The 71-year-old is facing nine counts of fraudulently obtaining cash by falsely declaring his income between 2003 and 2007.
But experts have diagnosed him with a “depressive illness” and said he would have “difficulties instructing his legal advisor or follow court proceedings”.
Prof Don Grubin, a specialist in forensic psychiatrist at Newcastle University who also works with Northumberland Tyne and Wear NHS Foundation Trust, told a court hearing Sayers suffered from “depressive episodes”.
He said: “It’s right that I have seen the defendant John Brian Sayers and prepared reports on him in relation to whether he is fit to plead or not.”
The allegations date back to 2003 and defence barristers have staged a three-year fight to prove their client is not able to go before a jury.
Now prosecutors have accepted he is unable to plead due to his mental state and he will now appear before Newcastle Crown Court for an issue of trial hearing.
Judge James Goss said: “I’ve read the medical reports in this case and the evidence of Prof Don Grubin and Dr James Stoddart.
“Whatever the cause of the current state of defendant, I’m satisfied on the written and oral evidence that’s been placed before me he’s not fit to plead and therefore stand his trial.
“This is on the basis of the difficulty he would have with following his trial and instructing his legal advisors.”
