Reg­u­lat­ing pre­paid fu­ner­als

Pilbara News - - Lifestyle - Gwyn­neth Hay­wood Gwyn­neth Hay­wood is the se­nior re­gional of­fi­cer for Con­sumer Pro­tec­tion.

It is es­ti­mated $140 mil­lion of pre­paid fu­neral funds are be­ing held on be­half of West Aus­tralian cus­tomers.

The State Gov­ern­ment is de­vel­op­ing a pro­posal to reg­u­late the pre­paid fu­neral sec­tor to pro­tect that sub­stan­tial amount of con­sumers’ money.

At present, fu­neral direc­tors who are mem­bers of the Aus­tralian Fu­neral Direc­tors’ As­so­ci­a­tion ad­here to a vol­un­tary stan­dard with re­gard to the han­dling of pre­paid fu­neral funds. Un­der the stan­dard, the funds are in­vested in a third-party fi­nan­cial in­sti­tu­tion which has in­sol­vency pro­tec­tion. The in­sti­tu­tion pro­vides the con­sumer with a cer­tifi­cate of in­vest­ment and funds are only re­leased to the fu­neral di­rec­tor upon proof of de­liv­ery of a fu­neral ser­vice.

The con­cern, how­ever, is that the level of com­pli­ance with the vol­un­tary stan­dard by mem­bers of the as­so­ci­a­tion is not clear and only about 80 per cent of fu­neral direc­tors op­er­at­ing in WA are mem­bers. There are also other or­gan­i­sa­tions in the com­mu­nity which are not fu­neral direc­tors of­fer­ing pre­paid fu­ner­als.

The pro­posed manda­tory code of prac­tice un­der the Fair Trad­ing Act will be de­signed to cover all sell­ers of pre­paid fu­neral pack­ages and pro­vide all con­sumers with con­sis­tency, clar­ity and cer­tainty.

Sell­ers will be re­quired to es­tab­lish and main­tain an in­di­vid­ual reg­is­ter of con­tracts.

The ob­jec­tives of the code of prac­tice would be to:

pro­tect pre­paid con­sumer funds in the event of bank­ruptcy or in­sol­vency of the seller or the clo­sure of the busi­ness;

pro­vide cer­tainty as to the treat­ment and in­vest­ment of pre­paid con­sumer funds;

pro­vide cer­tainty around the goods and ser­vices agreed to and paid for by the con­sumer;

en­able next-of-kin to as­cer­tain whether a pre­paid fu­neral has been pur­chased; and

pro­vide cer­tainty as to the treat­ment of late or missed pay­ments (where in­stal­ments ap­ply) or the en­ti­tle­ment to a re­fund in cer­tain cir­cum­stances.

While con­sul­ta­tion on pro­posed reg­u­la­tion of the in­dus­try has been car­ried out in the past, the in­dus­try and com­mu­nity will have an­other op­por­tu­nity, by the end of the year, to have a say be­fore fi­nal de­ci­sions are made.

Any­one in­ter­ested in pro­vid­ing feed­back can keep up to date with where the con­sul­ta­tion is at by check­ing /con­sul­ta­tions.

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