Hot Off The Press - before we kick off, we can report that platform AUA hit £102 billion as at 31 March 2010, an increase of 10.7% from the December close. Our detailed research containing all the stats, IFA feedback and ratings - The (plat)Form Guide Issue 2 - will be published mid-May.

I have spent the last 7 weeks on maternity leave, as any mum will tell you, this involves either succumbing to daytime TV or reading a lot. I’ve never been one for Oprah so my reading material of choice has been Grazia, all the latest papers from the FSA and the amazing spats on Money Marketing’s forums. (Where do you guys find the TIME!?)
One thing that time away from the day job gives one is the luxury of some perspective and time for thought. Most reactions to the platform discussion paper are inevitably self-serving – our views follow and are impartial and free from commercial impetus. Let’s set out our stall.

We do not believe that rebates should be banned but think that full disclosure of terms should nonetheless be mandatory. We think that the focus is too black and white and, as there are different customers, so should we be able to produce different propositions which are explained and positioned differently. Standalone products are not evil! Nor is bundled pricing for some customers! As long as the information is accessible for those who want it, who is any one of us to insist that our way is the only way? But we digress. We think that Tully and The Gang at Canary Wharf have done a good job but the paper needs to be honed with a more commercial focus or we risk having the fairest, most expensive system in the world. Let’s elaborate.

On rebates. Were we stating with a clean slate then rebates would make no sense in today’s market. But we’re not - the re-reg situation would be impossible, the inevitable different share classes a nightmare, the management of cash levels to pay platform fees would be complex and the systems changes a big rush pre 2012. Rather than tinkering with the engine, we think it preferable that the FSA set clear parameters and expectations around disclosure. Platforms have ignored gentle nudges about disclosure and reporting for too long. Firm guidelines about what has to be disclosed to the customer surely provide the required backdrop for the FSA’s goal of the customer understanding what they are paying and removing hidden potential for bias. We think the rules should furthermore be the same for execution-only and advised platforms – again, disclosure can only be a positive thing and encourage good behaviour.

All the argy-bargy in the press and semantic jiggery-pokery about service vv product and administration vv distribution vehicles are – we believe – red herrings couched in the language of the past and should not play a part in deciding if rebates are valid or not. Again – is any of this relevant to the desired outcome which is clarity and fairness? A system with rebates isn’t perfect but it works, it won’t involve huge costs to the industry (ultimately customer) and it can still involve full customer disclosure of terms and rebate levels. People aren’t daft and, with full disclosure, will be able to see any commercial bias in guided architecture solutions for themselves – which will be shouted down by the competition out there.

Most industry participants have an axe to grind. Smaller platforms will welcome the arrows from Canary Wharf potentially pointed at the heart of the supermarkets. However our impartial view is that logic this time supports the presumed desired outcome of the supermarkets – namely the status quo of rebates - BUT with full accompanying disclosure.

So a good paper, we think in balance, even though the proposed rebate ban seems a step too far invoking the law of unintended consequences. And they could also take a leaf out of Grazia’s book and include a few pictures to break it up next time?
Have a good weekend all – the weekend papers should make for interesting reading.

Holly