No price controls for funerals as investigation hampered by pandemic

Stricter rules to crack down on the price of funerals have had to be abandoned due to the coronavirus pandemic, the competitions watchdog has said.

The CMA investigation into the funeral industry has been hampered by the pandemic.

The Competitions and Markets Authority (CMA) said all funeral directors and crematoria will now have to provide customers with transparent information on the various services and packages they offer - but said the outbreak had hampered plans to bring in more stringent rules in the sector, such as price controls.

SunLife’s annual Cost of Dying report found recently that a typical funeral in Scotland rose 3.5 per cent last year to £4,229.

An investigation into the funerals industry by the CMA found that prices had risen far above inflation for the past decade and that funeral operators were not clear in their pricing but warned that some of the remedies it had been considering could not safely be introduced during a national emergency, creating a "serious dilemma".

It said that its investigation, which began in October, had been hampered by the pandemic, due to “an unprecedented increase in demand for funerals”.

The report added: “This has made it difficult to obtain necessary data from funeral directors, crematoria operators and local authorities.”

Meanwhile, restrictions imposed by government during the pandemic have changed the kinds of funeral services available to people, making it “challenging” to effectively conduct research. It also pointed to questions over the future profitability of funeral directors due to the economic climate, saying it could not introduce price controls as a result.

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 that they are not being overcharged and that their loved one is cared for properly – this is what our investigation has focused on.

“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.”

He added: “Further change in the sector is necessary but some of the remedies we were considering could not safely be introduced in the middle of a national emergency. Our proposals will hold open the door to price controls when circumstances created by the pandemic change sufficiently to permit these to be considered.”

Clive Whiley, executive chairman of funeral provider Dignity, said: "Dignity has engaged openly and collaboratively with the Competition and Markets Authority throughout the funerals market investigation.

"We will take the time to fully assess the CMA's provisional decision report and its recommendations, and will continue to constructively engage directly with the CMA through the statutory process."

Sam Tyrer, the managing director of Co-op Funeralcare said: "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.

"We have fully engaged with the CMA through the process and look forward to continuing to do so in the coming months to secure the best outcome for bereaved families."

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