Deliberate deprivation of assets is when the local authority deems that a person has deliberately disposed of assets to increase eligibility for local authority funding. This might include giving away (gifting) assets, as well as other courses of action, such as selling an asset for less than its true value.
A recent case, decided on the 14th September 2018, is a useful reminder that when considering deliberate deprivation it is essential that the local authority look closely at the intentional aspect of deprivation and not just infer it from the proximity of the gift to the need for care.
In this case South Gloucestershire Council has been asked to apologise to an elderly couple after deciding they deliberately deprived themselves of capital in order to reduce the husband’s care costs. The scenario is outlined below:
The husband, who has a number of health conditions including Parkinson’s disease and dementia, had been living with his wife in their family home. Over the years the family had spent significant sums to adapt the home and garden to ensure he could remain there for as long as possible.
In the 1980s and 1990s the couple gave three of their children help to purchase their houses. Their fourth child had been living in accommodation tied to her husband’s job, and so had not needed help to buy until he retired.
The husband’s condition deteriorated at the same time as the couple’s daughter needed help to buy a house.
He was placed in a nursing home and a financial assessment of the couple took into account the money they had recently given to their daughter and son-in-law. This meant they had to pay the full cost of his care, which they said they could not afford.
The Local Government & Social Care Ombudsman found the local council did not take into consideration all the relevant facts when it decided the couple had deliberately deprived themselves of their assets.
The council did not fully explore the reasons why the couple had transferred money to their daughter and son-in-law, before reaching its decision, and did not provide the couple with the reasons for its decision.
The decision also provides a very helpful reminder of the way in which a local authority should approach issues of potential deliberate deprivation. Further details of this case are available via the link below.
Chartered Financial Planner