The Competition and Markets Authority (CMA) has decided to do a full investigation into the funerals sector after concerns that large price hikes are hitting people when they are at their most vulnerable.
Funeral industry investigation
The CMA launched a Market Study (in conjunction with Age UK and the Money Advice Service) of the funerals sector, and published an interim report in November 2018. The report indicated, amongst other things, that for over ten years, both funeral director services and crematoria services have issued above inflation price rises, which do not appear to be justified by cost increases or quality improvements. This report has been consulted on and the decision has been taken by the CMA to progress to a full investigation.
What are the CMA’s concerns?
The CMA’s concerns include:
- The rise in cost of organising a funeral, the essential elements of which have increased by 6% each year – twice the inflation rate – for the last 14 years. Funerals typically cost several thousand pounds which is a significant outlay for households.
- The vulnerability of many people when organising a funeral, which may mean that they are not in a position to look at a range of choices. This appears to have made it easier for some funeral directors to charge high prices.
- Reluctance of firms to publish/disclose clear prices, including online, or to provide comprehensive information on quality and range, making it difficult for people to compare funeral directors.
- Low numbers of crematoria providers in local areas, and difficulty for new companies to enter the market due to the planning regime and high fixed costs.
- High prices in relation to crematoria services – the largest private operators have implemented average price rises of between 6% and 8% each year for the past eight years and some local authorities have also implemented large increases in fees.
The CMA will examine the concerns and decide what action – if any – to take. They have the power to make legally binding orders.
Andrea Coscelli, Chief Executive of the CMA, says: “People mourning the loss of a loved one are extremely vulnerable and at risk of being exploited. We need to make sure that they are protected at such an emotional time, and we’re very concerned about the substantial increases in funeral prices over the past decade.”
You can find a report of the CMA’s market study, and further information relating to the market investigation on the funerals market study page of gov.uk.
SavvyWoman email newsletters: If you found this information useful why not sign up now to receive free fortnightly email newsletters with money saving tips and help? You can sign up at the top of any page on the website and your details won’t be passed to any other company for marketing purposes.