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Monday, 23 November 1998
Page: 463

Mr FITZGIBBON (10:40 PM) —I bet the Minister for Financial Services and Regulation, at the table, looks forward to the contribution of the member for Gilmore to the debate which will inevitably flow from the Australian Competition Tribunal's decision on newsagencies.

I am here tonight to talk about dying. I am here to inform the House that it is about to become increasingly expensive to die in the Hunter Valley. The minister at the table will jump to the conclusion that I am about to launch an attack on the GST. But no, I am not. The minister jumps to that conclusion because he knows that the effect of the GST will be to increase the average cost of a funeral by some $500. But that is not what I want to talk about tonight.

I want to talk about the increasing dominance of the US based firm Services Corporation International in the Australian funeral market. Through its Australian subsidiary, Services Corporation International Australia, SCIA, it is buying up every mortuary, every cremator and every funeral business in its sight. In the Hunter alone, SCIA has already sucked up Beresfield Funerals; White Lady Funerals at Mayfield, Maitland and Charlestown; Parsons Funerals at Belmont; Awaba Funerals; Maitland Funerals; and a number of Simplicity Funeral outlets. Of course, Mr Speaker, none of the names have been changed. SCIA likes to retain the names to give all those in the Hunter and in the wider Australian community the impression that it is business as usual, particularly for those family owned firms.

Now SCIA is gunning for Cremations (Newcastle) Holdings Pty Ltd. This purchase will give the Texas based firm ownership of the Hunter Valley's only two cremators—the Beresfield crematorium and the Macquarie Memorial Park crematorium. As the Newcastle Herald's Jeff Corbett has pointed out, more than 70 per cent of funerals in the Hunter Valley end in cremation.

SCIA has made the shareholders of Newcastle Cremations `an offer too good to refuse'. Of course, SCIA has indicated to the shareholders that, if they choose to decline the offer, it will have to look at other options—which is simply code for moving against them in some other form. It is not surprising that SCIA is prepared to pay a price for Newcastle Cremations which obviously is high above the market value. The vertical and horizontal arrangements which will stem from the purchase will effectively give the US based firm a licence to print money.

Some members will remember the name `Services Corporation International' from the coverage it received some time ago on Channel 9's 60 Minutes program. On that particular program, we saw the manner in which the company or corporation had brought to Australian shores the hardest of selling techniques—and some of the most obscene selling techniques when applied to the funeral industry. The SCIA training manual trains and encourages the employees—which it has so kindly retained following the acquisitions—in the hardest sell approaches, some of which you would only expect from a used car salesman. Many of these employees are now forced to work on a commission basis. Of course, for many years many of them had worked in the industry in a dignified manner and have since taken the option of leaving the industry.

It is interesting to note that in a letter to Newcastle Cremations' shareholders SCIA point out that they see great potential for both of the firm's cremators. I am sure they do. Their new vertical and horizontal arrangements will produce a windfall for SCIA. The losers will be the Hunter's funeral services consumers—consumers who at the time of their purchase are at their most vulnerable; consumers who will now be offered all sorts of additional services, monuments, et cetera which they will be told are the appropriate memorial in this day and age as a dedication to their lost loved ones. I wonder what will become of the remaining independent funeral services left in the Hunter. How will they fare in terms of their business relations with the company with all these dominating arrangements? (Time expired)