On 1 June 2018 the CMA launched a market study into the provision of funeral services in the UK. This was in response to concerns that there is a lack of transparency in the funeral market and rapidly increasing prices. In particular they investigated the following two points:

  • how competition between funeral directors works and transparency issues in the provision of funerals
  • how competition works in the crematoria segment of the industry

In November last year the CMA published their interim report. In the report they published their findings that over the last 14 years the costs of the essential elements of a funeral such as burial and cremation fees have increased by 6% per annum. They also reported a 68% increase in funeral director prices over the last 10 years. The CMA proposed that the funerals market should be referred to a CMA Group for a market investigation reference on the basis that they suspected that there are factors restricting competition in the supply of funeral services at the point of need.

On 8 April 2019 the CMA published an issues statement setting out the framework for the next stage of their investigation. The issues statement sets out their initial theories on what factors are adversely affecting the funeral market as well as potential remedies.

The three-hypothesis identified for investigation, referred to in the issues statement as ‘theories of harm’ are grouped into:

  • The difficulties people have in engaging with the funeral purchasing process
  • Behaviours in the supply of funeral director services
  • Market structure and barriers to entry in the supply of crematoria services.

The potential remedies that the CMA have suggested, though only hypothetical at this stage. One suggested remedy is to improve transparency and encourage consumers to be more prepared by considering funeral services before the point of need, i.e. to consider prepaid funeral plans when making a will. They also hope to encourage consumers to shop around more, as in their interim report they found that people could save on average £1000 if they shopped around for funeral services.

Further remedies the CMA are seeking feedback on is regulation of quality of service, as well as pricing regulation to potential introduce safeguard caps on fees for essential funeral services. They also suggest methods of opening the market to promote increased competition for crematoria.

Responses to the statement are invited until 9 May 2019. For more information on the ongoing market investigation and to read the reports in full visit https://www.gov.uk/cma-cases/funerals-market-study

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