Elderly People: Powers of Attorney and Living Wills Debate
Full Debate: Read Full DebateLord Hodgson of Astley Abbotts
Main Page: Lord Hodgson of Astley Abbotts (Conservative - Life peer)Department Debates - View all Lord Hodgson of Astley Abbotts's debates with the Department of Health and Social Care
(9 years, 7 months ago)
Lords ChamberMy Lords, I begin by thanking the noble Baroness, Lady Bakewell, not only for giving us the chance to debate this important matter, but for having introduced the whole subject with such a clear and informative exposition which has laid out very clearly the challenges we face.
In my few moments I do not want to merely repeat much of what she has said. I found her arguments persuasive, and I agree with them in large measure. I want to raise an associated issue which concerns wills, powers of attorney, and the flow of funds to voluntary groups, many of which are providing services to dementia sufferers. Like the noble Baroness I fear there is another issue which may be falling between different governmental stools. Some noble Lords will be aware that I undertook the review of the Charities Act for the Government. A couple of years ago I produced a report about it entitled Trusted and Independent: Giving charity back to charities. There were a number of proposals to try and improve the position of charities, some of which have formed the basis for legislation now before your Lordships’ House, including the Protection of Charities Bill, which is in pre-legislative scrutiny. One issue that was raised was the number of charities. There are over 160,000 registered charities, and probably as many again unregistered charities, so in all a third of a million charities. There were great concerns about duplication. Many members of the public felt that charities were overlapping and that money was being spent on administration and fundraising which could be better deployed in providing the services for which the charities had been established in the first place.
There is room for a debate on that topic, but not tonight. The freedom for people to decide what they do with their voluntary giving seems a pretty important principle. But there is an issue as to why charities do not merge. In my research, this is for one of two reasons. One is amour propre among the trustees, they cannot bear to collaborate and they would rather work on their own than work together. But there is another important technical reason that concerns bequests and wills. This is where we come to the relevance of our debate tonight. As many Lords will know, bequests and wills are a very important source of fund-raising for charities, but they obviously take time to emerge because unfortunately it requires the person who made the bequest to die before the money changes hands. Importantly, where two charities merge, and as a result one disappears, a bequest to the latter may well be null and void unless the wills are drawn appropriately widely.
I will give a quick example. Let us assume that the noble Baroness, Lady Bakewell, and I have both set up separate dementia charities, and after a period of time we agree that we should merge them. We go to the Charity Commission, we get it blessed, and it is all done properly and above board. We also agree that because her charity is larger and more famous than mine, hers should be the surviving charity, and that the Hodgson charity should just disappear. But if the Hodgson charity was hoping for a legacy, it may be that because of the way trust law is drawn, that bequest will be null and void, because there is no longer a Hodgson charity to which the bequest can go, and therefore the bequest must go back into the estate from which it was originally drawn. That seems to me an entirely counterintuitive outcome. The person leaving the money wishes to leave some to the dementia sector, and the merger has been approved by the regulator—so why should the bequest then fall foul of what I would consider a narrow technicality? I understand that that is not my noble friend’s direct responsibility, but I use this opportunity to urge him to remind his colleagues in the Ministry of Justice and the Cabinet Office, as well as the Law Commission, that there is an issue here that is worth tackling. It applies with equal force to powers of attorney, to which the noble Baroness referred. As people live longer, there may be longer periods when they are not compos mentis. The role of family members and advisers holding a power of attorney needs to be similarly properly and widely drawn to avoid the counterintuitive outcomes that I have just described. I am not clear whether the prescribed form of the lasting power of attorney has sufficient flexibility built into it to enable this to happen.
Finally, this issue also applies to standing orders and direct debits. Banks will refuse to redirect such payments to the surviving entity. Instead, they require all direct debits and standing orders to be re-signed. Noble Lords will be perfectly aware that if you tried to get all direct debits and standing orders re-signed, the fall-out rate would be very high indeed, with a very big consequential loss of funding to the charity hoping to receive them.
To conclude, the issue of the implications of dementia is an important and growing topic. My intervention seeks merely to urge the Government to ensure that legal practices are kept up to date with the evolving conditions of our society and, in so doing, maintain the badly needed flow of funding to charitable and voluntary groups, dealing with the very difficult problems of our society, including dementia and other progressive diseases.