or not that would mean objections to registration might fall outside that window. My key focus is on where we are doing the administration, and getting that as slick as possible. As part of that we can come back to whether six weeks is right. We can come back to what we need to do in terms of the process to register a lasting power of attorney and elements to question actually within the lasting power of attorney. That is in our thinking about where there may be measures in secondary legislation, as well as in administration and infrastructure, that we can take to help make the process slicker for users, easier to understand and easier to navigate.

Q20 Mr Buckland: I just want to develop the points that we’ve been dealing with somewhat. We know that these documents are living documents and they are to be used often by ordinary people-deputies out there in the real world. I don’t know whether you are aware, first of all, of the lack of awareness of this particular procedure and the powers that are granted by lasting powers of attorney amongst institutions such as banks and utilities. Secondly, when there is awareness there is a great disparity in practice. For example, a deputy could ring one bank and be asked that before they are dealt with the bank has to speak to the person over which the power exists, which seems self-defeating and ridiculous; or, secondly, a demand by a utility company for a full copy of that rather large document that we’ve been talking about. There doesn’t seem to be, first of all, enough awareness and, secondly, enough consistency of approach amongst a lot of companies and utilities. What work is being done to increase awareness by companies and other bodies about the procedures that exist?

Mr John: There has been a lot of focus, particularly in the banking and building societies industry. Traditionally we have had a relationship with the BBA and the BSA, but equally we at OPG and other practitioners-lawyers and local authorities-have also recognised that the banks, particularly at branch level, don’t quite get it. It is very true to say that at an institutional level there is good guidance. There are central teams that understand the Mental Capacity Act, how to use lasting powers of attorney and how deputyship orders need to be handled, but the real issue is translating that to branch level.

We very recently sat down with the BBA and the major banks to say, "Okay, come on, guys, let’s see what else we can do now," on the back of the kind of experience and the kind of feedback that we get from customers. As you say, you walk into a branch and somebody looks a bit blank and says, "Oh", or says, "I’ll need to see the donor". We are aware of those practical issues and are working very hard now with the banking industry, with the legal profession and with the third sector, Age UK particularly, to say, "Okay, what other progress can we make?" so that people can come in more confidently and get a consistent service or, where they don’t get a consistent service, they can be clear and point to it and say, "Hang on, this says-".

There will very frequently be a need for an individual to lodge a copy of the lasting power of attorney with the institution. We recognise that can be an obstacle in terms of getting sufficient copies produced. It is an area that’s in our minds again in developing the process. Is there some other way to effect proof of that lasting power of attorney being there that is legally sustainable, that recognises that power of attorney is a deed, but is more user-friendly, if you like?

Coming back to the point generally about awareness and the Mental Capacity Act, I have often said that its effect is about attitudes and behaviours. It is not a mechanical piece of legislation: it is about how it seeps into the culture. For that kind of legislation three years is still relatively early days. There is not much jurisprudence from the Court and we still need to keep working to identify where there are pockets of good practice and also where there are areas to improve. We know that certainly with banking and the building societies there is more that can be done. The BBA and the BSA are receptive to helping us do that.

Q21 Mr Llwyd: I would like to ask you a few questions on the issue of costs. There is an initial fee of £120 to register a lasting power of attorney. If a court hearing is necessary there is an additional £500. Do you think these fees deter people from making an LPA and registering? What are you doing to try and keep the costs down?

Mr John: It’s easy for us sometimes to get mixed between the different fees. Certainly I have fees for OPG and the Court has fees for its applications and for hearings. For a lasting power of attorney the fee is £120 now. We reduced that from £150 at introduction in April 2009. Our experience immediately upon implementation of the Act was that this was not a price-sensitive market. The volume of work that we were getting showed that the £150 fee was not deterring applicants.

Having reduced it to £120 and having continued to see the growth, that is still our view but that takes nothing away from the recognition that it is a potential obstacle. We do have an exemption and remissions scheme. Individuals receiving qualifying benefits are exempt from the fee. Remissions are available on an income basis, so the full fee may not necessarily be payable. But, yes, again, moving into the medium to long term, we want to be able to change the operating model to allow us to push down on the cost to deal with that application and to process that work, and also to bear in mind conducting the compliance and investigation work that we do. Part of that fee contributes not just to corporate overheads, customer contact, etc, but to my compliance and investigations team that deals with allegations received against attorneys and deputies and where, frankly, it is very, very difficult or nigh on impossible to charge who is being investigated for that work, not least when the allegation may be unfounded.

