Sheila McHale

Sheila McHale

Minister for Disability Services; Tourism; Culture and the Arts; Consumer Protection

    Prepaid funerals set to be regulated

    6/01/2008 10:02 AM

    Prepaid funeral funds will face tighter controls with the State Government set to regulate the $50million industry.

    Consumer Protection Minister Sheila McHale said the funeral industry in Western Australia was highly regarded, but there were concerns the lack of regulation could potentially expose consumers to risk.

    “Consumers entering into prepaid funeral contracts in WA are not protected by any specific industry legislation or mandatory Code of Practice that applies in all other Australian States,” Ms McHale said.

    “Without any regulation, there is the potential for businesses to engage in unsound or unscrupulous business practices, and the risk of substantial losses if the money is misappropriated or the business fails.

    “This Government wants to ensure people who prepay their funerals are protected, and that their money and wishes are safeguarded.”

    The Minister said the Government was considering introducing a mandatory Code of Practice that would apply to WA’s 100-plus funeral businesses.

    The Code of Practice would require:
    • prepaid funeral monies to be invested in an approved funeral benefit fund or approved trust account;
    • funeral directors to provide written details of how the money would be invested, what would happen if payments were missed, and their obligations if the business ceased;
    • disclosure of circumstances under which money can be refunded; and
    • a substantial cooling-off period for prepaid funeral contracts.
    “This can be a stressful and emotional arrangement, and particularly vulnerable consumers may sign a contract without fully understanding the implications,” Ms McHale said.

    The Minister said the proposed introduction of a Code of Practice followed today’s release of the ‘Regulation of Prepaid Funerals’ issues paper and consultation with industry and the public.

    “Some consumers pay for their funerals decades in advance and this code will ensure their money is secure and they get the service they paid for,” she said.

    Minister's Office - 9213 6900