Death, debt and exploitation - Government launches investigation into the funeral market

UNJUSTIFIABLE prices, a lack of competition and a practice of exploiting people when they are at their most vulnerable is the damning verdict on the funeral industry. The Government has now launched a major investigation following the findings by the Competition and Markets Authority (CMA).

The CMA launched a review of the £2 billion funeral market last June, amid concerns that prices had been increasing substantially and that funerals had become unaffordable for many.

In Bolton last year there were  448 burials and and 2,049 cremations. 

The average cost of the essential elements of a funeral in 2018 was estimated to be nearly £3,744 for a cremation and £4,798 for a burial. Discretionary items such as flowers and catering would add another £2,000 to the bill.

The report stated: “Most people will continue to be open to exploitation. …We therefore consider that the markets for funeral director and crematoria services are not functioning as well as they should be.

“We anticipate continuing high price increases in relation to crematoria services, and we consider that the average price of funeral director services is well above what could be expected in a well-functioning market.”

One person who welcomes the news is John Howarth, co-owner of the independent family firm Howarth’s Funeral Service.

“I’m all in favour of an investigation because it will let people know exactly what is going on and it will look at the situation,” he said.

Mr Howarth established his business in 1991 and runs it along with five family members.

“Unfortunately, the funeral industry is unregulated and unlicensed which means anyone could set themselves up as a funeral director.

“I would like England to operate a similar system as Scotland, which has a government-appointed independent inspector of funeral directors who monitors standards.”

Mr Howarth is a member of the National Society of Allied and Independent Funeral Directors (SAIF), which was established in 1989.

It promotes best practice and provides training and education programmes to ensure members meet the highest of standards. Significantly, it holds regular inspections.

Mr Howarth said: “They inspect premises and prices, it’s very thorough.”

In its research, the CMA paid particular attention to funeral directors’ activities as their fees are the largest element of funeral bills.

A spokesman said: “Overall, we have found evidence that for a considerable number of years the largest firms of funeral directors have implemented consistently large annual price increases, without reference to underlying operating cost pressures.”

The initial consultation found that local authorities’ price rises were lower than private crematoria. The cheapest crematoria remain local authority ones and the 20 most expensive crematoria are all private ones.

Since the family of the deceased are at their most emotionally vulnerable, the CMA report said clients don’t know what to expect, spend little time thinking about the provider and feel under pressure to sort things quickly.

It said: “The bereaved are not generally able to exercise some of the most basic commercial judgements that customers typically display in more normal circumstances.”

According to CMA research, only 14 per cent of people organising a funeral compare more than one funeral director and only 4 per cent search for a funeral director on the internet.

The report said: “The vulnerability of customers and difficulty in engaging with the process of buying a funeral appears to have been a major factor in enabling suppliers to charge high prices in this sector.”

A lack of transparency of costs and prices was another finding of the report.

But at Howarth’s Funeral Service, Mr Howarth said prices are fully displayed and potential clients can also take away a complete price list to consider before engaging the company’s services.

In the last month the cheapest funeral it did was £2,190.This is below the nationwide average of £3,744 for a cremation.

“When people explain that they don’t have a lot of money we actually sit down with them and advise them on how they can make savings,” said Mr Howarth.

“Instead of telling them what they should have, we tell them what they don’t need.

“We also put them in contact with charities and organisations, such as the British Legion, that contribute to funeral costs in certain circumstances.”

Increasingly, independent family-owned funeral firms are facing more and more competition from national chains which have been criticised for having something of a monopoly.

Dignity owns over 800 funeral locations and operates over 45 crematoria in the UK, while Co-op Funeralcare operates over 1,000 funeral homes and is the largest funeral director in the United Kingdom.

Some 14 funeral directors operate in Bolton, of which five are owned by the Co-op.

Responding to the report Tim Bloomer, head of operations north for the Co-op, said:“We welcome the CMA’s decision to launch a market investigation and hope it will lead to improved protection for families through access to consistently high standards of funeral care at an affordable price.

