Question to the HM Treasury:

To ask Mr Chancellor of the Exchequer, with reference to section 3.1 of his Department’s consultation entitled, Pre-paid funeral plans: call for evidence, published in June 2018, what the evidential basis is for the statement that the current framework of self-regulation in the funeral plan sector is not sufficient.

The Funeral Planning Authority regulates 95% of the market. The FPA reviews registered providers’ compliance with its code of practice and has the power to terminate membership or levy a fine of up to £5,000 should a firm fail to adhere to its principals. These powers have never been used. Moreover, the voluntary nature of the FPA’s jurisdiction means it cannot prevent firms from trading, and that some firms are currently operating outside of regulation entirely. Where things do go wrong, consumers do not have access to adequate redress or arbitration services.

HM Treasury has conducted meetings with several market participants who have indicated that the current framework of self-regulation is insufficient. Citizens Advice Scotland and Fairer Finance have published reports which analyse the pre-paid funeral plan market. The reports highlight numerous failings in the sector including a lack of clarity for consumers and high pressure and misleading sales activity.