Matt Storey: The Platform Borg III – The off-platformers guide to the galaxy

Well, I’m back for a third go-around, which means it’s official – my Platform Borg rants have definitely gone #biannual. Aren’t you lucky.

I hope you’ve had a good couple of quarters, but if all your eggs are STILL in one Borg-shaped basket, your friendly neighbourhood dolphin is back with yet another warning (I promise that will make sense later).

For those of you unfamiliar or in need of a recap, the Platform Borg is my characterisation of the all-encompassing provider blob, on which advisers nowadays tend to hold essentially all their clients’ wealth.

As I’ve conceded in the first and second instalments, I don’t think it’s automatically a mistake for advisers to service most of their clients on-platform; in fact, it usually makes sense. “If it ain’t broke”, etc.

My bugbear has been that it can start to look like an unthinking default, one which can incur various consequences, some of which I’ve outlined in my previous instalments.

The question this time is: what happens when it IS broke, and in quite a significant way?

The off-platformers guide to the galaxy

The Hitchhiker’s Guide to the Galaxy begins with protagonist Arthur Dent being saved by his friend Ford Prefect when Vogons blow up Earth to make way for a hyperspace highway.

They see a planet replete with retirement expertise, and another planet that boasts a wonderful technology ecosystem

The Gods of the Platform Borg share a similar urge to tinker, merging constellations of provider planets, attempting to consolidate smaller universes, and so on, in search of ‘synergies’ and ‘economies of scale’.

On paper, it makes perfect sense. They see a planet replete with retirement expertise, and another planet that boasts a wonderful technology ecosystem. Let’s migrate one planet’s expertise to the other to form one massive, amazingly efficient and profitable planet!

But alas, as we all know, it’s possible that somewhere during that interplanetary voyage they could, er, misplace the proceeds of a few SIPPs. Whoops!

Mostly harmless

In THGG, Ford Prefect subsequently reveals he is in fact an alien who updates a guide to the universe known as the Hitchhikers Guide to the Galaxy. The previous entry for Earth read: “Harmless”; now it’s been blown up, Ford informs Arthur that it now reads: “Mostly harmless”.

It’s hard to keep someone calm during decumulation when it appears to them that their planet has been destroyed

I’m going to dispense with the flippancy now – re-platformings historic and recent have been anything but harmless.

In fact, they’ve generated the sort of stories no adviser wants to read. Withdrawals delayed by weeks; in some reported cases, over seven weeks. Missed income payments traced back to off-platform DFMs. Seasoned advisers describing the most stressful stretch of their careers, unable to get their clients’ own money out of their clients’ own SIPPs.

Public review sites tell their own story too, and it’s not pretty.

Apologies have been issued, and that’s obviously good and deserving of credit. But an apology doesn’t undo the harm caused when clients can’t access their retirement savings for the best part of two months.

Advisers could provide reassurance, but it’s hard to keep someone calm during decumulation when it appears to them that their planet has been destroyed and all its wealth vanished without a trace. We’re talking about hundreds of thousands of pounds here.

It’s all sadly indicative of the service levels and accountability evident in the platform sector today

In THGG, Arthur and Ford tried to go to the source for answers. The Vogons argued that “a planning notice was displayed a mere four light years away” (before reading them the second worst poetry in the universe).

Many advisers also attempted to go to the source. As far as I’m aware, I think many advisers would agree that the explanations they receive (or don’t) when seeking answers directly from platforms are about as useful.

It’s all sadly indicative of the service levels and accountability evident in the platform sector today. It’s simply not good enough.

The answer is not four light years away

Just before the earth was blown up in THGG, it was the dolphins who attempted to warn the humans about their impending doom, before realising it was futile and flying off.

Now, you can’t say that this particular dolphin (yes, that means me, told you it would make sense…) hasn’t been sounding the Platform Borg alarm for more than a year now.

There’s a galaxy of specialists out here. And ‘specialist’ isn’t the same as ‘niche’, or ‘expensive’

You might also say it’s self-interest talking, but really: if this had happened to one of your clients and they’d asked you the obvious question – “was there an alternative?” – what would you reply? Could you even say you’d thought about it?

If your reply would have been “yes, but they’re a bit niche, a bit bespoke, a bit expensive”, then my message to you today is that you basically haven’t thought about it at all.

Because there’s a galaxy of specialists out here. And ‘specialist’ isn’t the same as ‘niche’, or ‘expensive’ – yes, we do one thing and one thing only, but we do it well, and what’s more we’re built to cope with scale just as much as any platform.

And not only are we not four light years away, we also don’t have to coexist within the faceless Platform Borg, with its countless other moving parts and conflicting priorities. We even answer the phone. Yes, really.

Doesn’t that sound like a universe worth exploring?

Matt Storey is head of business development at @sipp