For where we are the fee has proved to be sustainable, certainly seeing the volume of work that we’ve received, but going forward it is absolutely in our minds to see what else we can do to push that down and reduce the risk of its being an obstacle to take-up.

Q22 Mr Llwyd: This may be a question for Mr Thompson. Are you concerned about the fees that deputies are charging? I am told that a London-based solicitor acting as a deputy would expect to receive £409 per hour. Do you think that this is right when some of the work they will do will be paying utility bills and so on? Why has the amount approved doubled in the last four years?

Mr Thompson: The £409 that you specifically refer to there is the band A fee-charger but only for a solicitor based in the City of London. To my knowledge there is only one Receiver based in the City of London who would be eligible to charge that. The wider level payable in London is in fact £317 an hour, but that is a minor point.

The issue here is that the Court has made a decision that the most appropriate person to be the deputy is a professional. In fact, over 51% of deputies are in fact family members, and 22% are professionals-solicitors, accountants and the like. First of all, it is a Court decision, which is obviously challengeable by family members if they feel it appropriate to do so, to appoint somebody who has to then charge professional fees.

The safety net in relation to the costs is the assessment of costs by the Senior Courts Costs Office. If a professional doesn’t want to accept the fixed costs, which are some £1,400 a year, for the management of P’s estate, then they have to submit a detailed bill of costs for detailed assessment by either judges or costs officers at the Senior Courts Costs Office. They will tax off or downgrade the hourly rate for the work, depending upon what it is. For example, the payment of a utility bill would never have been allowed to have been charged at the band A fee-earner rate. That would have been pushed right down to the lowest fee-earning level, as it would be in all civil and family costs that the Senior Courts Costs Office tax.

Q23 Mr Llwyd: So the bill would go to a Taxing Master in the Royal Courts?

Mr Thompson: A Taxing Judge these days, yes, or a costs officer.

Mr Llwyd: What used to be called the Taxing Master. I am showing my age again, I’m afraid.

Q24 Chair: Can you just clarify the circumstances in which the Court would have insisted that it was a professional who was the deputy?

Mr Thompson: In some cases there is no family member who is prepared to take on what are obviously onerous and time-demanding responsibilities, and in some cases exceptionally complex. A lot of the cases that solicitors act in are the multi-million pound damages awards to road traffic accident victims and birth injury, where another court has awarded a specific multi-million pound settlement. Often within that settlement there will be a specific head of damage that recognises there is going to be this ongoing professional charge made against the estate, and therefore a specific sum of money is added to the general damages to say "and that will offset those ongoing costs against the estate".

Q25 Yasmin Qureshi: Just carrying on from this, if I understand what you are saying, when a professional is appointed of eight years’ experience or more in the City of London then they charge £409 per hour.

Mr Thompson: Yes.

Q26 Yasmin Qureshi: And that is for everything that they do in relation to that person. Don’t you think that is an excessive amount?

Mr Thompson: Only in relation to what they, as an individual, do. A lot of the functions and tasks that are completed within that year by that professional will in fact be done by a junior member of staff within that firm. That will then not be the £409. As I say, there is only one case I am aware of where there is a deputy from the City of London. That is a City of London hourly rate for band A fee-earners. The Greater London area is £317.

Mr John: Perhaps I can add my perspective as Public Guardian. Obviously when a deputy is appointed by the Court I then have a role to supervise that deputy. In my experience a professional is appointed, very typically by the Court, as David has said, when there is a large amount to manage or there are particular complexities to the estate. They can also be appointed, to be frank, where there is family strife and the Court feels an independent person or individual is needed because of the tension in the family. Those are the types of cases that I will typically supervise in a higher level of supervision because of the potential for wrangling, and because they can add to the costs. We can’t take anything away from a deputy’s actions. It is quite right that when a solicitor is acting on behalf of P-in engaging P, in making decisions, in understanding that those that have an interest and a stake in P’s well-being are engaged and involved-where the family situation is more difficult, that will be more work for the solicitor.

Q27 Yasmin Qureshi: So you are comfortable with this figure? Let me declare an interest here. I used to be a barrister. I can remember doing massive trials, six or seven-handed cases with a number of QCs, and whatever. Most of us would be completely stunned. I know those cases were complicated, with so much evidence and so much paperwork to go through, videos and whatever, but to pay £409 per hour seems excessive.

Mr Thompson: These are the rates that are applicable in all private civil litigation, and that is what this is. It is not a legally-aided funded part of the costs at all. Either the £409 or the £317 is exactly the same hourly rate that you would find in any other part of civil litigation where it is privately funded.

