Funeral Payments are available to people who receive certain income-related benefits to help pay for a simple funeral of an immediate friend or relative. It allows them to receive up to £700 for funeral expenses, such as funeral director’s fees, the coffin, flowers and travel.

However critics argued that these payments have failed to keep up with the increasing cost of funerals and concerns have been raised over a lack of clarity on eligibility criteria.

The government launched a consultation on Funeral Payments this summer and it has now revealed a number of changes to the system, including:

• Allowing Funeral Payment recipients to receive contributions from relatives, friends or charities without it being deducted from the payment
• Extending the claim period from three to six months from the date of the funeral
• Evidence to be submitted electronically to speed up the claim process
• Introducing a shorter application form for children’s funerals.

Minister for family support, housing and child maintenance, Caroline Dinenage, said: “Losing a loved one is a sad and difficult time and we want to make the process of claiming a funeral payment as simple as possible.”

However, while Royal London said this is a step in the right direction, the government should have gone one step further to increase the payment amount to offset the rising cost of funerals.

Its National Funeral Cost Index 2017 found that funeral poverty has reached an all-time high of £160m with those struggling to pay funeral costs taking on an average debt of £1,680.

Further, the average cost of a funeral in the UK rose 3% from 2016 to £3,784, and the gap between the amount received from the government and the average funeral cost continues to widen, with bereaved people facing a £2,355 shortfall.

Louise Eaton-Terry, funeral cost expert at Royal London, said: “Funeral costs continue to increase above inflation year-on-year, with our research showing that bereaved families who qualify for the fund face a shortfall of more than £2,000 to cover the cost of a funeral.

“While these reforms are a step in the right direction, they fail to address the value of the award and we want the government to go further and commit to increasing the value of the social fund funeral expenses payment.”

The government hopes to bring in the new regulations from spring 2018.