Making Plans...for Archibald (Part 2)

The sequel to the 'Pick of the Day' award winning story - Making Plans...for Archibald (Part 1)

Archibald Thurble lurked at the end of the corridor leading to the office of his employer, Josiah Oakshott.  From this vantage point, he could keep an eye on the office door and so, he was able to spot the grey individual taking his leave, hear the mumbled farewells, soft closure of the office door, footsteps heading away toward the outer door.  Archibald counted to ten, in an effort to leave a diplomatic gap between this departure and his arrival, and then scuttled down the corridor.

Josiah Oakshott leaned back in his comfy executive chair and gazed at the ceiling, emitting a deep sigh.  He began to mentally count and had reached ‘eight’ when the expected knock came on his door.

“Come!”  He ordered, wearily.

Archibald peered around the half-opened door and surveyed the office, suspiciously.

“Has, erm, has that fussy bloke gone then?” He said, at last.

“If you are referring to Mr. Skits, he is not, as you put it, ‘fussy’, he is the representative of the FCA, the Financial Conduct Authority, and, yes, he has ‘gone’” Josiah continued to stare moodily at the ceiling.

“Ah, right” Archibald sidled into the office and threw himself into the chair in one swift movement, “was he alright then?”

“I did not enquire after his health but he seemed perfectly fine to me” Josiah intoned, still staring at the ceiling.

“Yeah, well, you know what I mean” Archibald shrugged.

“If the nature of your enquiry is, did the meeting go well?  Then, yes, I would have to say that, after an exhaustive, and exhausting, review of our accounts, yes it did.  If, on the other hand, you wished to know if I was pleased with the outcome, I would have to say, no, simply because I have JUST WASTED AN ENTIRE MORNING ON SOMETHING THAT DID NOT NEED TO HAPPEN!”  Josiah’s shouts echoed off the ceiling to which they were directed.

One of those pregnant silences filled the room.

“I erm, I take it you’re not best pleased then?”  Archibald ventured.

Josiah gradually righted himself in his chair, so that he was now eye to eye with his employee.

“You would take it correctly, Archibald” He said, icily, “I have spent the entire morning attempting to demonstrate, beyond reasonable doubt, that this business does not own, offer, manage, promote or have anything whatsoever to do with the operation of funeral plans, a fact which I have made plain to that Authority on numerous past occasions, via my returns to their office, but which happy state of affairs YOU managed to wreck in the space of just one telephone call”

“Ah!” Archibald nodded, sadly, “well, I did explain about that, didn’t I?”

“You did” Josiah responded, tersely.

There was another pregnant silence.

“I was talking about funeral plans…planning for funerals and stuff!  I weren’t to know he was on about summat else entirely, was I?”  Archibald whined.

Josiah glared at his employee and then busied himself with some paperwork.  Archibald swallowed hard and tugged on his jacket sleeve, a sure sign of agitation.

“I don’t rightly see what it’s got to do with them, any road?”  He ventured, at last.

“With whom?” Josiah enquired, still busily engrossed in his reading.

“This FAC mob” Archibald explained.

Josiah sighed, deeply, put down his pen and leaned back in his chair.

“It is the FCA and they have every right to take an interest in the management of funeral plans.  You see, Archibald, if a business, such as ours, takes monies on deposit against the future provision of a service (in this instance, funeral arrangements) and holds those monies for some time, as one would hope in the case of those pre-paying for their funeral, then how those monies are managed in the interim is, inevitably, of interest to the Financial Conduct Authority because we are, to all intents and purposes, acting in the manner of a bank”

“Eh?” Archibald frowned.

“Let me put it this way” Josiah leaned forward, warming to his theme, “suppose you decided to make your funeral arrangements and pay for them in advance, today…”

“Oh, I don’t think I’ll be doing that just now, Mr. O.” Archibald chuckled.

“No, nor would I encourage you to do so, Archibald.  Nevertheless, for the sake of argument, let us pretend that you did, what do you imagine I would do with the money you gave me?”

“I dunno” Archibald shrugged, “put it somewhere safe, I suppose”

“Quite, but where?”

“Well, in the bank, for a guess”

“Yes, that would be one option” Josiah nodded, “however, you are a relatively young man and one trusts that your demise will be many years from now, what do you imagine might have happened to the price of funerals in the intervening period?”

“Shot up, I suppose” Archibald offered, “I mean, everything’s gone through the roof in just the last year hasn’t it?  You wouldn’t believe what it costs to buy a pint these days!”