Q28 Yasmin Qureshi: We are talking about big commercial firms, aren’t we-the Slaughter and Mays and those types? But here we are talking about people with mental capacity issues.

Mr Thompson: Yes.

Q29 Yasmin Qureshi: Although there may be some with big estates because they’ve got compensation of excessive amount, the majority are not in that category. Putting in the same salary scales as, say, Slaughter and May or Clifford Chance, where big companies couldn’t care a toss how much they are paid because in essence it’s a tax write-off, does seem excessive here.

Mr Thompson: But they are the £409, and as I said, there is only one that earns that. The point remains that the Court has made a decision that a professional is required, and that has to be paid for. The costs office is there to ensure that on taxation and assessment it is a reasonable hourly rate for the work claimed to be done. Any party member can apply if they want to take over from that. The Public Guardian can make an application to stand the professional aside. There are a number of ways that we can change who the deputy is.

Going back to another part of your initial question on this, you were concerned, or expressing an issue, about the rising costs over the last couple of years generally. I think Martin did just touch on that, in that this Act requires a different approach to decision making than the previous Mental Health Act legislation did. They were called receivers before the Mental Capacity Act came in. The actual receiver was the Court and it delegated its powers to receivers, and they had absolute power.

This Act requires a deputy first of all to consider: does P, who the legislation refers to as the person lacking capacity, have an ability to contribute to this decision at this time? It is very decision-specific and it is very time-specific. It is right for P that the deputies who have this authority have to challenge themselves about whether they are taking into account P’s ability to contribute to that decision. But unfortunately that does create some cost. It may require the deputy to visit P more often to have a conversation about the decision that has to be made, and that meeting has to be paid for. It has given P more rights, if you like, and a better voice than the previous legislation, but where you have a professional deputy in place it does come at a cost. There are some cases where P’s lack of capacity is so extreme that you couldn’t justify visiting P; but where P’s capacity does enable them to make a contribution it is absolutely right that they are enabled to do that.

Q30 Chair: You might have to visit the person in order to establish whether the need was being properly met, might you not?

Mr John: I can add to what David has said around some of the other protections, in my role in supervising deputies. There is an annual reporting process and that is not, for a financial deputy, just, "Does the money balance?" It is an account of what decisions have needed to be made; were there particularly contentious issues and how was the deputy involved with P? I would expect the deputy to have made arrangements to engage with P over the course of the year. For professionals, that won’t always necessarily be that individual, but they will have empowered somebody else to have that engagement.

I have Court of Protection visitors. It is a bit of a misnomer. They are called "Court of Protection" even though they are commissioned by me as Public Guardian. Our visitors, as part of my supervision regime, will go out and will regularly be engaging P and the deputy. There is an opportunity to say, "Well, hang on, are these arrangements proportionate?" Sometimes we find professionals where the arrangements are disproportionate.

I would never directly gainsay a costs office assessment, but if we have concerns about how a professional is acting, I would seek to confirm that they had had all their costs assessed by the costs office. As David said, in extreme circumstances where we think the deputy is not acting in P’s best interests because they are overloading with bureaucracy or they are not engaging in the right way, I will apply back to the Court to say, "This is not appropriate; this deputy is not the right person."

As David said, the majority of deputies are lay individuals. They are family members; they are friends; they are relatives. Local authorities play a big role particularly in providing deputyship services for those with the lowest means or those where there is no alternative. Professionals do play an important part in that overall landscape. The Court will quite rightly consider, with some rigour, whether or not the professional is the right person.

Q31 Mr Llwyd: Mr Thompson was saying earlier on that the scale of fees charged is linked to privately funded civil litigation. I am not aware of those fees having doubled over four years, I must say.

Mr Thompson: No, the fees haven’t. I think the suggestion is that the average professional’s costs are going up more than the rate of inflation and by more than the hourly rate charged because more work is being done; so the hours charged against the client are more.

Q32 Mr Llwyd: I don’t want to labour the point, but surely what was said earlier on was that it is linked to the hourly rate of a solicitor in London. I am not aware of that hourly rate having gone up.

Mr Thompson: No, it hasn’t. The number of chargeable hours has increased rather than the rate.

Q33 Mr Llwyd: Can I ask you one other point, if I might? You will know that there has been criticism of the interest rates applied to funds. This may or may not be a question for you-I am not sure who is dealing with it.

Mr John: We will work it out.

