The Barr government will look for a private partner to run a new cemetery and crematorium in Canberra's south, as it considers allowing graves to be recycled.
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The ACT government did not allocate funding for a new cemetery in its 2018 budget, despite a Legislative Assembly inquiry last year recommending the ACT build a new graveyard in Tuggeranong as an "urgent priority".
Burial space is due to run out at the Woden cemetery this year and a planned expansion was dumped due to stage two of light rail.
A site on Mugga Lane has been reserved for a new cemetery for nearly a decade.
But the project has been on delayed indefinitely, after Treasury refused to support a crematorium as a way to pay for the cemetery and to deal with a future $18.3 million shortfall in the perpetual care trust.
That trust provides for the future maintenance of Canberra cemeteries, but failed to absorb the costs of caring for existing graves when it was created in 2003.
In 2005, Treasury said there was no demand for a second crematorium but last year a Legislative Assembly committee found otherwise, with just one crematorium for 400,000 ACT residents compared to one per 155,000 NSW residents.
Despite this, the government has indicated it will look to the private sector for a solution.
"There is more work to do in developing the best approach to a new cemetery and crematorium for Canberra," a Transport Canberra and City Services directorate spokesman said.
"The next steps will be to conduct market soundings to gauge interest in working with government to run the Southern Memorial Park, and a period of community consultation to follow to ensure we are meeting the needs of the community."
The spokesman also said the government was committed to a review of the Cemeteries and Crematoria Act 2003, and " further exploration of the best way to deliver the Southern Memorial Park".
This leaves the door open to a proposal to begin recycling graves at the future cemetery.
The Assembly committee urged the government to give the idea from the ACT Public Cemeteries Authority serious consideration.
Under a renewable tenure scheme, burial plots would be sold for a set period and could be renewed in future.
In NSW families have two years to renew the lease.
If the plot wasn't renewed, its occupant would be re-interred and the grave re-used.
The cemeteries authority argued the period of "exclusive right" to a burial plot should not be longer than 25 years.
The committee recommended any changes to tenure should not apply retrospectively - only to people buying future plots.
Meanwhile, the ACT Public Cemeteries Authority has recorded a shortfall of $476,000 this financial year due to lower expected sales.
Budget papers said this decrease in estimated income was particularly due to lower sales for the Woden Mausoleum, which underwent a $2.5 million expansion in 2015, and burial fees paid in advance, which are lower than the current fees.
The papers also revealed the cemeteries authority has also persisted in sending out post-burial surveys to the recently bereaved, despite failing to receive enough returns to be statistically significant as per previous years.
However the authority said it continued to receive excellent feedback from funeral directors and had maintained a market share of about 35 per cent of deaths in the ACT.
