I’ve been reading about Kim Philby lately, the so-called Cambridge Spy who fooled the British Intelligence Service for decades as he passed information to his KGB handlers. Secrecy, covering his tracks and passing communications in a manner that meant they would go undetected by all but the intended recipient were all in a day’s work.
Bringing things slightly more up to date than the Cold War and the FCA has “announced” that it will carry out a platform market review. We’ll get to the inverted commas.
It’s possible that you may have missed the announcement, initially at least. Many of us did. I was one of them. How were we all so lax about what is potentially quite a big deal? Perhaps the fact that it was nestled quietly on page 76 of the FCA’s 2017/18 Business Plan. Right after the bit about assessing disclosure.
So, yes, “announcing” is stretching it a bit. But now we know about it, what do we know?
It stems from the interim findings of the Asset Management Market Study (AMMS). These findings highlighted some areas where competition may not be working for platform investors as well as it could or should be. Charging structures, how well investment tools enable effective choice and whether platforms have the clout and enthusiasm to drive competitive pressure on asset manager charges will all be under the spotlight. In a bare room. With no windows. And no clock. I’ll stop now.
Much like the AMMS, the aim is to understand where competition between platforms isn’t working to benefit consumers and what can be done to address that.
There has been the usual baseline of grumping which greets pretty much anything the FCA proposes. We’re sure they’re used to it and do their crying in the rain. And there are undoubtedly other things that stretched resources could be allocated to. But, we’re talking about making sure that the primary market for consumer investment, which is steadily growing and introducing new offerings, is working in consumers’ interests. That’s a good thing.
Making decisions about investing is important. You could have £1m or £1,000 or £100 to invest. It doesn’t matter. If it’s yours, it’s important and you want to do the best you can with it. But deciding what that looks like can be difficult. There are more options than ever before, more information than ever before but it can be very tricky getting a straight answer to what appears to be a simple question.
The last thing anyone needs on top of all that is an extra layer of concern that, having worked through all the other stuff, you’re still not getting the best arrangement for your money because inefficiently managed market dynamics are impacting effective competition.
Anything that highlights impediments to consumers getting the best possible outcome, in a manner that is easy to navigate and understand, is a good thing in my book.
Suggestions that the consultation paper will only be available via dead drop are yet to be confirmed.