Mr Llwyd: You can pass the ball to each other and pass it back again. I understand that deputies are free to move money to various investments where they see opportunities. Are they given firm, good investment advice? I’m a lawyer and I wouldn’t know one investment from the next, I am sorry to say, which is probably why I’m in Parliament and not making a lot of money.

The other question I want to ask you is: do you do any routine monitoring of the way in which funds are invested by individuals?

Mr John: I will take this point. In supervising deputies, my staff and I are not financial advisers either. The Court in its orders will, on occasion, direct that the deputy does engage financial advice, so part of what I would do in supervising is to check that they have engaged an independent financial adviser and they have put an investment package together for the moneys that are there.

On the basic point about whether a deputy chooses to keep their money in a special account in the Court Funds Office and might move it somewhere else, the most we might want to do is to ask the deputy to consider whether or not they might want to move or differentiate that. We wouldn’t necessarily penalise the deputy for keeping it there because, of course, there is a 100% guarantee for that money. There is that balance.

We have seen a variety of practice. Some deputies have been taking £50,000 packages and working out which banks are separate from each other, to put those into interest-bearing accounts to increase the return but retain a chunk of money in a special account. Others have chosen to say, "That’s convenient; it’s safe. These circumstances are such that maximising the rate of return is less of an issue and security is something that I value more."

It is something where we will, in the course of our supervision activity, periodically prompt and say, "Have you thought?" Again, this is one of these cultural things. The money doesn’t need to be in the Court Funds Office now. Typically in times past the Court would say, "Put your money in the Court Funds Office", and that’s that. With receivers in times past-now deputies-changing that behaviour and that attitude is difficult. They are used to the money being there and they are used to saying that the Court controls that. The new deputies are much more open to much more immediately thinking about, "Where is the money? How do I manage it to best effect?" There won’t necessarily be an amount sitting in the Court Funds Office anyway.

Q34 Mr Buckland: Can I move on now to the question of children and young adults-mentally disabled children and their families? We know that there is an obligation upon parents to apply to the OPG when children reach the age of 18, or sometimes 16, as the case may be, to become deputies and to register their children or young people as donors. Is the one-size-fits-all approach the right one? You know what I mean by that; there is a range. There are some examples where young people will have received substantial damages for a negligence claim, either a settlement or successful litigation, but a lot of families will be on benefits and will not have large amounts of money and will find the £120 fee quite an onerous bill. Is the one-size-fits-all approach the right one?

Mr John: I will start and David may want to add something. Typically in those situations it will be, "Okay, the individual is now an adult," and the parents need the legal ability to act on behalf of that individual. If they have assets, or if they are receiving anything more than benefits, they will need to think about whether they need to apply for deputyship and apply to the Court of Protection to be certainly a property and affairs deputy, and potentially to ask whether they can and should also be a welfare deputy. That is not a hard and fast rule, so it is not one size fits all. The framework that the Mental Capacity Act provides, and within which the Court makes its decisions, purposely has a huge continuum of options available, but there is typically a single access point, which is to apply to the Court and the Court determines the kind of order and kind of powers that are there.

If an adult child in transition purely has benefits as an income then there isn’t an empirical need to have a deputyship, but parents may wish to apply for deputyship, not least to provide for future circumstances. If that individual should benefit from a bequest-if they are a beneficiary of the parents’ will-thinking in terms of a future point of time when they may have assets or they may have more money than just benefits, a deputyship would be necessary.

I recognise that this is coming back to the point about awareness and the right information at the right time. It is quite a difficult and subtle area and where we rely on social services, particularly in their engagement around that transition period for children with learning disabilities moving from child to adult. I am not saying there isn’t more that can be done, but again I think it comes to this point about the cultural nature of the Act and how that seeps in. Definitely the question needs to be in parents’ minds.

Something that has come up is the point about welfare deputyship. Certainly many parents of adult children with learning disabilities want to be welfare deputies. The Court takes an attitude, "Well, it’s not always necessary." There have been some questions about the extent to which that is right as a mechanism. Again, I come back to this: it is within the range of opportunities or options that is available to the Court in the framework. It is by far from a one-size-fits-all system.

Q35 Mr Buckland: Thank you for that answer, but are we not in a situation where the gateway is overly prescriptive? In effect, we are saying-I think this is what the Minister actually suggested-that we were in the position where in the former regime you would register and then checks would be made when things went wrong. But we are now in a situation where, whatever the status, the system has become overly bureaucratic from the outset.