“I have no knowledge of the price of such beverages but I agree that inflation has been a problem recently and is likely to continue to be an issue for the foreseeable future.”  Josiah sighed,  “Nevertheless, if we agree that your future funeral will be considerably more expensive than the same funeral today, and yet the price you would have paid would be that which currently applies, how do you imagine that I might ensure the money you have paid will cover the cost at some future date?”

“Ooh, yeah, I see what you mean” Archibald nodded, “that’s tricky!”

“I would have to invest the money in some financial instrument or other that would guarantee to provide earnings in line with, or in excess of inflation, otherwise the money you have entrusted to me would not cover the cost of your funeral” Josiah explained, “moreover, there is the question of whether this business would still be operating whe,n you join the choir invisible”

“When I do what?”  Archibald looked puzzled.

“My apologies, I was a fan of ‘Monty Python’ in my younger days and the tone of this conversation reminded me of their ‘Dead Parrot’ sketch” Josiah grinned at the memory.

“I don’t know what that’s about?  Who’s Monty Python?”

“It was about a man who bought a parrot and…oh, never mind!” Josiah abandoned that topic, “to put it simply, Oakshott and Underwood might not even be in business when you finally need our services, so what would happen to your money then?”

“Oh strewth!  You’re not telling me we’re going bust?”  Archibald looked panic-stricken.

“No, I am not telling you we are going, as you put it, ‘bust’!” Josiah said, with some exasperation, “However, it has to be said that neither you, nor I, can guarantee that this business will still be operating decades into the future.  What, then, happens to the money that the business has taken in payment for funerals yet to be provided?”

“Oh right, yeah I see what you mean” Archibald nodded, sagely, “it’s a bit of a bug…a bit of a problem, innit?”

“Precisely, and that is why the Financial Conduct Authority take an interest in such things” Josiah leaned forward and took up his pen again, “of course, I could also be operating a Ponzi scheme” he said, as an aside, and immediately regretted it.

“A poncey scheme?” Archibald looked shocked.  “That doesn’t sound very…nice”

“No, not a ‘poncey’ scheme, a Ponzi scheme.  Named after one Charles Ponzi, although I believe the method pre-dated his involvement.” Josiah leaned back and considered how to explain, “it is a form of fraudulent activity.  Let us imagine that you and four others each pay me £2,000 for your funeral…”

“Right, that’s not a bad price” Archibald grinned.

“Don’t take it as a quote, I’m just using an imaginary round number” Josiah explained, hastily, “now, tragically, one of the five of you perishes the following week…”

“Oh gawd, don’t say it’s me!” Archibald wailed.

“Regrettably not” Josiah shook his head, “you need to survive to see the outcome!  No, it’s one of the other investors…”

“Phew!” Archibald said, much relieved.

“So, I use his £2,000 to pay for his funeral but then I use the other £8,000 to take myself and Ms. Knight on a fabulous Caribbean holiday” He closed his eyes for a moment and imagined this scene, fondly.

“Cor, can you do that Mr. O.?” Archibald asked, wide-eyed, “what happens if someone else dies?”

“A good point, Archibald” Josiah made a quick return from the silvery sand and sun-kissed beach, “in a Ponzi-type scheme, I would use the money being paid in by a future customer to pay for the funeral, and so on and so forth”

“So, you don’t invest the money then?”

“No” Josiah shook his head, “I live a life of unabashed luxury on the proceeds and pay for any withdrawals (in the form of funeral arrangements) using the money paid in by future investors”

“Coo!  Makes you wonder why everyone don’t do it” Archibald looked impressed.

“Ah well, the problem with a Ponzi scheme, aside from the illegality of its operation, is when the demands on the scheme exceed its ability to pay.  For example, if there were to be another pandemic and a number of people suddenly needed funerals at the same time but there were not enough new customers to cover the cost”

“Them pandemics, they don’t happen very often though, do they?”  Archibald mused, still obviously taken with the idea.

“No, indeed, but more prosaically, what if the number of people wishing to pay into the scheme suddenly dropped, perhaps because of a recession or slump of some sort, but the number of people dying continued as normal?”

“Ooh, yeah, that would be awkward” Archibald agreed.

“Because the money has not been invested, other than in my luxury holiday, then there would be no funds to pay for the funerals”

“What do we do then?” Archibald asked.

“We make a run for it” Josiah smiled.

“What, you and me?”  Archibald looked surprised.

“No, Ms. Knight and myself, you can stay here and explain to the irate customers and the authorities” Josiah chuckled.

“Awww!”

“It was purely hypothetical, Archibald”

“It’s all very well you saying that” Archibald said, in some distress, “you’re not the one having to sort all this mess out, are you?”

“And they say there’s no justice in the world” Josiah mused, leaning forward to attend to his paperwork again.