Court Funds Office: change to interest rate for basic accounts

View profile for Kelly Knight
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As of the 6th June 2016, the Court Funds Office (CFO) is changing the interest rate payable to funds held in a basic account to 0.1%.

With the true rate of inflation at around 2% to 2.5% per annum, this means that leaving money in an account at the Court Funds Office would see an erosion in the true value of the capital over time. Leaving money in any account over the long term with a return of less than the true rate of inflation would see the true value of the funds decrease.

If the funds held in the CFO are there to compensate someone for an injury, their original award will have been reduced to take account of it being invested and achieving a reasonable rate of return over their lifetime.   It is, therefore, vitally important to ensure that the award is invested wisely providing a return that maintains the value of the funds in line with/or above inflation but also one that does not put the funds at risk unnecessarily.

It is therefore imperative that where deputies continue to invest their client’s funds at the Court Funds Office that they review this and take investment advice from a qualified advisor in order to maximise the individual’s money.  Under the new Deputy Standards, this is one of the key principles that a deputy needs to be aware of and is a something that the Office of the Public Guardian will keep under review through their monitoring process.

Deputies will need to check their deputyship order to ensure that they have the necessary authority to remove funds from the Court Funds Office and to take investment advice from a suitably qualified advisor. If you require further advice on this or assistance with a court application then please contact Hyphen Law as we will able to help you with this.