Company News

UK watchdog holds off on price controls in funeral sector; Dignity shares soar

Aug 13 (Reuters) - Britain’s competition watchdog said on Thursday it was currently unable to impose price controls on the funerals sector due to the coronavirus crisis but will likely require it to make more disclosures on pricing and other financial data.

Shares in London-listed funeral services provider Dignity Plc jumped 37% on the news. The company said it was considering the Competition and Markets Authority’s (CMA) provisional report in detail.

Demand for funerals has seen an unprecedented rise due to the number of deaths from COVID-19, although the nature of these proceedings has been drastically altered because of social distancing rules and limitations on gatherings.

Britain recorded 46,672 deaths as of Thursday, and 343,286 people have been infected by the novel coronavirus.

An investigation into the sector, focusing on funeral directors and crematoria services, was launched in March last year after a market study in 2018 revealed here high prices were charged, taking advantage of grieving families.

“Further change in the sector is necessary but some of the remedies we were considering could not safely be introduced in the middle of a national emergency,” CMA Panel Inquiry Chair Martin Coleman said in a statement.

“Our proposals will hold open the door to price controls when circumstances created by the pandemic change sufficiently to permit these to be considered,” Coleman added.

In the short term, the CMA has provisionally decided that funeral directors and crematoria will be required to provide customers with information and prices of various services and packages they offer, and will also need to give the regulator key financial data every quarter.

Dignity, which owns 800 funeral locations and operates 46 crematoria in Britain, reported last month an 11% rise in profit as it conducted more funerals due to the pandemic, even as the average price per funeral fell as people chose simpler services. (Reporting by Yadarisa Shabong in Bengaluru; Editing by Muralikumar Anantharaman)