Dr the Baroness Altmann CBE
Department of Work & Pensions
Caxton House
Tothill Street
London
SW1 9DA

16th November 2015

Dear Baroness Altmann,

This is our first correspondence since your appointment as Minister of State in the Department of Work and Pensions so we’d like to take this opportunity to say congratulations. It is good to know that there is someone with your strong sense of social justice in this position in Government. It is with this in mind that we are writing to you today.

In September 2014, the Funeral Poverty Alliance formed to act as a much needed not-for-profit voice to campaign collectively against funeral poverty. The Alliance includes respected charities and faith groups whose beneficiaries are affected by funeral poverty including the prominent organisations Marie Curie, Citizens Advice Scotland, Macmillan, Cruse Bereavement Care and Hospice UK (a full list of Alliance members in given in Appendix A). Among the membership of the Alliance are several organisations supporting the increasing numbers of people struggling with funeral debt.

The Alliance is facilitated by Quaker Social Action (QSA). Since 1867 QSA has delivered practical responses to poverty. We run the Down to Earth project which supports people on low incomes avoid financial problems paying for funerals. In 2014 we launched the Fair Funerals campaign to tackle the underlying causes of funeral poverty.

Funeral Costs

We have, with the assistance of the insurer Royal London, been monitoring the rising cost of funerals. The second annual Funeral Cost Index has just been published. The Index found that in 2015, the average cost of a funeral was £3702, a 3.9% increase year on year, and well above inflation. The average cost of a burial funeral is now £4110 and the average cost of a cremation funeral is now £3294. The price of funerals has now risen above inflation for the past 35 years, with a cumulated increase of 300% in the last 20 years. This compares to a 150% increase in the Consumer Price increase and a 150% increase for median earnings.

The cost of a funeral continues to rise and there is also marked discrepancies in funeral costs right across the UK. The new Funeral Cost Index reveals the cost of a funeral continues to be a postcode lottery. Funerals range from £2976, for a cremation in Greenock, to £7216 for a burial in Beckenham, Kent - a difference of £4240. This suggests that more than just inflationary pressures are at work.

The result of this is many bereaved people are getting into serious debt. According to the UK Cards Association, in 2013 the highest value transaction on credit cards was “Funeral Services”, with an average cost of £1114.

Problems with the Social Fund Funeral Payment

We should like to draw your attention to the operation of the Social Fund Funeral Payment (SFFP) scheme and the increasing problem of funeral poverty. The Department of Work and Pensions (DWP) is the custodian of this important scheme and the latest figures published by the DWP in June 2015 show that the average SFFP award rose by £28 (2014/15) while the average funeral cost rose by £140.

When the SFFP began it was intended to cover the overall cost of a simple funeral, but over the last 12 years the value of grants awarded has been dramatically eroded in real terms. This leaves a financial shortfall, pushing bereaved people on low incomes into unmanageable debt which they often have no means of paying off. The average award in 2014-2015 was £1375, which covers around a third of the cost of a basic funeral. During the same period nearly half of all applications were turned down. Although in 2014-15 32,000 payments were awarded worth about £44 million, the amount spent on the SFFP has only increased around £2 million since 1988. In 2014, insurers Sunlife found that funeral poverty had increased 50% in just three years. Because SFFP applicants have to wait for weeks to find out whether their claim has been successfully -by which time the funeral will already have taken place- many are forced to commit to funeral expenses before they know if they'll receive any support from the state.

Reforms needed

Members of the Funeral Poverty Alliance have come together to engage policymakers and seek improvements to the funeral sector and the support and information provided to bereaved people on low incomes. There are several opportunities to improve the way the SFFP is processed which would alleviate distress to bereaved applicants whilst saving time and money to the Department who administer the payment.

These issues were subject to a Ten Minute Rule Bill in the last Parliament and a Westminster Hall Debate last month, which garnered much cross-party support). Following the Westminster Hall Debate members of the Funeral Poverty Alliance met with senior civil servants at the Department of Work and Pensions to discuss practical, positive solutions to improve the way the SFFP meets the needs of bereaved people on low incomes. The Government has committed to give the issue of funeral poverty more Parliamentary time in the near future.

We, and other concerned stakeholders, are pressing for

  • Policymakers in England, Wales and Northern Ireland to follow the lead of the Scottish Government and conduct a cross-departmental inquiry into the underlying interrelated issues that are causing funeral inflation including; pressures on local authorities, the use of burial space and the privatisation of crematoria and burial grounds.
  • A full and fundamental review of the SFFP as part of a wider review of financial support for those facing bereavement.
  • A review of the SFFP response times. Currently the DWP has a target of 16 working days to process applications (currently achieving an average of over 17 days) but for client of Down to Earth, applications currently take around 30 days to process.
  • A review of the SFFP application process whereby a receipt can be sent upon application – frequent “lost” applications cause particular pain.
  • A review of the SFFP application process whereby applicants are given eligibility checks as to the likelihood of payment. This would save pain to the bereaved and significant time and money saving to the DWP.
  • Policy makers in England, Wales and Northern Ireland to take account of the experience in Scotland where the removal of a necessity for additional medical certificates for cremation has resulted in the differential between burial and cremation costs being reduced.
  • Wider funeral industry participation in the Fair Funerals pledge asking funeral directors to provide clear, comparable prices so people know what they’re buying. It also asks them to make their most affordable funeral visible to the public.

Representatives of the Funeral Poverty Alliance are keen to meet with and discuss the problem of funeral debt and options for impacting this. Please contact Quaker Social Action at:
Email
Call 020 8983 5059

Yours sincerely

Heather Kennedy
Fair Funerals Campaigns Manager on behalf of the Funeral Poverty Alliance