“For a number of years we’ve been focused on tackling funeral affordability, we’ve reduced prices of our most affordable funerals and we’ve introduced new choices for our clients in response to their changing needs. We are fully committed to continuing to make our products and services more transparent for our clients in Bolton and across the country. We recently piloted a new online tool which will launch nationally this month and will make our prices and those of third parties such as cremation and burial fees clear.

“We’ll continue to work with the CMA as they progress with the market investigation.”

Bolton Council operates seven cemeteries: Astley Bridge, Blackrod, Farnworth, Heaton, Horwich, Tonge and Westhoughton. Last year it had responsibility for 448 burials and 2,049 cremations.

A council spokesman said: “We support the Charter for the bereaved published by the Institute of Cemetery and Crematorium Management.

“The charter sets out a minimum standard of service that the bereaved should be entitled to. As a member of the Federation of Burials and Cremation Authorities, we are bound by the Code of Cremation Practice.”

Funeral poverty: debt and death

IN 2017, there were 607,000 deaths in the UK, 513,000 of which involved a funeral that had to be paid for by the bereaved at the time of death, as opposed to a pre-paid plan.

The average cost of the essential elements of a funeral in 2018 was estimated to be nearly £3,744 for a cremation and £4,798 for a burial, with another £2,000 being spent on discretionary items, such as flowers and catering.

The cost of a funeral will amount to nearly 40 per cent of the annual expenditure of someone on the lowest income. This is more than what they would spend on energy, food and clothing combined in a year.

The Fair Funerals Campaign which was set up to help funeral poverty that affects one in six people.

A campaign spokesman said: “The impact of funeral poverty can be financial, in the form of unmanageable debt, but it can also be emotional in the form of the distress, shame and the perceived stigma of not being able to provide a ‘decent send-off’ for someone we love.”

Funeral costs have risen by more than 112 per cent during the past 14 years.

The spokesman said: “These costs are placing an unbearable burden on the already stretched finances of bereaved families, many of whom are getting into serious, unmanageable debt when they lose someone they love.”

People are at their most emotionally vulnerable when a loved one dies, which means they are not always as “savvy” when it comes to arranging a funeral.

The spokesman said: “This is a big problem in an industry where there are such huge differences in what funeral directors charge for the same goods and services. And to make matters worse, it’s difficult to find clear, comparable information about what funerals really cost.”

Cutting the costs with a DIY funeral

ONE thing that many people do not realise is that it is not a legal requirement to have a funeral.

It may also surprise people to learn that a lot of assumptions surrounding the disposal of bodies are a myth. These include:-

* you have to have a coffin

* bodies have to be transported in hearses

* bodies have to be embalmed

* you have to employ a funeral director

* you can only bury a body in a cemetery

* you can’t keep a body at home

* bodies must be buried at six foot

With this in mind, an increasing number of people are taking matters into their own hands and saving a lot of money by organising DIY funerals.

The Money Advice Service explains that you must register the death at a registry office within five days and you need to take the medical certificate, which is signed by a doctor, when you register the death.

You will then receive a Certificate for Burial or Cremation and a Certificate of Registration of Death.

With coffins costing hundreds of pounds, some people make their own. Alternatively, a simple shroud could be used.

For cremations, you can opt for a direct cremation, which is where a body is cremated at a convenient time without any ceremony or mourners attending. Typically, this costs around £1,600.

When it comes to burials, people can be buried in private gardens and other land provided certain conditions are met.

Obviously, the permission of the owner of the freehold of the land where the burial is to take place is required.

The body must have at least one metre of soil above and below and the site should be at least 250 metres away from boreholes or water supplies.

The grave should be 30 metres from any standing or running water and free of standing water when dug. It must also be ten metres from any dry ditch or field drain.

Planning permission is only needed if the grave is to be marked with a monument that can be seen by neighbours.