Equity release schemes ‘should be better regulated to protect elderly’

GREATER regulation is needed for equity release schemes aimed at property-rich older people, according to a new Law Reform Commission report.

In a bid to copper-fasten the welfare and rights of elderly homeowners, the commission wants to see all types of equity release schemes — many of which are aimed at older people — coming under the Irish Financial Services Regulatory Authority’s (IFSRA) jurisdiction. According to the commission, some equity release schemes have been designed so that they are not financial products, preventing the IFSRA from regulating these schemes.

The report on vulnerable adults and the law, which is being published later today by the commission, also wants to see clear rules on when a person is in their right mind to make a legally-binding decision, such as a property transaction or a health care agreement.

The report, which will be officially launched by Health Minister Mary Harney at the commission’s offices, examines issues surrounding the law and older people; and the law concerning adults whose ability to make decisions may be limited through intellectual disability, dementia or an acquired brain injury (such as in a car crash).

The commission aims to promote the empowerment of vulnerable adults, while also recognising that some protections are still needed.

Its proposed new law should include a clear presumption that all people over 18 should be presumed to have mental capacity and that no intervention can take place unless it is necessary for the person.

At present, says the report, many routine health care treatments — such as dental treatment — are carried out for adults who have limited or no capacity on the basis of “consent forms” signed by a relative.

These consent forms have no legal standing, and technically they could be regarded as assaults.

The commission recommends that this should be dealt with by stating in the proposed law that such routine treatments are lawful if they are clearly in the person’s best interests: this is called an informal authority to act.

The commission wants the Health Minister to appoint a working group on capacity to make health care decisions, to formulate a code of practice for health professionals.

It also recommends that enduring power of attorney, which currently covers financial decisions only, should be extended to include minor health care and treatment decisions.

The High Court wards of court system needs to be replaced by a guardianship scheme, where a guardianship board would decide whether people of limited mental capacity had the ability to make decisions for themselves, it says.

According to today’s report, this could include deciding that a personal guardian should manage a limited aspect of the person’s financial affairs, but not necessarily everything.