This House of Commons Library landing page has been prepared in advance of a debate entitled "Funeral Poverty". It will be led by Mrs Emma Lewell-Buck MP and will take place in Westminster Hall on Tuesday 11th September 2018, starting at 2.30pm.
Official statistics are not available on the average cost of funerals. Some research carried out by insurance organisations can, however provide indicative figures. Sun Life’s latest annual Cost of dying report, published in September 2017, estimated that the average cost of a funeral in the UK in 2017 was £4,078 (up from £3,897 in the 2016 report), but with considerable regional variations. London had the highest average basic funeral cost, at £5,951, followed by the South East and East of England at £4,656. Northern Ireland had the lowest average cost of a funeral at £2,982, almost 27% below the UK average.
Help with funeral costs for those on means-tested benefits and tax credits may be available from the Social Fund. Where it appears that suitable funeral arrangements have not, or will not be made for a deceased person, the local authority or the NHS may sometimes have a duty to organise and pay for a funeral. The latter arrangements are sometimes referred to as “paupers’ funerals”.
Detailed information on the Social Fund Funeral Payments scheme and related issues can be found in Commons Library briefing SN-01419, Social Fund Funeral Payments, 25 April 2018. This complements Commons Library briefing CBP-06242, Arranging and paying for a funeral, 15 June 2018, which looks more widely at the issues around arranging funerals, and at the duties of public authorities where no-one else has accepted responsibility for arranging a funeral.
Payments from the Social Fund can be made to claimants of means-tested benefits and tax credits to help meet the costs of a funeral. Payments are made from the regulated Social Fund and, as such, are not limited by budgetary constraints.
To be eligible for a Funeral Payment, a person must meet the following criteria:
Note that the requirement to accept responsibility for the funeral means that the local authority has no duty to help under public health legislation (see below) where a person has claimed a Funeral Payment. A local authority is only under a duty to step in where it appears no suitable arrangements for a funeral are being made.
The payment is intended to meet specified funeral expenses including the cost of a burial plot, grave diggers’ fees, cremation costs, costs of obtaining documentation, and reasonable transport costs. In addition, up to £700 can be paid for other expenses such as funeral directors’ fees, church fees and flowers. The cap on other expenses has remained £700 since April 2003.
Successive Governments have maintained that the scheme provides a “contribution towards the cost of a simple, low cost respectful funeral,” but the adequacy of payments in relation to actual funeral costs has long been a source of complaint. The Coalition Government accepted that the full costs associated with a funeral could not always be met given the £700 limit, but did not commit to increasing it. Instead, it amended the Social Fund Budgeting Loan rules so that low income families in receipt of benefits could get additional help with funeral costs. Budgeting Loans are however repayable. A written answer in May said that data on Budgeting Loans for funeral costs is not collated centrally and could only be provided at “disproportionate cost.”
Asked whether the DWP would make an assessment of the adequacy of the level of the cap on Social Fund Funeral Payments to cover the basic cost of a funeral, the then DWP Minister Kit Malthouse said in a written answer in March this year:
The Social Fund Funeral Expenses Payments continue to meet the necessary costs of a cremation or burial for eligible claimants. Average payments have increased year-on-year to meet these necessary costs. We have had to make difficult choices about welfare spending and it has not been possible to increase the £700 maximum for other costs. However we have made interest-free Social Fund Budgeting Loans available for funeral costs in addition to Funeral Expenses Payments.
In 2016/17, approximately 27,000 Funeral Expenses Payments were paid worth around £38.6 million. The average payment made has increased in value in the past ten years by about 28 per cent – from £1,117 in 2006/07 to £1,427 in 2016/17 – as the necessary costs have increased
The Funeral Expenses Payments scheme continues to make a significant contribution towards the cost of a simple funeral for claimants on certain income-based benefits or tax credits.
Given that the average DWP Funeral Payment award in 2016-17 was £1,427 and the average cost of funeral in the UK is over £4,000, even successful Social Fund applicants will still face a substantial shortfall which will have to be met from other sources.
In a March 2016 report on Support for the bereaved, the Work and Pensions Committee recommended that the application process for Funeral Payments be simplified and clarified, with an online “eligibility checker” for prospective applicants. The Government believed an online checker could inadvertently cause additional confusion for bereaved people, but from April 2018 claimants have been able to submit supporting evidence for claims electronically to speed up the decision-making process. Further changes include: allowing recipients to receive contributions from other sources without deductions being made from the payment; extending the claim period from 3 to 6 months from the date of the funeral; and a shorter application form for children’s funerals.
In addition, the Prime Minister announced on 31 March 2018 that a “Children’s Funeral Fund” would be set up in England, under which fees for burials and cremations will be waived by all local authorities and met instead by Government funding. The intention is that “no bereaved family will have to pay for the essential costs of burying or cremating their child.” A written answer in June said that the detailed policy was under development and would be announced “in due course.” [PQ HL8047, 5 June 2018].
Section 46(1) of the Public Health (Control of Disease) Act 1984 imposes a duty on local authorities to bury or cremate the dead where it appears that no other suitable arrangements will be made. They should not cremate the deceased if they have reason to believe that the deceased did not wish to be cremated.
The local authority may claim the costs of the funeral from the deceased’s estate, if there are sufficient funds. Local authorities do not have the power to reimburse funeral costs where a third party has already arranged the funeral.
Where a person dies in NHS care, the NHS may arrange and pay for the funeral, if there are no relatives or friends who are willing or able to do so. However, before doing so, an NHS Trust may approach the local authority to see if they are willing to arrange and pay for the funeral.
The Government does not collate statistics on public health funerals. However as part of a recent ITV investigation into Public Health Funerals a Freedom of Information request to 300 councils elicited a 70% increase in public health funerals over the last three years, with a cost to councils of just over £4 million in the last financial year alone (£4,050,672).
On 1 June 2018, the Competition and Markets Authority (CMA) announced a review of the funerals market, to examine how well the market works and whether consumers are getting a good deal:
The Competition and Markets Authority’s (CMA) market study will examine whether the information provided by funeral directors on prices and services is clear enough for people to be able to choose the best option for them.
It will also look at how prices have changed over time and the factors that affect them.
The average cost of a funeral was nearly £3,800 in 2017 – not counting extras that can add another £2000 to the total bill. Affordability and debt can therefore be a real concern to many people, with those on the lowest incomes potentially spending up to one third of their annual income on a funeral.
The rising level of cremation fees will be considered as part of the review, with cremations now estimated to account for around 75% of all funerals.
On timescales, the CMA’s press notice says that “An interim report, presenting initial findings and views on potential remedies, will be published in 6 months, ahead of the final report in a year’s time.”
Commons Debate packs CDP-2018-0200
Authors: Andrew Mackley; Manjit Gheera; Steven Kennedy