Mr John: It is easy to allow powers of attorney and deputyship to overlap. In terms of the making and registering of a power of attorney, that can only be done where the donor has capacity to do that. Some children with learning disabilities will have sufficient capacity to be able to make a power of attorney for themselves and to make their wishes known. Where there is an ability to exercise choice and somebody has the capacity to make a lasting power of attorney, yes, parents should be thinking about that. Then that power is made and it is registered. There is no other intervention unless there are some issues, or an allegation or concern is raised.

On the deputyship side of things, the basic approach is in principle very similar to prior to the Mental Capacity Act. You need to apply to the Court of Protection in order to get that formal authority. I come back to the point about awareness. Yes, there is a degree of bureaucracy. There is very little to do to pre-prepare for an individual with severe learning difficulties. Against that though, the basic premise of the Act is: does an individual have capacity to make decisions-some decisions, maybe not all decisions? There is a risk of parents being overly paternalistic and protective-"My child doesn’t have the capacity to make decisions." An alternative approach might unwittingly allow parents to sustain that position when actually the child is able to make some decisions. That is where, again, the Court process, and the approach that ensures P is engaged, which ensures that if the Court has any concerns about P’s capacity it can say, "Well let’s just check that out", is an important protection and an important mechanism.

Q36 Yasmin Qureshi: Can I ask a question arising from what my colleague was asking? It is just a clarification. If the parents of an adult child want to become a deputy or take over the LPA, are there fees for that as well?

Mr John: There will always be a fee, yes, either to apply to Court or to register a lasting power of attorney.

Q37 Yasmin Qureshi: If the parents are on benefits and the person is on benefits, are any exemptions made?

Mr John: Both the OPG and the Court have an exemptions and remissions policies, so if the child is in receipt of qualifying benefits then they would qualify for an exemption or a remission.

Mr Thompson: Or indeed if the only income is the benefit then you don’t need a deputyship at all; you can become an appointee through a DWP scheme. The only point, as Martin was saying, is that might suit today’s circumstances, but if in five years’ time there was an inheritance from a grandparent, then you are going to need somebody else who can administer that on behalf of the child, or the adult. There is a spectrum between protection and empowerment. The state through the Mental Capacity Act has said that if there is an adult without capacity with money the court must decide, if there is no LPA, who is going to look after that, or administer that estate. The challenge in terms of the bureaucracy is how much trust there is <?oasys [pc10p0] ?>for loving family members to do that without overt supervision. Many years ago, the predecessor to Martin’s organisation, in checking the annual accounts, would have expected, and insisted upon, a receipt for literally everything-a bunch of flowers for mother or a box of chocolates. It was an exceptionally, overly non-trusting environment. I think every jurisdiction struggles with, "Where does it land on that spectrum?"

Q38 Yasmin Qureshi: Coming on to the Office of the Public Guardian Board, which as you know is now in the process of being abolished, do you think it has served a useful role? Have you been consulted by the Ministry of Justice as to what is going to replace it?

Mr John: Taking the latter point first, yes, absolutely. I have had a close and constructive relationship with the Public Guardian Board since I have been in post. I think at times the board has struggled to get its head round its statutory remit which is quite narrowly defined. It is there to scrutinise and review what I do as Public Guardian. In reality, naturally, the board has sought to open out a little bit more, to comment on the operation of the Mental Capacity Act, but with a particular focus on my function as Public Guardian and therefore the Office of Public Guardian. I think it has done that and done that ably.

The question for Parliament in the Public Bodies Bill is whether or not that is a proportionate mechanism and whether or not, in governance terms, there are more cost-effective and proportionate approaches. That is what I have been involved in with the Chair of the Public Guardian Board, Rosie Varley, in identifying what will be the mode of governance going forward. We have considered it, and I think it fair to say that the Chair and the board at large have been very supportive. They have recognised and accepted the rationale why they feature in the Public Bodies Bill and are subject to being abolished, and have worked very positively to say, "Okay, what would be a positive way to govern this organisation?"

The OPG is an executive agency. We are not a non-departmental public body. We are part of the Ministry of Justice so we already have a degree of governance and performance management. As an accounting officer, obviously I am subject to controls and scrutiny. What we are looking at, and what Ministers will decide in due course, is what else an OPG management board will add to that in terms of non-executive influence, giving confidence to stakeholders and assurance to Ministers. That is an active issue at the moment.

Chair: We have a responsibility to keep an eye on you and on what the Ministry of Justice does-amongst quite a large number of organisations, it has to be said. Thank you very much, Mr John and Mr Thompson, for your help this morning. We are most grateful.

Prepared 25th April 2012