The cost of guardianship

As Adrian Ward’s article on p 9 of this issue conveys, there is a current consultation reviewing Scottish Court Service fees, which includes proposed increases to the Public Guardian’s fees. The Scottish Government’s policy is that fees should be based on the principle of “full-cost pricing” or full cost recovery, so that the costs of the service provided are met by the person who uses that service (subject to reductions or exemptions for people who cannot afford to pay the full cost).

The financial memorandum which preceded the Adults with Incapacity (Scotland) Act 2000 committed to the policy that the fees charged by the Public Guardian would cover the cost of providing the service, such that the public purse would not have to subsidise this. This has never proved to be the case. The level of recovery on OPG fees dropped steadily over the years to around 48% of the cost of the service provided, i.e. the public purse was funding the majority of the OPG service.

Consequently, OPG fees were increased in July 2007. This was the first increase since the inception of the OPG in 2001, but the position was such that above inflationary increases were necessary. The incremental increase now proposed, in addition to that of July 2007, reduces the public subsidy on the OPG service to 21%. In line with the rest of the Court Service, the OPG has a well-targeted system of fee exemptions for those experiencing financial hardship.

Submission fees

The OPG acknowledges that fees increases are never welcome and that there has been a particular response to the introduction of a “per-submission” fee for a power of attorney document. This fee reflects the duplication of administrative time which is necessary to rework documents that are submitted on second or subsequent occasions because of faults with the original submission.

There are statutory criteria for registration against which a power of attorney must be checked by the Public Guardian before it can be deemed registrable, or not, as a valid document. Of all documents submitted, 20% failed to meet registration criteria.

The check process has to be repeated when a document is re-submitted. Ideally, the Public Guardian would like simply to review the particular section of the document that was subject to correction, but in practice it is actually more efficient to start the check process afresh.

Within the consultation document, the “per submission” fee is still shown. However, the Public Guardian has already suggested that consideration is given to leaving the fee for a second or subsequent submission at £60, the increase to £70 only affecting first submissions. This has been met positively by the Scottish Court Service.

To avoid unnecessary re-submission fees, the OPG agreed an internal policy of only levying these where a document was rejected because it failed to meet statutory validity/registration criteria.

A resubmission fee is not levied, for example, for a typographical error. This policy will remain even if a differential fee for first and subsequent submissions is implemented.

The most common reasons for rejecting a power of attorney arise from drafting errors in the completion of the prescribed certificate or related matters, such as omission of necessary dates or inclusion of an incorrect name. As a result of this, the OPG was instrumental in having the Scottish Government agree to a single certificate and in a re-prescribed format. This change was one of those made to the 2000 Act under part 2 of the Adult Support and Protection (Scotland) Act 2007. The revised format certificate (which comes into effect on 1 April 2008) aims to address all the current common failings and, it is hoped, will therefore markedly reduce the number of occasions on which a second submission will become necessary.

Additionally, the Public Guardian’s website has a checklist against which a power of attorney document can be assessed prior to submission.

Coming shortly

The changes to the 2000 Act by the 2007 Act were very helpfully summarised in Adrian Ward’s article “Adult Support: a new generation” (Journal, June 2007, 20). Certain provisions commenced on 5 October 2007; the remainder will come into force on 1 April.

One of the key changes from 1 April is the new part 3 of the 2000 Act, Access to Funds. The current part 3 will be completely revoked and replaced by the revised scheme. The markedly more flexible re-engineered scheme may be a suitable alternative to guardianship, or combined with an intervention order may be sufficient to safeguard an adult’s estate. More details of the revised scheme can be found on the Public Guardian’s website.

Another matter, one which impacts signficantly on the financial burden of guardianship, is caution. Under changes to the cautionary provisions from 1 April 2008, a sheriff “may” fix caution or request other securities in lieu. To further assist in relieving this particular financial burden, the Public Guardian is currently negotiating an agreement with Norwich Union under which they would provide an alternative cautionary arrangement.

Norwich Union are willing to accept a guardian’s suitability by virtue of the court appointment process and the ongoing supervision of the Public Guardian. Consequently, it will be unncessary for a guardian to submit a lengthy application proforma revealing personal financial information. A simple confirmation of their name, address, adult’s name and cautionary amount will be all that is required. Additionally, Norwich Union do not levy a minimum premium; this will advantage smaller estates where the annual premium will be pro rata to the size of the estate. Discussions are in their final stages; as soon as these are completed more detailed information will be provided.

In conclusion, the Public Guardian is acutely aware of the financial impact of applications to safeguard the estates of vulnerable adults, but it is necessary for us to cover the cost of the service provided by the OPG. The Public Guardian has worked proactively, in a variety of ways, to limit the financial burden and will continue to take action to limit costs as far as is possible.

www.publicguardian-scotland.gov.uk