Watchdog to launch investigation into UK funerals over 'unjustified' price hikes

Most people who organise a funeral are 'extremely vulnerable' to exploitation, CMA evidence shows

Cost increases have not been justified by quality improvements, CMA said (Getty/iStock)

The UK funeral market is facing investigation by the competition watchdog – after it noted “serious concerns” and “unjustified” price hikes of 66 per cent over the last 10 years.

The Competition and Markets Authority found “problems with the market that have led to above inflation price rises for well over a decade”.

The cost of organising a funeral has risen to between £3,000 and £5,000, which marks an increase of more than two thirds in the past decade, which is almost three times the rate of inflation.

Earlier this year, the Independent revealed that the number of people using online crowdfunding to pay for funerals had risen by a third in one year due to spiralling costs.

“The scale of these price rises does not currently appear to be justified by cost increases or quality improvements,” the CMA said.

The regulator said customers could save up to £1,000 if they shopped around – but added: “People organising a funeral are usually distressed and often not in a position to do this – making it easier for some funeral directors to charge higher prices.

"Prices are also often not available online, making it difficult to compare options.”

The CMA also said its evidence shows that most people who organise a funeral are “extremely vulnerable” to exploitation and price hikes.

Andrea Coscelli, head of the CMA, said: “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.

“We now feel that the full powers of a market investigation are required to address the issues we have found. We also want to hear from people who have experienced poor practices in the sector, so that we can take any action needed to fix these problems.”

Gillian Guy, chief executive of Citizens Advice, said huge upfront costs and a lack of clarity around fees are “far too common, with thousands of pounds of ‘extras’ regularly added to bills£ for funerals.

“We help thousands of people each year who struggle to work out over-complicated fees or who simply cannot afford the cost,” she added.

“It’s encouraging to see the CMA taking action in markets where it sees evidence of consumers being ripped off on a massive scale.”

Shares in funeral services provider Dignity dropped more than 16 per cent in early trading on Thursday.