Crematorium Charges 2010

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A decision made 30 November 2009 regarding: Crematorium Charges 2010.

Decision Reference: MD-TR-2009-0190
Decision Summary Title:	Health and Social Services Department – Increase in Crematorium Charges 2010		Date of Decision Summary:	20 November 2009
Decision Summary Author:	Head of Decision Support		Decision Summary: Public or Exempt?	Public
Type of Report: Oral or Written?	Written		Person Giving Oral Report:	N/A
Written Report Title:	Health and Social Services Department – Increase in Crematorium Charges 2010		Date of Written Report:	20 November 2009
Written Report Author:	Finance Manager, Decision Support		Written Report : Public or Exempt?	Public
Subject: The Minister for Treasury and Resources approved the Health and Social Services Department’s request to increase Crematorium charges in 2010.
Decision(s): The Minister for Treasury and Resources approved the Health and Social Services Department’s request to increase Crematorium charges in 2010 by 69% in order to reflect the full cost of providing the service.
Reason(s) for Decision: Financial Direction 4.1 Increases in States Fees and Charges states that where a fee or charge increase exceeds the limit of 2.5% per annum the Minister for Treasury and Resources is responsible for approving the increase.
Resource Implications: There are no financial or manpower resource implications other than those noted in the report.
Action required: Finance Manager to inform Finance Director, Health and Social Services Department, that the charge increases have been approved.
Signature:		Position: Senator P F C Ozouf, Minister for Treasury and Resources
Date Signed:		Date of Decision:

Crematorium Charges 2010

TREASURY & Resources ITEM NO:

TREASURY AND RESOURCES MINISTER

health and social services department

increase in crematorium charges 2010

Purpose of Report

Financial Direction 4.1 “Increases in States Fees and Charges” recognises that there are instances where one particular group receives a valuable service from a States Department at a charge which is below cost and they are, therefore, being subsidised by taxpayers generally. It is up to departments to carefully consider whether there is a case for the user to meet either the full cost or a greater proportion of the cost of service provided it does not exceed the cost of the service. Where a charge increase exceeds the limit of 2.5 percent per annum the Minister for Treasury and Resources is responsible for approving the increase.

The Health and Social Services Department seek approval for an increase in Crematorium charges for 2010, above 2.5 percent.

Background

The Health and Social Services Department seek approval for charge increases above 2.5 percent for the following Crematorium services:-

Cremation; and
Book of Remembrance and Memorial Cards

Cremation

The Department has known for a number of years that cremation charges are below the actual cost of the service. In recognition of this, and with approval of the Minister for Treasury and Resources, the Department have previously been increasing cremation charges by 10 percent per annum and planned to continue to do so until the cost of the service was matched by the income. However, a more recent review has identified accounting overheads, most notably depreciation, that were previously not considered. The Department now seeks approval to depart from the incremental increases and instead implement immediate full cost recovery. This request has been supported by the approval of the Minister for Health and Social Services and is factored into the Business Plan 2010.

The Department has provided a summary of their latest analysis including the full cost of the service and forecast cremations for 2008 to 2010:-


	2008	2009	2010
	Actual	Forecast	Estimate
	£	£	£
Direct costs	228,883	215,844	224,478
Indirect costs	9,411	9,332	9,705
Total cost	238,294	225,176	234,183

Number of cremations	536	487	438

Cost per cremation	£445	£462	£535

N.B. Depreciation is included within direct costs and relates to the cremators and buildings. The cremators are being depreciated over a 15 year period and the buildings are being depreciated by the amount provided by Property Holdings.

The Department is currently charging £317 per cremation for 2009 representing 69 percent of the full £462 cost. The remaining £145 is effectively subsidised by the tax payer. The Department wishes to increase 2010 charges to £535, being a £218 or 69 percent increase over 2009, in order to reflect the full cost of the service estimated for 2010.

Despite the large increase, the Department has provided comparative evidence that demonstrates their 2009 charge of £317 ranks Jersey in the ‘Crematorium Fee League Table’ 254th out of the 255 published charges for 2009. Raising the charges to full cost in 2010 will move Jersey into the upper quartile of the same Table. The Department has also provided evidence showing that even with the increase the cost of cremation is comparable to, or better than, the cost of burial in many of the Island’s Parishes.

The Minister for Health and Social Services, as prescribed by Order under the provision of the Crematorium (Jersey) Law 1953, has approved the proposed 2010 charges and now seeks approval from the Minister for Treasury and Resources:-

		Current fee 2009 (£)	Proposed fee 2010 (£)
a)	For the cremation of remains of a person aged seventeen years or less at death.	0.00	0.00
b)	For the cremation of remains of a person aged eighteen years or more at death.	317.00	535.00

Book of Remembrance and Memorial Cards

The Department also seeks the Minister for Treasury and Resources approval for the following increases to more accurately reflect costs:-

Book of Remembrance	Current 2009 (£)	Proposed 2010 (£)	Increase (%)
Two line entry (minimum)+ gold initial	29.50	32.50	10.17
Five line entry + gold initial	42.70	47.00	10.07
Eight line entry + gold initial	57.75	63.50	9.96


Miniature Book of Remembrance	Current 2009 (£)	Proposed 2010 (£)	Increase (%)
Two line entry + gold initial	51.00	56.00	9.80
Five line entry + gold initial	61.00	67.00	9.84
Eight line entry + gold initial	70.00	77.00	10.00


Memorial Card	Current 2009 (£)	Proposed 2010 (£)	Increase (%)
Two line entry + gold initial	14.20	15.60	9.86
Five line entry + gold initial	23.10	25.50	10.39
Eight line entry + gold initial	33.70	37.00	9.79

Floral illustrations	36.65	40.30	9.96
High rate illustration	51.00	56.00	9.80
Personal photograph	33.70	37.00	9.79

Recommendation

The Minister for Treasury and Resources to approve Health and Social Services request to increase the Crematorium charges for 2010 in order to more accurately reflect the cost of providing the service.

Reason for Decision

Financial Direction 4.1 Increases in States Fees and Charges states that where a fee or charge increase exceeds the limit of 2.5% per annum the Minister for Treasury and Resources is responsible for approving the fee increase.

States Treasury Nick Collins, Finance Manager Decision Support

30 November, 2009 for decision 30 November 2009