Government must step in after its role in the failure

WHEN I started my campaign for regulation of the funeral plan industry in 2017, I knew that if I was successful it would end with thousands of customers losing their money.

It was clear from our investigations that firms such as Safe Hands Plans were playing fast and loose with clients’ cash.

But this could, and should, have been prevented. In 1999, the Treasury published a consultation paper announcing plans to protect funeral plan customers.

In the rules that followed, it said firms could avoid full regulation by the new financial regulator – but only on condition that they abided by a clear set of rules on how they looked after customers’ money.

This would have been fine if the Financial Services Authority – the precursor to the Financial Conduct Authority – had done its part and policed whether firms were abiding by the rules. But it didn’t and nor did the Treasury.

As a result, the conditions were created for the likes of Safe Hands to get away with what we now know they have.

It was the Government and regulator’s failings two decades ago which led to the mess we’re in now. And it is the Government’s act of introducing regulation today which will crystallise losses for thousands of funeral planholders. That’s why I firmly believe it is the Government’s responsibility to compensate those who are set to lose out.

With the support of the funeral plan industry, the bill doesn’t need to be huge. Furthermore, what cost there is won’t arise overnight – these plans will mature over a 20year period.

John Glen, Economic Secretary to the Treasury, acted quickly to introduce regulation when we made him aware of problems in the industry five years ago. And, of course, he wasn’t in charge when regulation failed 23 years ago. But he is now, and this is his moment to step forward and do the right thing for the thousands of customers who are set to lose out.

Make good their losses and enable them to have the funerals they paid for when their time comes.