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Funeral sector ‘not working well’ and ‘reforms needed’, regulator says

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13/08/2020
A number of issues in the funeral and crematoria sector have been raised by the competition regulator, namely inconsistent pricing and products as well as a lack of choice for bereaved families.

The Competition and Markets Authority (CMA) launched an investigation into the funerals sector in March 2019 and it has today published its provisional findings.

The regulator said that due to the naturally distressing time when arranging a funeral, the bereaved tend not to spend time comparing providers, typically choosing a recommended funeral director.

For cremations, people generally select the closest to them and the CMA said people “have little or no choice about which crematorium to use” as there’s only one option within a reasonable distance.

The regulator also said that pricing and product information isn’t consistent so people can’t easily compare different offers.

Many mistakenly believe funeral directors are regulated, but this isn’t the case in England, Wales and Northern Ireland. While many funeral directors meet good standards, some are providing unacceptably low levels of care of the deceased, the CMA said.

Further, fees charged by funeral directors and crematoria increased at a rate well above inflation for at least a decade.

Next steps for the sector

The CMA did note that coronavirus has severely impacted the investigation; with many more deaths, there has been unprecedented demand for funerals and with the lockdown restrictions, services have changed.

It previously considered setting a funeral price cap but this couldn’t be safely introduced during the national emergency.

The report stated: “This combination of circumstances highlights a serious dilemma. On the one hand, it is clear that the funerals sector is not working well and that reforms will be needed. On the other hand, the pandemic has created insurmountable obstacles to some of the solutions needed to design and implement far-reaching reform of the sector at this stage.”

However, it has provisionally decided that, in the short-term, all funeral directors and crematoria should provide customers with information on, and the prices of, various services and packages they offer.

The CMA also proposes to continue monitoring the sector, with funeral directors and crematoria obligated to provide financial data quarterly.

It is also proposing for the UK government and the devolved administration of Wales and Northern Ireland establish an inspection and registration regime to monitor service – similar to the Scottish regime.

‘Bereaved should be confident they’re not being overcharged’

Martin Coleman, CMA panel inquiry chair, said: “Given the inherently distressing circumstances in which people arrange a funeral, we want to make sure they can be confident they’re not being overcharged and that their loved one is cared for properly.

“The later stages of the investigation have been conducted in the midst of the coronavirus pandemic, which has caused a tragic increase in death rates and has materially changed how funerals are carried out. This has had a big impact on how far we can immediately address some of the issues we have identified.

“But there are remedies that are feasible and effective in the short-term. We are proposing a package of ‘sunlight’ remedies which will shine a light for consumers on the pricing and practices of the sector and make sure that deceased people are cared for properly. This will ensure that the prices of funeral directors and crematoria, and the quality of the service that funeral directors provide, are exposed to greater scrutiny, helping people to make the right choices during an incredibly difficult time.”

‘Putting the needs of the bereaved first’

Sam Tyrer, MD of Co-op Funeralcare, said: “Every funeral should reflect the life of the person that has died and the vital role that funeral services play in the grieving process has never been more apparent than in recent months.  As keyworkers, our colleagues have adapted to the challenging conditions and worked tirelessly through the pandemic, always putting the needs of the bereaved first.

“As the UK’s largest funeral provider, the Co-op is proud to have led the way in driving changes in the industry – calling for regulation of the sector, lowering prices and increasing choice and transparency.

“The Co-op has taken a range of steps to significantly reduce funeral price and as the CMA notes, the market has adapted at pace to respond to the devastating loss caused by coronavirus.”

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